In the course of their work, many professionals may find themselves having to respond to a production order.
Production Orders (“POs”) are an essential tool in the fight against crime. They compel the holder of documents to hand them over to the police, HM Revenue and Customs (HMRC), National Crime Agency (NCA), Serious Fraud Office (SFO) or other authority on pain of punishment. In most cases, PO’s are obtained by the police at a without notice hearing from a Crown Court Judge. This will usually be because the investigation is on-going and the police do not want to tip off the suspects. PO’s are required because the police will not be able to get the evidence voluntarily from banks and other organisations (most often solicitors, financial institutions or accountants) who are under a professional duty not to disclose any client material without a court order. But there will also be large corporate organisations who, although they may not be under a professional duty to withhold material, will feel very uncomfortable about simply handing over files to the police.
Two Types of Production Order
Section 345 of the Proceeds of Crime Act 2002 (POCA) enables a Crown Court Judge to make a PO in support of a number of different types of investigation. This includes money-laundering investigations.
If the crime being investigated is something other than money laundering, then an application under Schedule 1 of Police and Criminal Evidence Act 1984 (PACE) will be required.
PACE PO’s are granted under Schedule 1 (paras 1-4) of PACE. This applies where there may be ‘special procedure material’ (SPM) or excluded material (EM) on the premises. SPM is defined at s14 of PAC. It is a sweeping up category of material meriting special protection but falling outside of legal professional privilege (LPP) and EM (journalistic material). This includes material possessed by a person who acquired or created it in the course of any trade, business, profession or other occupation, or for the purpose of any paid or unpaid office (s14(2)) and is held by that person subject to an express or implied undertaking to hold it in confidence. That sounds very far reaching but in effect it is more limited and really applies to very confidential information, such as medical or welfare records of individuals, or very sensitive business documents, such as confidential contract negotiations or staff disciplinary records.
Whether the Order is made under PACE or POCA, it can never authorise the seizure of legally privileged material.
What to Do When a Production Order Lands
Often the recipient of a PO will have been made aware by the police of what they are looking for.Routinely, banks will tell officers that they do have the sort of material about a customer that the police are interested in and the bank will prepare it for disclosure as soon as the Order is served.
The Orders will routinely allow seven days for compliance.However, PO’s are often drafted and applied for by police officers with little, if any, input from a lawyer.The result can be a standard form, cut and paste Order which the Judge then approves but means a mountain of work for the organisation that is required to produce the material.This is especially so if there has not been any advance warning.
Persons affected by PO’s may apply to the court to vary or discharge the Order.Thus, when an Order lands which appears to be so widely drafted that compliance in time may be an issue, immediate steps should be taken.A letter to the officer concerned, copied into the court, indicating what can be complied with immediately and what needs more time should be the first step.That will protect the organisation.If there may be legally privileged material contained in the documents then it is wise that the police and / or court should be so warned in writing.
A PO may be routine but it is a serious matter. If there are any concerns about compliance then immediate specialist legal advice should be taken.
Challenging the Order
It is not just the recipients of the Orders that can seek variation or discharge.The target of the investigation can also respond to the PO.Of course, by the time he or she is aware of the PO it would have already have been complied with and the resulting material put to him or her in a police interview.
But even if the organisation was happy to comply with the Order this does not mean it was lawfully made.There have been a number of challenges to the making of the Orders themselves.Just like search warrant challenges, the challenge happens after the event and the effect is that the Order will be declared unlawful – which means the material has to be returned.This happened so often in search warrant cases that Parliament intervened, in the shape of the Criminal Justice and Police Act 2001.This allowed a second-bite at the cherry: in other words, even if the High Court declared that the search warrant was unlawful, the police could retain the material and re-apply.The same is technically true in relation to material produced under a PO. But in practice it seems the police do treat failed PO applications differently to quashed search warrants.
The grounds for a suspect to challenge a PO are the same as for search warrants. These would warrant a very lengthy article on their own. However, one familiar complaint from clients is that the judge was not given the complete picture in the application for the PO. This is, of course, unfair as the suspect was not present to put the picture right.There is a duty in ex parte applications of any sort for the applicant to ‘put on his defence hat’ and tell the judge what the suspect would say if he was present - see in re Standford  1 WLR 941, 191.
The police and other agencies are now very used to handing over the actual applications - and other material used at court to secure a search warrant - to a suspect who is considering challenging the warrant.However, experience tells us that the police will sometimes refuse to hand over the very same sort of material in relation to PO applications.Such objections are un-sustainable: the law is precisely the same in both cases. There is a common-law duty to provide the information to the suspect if it is demanded; see e.g. R (Cronin) v Sheffield Justices  1 WLR 752 and R (Haralambous) v Crown Court at St. Albans and another  EWHC 916 (Admin) (this case was the first case to reach the Supreme Court in 2018, but on a different point).
The same is true in relation to the court’s reasons for granting the Order.Judges generally have a duty to give reasons for their rulings and they should be noted – see R (Rawlinson and ors v Central Criminal Court  EWHC 2254 (Admin).Those reasons can be demanded from the court and there is a procedure in place to deal with such demands under Crim PR 5.7.
Bearing in mind that the ultimate remedy may be a judicial review it is essential that those considering a challenge to a PO act ‘promptly’ and in any event within 3 months.