X, Re

X, Re

The court has jurisdiction to vary a restraint order under the Criminal Justice Act 1988 to permit payment to creditors prior to conviction, but must exercise this discretion with a view to preserving the value of realisable property for any future confiscation order. The Crown does not have absolute priority over general creditors at the pre-conviction stage. However, on the facts, it was not appropriate to vary the order to permit payment to Z Limited.

Parties
Claimant: Claimant (Crown/Prosecutor); Applicant: Z Limited; Defendant: X; Interested Party: Y Limited
Jurisdiction
England and Wales
Judgment Date
22 April 2004
Procedural Posture
Application to Vary Restraint Order (criminal Asset Forfeiture) / Post Restraint, Pre Conviction, Application to Vary Order
Outcome
Application dismissed
Legal Topics
Restraint Orders, Jurisdiction to Vary Orders, Priority of Creditors, Confiscation Proceedings
Criminal Law Asset Forfeiture Civil Procedure Restraint Orders Jurisdiction to Vary Orders Priority of Creditors Confiscation Proceedings

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Parties

Claimant (Crown/Prosecutor)

Claimant

Z Limited

Applicant

X

Defendant

Y Limited

Interested Party

Procedural Posture

Application to Vary Restraint Order (criminal Asset Forfeiture) / Post Restraint, Pre Conviction, Application to Vary Order

Legal Issues

  1. 1 Does the court have jurisdiction to vary a restraint order under the Criminal Justice Act 1988 to permit payment to a creditor prior to conviction/confiscation order?
  2. 2 What is the priority of the Crown versus general creditors under a restraint order?

Ratio Decidendi

The court has jurisdiction to vary a restraint order under the Criminal Justice Act 1988 to permit payment to creditors prior to conviction, but must exercise this discretion with a view to preserving the value of realisable property for any future confiscation order. The Crown does not have absolute priority over general creditors at the pre-conviction stage. However, on the facts, it was not appropriate to vary the order to permit payment to Z Limited.

Court Disposition

Application dismissed

Orders

  • Application by Z Limited to vary the restraint order to permit payment of £873,972 dismissed
  • Receiver directed to retain the sum until further order of the court