SFO v LCL et al – Court Order 20 May 2020

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IN THE HIGH COURT OF JUSTICE Claim No. CL-2017-000323
BUSINESS AND PROPERTY COURTS
OF ENGLAND & WALES
COMMERCIAL COURT (QBD)
Before: The Honourable Mr Justice Foxton
Dated 20 May 2020
IN THE MATTER OF GERALD MARTIN SMITH
AND IN THE MATTER OF THE CRIMINAL JUSTICE ACT 1988
B E T W E E N :
(1) THE SERIOUS FRAUD OFFICE
(2) MR JOHN MILSOM AND MR DAVID STANDISH
(as joint Enforcement Receivers in respect of
the realisable property of Gerald Martin Smith) Applicants
- and -
(1) LITIGATION CAPITAL LIMITED
(a company incorporated in the Marshall Islands)
(2) SMA INVESTMENT HOLDINGS LIMITED
(a company incorporated in the Marshall Islands)
(3) MR ANTHONY SMITH
(4) DR GAIL ALISON COCHRANE
(5) THE VISCOUNT OF THE ROYAL COURT OF JERSEY
(as administrator of the désastre of Dr Gail Alison Cochrane)
(6) STEWARTS LAW LLP
(7) HARBOUR FUND II LP
(8) PHOENIX GROUP FOUNDATION
(9) MINARDI INVESTMENTS LIMITED
(10) THE VISCOUNT OF THE ROYAL COURT OF JERSEY
(as administrator of the désastre of ORB A.R.L.)
(11) PHILIP BARTON
(12) ORB ESTATES PLC (in administration)
(13) MITRE PROPERTY MANAGEMENT LIMITED (in administration)
(14) HOTEL PORTFOLIO II UK LIMITED (in liquidation)
(15) ULRICH PELZ
(16) NICHOLAS THOMAS
(17) ROGER TAYLOR
(18) FRANEK SODZAWICZNY
(19) DAWNA MARIE STICKLER
(20) GERALD MARTIN SMITH
(21) UNICORN WORLDWIDE HOLDINGS LIMITED (in liquidation in the
BVI)
(22) GLEN MOAR PROPERTIES LIMITED (in liquidation in the BVI)
(23) BALLAUGH HOLDINGS LTD (in liquidation in the BVI)
(24) BRIDGE PROPERTIES (ARENA CENTRAL) LTD
(25) SPECIALTY FINANCE LTD
2
Respondents
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________________________________________________
ORDER
________________________________________________
UPON a hearing taking place on 18 May 2020 in accordance with paragraph
9 of the CMC order of Mr Justice Foxton dated 24 February 2020 (the
“February 2020 CMC order”)
AND UPON an Application Notice dated 9 April 2020 issued by the
Settlement Parties (as defined in the February 2020 CMC order) pursuant
to paragraph 7 of the February 2020 CMC order (the “Underlying Assets
Application”) in relation to the Settlement Parties’ claims to the assets
identified in Schedule 2 to this Order (the “Identified Underlying
Assets”)
AND UPON reading the evidence filed and the correspondence sent to the
Court, including letters from: LCL and Harbour dated 12 May 2020; Dr
Cochrane dated 13 May 2020 (attaching letters from Dr Imogen Smith and
Ms Iona Smith dated 7 May 2020) and emails from: Ms Stickler dated 13
May 2020; and Mr Pelz dated 17 May 2020 at 23.40
AND UPON hearing leading counsel for Harbour (on behalf of the
Settlement Parties), leading counsel for the SFO, and Dr Smith (in person)
AND UPON the Underlying Assets Application having been deemed to be
made without notice to Ms Alison Hollis, and Dr Smith agreeing to ascertain
and provide current email and correspondence addresses for Ms Alison
Hollis.
IT IS ORDERED that:
Case Management and Joinder
1. The Underlying Assets Application, and all claims made by the
Settlement Parties (or any of them) or others to the Identified Underlying
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Assets (the “Underlying Assets Claims”), shall be case managed
alongside the SFO’s application notice dated 26 June 2017 (but without
prejudice to paragraph 4 below).
2. The parties listed in Schedule 1 to this Order shall be joined as parties to
these proceedings (CL-2017-000323) (the “Additional Parties”).
