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MAY
14

Recent instructions for Lewis Nedas Law specialist Serious Fraud, Serious Crime and extradition lawyers

  1. extraditioni) Jeffrey Lewis advises an individual following allegations of involvement in multi-million pound pension fraud: he will be assisted by Siobhain Egan;

    ii) Jeffrey also advises a substantial buy to let landlord who has found that over 20 of his properties have been ‘colonised' by individuals running cannabis ‘farms'. The Police force to whom this issue has been reported has not reacted at all to this complaint, and it is now left to the landlord to pursue civil proceedings against these ‘sub-tenants' and his managing agents.

  2. i) Keith Wood defends an individual facing complex confiscation proceedings following a conviction for conspiring to defraud HMRC of £10million (the client was represented by another firm at trial). Keith is one of the top confiscation defence experts in the Country, he works with leading forensic accountants and barristers and achieves great success with these type of cases;

    ii) Keith is also defending another client facing extradition proceedings brought by the Spanish Government following allegations of involvement in a large scale 'time share' fraud which has attracted National publicity both here and in Spain.

  3. i) Sean Reilly advises a businessman whose assets have been frozen by a Civil Recovery Order brought as a result of a joint investigation by HMRC and the NCA. It is even more likely now, with the budgetary constraints and financial cuts that all investigative agencies are currently facing, that instead of instituting lengthy expensive criminal proceedings (for tax evasion and money laundering as in this case), the authorities will now directly target assets that they suspect are the Proceeds of Crime. The burden of proof will be upon the defendant to show that these assets are bona fide, have been lawfully acquired and that tax has been paid upon the income used to purchase those assets;

    ii) Sean is also representing a client facing extradition proceedings brought by the US Government, concerning allegations of serious fraud.

  4. Richard Demczak of our Oxford Office has received the following recent instructions:

    i) An undergraduate student at Oxford University facing three allegations of rape;
    ii) A young man with severe learning difficulties facing an allegation of rape;
    iii) A professional man defending a charge of perverting the course of justice;
    iv) Two young men accused of cultivating cannabis, they will raise the statutory defence (s45 Modern Slavery Act 2015) of victims of modern slavery and people trafficking.

  5. i) Siobhain Egan advises an academic investigated by Police, following a historic allegation of rape, which allegedly occurred some 56 years ago;

    ii) She also represents a Company Director facing an allegation of dishonesty and fraud.
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DEC
08

"OMG! I've been served with a freezing order: What now?" A practical guide to Freezing Orders (Part 2) by Ian Coupland, Head of Commercial and Litigation, Lewis Nedas Law.

articles publishedWe have all read in the press about people being “served” with a Court Order. If the order is a freezing injunction, you will probably find that:

  • your access to your bank account is restricted;
  • business transactions become more difficult; and
  • you are required to list and disclose your assets to the claimant in a matter of hours.

And all of this carries with it the threat of being imprisoned for contempt of court (i.e. disobedience to an order of the Court).

If you have the misfortune to be on the receiving end of the legal broadside that is a freezing order, the likelihood is that the Order itself will be many pages long, and that it will have been “served” – legal jargon for being formally delivered to you – with hundreds, and maybe thousands, of pages of evidence and exhibited documents. You need expert legal advice – and fast.

We at Lewis Nedas Law have many years’ experience of acting for clients who have had injunctions, including freezing orders, made against them. We can assist with ensuring:

  • that the person injuncted complies with what they have been ordered to do;
  • that the Order was only made after the Claimant has jumped through all the necessary legal “hoops”;
  • that the person injuncted’s rights are as fully protected as they can be; and
  • that the person who obtained the Order is not acting unreasonably or oppressively;

We can advise whether it is worth trying to get such an order removed.

We also obtain injunctions for our clients – see our Practical Guide Part 1 here.


What is a freezing Order?

A freezing Order is a form of injunction made by the Court to prevent a Defendant (which includes companies, employees and those acting on behalf of a Defendant) from hiding, removing, disposing of, or even merely dealing with, their assets. The objective is to prevent the person injuncted from creating a situation where, following a judgment in the Claimant’s favour at the end of the case, no money or assets are available (or none that can be found) to meet the Claimant‘s claims. 

A freezing order may be of two broad types: (1) where the Claimant is claiming their own property, such as where the Claimant says that the Defendant has possession of the Claimant’s money (for example, where the Defendant is responsible for the money being taken, or  perhaps it has been paid by an associate of the Defendant); and (2) where the Claimant believes that the Defendant may dispose of or conceal assets to defeat a judgment, and the Court freezes assets up to a value sufficient to satisfy the Claimant’s claim and estimated legal costs, so that, after a money judgment has been obtained, the frozen assets may be used to satisfy it. 

The freezing injunction must contain a maximum amount so that assets over that particular threshold are not frozen.


Whose assets are caught?

This depends on the terms of the Order that was actually made. Normally, the order defines “the Defendant’s assets” as assets whether or not they are in the Defendant’s own name, and whether they are solely or jointly owned. They include any asset which the Defendant has the power, directly or indirectly, to dispose of or deal with as if it were his own, and a person is regarded as having such power if a third party holds or controls the asset in accordance with his direct or indirect instructions.

Because everyone’s personal situation is different, it is frequently the case that there may be doubts about whether a particular asset is caught by the order. We can assist a person who has had an order made against them to decide whether an asset is frozen or not.


What about overseas assets?

The normal form of Freezing Order restrains only assets within England and Wales. An extended form of freezing injunction (for which additional safeguards apply) may be made in respect of assets whether they are in or outside England and Wales.


“I’ve been ordered to disclose all my assets – and in an incredibly short time. Must I?”

