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Civil asset recovery

Parallel proceedings

Is there any restriction on civil proceedings progressing in parallel with, or in advance of, criminal proceedings concerning the same subject matter?

There is no legislative rule that civil proceedings must be suspended pending the outcome of criminal proceedings. The onus is on the party seeking a stay of the civil proceedings to establish grounds necessary to enable the relevant court to make such an order. The test to be applied by the court in deciding whether the civil action can proceed before the criminal proceedings is whether there may be a real risk that prejudice might be caused to the criminal proceedings. The court will have regard to the extent to which it may be possible, by measures to be adopted in the criminal process, to minimise or ameliorate any such prejudice as might arise.

Forum

In which court should proceedings be brought?

The appropriate court is dependent on the amount of the claim:

  • up to €15,000: the District Court;
  • between €15,001 and €75,000: the Circuit Court; and
  • greater than €75,000: the High Court.

In addition, for disputes of a commercial nature between commercial bodies where the value of the claim is at least €1 million, an application can be made to have the matter entered in the Commercial List of the High Court, which involves a detailed case management system.

Limitation

What are the time limits for starting civil court proceedings?

The Statute of Limitations Act 1957 (as amended) prescribes time periods within which different causes of action are to be taken in Ireland. If a particular cause of action is not commenced within the prescribed period as provided for in the Act, then it is said to be ‘statute barred’.

In the case of a simple debt or a claim in tort or contract, the limitation period is six years. However, in cases of fraud the limitation period is regarded as having commenced on the date the claimant discovered the fraud or could with reasonable diligence have discovered it.

Jurisdiction

In what circumstances does the civil court have jurisdiction? How can a defendant challenge jurisdiction?

Irish courts generally recognise express choice of governing law in civil and commercial contracts between parties in EU member states under Regulation (EC) No. 593/2008 and the law applicable to contractual obligations.

In the case of non-EU member states, the courts will recognise a choice of law under common law rules subject to the following qualifications:

  • courts can apply overriding mandatory provisions of Irish law; and
  • the application of legal provisions may be refused if the application is manifestly incompatible with Irish public policy.

Irish courts will respect the choice of jurisdiction in a commercial contract in accordance with the provisions of Regulation (EC) No. 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters.

Irish courts can also accept jurisdiction to determine a dispute where they accept jurisdiction is not exclusive or where both parties agree to Irish courts accepting jurisdiction.

Time frame

What is the usual time frame for a claim to reach trial?

In the High Court, the usual time frame for an asset recovery claim to reach trial would be approximately two years from the date of issuance. However, where those proceedings are entered into the Commercial List (see question 2), the time frame can be significantly shorter, with the claim reaching trial approximately one year from the date of issuance.

Admissibility of evidence

What rules apply to the admissibility of evidence in civil proceedings?

The cardinal principle is that evidence is, in general, to be given orally. This is enshrined in the Rules of the Superior Courts, which also allow for a number of exceptions. This evidence is principally given by way of testimony in open court. However, in certain circumstances and actions, evidence is given by way of sworn written testimony on affidavit. In some limited situations, oral evidence can be taken on commission or before an examiner. Certain evidence can also be taken through the exchange of written interrogatories and replies.

In relation to documentary evidence, the ‘best evidence’ rule continues to apply in Ireland, namely that the original of a document should be produced. There are exceptions to the ‘best evidence’ rule, for example, copies of documents generally would suffice where the original is not capable of being produced (destroyed, lost or impossible to obtain).

Witnesses

What powers are available to compel witnesses to give evidence?

The general position is that anyone who is competent can be compelled to give evidence in a criminal or civil case. One is considered to be a competent witness if one is capable of giving admissible evidence in a court. If a witness receives a subpoena to attend court to give evidence and fails to do so, that witness can be found to be in contempt of court.

Publicly available information

What sources of information about assets are publicly available?

Land registration

It is possible to search the Property Registration Authority of Ireland (PRAI) website (www.landdirect.ie) to ascertain the ownership of property. There are two distinct forms of property registration: the Registry of Deeds and the Land Registry. The Land Registry is a more modern form of registration and the jurisdiction is moving towards that particular format for all counties. It is possible on the PRAI website to ascertain when property was transferred, from whom and to whom, and also to ascertain whether the property is charged in favour of any third party.

