Proceeds of Crime Act 2002, section 58

Restraint orders

Part 2 Confiscation: England and Wales

(1)Subsections (2) to (4) apply if a court makes a restraint order.

(2)No distress may be levied [F279, and no power to use the procedure in Schedule 12 to the Tribunals, Courts and Enforcement Act 2007 (taking control of goods) may be exercised,F279] against any realisable property to which the order applies except with the leave of the Crown Court and subject to any terms the Crown Court may impose.

(3)If the order applies to a tenancy of any premises, no landlord or other person to whom rent is payable may exercise a right within subsection (4) except with the leave of the Crown Court and subject to any terms the Crown Court may impose.

(4)A right is within this subsection if it is a right of forfeiture by peaceable re-entry in relation to the premises in respect of any failure by the tenant to comply with any term or condition of the tenancy.

(5)If a court in which proceedings are pending in respect of any property is satisfied that a restraint order has been applied for or made in respect of the property, the court may either stay the proceedings or allow them to continue on any terms it thinks fit.

(6)Before exercising any power conferred by subsection (5), the court must give an opportunity to be heard to—

(a)the applicant for the restraint order, and

(b)any receiver appointed in respect of the property under section 48 [F280or 50F280] .

Definitions used in section 58 1

the court

(10) In this section, sections 120 to 140 and Schedule 3 “the court” means—

(a)the Court of Session, where a trial diet or a diet fixed for the purposes of section 76 of the Procedure Act in proceedings for the offence or offences concerned is to be, is being or has been held in the High Court of Justiciary;

(b)the sheriff exercising his civil jurisdiction, where a diet referred to in paragraph (a) is to be, is being or has been held in the sheriff court.

Defined in s.119(10) · see it in the full Act

Cases considering section 58 11

Senel Ahmet v David Paul Tatum

[2024] EWCA Civ 255 · 15 March 2024Interprets

Where proceedings are pending concerning property affected by a restraint-order application or order, the court may stay them or allow them to continue on terms. This express choice is inconsistent with an exclusive statutory code and supports a fact-sensitive approach; a stay will commonly be preferable to strike-out. (see paras [29]; [32]; [35]; [37])

The Serious Fraud Office v Lexi Holdings Plc

[2008] EWCA Crim 1443 · 10 July 2008

A court dealing with proceedings concerning restrained property may stay them or allow them to continue on terms. The court stressed that this provision applied to Lexi’s Chancery proceedings (see paras [93]-[94]). Before exercising the section 58(5) power, the court must hear the restraint-order applicant and any relevant receiver. The failure to draw the provision to the Chancery judges’ attention was an innocent but important procedural oversight (see paras [93]-[94]).

The Financial Conduct Authority (a company limited by guarantee) v WealthTek LLP (in special administration) & Anor

[2024] EWHC 424 (Ch) · 1 March 2024Interprets

The court interpreted proceedings in respect of property broadly. They include proceedings whose object is the underlying property, including claims requiring steps concerning property or compensation from it. The provision applied, or at least materially informed the stay decision (see paras [37]-[45]; [50]; [55]-[56]). The court identified the requirement to give the restraint-order applicant and any appointed receiver an opportunity to be heard before exercising the section 58(5) power. The provision formed part of the procedural framework (see paras [37]-[38]).

What each judgment says about section 58 is in the case-law panel in the full Act.

Explanatory note

112.Section 58 prevents certain actions from being taken against property subject to a restraint order without the leave of the Crown Court. It also gives any court dealing with property proceedings the power to stay them, or allow them to continue, if it learns that a restraint order has been applied for or made. The earlier confiscation legislation is silent on this issue, but the High Court has in practice stayed other property proceedings occasionally where a restraint order has been made.

All the explanatory notes for the Act

Amendments and notes

3 notes from legislation.gov.uk

Amendments

  1. F279Words in s. 58(2) inserted (6.4.2014) by Tribunals, Courts and Enforcement Act 2007 (c. 15), s. 148, Sch. 13 para. 143 (with s. 89); S.I. 2014/768, art. 2(1)(b)
  2. F280Words in s. 58(6)(b) substituted (1.4.2008) by Serious Crime Act 2007 (c. 27), s. 94(1), Sch. 8 para. 26; S.I. 2008/755, art. 2(1)(a) (with arts. 3-14)

Commencement

  1. I49S. 58 in force at 24.3.2003 by S.I. 2003/333, art. 2, Sch.