Clarifying proceedings for recovery orders in bankruptcy—Chief Constable of Greater Manchester Police v Wright

Clarifying proceedings for recovery orders in bankruptcy—Chief Constable of Greater Manchester Police v Wright

James Fletcher, barrister at 5 St Andrew’s Hill, discusses Chief Constable of Greater Manchester Police v Wright, a case which helps clarify when permission of the insolvency court is required for proceedings where alleged recoverable property under the Proceeds of Crime Act 2002 (POCA 2002) is included in a bankrupt’s estate.

Original news

Chief Constable of Greater Manchester Police v Wright [2015] EWHC 3824 (Ch), [2015] All ER (D) 270 (Nov)

The Manchester County Court dismissed the claimant chief constable’s application, purportedly under POCA 2002, s 311 for leave to continue forfeiture proceedings against a bankrupt as, on a true reading of that section, no permission was required. On that basis, a condition of permission, providing for payment of cash seized to the defendant trustee in bankruptcy, could not be imposed and, in any event, would fall foul of POCA 2002, s 298(4).

What was the background to the application?

Three amounts of cash were seized by police from Mohammed Tahir pursuant to POCA 2002, s 294 in August 2010 and May 2013. On 7 July 2014, Mr Tahir was adjudged bankrupt and a trustee in bankruptcy (Miss Wright, the respondent to the application) was appointed with effect from 14 August 2014. At some point after he had been made bankrupt, the Police applied to the magistrates’ court for the cash to be forfeited.

Due to the bankruptcy, the police considered that they needed to make an application to the County Court pursuant to POCA 2002, s 311 to seek permission for the cash forfeiture proceedings to continue.

The interpretation of POCA 2002, s 311 was crucial to the application. POCA 2002, s 311 says, so far as was relevant to this case:

‘(1) Proceedings for a recovery order may not be taken or continued in respect of property to which subsection (3) applies unless the appropriate court gives leave and

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About the author:

Stephen qualified as a solicitor in 2005 and joined the Restructuring and Insolvency team at Lexis®PSL in September 2014 from Shoosmiths LLP, where he was a senior associate in the restructuring and insolvency team.

Primarily focused on contentious and advisory corporate and personal insolvency work, Stephen’s experience includes acting for office-holders on a wide range of issues, including appointments, investigations and the recovery and realisation of assets (including antecedent transaction claims), and for creditors in respect of the impact on them of the insolvency of debtors and counterparties.