Vehicle registration

In relation to vehicle registration, it is possible to request details of vehicle ownership from the national database. Similar databases are maintained in relation to aircraft and maritime vessels.

Company information and securities registration

It is possible to obtain a considerable amount of information in relation to Irish corporate entities. There is an obligation on limited corporates to file annual financial statements, which will disclose their financial performance together with management and ownership, including shareholder details. In relation to shareholding, there is no obligation on private companies to indicate whether a particular shareholding is held on trust for a named beneficiary.

In relation to publicly traded companies, there is a requirement to notify the Irish Stock Exchange when there is a change in the percentage of shares to above 3 per cent or more of the relevant share capital of a publicly traded company.

Cooperation with law enforcement agencies

Can information and evidence be obtained from law enforcement and regulatory agencies for use in civil proceedings?

The Freedom of Information Act 2014 asserts the right of members of the public to obtain access to official information to the greatest extent possible consistent with the public interest and the right to privacy of individuals. However, this does not extend to records concerning criminal case files.

Any person may make an application to the An Garda Síochána or to the Director of Public Prosecutions (DPP) for a copy of their personal data, as held by An Garda Síochána or the DPP. There is an exemption under section 5 of the Data Protection Act 1988 in respect of personal data kept for the purpose of prosecuting offenders where the disclosure of that data would be likely to prejudice such a prosecution. The exemption is finite and no longer applies after the prosecution process has concluded, allowing time for any appeals. There is also an exemption under the same section in respect of privileged material for which there is no such time limit. Only personal data in respect of the applicant can be provided, and all the personal data of other parties must be redacted unless such parties give their consent.

Third-party disclosure

How can information be obtained from third parties not suspected of wrongdoing?

Irish courts have granted Norwich Pharmacal orders on numerous occasions, requiring the respondent to provide information and documentation to the applicant.

In addition, where it appears to the court that any person or entity not a party to an action is likely to have or have had in their possession, custody or power any documents that are relevant to an issue arising or likely to arise, in the action, discovery of such documents may be directed by the court. The court must be satisfied that the documents are not available to the applicant from another source.

Interim relief

What interim relief is available pre-judgment to prevent the dissipation of assets by, and to obtain information from, those suspected of involvement in the fraud?

Interim relief can include injunctions: requiring a party to either take or cease a particular course of action. Mareva injunctions are also a feature of Irish proceedings, which freeze a defendant’s assets pending the hearing of the matter. Anton Piller orders are also available to claimants in Ireland. A European Account Preservation Order (EAPO) could also be sought.

If the proceedings relate to the disposal of land, it is possible to register a lis pendens over that land, which will directly impact on any proposed further disposal of the land while the proceedings are ongoing.

Non-compliance with court orders

How do courts punish failure to comply with court orders?

Where a defendant fails or refuses to comply with the terms of a court order, that person may be committed to prison for contempt for an indefinite period until that person is willing to purge his or her contempt.

The courts may also make adverse costs orders or strike out pleadings for failure to comply with court directions.

Obtaining evidence from other jurisdictions

How can information be obtained through courts in other jurisdictions to assist in the civil proceedings?

Ireland has not adopted the 1970 Hague Convention and, accordingly, if overseas witnesses are unwilling to cooperate, it would not be possible to compel them to do so by way of subpoena. However, an application can be made for letters rogatory (letters of request) to be issued to the courts of the appropriate jurisdiction, to seek their assistance in compelling the attendance of an individual to give testimony. In practice, the procedures are similar to those that would be applicable under the Hague Convention.

Alternatively, if the witness is located in an EU member state, then procedure (under Council Regulation (EC) No. 1206/2001 of 28 May 2001 on cooperation between the courts of the member states in the taking of evidence in civil or commercial matters) is available that allows the taking of evidence from one member state to another without recourse to consular and diplomatic channels.

Assisting courts in other jurisdictions

What assistance will the civil court give in connection with civil asset recovery proceedings in other jurisdictions?

