Microsoft Corporation v Mbaezue (aka Barry Ejiofor Omesuh) [2009] EWHC 51 (Ch)

[2009] EWHC 51 (Ch)Case No HC08C00674
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 22/01/2009
Before
MRS JUSTICE PROUDMAN
Between
MICROSOFT CORPORATIONClaimantJOSEPH CHINEDU MBAEZUEDefendant
Andrew Hunter (instructed by Mishcon de Reya) for ClaimantRaymond Walker QC (instructed by Cooper & Kenyon) for DefendantHearing Hearing dates: 13-16 January 2009
JudgmentProudman J:
[1]This is the claimant’s application to commit the defendant for contempt of court constituted by breaches of Freezing and Search Orders made by Mann J on 5th March 2008 (“the 5th March Orders”). The power of the Court to commit for contempt is the Court’s ultimate weapon in securing compliance with its orders. However as it is a powerful one which can deprive the subject of his liberty it must be exercised only where the Court is sure that the alleged contemnor is in breach of an unambiguous order. The burden of proof is on the claimant to establish the contempt and the standard of proof is the criminal standard. In other words, the claimant has to satisfy me so that I am sure that the alleged contempts have been established. In the time-honoured phrase, the matter must be beyond reasonable doubt.[2]It is a contempt of court to commit a breach of a court order. A breach will include acting in a manner calculated to frustrate the purpose of the court order. The act constituting the breach must be deliberate rather than merely inadvertent, but an intention to commit a breach is not necessary, although lack of intention is relevant to penalty: see Stancomb v. Trowbridge Urban DC [1910] 2 Ch 190 at 194, Director General of Fair Trading v. Pioneer Concrete (UK) Limited [1995] 1 AC 456. The parties[3]The claimant is a company carrying on a world-wide business designing, manufacturing, distributing and selling computer software, of which it is the owner of registered trade marks, goodwill and copyright.[4]The defendant is a man of Nigerian origin who entered the United Kingdom in or about 1988 at the age of about 20 using the name and identity Barry Ejiofor Omesuh. At a hearing on 11th March 2008 he revealed through his Counsel that his real name is Joseph Chinedu Mbaezue. He asserts that he assumed the identity Barry Ejiofor Omesuh, having bought a birth certificate in that name in about 1987. His purpose, he says, was to enter the UK and live and work under the new identity in order to flee an imminent danger of oppression in Nigeria. He has adopted that identity, including the date of birth 13th March 1968, although he says his real date of birth was some 5 months later. He asserts that he does not know the real Barry Ejiofor Omesuh and that his mother arranged the purchase of the birth certificate for him. His solicitors have produced copy documents showing that towards the end of 2007 he made an application to the Home Office to remain in the UK, telling his full story to the British authorities for the first time.[5]A company search made by the claimant prior to 10th March 2008 revealed that a Barry Ejiofor Omesuh, date of birth 13th March 1968, was a director of a transport and clearance company Barroski Ltd, the registered office of which is in Stratford, East London. Another director is Dilibe Chidi Omesuh. On the Company’s annual return both directors’ addresses were the same as the company’s registered office. When a private detective instructed by the claimant went to those premises he found a woman claiming to be Barry Ejiofor Omesuh’s mother and a man claiming to be his brother Dilibe. Both failed to identify a photograph of the defendant as Barry Omesuh and the woman showed the investigator a photograph of a different man. The defendant says that he has no brother.[6]Until the 11th March last the claimant believed that the defendant and the Barry Omesuh at the Stratford address were one and the same. As a result of what was then said, and its own investigations, the claimant currently accepts that there is another Barry Ejiofor Omesuh in the United Kingdom and that the Barry Ejiofor Omesuh who is a director of Barroski Ltd is not the defendant. Chronology in relation to this Committal Application[7]On 10th March 2008 the claimant issued proceedings against the defendant for trade mark infringement and passing off in relation to the claimant’s intellectual property rights. Particulars of claim served on 27th March 2008 rely on alleged parallel importation and volume licensing fraud. Previous infringement proceedings were brought by the claimant some four years earlier against the defendant and his company ITAC (UK) Limited to which I shall refer as ITAC. Those earlier proceedings were stayed on agreed terms including undertakings by the defendant. In the current action the claimant asserts that notwithstanding those undertakings the defendant has continued to infringe the claimant’s intellectual property rights.