The Supreme Court dismissed the Minister for Justice’s appeal over whether the State should provide an undertaking as to damages when seeking an ex parte order restraining dealings with property in Ireland under an international confiscation scheme.
The appeal concerned only the provisional, ex parte stage. The court did not decide whether the assets should ultimately be confiscated. It held that the usual presumption requiring an undertaking applied, and that the material presented did not establish an exceptional reason to dispense with it.
The proceedings arose from a UK request for assistance following Bernadette Margaret Rose Devine’s conviction in England for five offences of fraudulent evasion of value added tax. The judgment says the Crown Court determined that she had benefited from the scheme by £18,759,430 and made a confiscation order for £1,446,368.68, the amount it considered could be realised. The UK confiscation order became final in December 2005.
In March 2005, before that finality, the Minister applied in the High Court on the UK government’s behalf for an ex parte restraint order over specified Irish property, including bank accounts, land holdings and company assets. The application was made under Part VII of the Criminal Justice Act 1994 and regulations providing for provisional measures in support of foreign confiscation proceedings. Quirke J made a temporary order and set a date for an application for an interlocutory injunction. No undertaking was offered or required at that hearing.
Devine later sought to set aside the order on the ground that it had been made without first requiring an undertaking. The High Court held that the absence of one did not invalidate the order, but considered that an undertaking should generally be required unless there was an adequate explanation. The Minister then gave a limited undertaking pending the appeal.
The Minister argued that the application served Ireland’s international obligations and should be treated like State action to enforce the law. The Supreme Court rejected that characterisation on the facts before it. Fennelly J said that, before the restraint order, dealing with the property was not unlawful under Irish law. The application therefore did not fall within the law-enforcement category relied on by the Minister.
Fennelly J said a court may have discretion to dispense with an undertaking in an exceptional case, including where the State seeks to prevent illegal acts. But an applicant seeking an interim order ex parte must identify an exceptional reason for dispensing with it. The court also noted possible compensation provisions and modified undertakings as matters that could be addressed in another case; none had been put before the High Court here.
Approving the High Court’s approach, the Supreme Court dismissed the appeal. Its decision addressed the undertaking at the interim stage, not the merits of any final confiscation order or the ownership or criminal origin of the Irish assets.