As referenced in question 13, Ireland is not a signatory to the Hague Convention on the taking of evidence. The letters rogatory process is a formal request from the overseas court to the Irish court to compel witnesses to give oral evidence for use in overseas litigation, in addition to the production of documents relating to the witness testimony.

The relevant legislation governing requests for international judicial assistance by way of letters rogatory is the Foreign Tribunals Evidence Act 1856, and the procedural rules to be followed by applicants seeking the Irish courts to give effect to a letter of request are set out in Order No. 39 of the Irish Rules of the Superior Courts 1986 (as amended).

Causes of action

What are the main causes of action in civil asset recovery cases, and do they include proprietary claims?

Among the causes of action are the following:

  • fraud or fraudulent misrepresentation;
  • negligent misstatement;
  • breach of fiduciary duty;
  • breach of contract;
  • fraudulent disposition; and
  • conspiracy.

Remedies

What remedies are available in a civil recovery action?

The main remedies available include the following:

  • damages;
  • restitution;
  • rescission;
  • specific performance;
  • account of profits; and
  • declaratory relief.

Judgment without full trial

Can a victim obtain a judgment without the need for a full trial?

If a defendant does not enter an appearance, it is possible to obtain judgment in default of appearance. Similarly, if a defendant has entered an appearance but does not enter a defence, it is possible to obtain judgment in default of defence. Such an application for default judgment is on notice to the defendant.

Post-judgment relief

What post-judgment relief is available to successful claimants?

A freezing order can be sought from the court to prevent the dissipation of assets. Similarly, an EAPO can be sought.

The defendant can also be examined in court as to his or her means. Following such examination, the court can make an instalment order.

Enforcement

What methods of enforcement are available?

If the defendant has property assets in the jurisdiction and the judgment is for a liquidated sum, it is possible to register a judgment mortgage against that property.

If the defendant is resident in Ireland or has property assets in Ireland, it is possible to have the judgment executed by the county sheriff in the county in which that defendant is resident or has property. This will involve the sheriff seizing goods or assets up to the value of the judgment.

It may also be possible to obtain a garnishee (attachment) order against monies due and owing to the defendant.

It will also be open to the claimant to petition to have the defendant placed into liquidation (corporate) or into bankruptcy (individual).

Where there are assets located in another EU jurisdiction, a European Enforcement Order can be sought.

Funding and costs

What funding arrangements are available to parties contemplating or involved in litigation and do the courts have any powers to manage the overall cost of that litigation?

A third party professional funding agreement to support a party in legal proceedings offends against the rules of maintenance and champerty, and is prohibited under Irish law. This position was upheld in May 2017 by the Supreme Court of Ireland.

After-the-event insurance, however, is gaining traction as a possible method for parties to litigation to mitigate the risk of the expense of an adverse costs order, should the party lose.

Criminal asset recovery

Interim measures

Describe the legal framework in relation to interim measures in your jurisdiction.

Section 2 of the Proceeds of Crime Act 1996 (as amended) (PCA) provides for the making of an interim order. An application for an interim order is only sought where there is an immediate threat of dissipation of property or where a receiver needs to be appointed to preserve its value. Interim orders prohibit a person from disposing of the assets in question for the duration of the order.

An application for an interim order is the preliminary application that may be brought in order for an interlocutory order to be subsequently granted; however, it is not a prerequisite for an interlocutory order. An interlocutory application may be made even when no interim order is in place.

The application is made by an authorised officer of the Revenue Commissioners, a member of the An Garda Síochána (a member not below the rank of chief superintendent) or the Criminal Assets Bureau. To seek an interim order, the applicant must show the High Court the following:

  • that a person is in possession or in control of property that constitutes, directly or indirectly, proceeds of crime; and
  • that the value of the assets is not less than €5,000.

The application is made on notice of motion grounded on affidavit. The court may, in cases of urgency, hear an application for an interim order on oral evidence. Applications for interim orders are heard on camera.

If granted, an interim order will prohibit the person (or any other specified person, or person having notice of the order) from disposing of or otherwise dealing with the whole or specified part of the property, or from diminishing its value during the period of 21 days from the date of the making of the order. An interim order may contain such provisions, conditions and restrictions as the High Court considers necessary or expedient. Section 10 of the PCA provides for mandatory notification to the Companies Office, the Land Registry and the Registry of Deeds where an interim order is made.

