The Director of the Serious Fraud Office v Nina Jiang

Summary judgment may be given where the defendant has no real prospect of successfully defending the claim and no other compelling reason requires a trial.

For civil recovery under Part 5 of the Proceeds of Crime Act 2002, unlawful conduct is established on the balance of probabilities. The enforcement authority need not identify precisely when, by whom, or in what circumstances the conduct occurred. It must establish a causal connection between the property and relevant criminal conduct. Recoverable property may be traced into the hands of subsequent recipients, and profits accruing from it are treated as representing the original property.

The Director of the Serious Fraud Office applied for summary judgment on a civil recovery claim under Chapter 2 of Part 5 of the Proceeds of Crime Act 2002. The claim concerned an apartment and rental income alleged to derive from bribery, money laundering and related unlawful conduct connected with a Chinese business enterprise.

The proceedings were brought under CPR Part 8. Permission for alternative service and permission to apply for summary judgment had been granted. The respondent, who was believed to have fled to China, did not respond or attend the hearing. The central issues were whether the property was recoverable and whether the summary judgment test was satisfied.

1. Summary judgment. Under CPR 24.2, the court may give summary judgment where the defendant has no real prospect of successfully defending the claim or issue and there is no other compelling reason for a trial. Those requirements were satisfied.
2. Unlawful conduct and recoverable property. Under sections 240(2), 241 and 242 of the Proceeds of Crime Act 2002, the civil recovery powers may be exercised whether or not criminal proceedings have been brought. The court decides alleged unlawful conduct on the balance of probabilities. The enforcement authority need not prove precisely when, by whom or in what circumstances the conduct occurred. It must establish a causal connection with relevant criminal conduct.
3. Tracing and profits. Sections 304 to 309 provide the relevant framework for recoverable property. Property obtained through unlawful conduct remains recoverable when it has been disposed of if it is held by a person into whose hands it may be followed. Section 305 permits tracing into the hands of a person obtaining property representing the original property. Under section 307, profits accruing in respect of recoverable property are treated as representing the property obtained through unlawful conduct.
4. Application. The evidence established, on the applicable standard, that funds used to purchase the apartment were referable to corrupt business activity and that the subsequent transfer into the respondent’s sole name was for no consideration. The rental income was also recoverable under section 307. No statutory limitation or exception applied.
5. Order. The respondent had no real prospect of successfully defending the claim, and there was no compelling reason for a trial. The order sought was made.