Freezing Orders always contain so-called “ancillary orders” designed to make the primary order more effective. The most usual one of these requires the person injuncted – often within 48 hours of service of the order to inform the Claimant’s solicitors of all his assets whether in his own name or not and whether solely or jointly owned, giving the value, location and details of all such assets.

Usually this requirement is subject to a minimum value per item in order to avoid listing items such as household furniture or bicycles, which are not the sort of assets that the Claimant is likely to be interested in.

The Order then usually requires the person injuncted to produce an affidavit (which is written testimony sworn as true) verifying the disclosure made, and producing evidence such as supporting bank statements. There is a set time for compliance with this, which is usually a matter of days.

Because the Order contains statements such as that “Wrongful refusal to provide the information is contempt of court and may render the Respondent liable to be imprisoned, fined or have his assets seized” it is important that anyone who receives such an order takes proper advice on their compliance obligations.


“Taking the 5th“ – the “privilege against self-incrimination.”

In the USA, the right against self-incrimination is enshrined in the 5th Amendment to the Constitution. In England, it is (perhaps strangely) referred to as the “privilege against self-incrimination.”

In the standard form of freezing injunction, this privilege is worded as: “If the provision of any of this information is likely to incriminate the [person injuncted], he may be entitled to refuse to provide it, but is recommended to take legal advice before refusing to provide the information.”

The principle is that a person cannot be forced to give evidence which may tend to show that he has been guilty of criminal conduct. Using it, then, can be considered to be a double-edged sword, for whilst reliance on it may avoid the disclosure of information, it is also an admission of involvement in criminal conduct, which does not necessarily assist in persuading the Court on a subsequent occasion that the person injuncted has no liability in respect of the conduct which led to the making of the injunction.

The occasions when it is appropriate to rely on the privilege against self-incrimination are very rare.


“If my assets are frozen, how do I live?”

The standard form of freezing order contains provisions which allow the person who has been injuncted to have access to ordinary living and business expenses and also a reasonable sum for legal advice and representation. However, the amounts originally permitted are often far lower than the actual amounts spent each week, and it will often be necessary to obtain the Claimant’s agreement or a further Court order increasing the amounts.

Furthermore, the order does not prohibit dealing with or disposing of assets “in the ordinary and proper course of business.” This is designed not to close down a business which has its normal costs such as rent or salaries to be met.


“What do I do if the Claimant’s got it all wrong?”

Every freezing injunction has a provision in it allowing anyone affected by it to apply to the Court at any time to vary or discharge the Order (or so much of it as affects that person). This includes the person who has been made the subject of the injunction.

Before making such an application, that person must first inform the Claimant’s solicitors. If any evidence is to be relied upon in support of the application, the substance of it must be communicated in writing to the Claimant’s solicitors in advance.

The right to apply to set aside (i.e. undo the making of) an Order can be deployed in more circumstances than if the Claimant has obtained an injunction against completely the wrong person (for example, the wrong John Smith). When applying for an injunction, a Claimant must make what is called “full and frank disclosure” of material facts which may make the Court doubt that it is right to grant an injunction. If the Claimant has provided written evidence which is incomplete or which materially misstates the facts, then the person injuncted can go back to the Court and ask for the order to be discharged.

There are other grounds for seeking to set aside such an order once made. At Lewis Nedas, we can advise if such grounds exist, and how to make the best use of them.


How long will the injunction last for?

A freezing injunction is normally applied for in the absence of the Defendant, and if granted, lasts for a short period such as one week. The Claimant then has to return to the Court (the so-called “Return Date”) to obtain the continuation of the injunction.

This is the Defendant’s chance to seek to obtain changes to the Order, or to seek its discharge. However, the complexity of the case may require a longer period than one week to prepare for such an application, and tactical decisions may need to be made as to how to proceed. For example, it is often better to agree to delay the Return Date (meaning that the injunction continues for a short further period before the case comes back before the court) in order to have more time to prepare to resist the longer-term continuation or its terms, or to ready an application to set aside in whole or in part.

We are experienced in helping clients with those decisions.


Budgeting

We are not going to pretend that resisting the continuation of an injunction, or applying to set aside, is cheap. It is only worthwhile when there is a serious dispute and a lot of money at stake.

Why are we saying this? It is because we do not want to waste your time or ours.

We will always provide you with estimates of the likely legal costs going forward. Like filling a car with petrol before going on a trip, our business model works on the basis that each stage is pre-funded: we hold the funds in our client account on your behalf until they are needed. In this way, our clients can keep track of their ongoing expenditure.

Whilst, as mentioned above, the Order allows for expenditure on legal costs, there can nevertheless be difficulties where the Claimant alleges that all the frozen assets belong to them. In such a case, it will usually be necessary to borrow the funds from elsewhere.


Why Lewis Nedas?

At Lewis Nedas Law, you can rely on us to do a proper job at reasonable cost. We have the experience, but we do not have City of London overheads or steep hourly rates. Above all, we want to understand your commercial objectives, and will do our best to achieve them. We work closely with exceptional Counsel as appropriate.

We do not rack up legal costs willy-nilly. We are aware that legal costs are a burden, and we are keen to keep our charges to as low a level as can reasonably be achieved. We will guide you as to the most effective ways of enabling us to give you the best service we can, whilst also keeping our fees down.

You can rely on Lewis Nedas to tell you if your case has problems which make it desirable to negotiate a settlement with your opponents.

 

This article is intended to be no more than a general guide, and does not comprise legal advice. You are strongly advised to take legal advice before making or resisting any application to the Court.

For legal advice and assistance please contact Ian Coupland, Head of Commercial and Litigation, Lewis Nedas Law on 02073872032 or icoupland@lewisnedas.co.uk.

  

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