Where an interim order is in force, the High Court may discharge or vary the order on application to it by the respondent (or any other person claiming ownership of any of the property concerned); however, it must be shown to the satisfaction of the High Court that the property is not the proceeds of crime or that the value of the property is less than €5,000. If the applicant applies to court to discharge an interim order at any time, the High Court will accordingly discharge the interim order; the application must be made by notice of motion grounded on affidavit.

The terms of an interim order will provide for notice of it to be given to the respondent and any other person who appears to be affected by it, unless the High Court is satisfied that it is not reasonably possible to ascertain his or her whereabouts. An interim order has a lifespan of 21 days, and lapses unless an interlocutory order is sought within that time frame.

Proceeds of serious crime

Is an investigation to identify, trace and freeze proceeds automatically initiated when certain serious crimes are detected? If not, what triggers an investigation?

The DPP Guidelines for Prosecutors state the following:

Confiscation is an issue to be considered and advised upon from the outset in all cases. It should not be regarded as a mere optional addition to sentence proceedings or to the conduct of a prosecution. The question of whether or not a confiscation application might be appropriate should be addressed by the investigator when preparing or submitting the file and should be considered by the professional officer dealing with the case when a prosecution is being directed.

See question 21 for details regarding interim orders.

More generally, as set out in question 24, a confiscation application will be made following the conviction of the defendant.

Confiscation – legal framework

Describe the legal framework in relation to confiscation of the proceeds of crime, including how the benefit figure is calculated.

Confiscation of the proceeds of crime is governed by the Criminal Justice Act 1994 (as amended).

The legislation provides an option to the DPP to apply to court following the conviction of an individual for certain offences for a con­fiscation order.

The DPP must be of the view that the defendant has benefited from the offence of which he or she has been convicted. Benefit is defined by the reference to the obtaining of property as a result of the commission of the offence.

In relation to how the amount in the confiscation order is calculated, the order shall not be for an amount greater than the amount of the benefit and the pecuniary advantage, or the amounts realisable, whichever is less.

In relation to the amount realisable, this is a calculation of the value of all the realisable property held by the defendant minus the value of priority obligations relating to that property, plus all gifts made by the defendant after the commission of the offence (where the court considers this appropriate).

Confiscation procedure

Describe how confiscation works in practice.

The DPP applies to court for the order following the conviction of the defendant. Essentially, the court will compare the standard of living of the defendant with his or her bona fide income and generate the order based on that.

Agencies

What agencies are responsible for tracing and confiscating the proceeds of crime in your jurisdiction?

The main agencies involved in Ireland are the An Garda Síochána and, in particular, the Criminal Assets Bureau. The Irish tax authorities, the Revenue Commissioners, are also heavily involved, particularly with regard to providing information relating to the income and assets of the defendant.

Secondary proceeds

Is confiscation of secondary proceeds possible?

Yes. The definition of realisable property is wide enough to cover property that has been acquired through the proceeds of crime.

Third-party ownership

Is it possible to confiscate property acquired by a third party or close relatives?

It is possible to confiscate property acquired by a third party and there have been a number of cases where a family home, which has been acquired from the proceeds of crime, has been confiscated.

In addition, all gifts made by the defendant after the commission of the offence where the court considers it appropriate, may also be taken into account in calculating the quantum of the realisable assets.

All gifts would include transfers, directly or indirectly, to another person at a value significantly less than the value provided by the defendant at the time of acquiring that property.

Where property is held in trust on behalf of the defendant, it is also possible to make an order of confiscation in relation to this asset.

Expenses

Can the costs of tracing and confiscating assets be recovered by a relevant state agency?

Money paid or recovered in respect of a confiscation order may be applied to meet expenses incurred in exercising any powers under the Criminal Justice Act, and used for the remuneration of any person employed for that purpose.

Value-based confiscation

Is value-based confiscation allowed? If yes, how is the value assessment made?

As stated in question 23, the courts will make a confiscation order for an amount not greater than any amount of the benefit of a pecuniary advantage, or the amount realisable, whichever is less. The courts do not make orders relating to specific property, but rather to a monetary amount.