3. All parties (which for the avoidance of doubt shall hereafter include the
Additional Parties) and non-parties shall have permission to apply to
make a proprietary claim and/or a claim under the Criminal Justice Act
1988 to the Identified Underlying Assets. Further details of the steps to
be taken, and the timeframe within which they must be taken, are
provided in paragraph 13 below.
4. The question whether the Directed Trial shall be expanded in scope in
order to determine one or more of the Underlying Assets Claims shall be
determined at the CMC fixed for 27 to 28 July 2020.
5. Any party wishing to propose that the Directed Trial be expanded as
aforesaid shall set out their position in writing by 4pm on 13 July 2020.
Service
6. The steps taken by the Settlement Parties to bring the Underlying Assets
Application to the attention of the existing parties to these proceedings,
and (save in respect of Ms Alison Hollis), to the attention of the Additional
Parties, as identified in the Seventh Respondent’s solicitors’ letter dated
12 May 2020, shall constitute valid service of the Underlying Assets
Application.
7. The Settlement Parties and/or the other parties to these proceedings (as
appropriate) have permission to serve the following documents
(including out of the jurisdiction insofar as necessary):
a. this Order;
b. the Underlying Assets Application;
c. any further documents in these proceedings; and
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d. the SFO’s application (including evidence) for further restraint
orders made by application notice dated 10 February 2020,
on all parties to these proceedings by the alternative methods as set out
respectively in Schedules 3A and 3B to this Order.
8. The Order shall be served by the Seventh Respondent on all parties by
4pm on 2 June 2020.
9. The Settlement Parties shall also make available to all Additional Parties
a link through which the existing statements of case in these
proceedings can be downloaded.
10. Any party to these proceedings wishing to change or update their
details for the purposes of service should inform all other parties and the
court of a replacement email address which can be used for the purposes
of service. If a party fails to do so, service by the methods set out in
Schedules 3A and 3B to this Order will continue to be valid.
Guillotine
11. Pursuant to CPR r19.8A (and alternatively, so far as may be
necessary, the inherent jurisdiction of the court), the Seventh
Respondent on behalf of the Settlement Parties shall as soon as
reasonably practicable procure that notice be published in the London
Gazette and the Times newspaper in the form identified in Schedule 4
(the “Notice”) and served on the persons and by the methods set out in
Schedule 3C. The Seventh Respondent shall also take reasonable steps
to ascertain whether the Notice can be published on appropriate
websites as indicated in the Court’s reserved judgment, and if so,
additionally to advertise the Notice in that way.
12. Upon service and advertisement of the Notice, as provided for by
paragraph 11 above, all non-parties to these proceedings, wherever
situate, shall be bound by orders and judgments made by the Court in
relation to the Underlying Assets Claims as if they had been a party to
the claim.
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13. All parties and non-parties (including those identified in paragraph 12
above) may apply to (i) have determined any proprietary claim or claim
under the Criminal Justice Act 1988 (the “1988 Act”) in relation to the
Identified Underlying Assets, or (ii) advance any argument they wish to
make in relation to any such proprietary or 1988 Act claim. Any such
application shall be made as soon as reasonably practicable, and in any
event by 4pm on 3 July 2020, and shall be supported by a properly
particularised statement of case identifying the relief which is sought
and/or the argument which is sought to be raised (as applicable).
14. Save to the extent that any such application is granted, and subject
to paragraph 16 below in the case of non-parties,
15. the said parties and non-parties shall be debarred from: (i)
contending that they have a proprietary claim or claim under the 1988
Act in relation to the Identified Underlying Assets which takes priority to
the claims advanced pursuant to paragraph 13; or (ii) otherwise
challenging the Court’s judgments or orders in relation to the Identified
Underlying Assets.
16. The requirements contained in CPR r19.8A are varied as provided for
above. In particular, but without limitation:
a. the service and notice requirements contained in CPR r19.8A(4) be
varied as provided for in paragraphs 11 and 12 above; and
b. the requirements for service and filing of an acknowledgment of
service contained in CPR r19.8A shall be dispensed with.
17. There shall be liberty to apply in relation to paragraphs 11 to 14
above.
