National Crime Agency (NCA) v Simkus & Ors

Applications for property freezing orders and disclosure orders may be determined without notice and on paper where that procedure is justified; the absence of an oral hearing does not automatically invalidate an order. The court must assess suitability, require a hearing where complexity or disclosure difficulties call for it, and give reasons, usually briefly. A target must receive the evidence relied upon when the order comes to the target’s attention, and redactions require judicial approval. Pre-amendment civil-recovery powers were not confined to property already identified. Full and candid disclosure remains essential, but material non-disclosure leads to discharge only after a broad merits-based assessment balancing seriousness, prejudice, public interest and the continuing merits of the order.

Three respondents applied to vary or discharge orders obtained by the National Crime Agency under Parts 5 and 8 of the Proceeds of Crime Act 2002. The Ghulam and Jardine applications concerned disclosure orders. The Simkus application concerned a property freezing order made while criminal proceedings and a restraint order were pending.

The common issues were whether the orders could properly be made without notice and on paper, whether reasons were required, whether disclosure orders were impermissibly wide, and whether supporting evidence had to be served. The Simkus application additionally raised material non-disclosure and abuse of process, because the prosecution had not pursued confiscation proceedings after accepting a limited basis for sentence.

The applications to vary or discharge the orders were refused.

1. Applications for a property freezing order or disclosure order may be made without notice and determined privately, including on paper, where notice or a public hearing would be likely to frustrate the application’s purpose. That question is for the court, not the NCA. A paper application is a genuine judicial determination and is not a rubber stamp.
2. The NCA must consider suitability case by case. A hearing is particularly appropriate in a large or complex matter, or where disclosure presents real difficulty. If the applicant requests a hearing, it should be granted. Judges should require attendance where there is a clear reason. Reasons should be given for the decision, including the decision to proceed without notice or on paper, although they may be brief. Failure to give reasons alone does not invalidate the order; an inter partes application permits a fresh exercise of discretion.
3. For a target, the right to apply to vary or discharge is real only if the target knows the evidence relied upon. The evidence must be served when the order comes to the target’s attention. Any redactions require judicial approval. A term permitting the NCA unilaterally to withhold evidence from a target is invalid. Different considerations apply to third-party recipients of notices.
4. The pre-amendment civil-recovery investigation provisions were not confined to property whose existence had already been identified. The requirement to specify property for the purpose of obtaining a disclosure order was a threshold condition, not a limit on the investigation or notices. The investigation could extend to other recoverable property, its holders, and its extent or whereabouts. The 2015 amendment made that position express. The contrary dictum in Serious and Organised Crime Agency v Perry and others [2012] UKSC 35 was not followed.
5. The duty of full and candid disclosure applied. The material non-disclosure in Simkus was serious but not sufficiently grave to require discharge. The PFO was continued because civil recovery proceedings were properly on foot, dissipation was likely, and no sufficient injustice or prejudice had been shown. The Part 2 confiscation and Part 5 civil-recovery regimes were distinct, and the state could choose the procedure producing the greatest public benefit provided no injustice resulted. The qualified approach in R v Lunnon and R v Lazarus did not carry over to this context.
6. The Ghulam order was properly made on paper, although the redaction term was invalid; nothing turned on that defect. The Jardine application disclosed no sufficient procedural ground for discharge. The application for a further costs exclusion in Simkus was left for further submissions.