Court provides guidance in relation to applications for search and seizure orders

During a bankrupt’s application for orders in relation to a search and seizure order made under section 365 of the Insolvency Act 1986 (“s.365”) the Court firstly clarified the legal principles of s.365 and also provided guidance on how to draft s.365 orders.

Legal principles:

  • In deciding whether to grant a s.365 order the Court should be concerned with the rights of those who are affected, such as privacy in the home, protection against unjust and arbitrary searches and seizures, and the right to be heard in defence of a claim before an order was made.
  • The making of such an order requires there to be a strong arguable case with clear evidence and the damage being prevented had to be proportionate to the grant of the remedy.
  • To reduce any potential injustice and harm appropriate safeguards should be included within the terms of execution.

An applicant is required to ensure an appropriate draft order is placed before the court, which would include:

  • An explanation of what was expected to occur when the order was enforced, including for example, who might be present and any potential risks, including medical issues.
  • Rights of third parties.
  • Provisions relating to confidentiality and/or legal privilege.
  • The order should be readily understood by a layperson and clear as to what might be done under its terms.
  • It should feature a penal notice to explain the possible consequences of a breach of its terms.

As above, the order should also deal with appropriate safeguards when enforcing its terms. The Court stressed that safeguards would depend upon the application and be decided on a case by case basis but would normally include:

  • The supervising solicitor should be identified and must stay throughout, consideration should be given whether this needed to be an independent solicitor or whether one with conduct of the litigation would suffice.
  • Those at the premises should be informed of their rights including the right to seek legal advice and challenge the order by court application.
  • At least one representative should be female if there are female occupants at the premises.
  • Everything taken into care of the solicitors or representatives should be listed appropriately and photographed prior to leaving the premises.
  • Consideration should be given in respect of computers or mobile devices as the owners might still require use of them.

Lastly, as the application in this instance was made without notice there was a duty of full and frank disclosure and of fair presentation, meaning that the skeleton argument and/or oral submissions should draw attention to any potential weaknesses, unexplained matters, alternative remedies, and any facts or law that might be relied upon to defend the application.



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