Other
18. The application to join Casa Futura Mallorca SL and to bring the
property known as Carrer Farrigola 2, 07181 Calvia, Illes Balears,
Mallorca, Spain, registered at the Spanish Land Registry under title
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number 07021000606774 within these proceedings as an Identified
Underlying Asset is generally adjourned, with liberty to restore.
19. The application to join Mr Kevin Philbin and Mr Mark Williamson is
generally adjourned on the terms set out in the separate order (made by
consent) dated 19 May 2020.
20. The application to join By Corporate LLP (formerly Atticus Legal LLP):
a. is adjourned for a minimum of 56 days until the first available date
thereafter; and
b. the costs of the application as against By Corporate LLP are
reserved.
21. This order has been made without notice to Ms Alison Hollis under
CPR r23.9. Ms Alison Hollis may apply under CPR r23.10 to set aside this
order or have it varied, insofar as it joins her as a party to the
proceedings and brings within these proceedings as an Identified
Underlying Asset the proceeds of the leasehold of Flat 9, 54-57
Goodwood Court, Devonshire Street, London, W1W 5DZ, registered at
HM Land Registry under title number NGL984402, of which she was the
legal owner. Any such application must be made within 7 days of the
service of this order upon her at the correspondence address provided
by Dr Smith.
22. Save as set out in paragraph 19(b) above, costs in the case.
Dated: 20 May 2020
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SCHEDULE 1: PARTIES TO BE JOINED TO THESE PROCEEDINGS
1. Dr Imogen Smith
2. Ms Iona Smith
3. Ms Sinead Irving
4. Ms Alison Hollis
5. Mr Nicolas Greenstone and Mrs Patricia Greenstone
6. The companies owning the Hamilton House properties identified in
Schedule 2 (under the control of the Enforcement Receivers), being (i)
Graig Holdings Limited, (ii) Diversified Group Limited, (iii) Future
Investments Limited, (iv) Blackwood Investments Limited, (v) Hamilton
House Property Limited, (vi) Great Eastern Street Investments Limited,
(vii) Dewr Holdings Limited, (viii) Mynydd Holdings Limited, (ix) Sarn
Investments Limited, (x) Merch Holdings Limited, (xi) Bryanstone
Square Investments Limited, (xii) Ingenuity Capital Limited, and (xiii)
Hamilton House (Southampton Row) Management Limited
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SCHEDULE 2: THE IDENTIFIED UNDERLYING ASSETS
1. The leasehold property known as and situate at Flat 1 Hamilton House,
81 Southampton Row, London, WC1B 4HA (“HH”), registered at HM Land
Registry under title number NGL270419 the legal owner of which is Ms
Imogen Smith.
2. Flat 2 Hamilton House, 81 Southampton Row, London, WC1B 4NH (HM
Land Registry title number: NGL550705), the legal owner of which is
Graig Holdings Limited.
3. Flat 3 HH (HM Land Registry title number: NGL208408), the legal owner
of which is Diversified Group Limited.
4. Flat 10 HH (HM Land Registry title number: NGL870810), the legal owner
of which is Hamilton House Property Limited.
5. Flat 11 HH (HM Land Registry title number: NGL889218), the legal owner
of which is Future Investments Limited.
6. Flat 12 HH (HM Land Registry title number: NGL930424), the legal owner
of which is Blackwood Investments Limited.
7. Flat 14 HH (HM Land Registry title number: NGL835124), the legal owner
of which is Hamilton House Property Limited.
8. Flat 17 HH (HM Land Registry title number: NGL219447), the legal owner
of which is Great Eastern Street Investments Limited.
9. Flat 18 HH (HM Land Registry title number: NGL232204), the legal owner
of which is Future Investments Limited.
10. Flat 19 HH (HM Land Registry title number: NGL219182), the legal
owner of which is Dewr Holdings Limited.
11. Flat 20 HH (HM Land Registry title number: NGL850623 the legal
owner of which is Mynydd Holdings Limited.
12. Flat 21 HH (HM Land Registry title number: NGL850622), the legal
owner of which is Sarn Investments Limited.
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13. Flat 22 HH (HM Land Registry title number: NGL209052), the legal
owner of which is Merch Holdings Limited.
14. Flat 23 HH (HM Land Registry title number: NGL217637), the legal
owner of which is Bryanstone Square Investments Limited.
