Chatwani & Ors, R (on the application of) v The National Crime Agency & Anor

Under section 345(5) of the Proceeds of Crime Act 2002, the default period for compliance with a production order is seven days. A shorter period, including immediate production, is lawful only where the applicant provides sufficient evidence to enable the judge to determine that it is appropriate in the particular circumstances.

An assertion that giving notice may compromise an investigation is insufficient. Where the target is a professional person with no evidence of criminal conduct or other wrongdoing, the application must explain the factual basis for the alleged risk. An order made without that evidential foundation is unlawful, although relief may be limited where the error caused no practical prejudice.

The claimants challenged a production order made by the Birmingham Crown Court under the Proceeds of Crime Act 2002 at the request of the National Crime Agency. The order required the claimants’ auditors to produce extensive financial and audit material concerning the claimants and their companies immediately upon service.

Permission was refused on all grounds except the challenge to the immediate compliance requirement. The central issue was whether the material before the Crown Court provided a sufficient basis for shortening the statutory default period of seven days.

1. Permission and substantive outcome. Permission to apply for judicial review was granted on the single ground concerning immediate compliance. The claim succeeded on that ground. The production order was declared unlawful, but no further relief was granted and the injunction restricting copying and use of the material was discharged.
2. Other grounds. The breadth of the order was not Wednesbury unreasonable, disproportionate or otherwise unlawful. The information before the Crown Court provided a proper basis for the reasonable suspicion, belief in the material’s substantial value, and public-interest requirements in section 346 of the Proceeds of Crime Act 2002. The reference to the auditors as “The Zane Partnership LLP” did not provide an arguable basis for quashing the order.
3. Timing of production. Section 345(5) establishes seven days as the default compliance period, but permits a longer or shorter period where the judge considers that appropriate in the particular circumstances. The court had jurisdiction to require immediate production.
4. Evidential basis. In an unusual case where the target may disclose the investigation or destroy or dispose of documents, the applicant must set out an evidential basis, even briefly, for shortening the period. A bare assertion that notice may compromise the operation is inadequate. On the evidence, there was no proper basis to infer that the professional auditors would compromise the documents if given seven days. The judge therefore erred in requiring immediate production.
5. Relief. The error had no material practical effect. There was no evidence that the auditors would have tipped off the claimants, destroyed documents, or sought to discharge or vary the order if given seven days. Returning the material or restraining use of copies was therefore inappropriate.

This was a first-instance judicial review in the Administrative Court. The judgment refers to a separate related judicial review concerning arrests and search warrants, decided in [2015] EWHC 1283 (Admin), but that decision was not the judgment under challenge in this claim.