[2022] KEHC 12335 (KLR)

Asset Recovery Agency v Olaiwon (Anti-corruption and Economic Crimes Miscellaneous E034 of 2021) [2022] KEHC 12335 (KLR) (Anti-Corruption and Economic Crimes) (9 June 2022) (Ruling)

Neutral citation: [2022] KEHC 12335 (KLR)

Republic of Kenya

In the High Court at Nairobi (Milimani Commercial Courts Commercial and Tax Division)

Anti-Corruption and Economic Crimes

Anti-corruption and Economic Crimes Miscellaneous E034 of 2021

EN Maina, J

June 9, 2022

Between

Asset Recovery Agency

Applicant

and

Peter Oluwafemi Olaiwon

Respondent

Ruling

1. On November 12, 2021 upon the application of the Assets Recovery Agency of even date, this court issued an order for preservation of a sum of USD 28000 found in the possession of the applicant. The order was made pursuant to section 82 of the Proceeds of Crime and Anti-Money Laundering Act and was to last for 90 days as provided in section 84 of the Proceeds of Crime and Anti-Money Laundering Act.

2. Subsequently on January 30, 2022 the respondent filed the notice of motion dated January 18, 2022 which seeks to rescind, revoke and or vary the order so that the Assets Recovery Agency/respondent is ordered to release part of the funds being USD 10000 the subject of the preservation order for provision of his reasonable living expenses as well as legal expenses to be used in defending criminal charges levelled against him in respect of the preserved sum.

3. The application is premised on grounds inter alia that the applicant is a foreigner who had come to Kenya on vacation; that the preserved funds were partly to be expended by him during the vacation and partly for the construction of a house for his aunt who resides abroad; that the respondent’s application dated November 11, 2021 was anchored on the criminal charges preferred in Cr Case No 1191 of 2021 against him in the Chief Magistrates Court being; that the USD 28000 was suspected to be proceeds of crime; that due to the fact that he is not working he has no means of livelihood here in Kenya and the preservation orders have rendered him destitute and unable to support himself forcing him to rely on the kindness of a friend who left the country on December 26, 2021; that he has no funds to pay rent, buy basic needs and seek medical attention whenever he is unwell and that it is therefore in the interest of justice that the orders for variation, discharge or rescission of the preservation order is made.

4. The application is premised on the supporting affidavit of the applicant sworn on January 18, 2022 in which he has reiterated the grounds for his application and also annexed the preservation order.

5. The Assets Recovery Agency/respondent opposed the application through the replying affidavit sworn by its investigator Fredrick Muriuki on February 1, 2022. It is the respondent’s case that the applicant has not demonstrated any reasonable grounds and has not adduced any evidence to warrant setting aside of the preservation order; that the applicant’s averments do not meet the threshold set in section 89 of the Proceeds of Crime and Anti-Money Laundering Act and that the respondents has already filed a forfeiture suit in regard to the funds being ACEC Civil Application No E002 of 2022. The Assets Recovery Agency/respondent deposes that the funds are presumed to be proceeds of crime and the applicant is not entitled to utilize the same before the forfeiture application is heard and determined. Further that a preservation order cannot lapse or be lifted where there exists a forfeiture application.

6. The application was canvassed by way of written submissions. I have carefully considered the application, the response thereto and the rival submissions. There is no doubt that this court has the requisite jurisdiction and power to grant the orders sought both under section 88 and section 89 of the Proceeds of Crime and Anti-Money Laundering Act which state:-“Provision for expenses1. A preservation order may make such provision as the court deems fit for reasonable living expenses of a person holding an interest in property subject to a preservation order and his family or household.2. A court shall not make provisions for any expenses underSubsection (1) unless it is satisfied that—(a)the person cannot meet the expenses concerned out of his property which is not subject to the preservation order; and(b)the person has disclosed under oath all his interest in the property and has submitted to that court an affidavit.“89. Variation and rescission of orders(1)A court which makes a preservation order—(a)may, on application by a person affected by that order, vary or rescind the preservation order or an order authorising the seizure of the property concerned or other ancillary order if it is satisfied—(i)that the operation of the order concerned will deprive the applicant of the means to provide for his reasonable living expenses and cause undue hardship for the applicant; and(ii)that the hardship that the applicant will suffer as a result of the order outweighs the risk that the property concerned may be destroyed, lost, damaged, concealed or transferred; and….”

7. It is the applicant’s case that the preservation order has rendered him destitute as he is a foreigner with no other means of livelihood. On its part the respondent contends that there is a forfeiture application in regard to the funds and hence the order preserving the same ought not to be varied.

8. I have considered the rival submissions carefully. My finding is that nothing would prevent this court to vary or rescind the order where it is shown that the operation of the order will deprive the applicant of the means to provide for his reasonable living expenses and cause him undue hardship. The power to do so as I have already stated is vested in the court by section 88 and section 89(1)(a) of the Proceeds of Crime and Anti-Money Laundering Act. There is however a rider that the hardship must be one that outweighs the risk that the property concerned may be destroyed, lost, damaged, concealed or transferred. My finding is that the applicant herein has not demonstrated that the hardship he alleges he will suffer outweighs the risk that the funds will dissipate once the order is made.

9. In regard to section 88 the applicant has not disclosed under oath all his interest in the funds as provided in section 88(2)(b) of the Act as to warrant this court to make an order for provisions of his reasonable expenses other than stating that the money was for his vacation and for construction of a house for his aunt. It is also instructive that having been served with a notice under section 83(3) of the Act he shall have an opportunity to oppose the making of a forfeiture order or to apply for variation of the same as provided in section 90 of the Proceeds of Crime and Anti-Money Laundering Act. It is clear from the wording of section 90(3) of the Act that the applicant’s right to apply for variation is not extinguished merely by reason of filing of the application for forfeiture. Be that as it may the applicant herein has not met the threshold for variation of the order.

10. More importantly there is a charge sheet showing that the preserved amount is the subject of criminal proceedings against the applicant in the lower court. The same may therefore be an exhibit in those proceedings and it would therefore not be in the interest of the administration of justice to make an order for the release of the same or even a part thereof.

11. In the upshot the application is rejected and dismissed with costs to the respondent. It is so ordered.

SIGNED, DATED AND DELIVERED VIRTUALLY THIS 9TH DAY OF JUNE, 2022E N MAINAJUDGE