15. Flat 24 HH (HM Land Registry title number: NGL217681), the legal
owner of which is Ingenuity Capital Limited.
16. The head lease of HH, covering the first to fifth floors and known as
1-25 Hamilton House, Southampton Row, London, and registered at HM
Land Registry under title number NGL303066, the legal owner of which
is Hamilton House (Southampton Row) Management Limited.
17. The leasehold of Flat 4, 58/59 Montagu Square, London, W1H 2LS and
the connected loft space registered at HM Land Registry under title
numbers NGL710703 and NGL952082, the legal owner of which is Sinead
Catherine Irving.
18. The 50% interest in the property known as 32 Moor Lane,
Rickmansworth, WD3 1LG, registered at HM Land Registry under title
number HD281 and purchased by Ms Sinead Irving on or around 7
August 2014.
19. The £500,028.80 paid into the client account of Atticus Legal LLP on
or about 5 November 2014 (and its traceable proceeds), the legal owner
of which is thought to be Mr Kevin Philbin and Mr Mark Williamson (as
trustees).
20. The proceeds of the leasehold of Flat 9, 54-57 Goodwood Court,
Devonshire Street, London, W1W 5DZ, registered at HM Land Registry
under title number NGL984402, the legal owner of which was Alison Jane
Hollis.
21. The right to payment, and all security granted in support, of the loan
in the amount of approximately £1,080,000 made in about July 2014 to
fund the purchase of the property known as Flat 19, Walham Court, 109-
111 Haverstock Hill, London, NW3 4SD, registered at HM Land Registry
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under title number NGL931346. The legal owner of the right to payment
of the said loan and the said security is thought to be Dr Gail Cochrane
(acting by the Viscount of the Royal Court of Jersey).
22. The diamond bracelet purchased by Dr Cochrane in about November
2014 from Graff Diamonds (Hong Kong) Limited for the sum of
£217,022.74. The legal owner of this bracelet is thought to be Dr Gail
Cochrane (acting by the Viscount of the Royal Court of Jersey).
23. The diamond earrings purchased by Dr Cochrane in about December
2014 from Graff Diamonds (Hong Kong) Limited for the sums of
£75,022.97 and £71,022.97. The legal owners of these earrings are
thought to be Dr Imogen Smith and Ms Iona Smith.
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SCHEDULE 3: ADDRESSES FOR SERVICE
3A: THE APPLICANTS AND RESPONDENTS
PARTY EMAIL ADDRESS(ES)
Applicants
(1) THE SERIOUS FRAUD OFFICE • [email protected]
• [email protected]
• [email protected]
ov.uk
• [email protected]
(2) MR JOHN MILSOM AND MR
DAVID STANDISH
• [email protected]
• [email protected]
RESPONDENTS
(1)LITIGATION CAPITAL LIMITED [email protected]
(2) SMA INVESTMENT HOLDINGS
LIMITED
[email protected]
(3) MR ANTHONY SMITH • [email protected]
• [email protected]
(4) DR GAIL ALISON COCHRANE [email protected]
(5) THE VISCOUNT OF THE ROYAL
COURT OF JERSEY
• Judith.Hughes@addleshawgoddar
d.com
• Jean.Boldero@addleshawgoddard
.com
(6) STEWARTS LAW LLP • [email protected]
• [email protected]
• [email protected]
• [email protected]
(7) HARBOUR FUND II L.P. • [email protected]
• [email protected]
• [email protected]
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(8) PHOENIX GROUP FOUNDATION • phoenixminardi@
richardslade.com
• [email protected]
m
• [email protected]
• [email protected]
(9) MINARDI INVESTMENTS
LIMITED
• phoenixminardi@
richardslade.com
• [email protected]
m
• [email protected]
• [email protected]
(10) T
HE VISCOUNT OF THE ROYAL
COURT OF JERSEY
• Judith.Hughes@addleshawgoddar
d.com
• Jean.Boldero@addleshawgoddard
.com
(11) P
HILIP BARTON
