Ancillary relief proceedings - assets possibly including criminal property - position of legal advisers

P v P (Ancillary Relief: Proceeds of Crime): FD (Dame Elizabeth Butler-Sloss President): 8 October 2003

In ancillary relief proceedings, the wife's legal advisers became concerned that part of the matrimonial assets might be criminal property within the meaning of the Proceeds of Crime Act 2002 (see [2003] Gazette, 16 October, 1).

They sought urgent directions from the court as to whether, and in what circumstances, it was permitted to act in relation to a relevant arrangement under section 328 of the 2002 Act; and whether, and in what circumstances, a legal adviser, having made an authorised disclosure, was permitted to tell others of the fact that he had done so.

Nicholas Mostyn QC and Christopher Pocock (instructed by Manches) for the wife; Florence Baron QC and Deborah Bangay (instructed by Mishcon de Reya) for the husband; Andrew Mitchell QC (instructed by Winckworth Sherwood) for the National Criminal Intelligence Service; Andrew Tidbury and Kennedy Talbot (instructed by Solicitor, Inland Revenue) for the Inland Revenue; Nicholas Elliott QC (instructed by Head of Legal Services, Law Society) for the Law Society; Philip Moor QC (instructed by the Bar Council) for the Bar Council.

Held, in a reserved judgment, that, while there was nothing in the Act to prevent a legal adviser from taking instructions, if involvement in a relevant arrangement were suspected, authorised disclosure should be made and appropriate consent sought under section 335; that thereafter, no further steps could be taken in relation to the arrangement until consent had been received, within the notice period of seven working days; that where consent was refused there was a moratorium on acting in relation to the arrangement for 31 days; and that, since sections 333(3) and 342(4) afforded protection in respect of communications connected with the giving of legal advice or in legal proceedings, provided there was no improper purpose an adviser was permitted to inform all parties that an authorised disclosure had been made.