Burden of proof

On whom is the burden of proof in a procedure to confiscate the proceeds of crime? Can the burden be reversed?

The standard proof is that applicable in civil proceedings, namely the balance of probabilities.

It is possible for the DPP to make statements in relation to assets and income of the defendant, and if any averment contained in those statements is not refuted by the defendant, the court may infer certain conclusions from that. In addition, the court may order the defendant to provide information to assist the court, and failure to do so may lead to negative inferences being drawn by the court.

Using confiscated property to settle claims

May confiscated property be used in satisfaction of civil claims for damages or compensation from a claim arising from the conviction?

The court may take into account civil proceedings that have been brought by victims of the convicted offence, and the court may direct payments to a third party as appropriate.

Confiscation of profits

Is it possible to recover the financial advantage or profit obtained through the commission of criminal offences?

Yes. It is possible to recover the financial advantage received by a company.

Non-conviction based forfeiture

Can the proceeds of crime be confiscated without a conviction? Describe how the system works and any legal challenges to in rem confiscation.

It is possible to update freezing orders or seizure orders.

Management of assets

After the seizure of the assets, how are they managed, and by whom? How does the managing authority deal with the hidden cost of management of the assets? Can the assets be utilised by the managing authority or a government agency as their own?

The court can appoint a receiver to the realisable property and bestow that receiver with powers to dispose of the property.

Receivers have a duty to take reasonable care in obtaining the best price reasonably possible for those assets at the time of sale. Generally, a receiver will not hold on to the property for an extended period of time but will dispose of it once appropriate, and the costs of management of those assets must be borne by the receiver and would be deducted from the gross sales proceeds of any asset.

There is no prohibition in Irish legislation to property assets being used by the Irish state, but this would be an unusual approach to take.

Making requests for foreign legal assistance

Describe your jurisdiction’s legal framework and procedure to request international legal assistance concerning provisional measures in relation to the recovery of assets.

Ireland is a signatory to various mutual legal assistance agreements with other jurisdictions. The law that allows Ireland to provide mutual legal assistance to, and to ask for mutual legal assistance from, other countries is contained in the Criminal Justice (Mutual Assistance) Act 2008.

Complying with requests for foreign legal assistance

Describe your jurisdiction’s legal framework and procedure to meet foreign requests for legal assistance concerning provisional measures in relation to the recovery of assets.

See question 35.

Treaties

To which international conventions with provisions on asset recovery is your state a signatory?

Ireland is a party to the following international conventions:

  • the Council of Europe Convention on Mutual Assistance in Criminal Matters 1959, and its Additional Protocol;
  • the United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances 1988;
  • the Council of Europe Convention on Laundering, Search, Seizure and Confiscation of the Proceeds from Crime 1990;
  • the OECD Convention on Combating Bribery of Foreign Public Official in International Business Transactions 1997; and
  • the Council of Europe Criminal Law Convention on Corruption 2003.

Requests made outside the provisions of an international convention will be decided on an individual basis.

Private prosecutions

Can criminal asset recovery powers be used by private prosecutors?

Private prosecutions of criminal law offences are not a feature of Irish law.

Update and trends

Update and trends

Are there any emerging trends or hot topics in civil and criminal asset recovery in your jurisdiction?

Owing to its procedural effectiveness and certainty, common law is the preferred governing law for a high proportion of global cross-border commercial contracts and arbitrations. Although the extent of post-Brexit changes remains uncertain as negotiations continue, Ireland will become the largest common law jurisdiction in the EU. Thus, Ireland is likely to become a more popular jurisdiction of choice in cross-border contracts where certainty regarding an EU passport for civil and commercial judgments is required. With a legal system closely analogous to the highly respected English system, Ireland benefits from the fact that judgments of the Irish courts are, and will continue to be, recognised under the Recast Brussels Regulation. Indeed, the recent announcement by the International Swaps and Derivatives Association - that Irish law will henceforth be an option for parties to its derivatives documentation - underscores the potential attractiveness of Ireland and Irish law in the context of international transactions post-Brexit. As transactional activities increasingly turn to Ireland as a legal jurisdiction of choice, this in turn should increase the utilisation of the Irish legal system for asset recovery measures and remedies in the medium to long term.