• [email protected]
• [email protected]
(12) O
RB ESTATES PLC
• [email protected]
• [email protected]
(13) M
ITRE PROPERTY MANAGEMENT
LIMITED
• [email protected]
• [email protected]
(14) H
OTEL PORTFOLIO II UK
LIMITED
• [email protected]
• [email protected]
(15) U
LRICH PELZ
• [email protected]
(16) N
ICHOLAS THOMAS
• maria.demetriou@stpaulssolicitor
s.com
• andrew.crossley@stpaulssolicitor
14
s.com
• [email protected]
(17) R
OGER TAYLOR
• maria.demetriou@stpaulssolicitor
s.com
• andrew.crossley@stpaulssolicitor
s.com
• [email protected]
(18) F
RANEK SODZAWICZNY
• [email protected]
• [email protected]
• [email protected]
• [email protected]
(19) D
AWNA MARIE STICKLER
[email protected]
(20) G
ERALD MARTIN SMITH
• [email protected]
• [email protected]
• [email protected]
(21) U
NICORN WORLDWIDE
HOLDINGS LIMITED
• [email protected]
• [email protected]
• [email protected]
(22) G
LEN MOAR PROPERTIES
LIMITED
• [email protected]
• [email protected]
• [email protected]
(23) B
ALLAUGH HOLDINGS LTD
• [email protected]
• [email protected]
• [email protected]
(24) B
RIDGE PROPERTIES (ARENA
CENTRAL) LTD
• [email protected]
• [email protected]
• [email protected]
(25) S
PECIALTY FINANCE LTD
• [email protected]
• [email protected]
• [email protected]
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3B: THE ADDITIONAL PARTIES
ADDITIONAL PARTY(IES) ADDRESS(ES) FOR SERVICE
Ms Imogen Smith • [email protected]
• [email protected]
• [email protected]
Flat 37 Lowe House, 12 Hebden
Place, London, SW8 2FT
Ms Iona Smith • [email protected]
• [email protected]
• [email protected]
• Flat 20, Hamilton House, 75-81
Southampton Row, London,
WC1B 4HA
Ms Sinead Irving • Flat 4, 58/59 Montagu Square,
London, W1H 2LS
• [email protected]
• 32 Moor Lane, Rickmansworth,
WD3 1LG
Ms Alison Hollis • [email protected]
• 35 Himley Green, Leighton
Buzzard, LU72 2PY
Mr Nicolas Greenstone and Mrs
Patricia Greenstone
• [email protected]
• Flat 19, Walham Court, 109-111
Haverstock Hill, London, NW3
4SD.
The companies owning the
Hamilton House properties
identified in Schedule 2 (under the
control of the Enforcement
Receivers), being (i) Graig Holdings
Limited, (ii) Diversified Group
Limited, (iii) Future Investments
Limited, (iv) Blackwood
Investments Limited, (v) Hamilton
House Property Limited, (vi) Great
Eastern Street Investments
Limited, (vii) Dewr Holdings
Limited, (viii) Mynydd Holdings
Limited, (ix) Sarn Investments
Limited, (x) Merch Holdings
Limited, (xi) Bryanstone Square
Investments Limited, (xii) Ingenuity
Capital Limited, and (xiii) Hamilton
House (Southampton Row)
Management Limited
• [email protected]
• [email protected] (Future
Investments Limited)
• [email protected]
(Dewr Holdings Limited and
Mynydd Holdings Limited)
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3C: PERSONS TO BE SERVED WITH NOTICE
PERSONS ADDRESS FOR SERVICE
Simon Cooper • [email protected]
• [email protected]
Simon McNally [email protected]
Anthony Stevens • [email protected]
• richard.slade@richardslade.
com
Andrew Ruhan • [email protected]
• [email protected]
• [email protected]
.uk
Grenda Invemstnets Ltd [email protected]
Tania Jane Richardson-Ruhan • [email protected]
• [email protected]
Santander UK Plc 2 Triton Square, Regent's Place,
London, NW1 3AN
Dr Robert Morris • Flat 21 Hamilton House, 79-81
Southampton Row, London,
WC1B 4HA;
• c/o Mr Matthew Hennessy-Gibbs,
Keystone Law, 48 Chancery
Lane, London, WC2A 1JF (DX 193
Chancery Ln).
• [email protected]
Catherine Irving • 32 Moor Lane, Rickmansworth,
WD3 1LG;
• c/o Mr David Rosen, Darlingtons
LLP, 7 Stratford Place, London,
W1C 1AY (DX 42707 Oxford
Circus North).
