Serious Organised Crime Agency v Perry & Ors

Part 5 of the Proceeds of Crime Act 2002 has clear territorial reach. Its definition of property as including property wherever situated permits civil recovery orders concerning overseas property. The presumption against extraterritoriality does not require that definition to be read down.

The practical limits lie in enforcement and discretion. Vesting overseas property may require assistance from the courts of the country where it is situated. Ancillary freezing and receivership orders are discretionary and should not be made where enforcement is unrealistic. Disclosure requirements must remain relevant to the assets subject to the order, although information may be used for wider proper purposes connected with civil recovery and international co-operation.

The first three respondents applied to limit a property freezing order made by Cranston J to assets and property within England and Wales. The application raised whether proceedings under Part 5 of the Proceeds of Crime Act 2002 could concern property obtained through criminal conduct and situated abroad.

The respondents also challenged disclosure requirements imposed by the order and sought to restrict SOCA’s use of information obtained under it. The central issue was whether the statutory definition of property, together with the provisions governing recovery and ancillary orders, permitted civil recovery in respect of overseas property.

1. Territorial reach. The court began with the presumption against extraterritoriality, reflected in Al-Skeini v Secretary of State for Defence [2007] UKHL 26, Masri v Consolidated Contractors International UK Limited (No 4) [2009] UKHL 43 and Société Eram Shipping Co Ltd v Cie Internationale de Navigation [2003] UKHL 30. That presumption was rebutted by the clear wording of section 316(4), which defined property as including all property wherever situated.
2. Recovery orders. The provisions concerning pension schemes, pre-emption rights, forfeiture and severance could not operate automatically upon foreign law or foreign land. Those limits concerned enforcement, rather than jurisdiction to make an order. The court followed the reasoning in Singh v the Official Receiver [1997] BPIR 530 that a similarly broad definition of property was not territorially confined.
3. A civil recovery order therefore may concern real or personal, movable or immovable property wherever situated, subject to the statutory exception which was not relevant. Overseas enforcement will ordinarily require co-operation from the courts of the place where the property is situated. Freezing and receivership orders remain discretionary, providing a control against orders which could not realistically be enforced.
4. Section 286 created an apparent anomaly concerning Scotland, but it did not limit the clear power of the High Court in England and Wales. Any Scottish inconsistency was for the Court of Session to resolve.
5. The respondents’ disclosure challenge failed except in relation to Mrs Perry. Requiring Mr Perry and Leadenhall Property Ltd to identify trusts of which they were settlors, transferred assets, and persons holding powers of attorney was reasonable on the evidence. Mrs Perry’s wider disclosure obligations were discharged because the information sought was not relevant to the assets frozen against her, although it might be sought under section 357.
6. SOCA was entitled to use information disclosed under the freezing order for wider proper purposes, including securing the assistance of foreign courts or authorities. The three respondents were ordered to pay 90 per cent of SOCA’s costs of the applications.

The judgment records that Cranston J made the property freezing order on 28 October 2009. The present decision was a first-instance determination of applications concerning its scope and ancillary disclosure provisions.