High Court: No grant of leave to actor to furnish unopened affidavits in Irish fraud proceedings to Monégasque authorities

About this case:

• Citation:
  [2023] IEHC 678
• Judgment:
  External link
• Court:
  High Court
• Judge:
  Mr Justice Rory Mulcahy

Delivering judgment for the High Court, Mr Justice Rory Mulcahy considered that if a request for the documents had been forthcoming from the Monégasque courts or authorities “which set out the intended use of the Documents, then an Irish court would no doubt look at that request in a different light than the request made here”.

Background

In 2020, the plaintiff actor commissioned the construction of a yacht for his personal use. In January 2021, the plaintiff met the second defendant, Terry Birles, who represented that he was a maritime law attorney and provider of services to the first defendant.

Following that introduction, the plaintiff engaged the first defendant to register his completed yacht and to manage its operation, leading to three alleged instances of fraud as against him relating to the maintenance of his yacht, insurance for his yacht, and fraud in respect of a purported investment opportunity.

The plaintiff alleged that the third to 11th defendants were knowing recipients of some or all of the funds paid into the first defendant’s account and that the ninth defendant was a co-conspirator in the fraudulent scheme. Wrongdoing was inferred for a multitude of reasons, including that Mr Birles was the secretary of the ninth defendant, his partner, Ms Zhao, was its sole shareholder, and that it had capitalised €6.8 million, roughly the amount paid by the plaintiff into the first defendant’s account.

The tenth defendant was a Monégasque company who had Ms Zhao as its principal shareholder and the same address as the couple’s residential address. The plaintiff alleged that the tenth defendant purchased a French property in 2022 to be held on behalf of the couple, and so it could be inferred that the property was purchased with the proceeds of fraud.

On 11 October 2022, a Mareva-type injunction was granted against the ninth and tenth defendants on an interim basis and requiring them to swear affidavits disclosing details of all bank accounts worldwide in which they had an interest.

Ms Zhao swore and filed a number of affidavits on behalf of the ninth and tenth defendants in the proceedings, in which she referred to her questioning by the Monégasque authorities in relation to money laundering and in respect of Mr Birles and related companies. The ninth and 10th defendants ultimately consented to the continuation of the interim order on an interlocutory basis, resulting in none of Ms Zhao’s affidavits being opened in court.

In June 2023, the plaintiff sought leave to furnish Ms Zhao’s affidavits to his Monégasque lawyers on their request in order to furnish them to the judge in charge of the criminal investigation in Monaco. The ninth and 10th defendants objected to the disclosure of the affidavits which had not been opened in court.

The High Court

Mr Justice Mulcahy set out that where affidavits have been opened in court, leave is not required for them to be furnished to any other party, as explained in AIB v Tracey [2013] IEHC 242; [2013] 3 IR 398. The court also noted Breslin v McKenna [2008] IESC 43; [2009] 1 IR 298 which set out that there was no prohibition on handing over transcripts or books of evidence to the Northern Ireland courts where necessary for the purpose of doing justice and provided that was no legal prejudice to the other party as a consequence of so doing.

The judge considered the defendants’ contentions that the plaintiff should have made an applications pursuant to the Foreign Tribunals Evidence Act 1856 and to give effect to letters rogatory from the Monégasque court. Observing that the defendants had accepted at hearing that the latter application was only appropriate where seeking to depose a witness, the court nonetheless considered the legal principles involved to have some relevance, highlighting in particular Cornec v Morrice [2012] IEHC 376; [2012] 1 IR 804.

Mr Justice Mulcahy also considered The Official Receiver v Skeene & Anor [2020] EWHC 1252 (Ch) which set out factors relevant to the exercise of the English court’s discretion, including the public interest in ensuring that criminal proceedings were conducted properly and that all relevant evidence was before the court, that the documents sought were produced voluntarily and highly likely to be relevant to the criminal proceedings, and that the provision of documents did not mean that they would be used as evidence in the criminal proceedings.

The court considered that relevance was not the key determinant of whether leave should be given, rather “that the overriding considerations are whether consent to furnishing the documents is consistent with the ‘due administration of justice’ or would unduly prejudice the party affected by the order sought”.

The judge also opined that where documents are requested by a court in another jurisdiction the principles in Cornec are applicable, with the burden of establishing that it is appropriate for the Irish court to provide such assistance resting upon the party seeking to use the documents, and with the onus on the applicant of establishing that no risk of prejudice would accrue to any party by the provision of the documents sought or that the provision of documents would not be oppressive or undermine any entitlement to claim privilege.

Mr Justice Mulcahy found that Breslin did not suggest that the burden on the applicant is “particularly onerous, but it is nonetheless a burden which must be discharged… crucially, there is no order from a Monégasque court or even a request from Monégasque authorities, which might enable the court to assume that any risk of prejudice will be addressed by the application of appropriate procedures in that jurisdiction”.

The court determined that it should “show some caution when faced with an application that would involve providing prosecuting authorities with evidence provided by a person for the purpose of assisting with a criminal investigation into that person. That caution must apply with greater force where the evidence is given in court proceedings in this jurisdiction but is to be provided for the purpose of a criminal investigation in an entirely different jurisdiction.”

Accepting the plaintiff’s proposition that a foreign court order is not a prerequisite to obtaining an order of the type sought, the court stated that nonetheless, “where the request is being made by the Plaintiff’s Monégasque lawyers, without any official imprimatur, this court cannot, on the evidence before it, satisfy itself that the provision of this evidence might not unfairly prejudice the ninth and tenth Defendants or Ms Zhao in defence of any criminal proceedings in Monaco, or the related civil claims being pursued by the Plaintiff.”

The court distinguished Skeene on the basis that it could not be satisfied, unlike the court in that case, that there would be “any limitation on the manner in which the Documents are used once provided to the Monégasque authorities”.

Conclusion

Accordingly, Mr Justice Mulcahy refused the plaintiff’s application.

Boon v South Sea Merchants Mariners Ltd Partnership & Ors [2023] IEHC 678