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SCHEDULE 4: FORM OF NOTICE
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND & WALES
COMMERCIAL COURT (QBD)
CLAIM NO: CL-2017-000323
IN THE MATTER OF GERALD MARTIN SMITH
AND IN THE MATTER OF THE CRIMINAL JUSTICE ACT 1988
NOTICE OF CLAIM TO NON-PARTIES
This Notice is served pursuant to the Order of Mr Justice Foxton dated 20
May 2020
TO: ALL NON-PARTIES TO THE ABOVE-MENTIONED PROCEEDINGS
TAKE NOTICE THAT:
(1) Proceedings have been commenced in the Commercial Court (QBD)
of the High Court of Justice, Business and Property Courts of England
& Wales under Claim No CL-2017-000323 (the “Claim”). The Claim
will determine proprietary claims and claims under the Criminal
Justice Act 1988 which are advanced against the following assets (the
“Identified Underlying Assets”):
IDENTIFIED
UNDERLYING ASSET
DETAILS OF LEGAL OWNER (IF
AVAILABLE)
1 Flat 1 Hamilton House,
81 Southampton Row,
London, WC1B 4HA
(“HH”)
Ms Imogen Laura Smith
2 Flat 2 Hamilton House,
81 Southampton Row,
London, WC1B 4NH
Graig Holdings Limited
3 Flat 3 HH Diversified Group Limited
4 Flat 10 HH Hamilton House Property Limited
5 Flat 11 HH Future Investments Limited
6 Flat 12 HH Blackwood Investments Limited
7 Flat 14 HH Hamilton House Property Limited
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8 Flat 17 HH Great Eastern Street Investments
Limited
9 Flat 18 HH Future Investments Limited
10 Flat 19 HH Dewr Holdings Limited
11 Flat 20 HH Mynydd Holdings Limited
12 Flat 21 HH Sarn Investments Limited
13 Flat 22 HH Merch Holdings Limited
14 Flat 23 HH Bryanstone Square Investments
Limited
15 Flat 24 HH Ingenuity Capital Limited
16 Leasehold HH Hamilton House (Southampton Row)
Management Limited
17 Flat 4, 58/59 Montagu
Square, London, W1H
2LS
Ms Sinead Catherine Irving
18 32 Moor Lane,
Rickmansworth, WD3
1LG
Ms Sinead Catherine Irving
19 £500,028.80 fund held
on trust (and/or
investment proceeds)
Mr Kevin Philbin and Mr Mark
Williamson
20 Flat 9, 54-57 Goodwood
Court, Devonshire
Street, London, W1W
5DZ
Ms Alison Hollis
21 Flat 19 Walham Court,
109-111 Haverstock
Hill, London, NW3 4SD
Mr Nicolas Greenstone and Mrs
Patricia Greenstone
22 Dr Cochrane’s Diamond
Bracelet
Dr Cochrane (acting by the Viscount
of the Royal Court of Jersey)
23 Diamond Earrings 1 Dr Imogen Laura Smith
24 Diamond Earrings 2 Ms Iona Smith
(2) You are or may be one of the persons who are interested in the
Identified Underlying Assets.
(3) On 20 May 2020, Mr Justice Foxton gave directions in relation to how
non-parties can assert an interest in the Identified Underlying Assets.
You may, by 4pm on 3 July 2020, make an application to be joined to
the Claim in order to make a proprietary claim or a claim under the
Criminal Justice Act 1988 in relation to the Identified Underlying
Assets, or to make any argument in relation to a claim asserted by
any other party. Any such application shall be supported by a properly
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particularised statement of case identifying the relief which is sought
or the argument which is sought to be raised.
(4) If you do not make such an application by 4pm on 3 July 2020, you
will (i) be bound by orders and judgments made by the Court in
relation to the Identified Underlying Assets, (ii) be debarred from
contending that you have a proprietary claim or claim under the 1988
Act that takes priority to such claims as are established to the
Identified Underlying Assets by persons who make applications by 3
July 2020, and (iii) be debarred from otherwise challenging the
Court’s judgments or orders in relation to such claims.
(5) Further information in relation to the Claim (including the statements
of case filed by all parties thereto) can be obtained by sending an
email to [email protected] and
[email protected].