OB v The Director of the Serious Fraud Office

Factual and Procedural Background

The Appellant was investigated for involvement in a substantial fraud scheme described as a "boiler room" fraud. A restraint order was granted against the Appellant pursuant to section 41 of the Proceeds of Crime Act 2002 ("POCA"), requiring disclosure and repatriation of assets, including a specific sum held overseas. The Appellant failed to comply with these obligations and subsequently left the jurisdiction. The Serious Fraud Office ("SFO") applied for the Appellant's committal to prison for contempt of court for breaching the restraint order. The Appellant was found in contempt in absentia and a bench warrant issued.

Later, the Appellant was located in the United States and consented to extradition to the United Kingdom to face fraud charges, but not for contempt. The SFO requested withdrawal of the bench warrant to facilitate extradition, citing the principle of specialty under the United Kingdom-United States Extradition Treaty 2003 ("the Treaty"). After extradition, the SFO proceeded with contempt committal proceedings, which the Appellant challenged on grounds of breach of the specialty principle and Article 18 of the Treaty. The Common Serjeant of London ruled the court had jurisdiction and that the contempt was civil, not criminal, and subsequently committed the Appellant to prison for 15 months. The Appellant appealed these decisions.

Legal Issues Presented

1. Whether contempt of court arising from breach of a restraint order under section 41 of POCA constitutes civil or criminal contempt.
2. If the contempt is civil, whether it was lawful to commit the Appellant to prison in light of Article 18 of the United Kingdom-United States Extradition Treaty 2003.

Arguments of the Parties

Appellant's Arguments

• English law should determine whether the contempt was civil or criminal, with the better view being that it was criminal.
• The courts involved (Central Criminal Court and Court of Appeal) suggest a criminal classification.
• If criminal, the specialty principle protects the Appellant from contempt proceedings, so the court lacked jurisdiction.
• Even if civil, committing the Appellant to prison breached Article 18 of the Treaty.
• The evidence regarding US authorities’ views was unsatisfactory and unreliable.
• The SFO should have sought a fresh restraint order rather than relying on contempt proceedings.

Respondent's (SFO) Arguments

• Both the SFO and US authorities initially erred in assuming the contempt was criminal.
• The contempt was properly characterised as civil, as restraint proceedings are civil in nature.
• Contempt arose from disobedience to a court order and thus did not engage the specialty principle or Article 18 of the Treaty.
• There was no misrepresentation to the US authorities or courts.
• The extradition statute and Treaty apply only to criminal offences, so civil contempt is outside their scope.

Table of Precedents Cited

Court's Reasoning and Analysis

The court began by framing the principle of specialty as applying exclusively to criminal offences, not civil matters, citing established extradition law. It examined statutory provisions, noting that while imprisonment for contempt is provided for under the Contempt of Court Act 1981, the language does not conclusively classify such contempt as criminal. The court emphasized that committal to prison can be a coercive remedy in civil contempt cases and that the burden and standard of proof are the same for both civil and criminal contempt.

The court reviewed key authorities distinguishing civil contempt (breach of court orders benefiting private parties) from criminal contempt (wilful interference with justice), including English and US case law. It found persuasive the analogy between restraint orders under POCA and freezing injunctions in civil proceedings, both giving rise to civil contempt upon breach.

Predecessor regimes to POCA and relevant case law consistently classified contempt for breach of restraint orders as civil. The court considered POCA’s statutory scheme and concluded it did not effect a fundamental change in the civil nature of restraint proceedings. The application of the Civil Evidence Act provisions to restraint proceedings further confirmed their civil character.

Accordingly, the court held the contempt in question was civil, not criminal. This determination rendered Article 18 of the Treaty inapplicable, as the Treaty’s scope is limited to criminal offences. The court rejected the Appellant’s argument that committal to prison breached the Treaty, emphasizing that punishment by imprisonment does not alter the civil nature of the contempt.

The court also addressed concerns about the SFO’s conduct and changes in position, finding no evidence of misleading the US authorities or courts. It underscored the importance of enforcing restraint orders effectively and noted the Appellant could purge his contempt by compliance.

Holding and Implications

The court held that the contempt for breach of the restraint order was a civil contempt and not a criminal contempt.

The court further held that committing the Appellant to prison for civil contempt did not breach Article 18 of the United Kingdom-United States Extradition Treaty 2003 nor the principle of specialty.

As a result, the appeal was dismissed. The decision confirms that contempt arising from breach of restraint orders under POCA is civil in nature and outside the scope of extradition protections for criminal offences. The ruling upholds the enforcement of restraint orders and clarifies the limits of the specialty principle in extradition contexts. No new precedent was established beyond affirming existing principles applied to the facts of this case.