[8]On 5th March 2008, before issue of the proceedings, the claimant applied to the Court without notice to the defendant for freezing and search orders.[9]The claimant, suspecting the defendant of trademark infringement, had hired a private investigator to keep the defendant under surveillance. On 3rd March 2008 there was an order for administration of ITAC. On the following day the private investigator reported from notes made at the time that he had followed the defendant to a Post Office in Manchester and overheard him speaking on his mobile phone. The report said that in one call the defendant mentioned a passport and in another he said, “Prepare to transfer a substantial amount of money fairly quickly”. At the counter he asked for mail redirection. When asked by the counter staff member when he wanted the redirection to take effect he replied, “I’m going to Africa. ASAP”. The defendant accepts that he went into the specified Post Office to ask for redirection of his mail but denies the alleged conversations. He accused the private investigator (who did not give oral evidence before me and thus was not cross-examined) of lying in order to get the result that his client, the claimant, wanted.[10]At all events, the claimant believed that the defendant was preparing to leave the United Kingdom and applied for the 5th March Orders. The private investigator made a witness statement in support of that application.[11]Mann J made the 5th March Orders and as a result a search was conducted of the defendant’s home in Middleton, Manchester on the following day, 6th March 2008. The supervising solicitor was a Mr Philip Davis who served the 5th March Orders on the defendant on entry at about 7.30 am. Thereafter, just after 8 am, Mr Jeremy Hertzog and Mr Adam Morallee of Mishcon de Reya, the claimant’s solicitors, attended the search on the claimant’s behalf. A Computer Specialist also attended but at the defendant’s request remained outside and, rather than inspect it on the premises, took the defendant’s laptop away for imaging in accordance with the 5th March Orders.[12]Evidence as to what was said and done on 6th March was given both in affidavits and witness statements and orally before me by Mr Davis, Mr Hertzog, Mr Morallee and the defendant. Also before the Court was a contemporaneous hand-written note taken by Mr Morallee of information provided by the defendant in his presence during the search. Mr Morallee said the procedure that he and Mr Hertzog adopted was to sit down with the defendant with copies of the 5th March Orders in front of them and go through the items specified in the Search Order. That procedure was not challenged in cross-examination or in the defendant’s oral evidence. He merely said that the terms of the 5th March Orders were too much for him to take in fully at that time.[13]On the following day, the claimant came to believe that, contrary to what the defendant had said during the search, he had applied for and received a passport. Accordingly the claimant applied for a Bench Warrant (issued by Etherton J) and the defendant was arrested on the evening of 7th March 2008.[14]The Application for Committal was made on 10th March 2008. On that day the defendant appeared before Evans-Lombe J and on the following day the defendant’s alleged true identity was revealed. The Judge ordered that the defendant should remain in custody until a hearing on 12th March 2008. The Judge also extended the 5th March Orders in certain respects and ordered the Passport Office to produce certain documents.[15]The claimant also came to believe that the defendant had concealed information and assets and Mr Hertzog swore a further affidavit to that effect. At the hearing before Evans-Lombe J on 12th March 2008 the defendant disclosed the password to his web-based e-mail account with btconnect. He also agreed to sign and did sign so-called Annex A letters, that is to say, letters to third parties authorising disclosure in the form annexed to the Freezing Order. The defendant was released from custody on condition that he attended at the offices of Mishcon de Reya the following morning in order to swear and serve affidavits as required by the 5th March Orders. The Judge gave permission to amend the Application Notice to include the further alleged breaches and made other directions and a further order for third party disclosure.[16]The defendant was released in the early afternoon of 12th March. He attended Mishcon de Reya’s offices in the morning on the 13th March in accordance with the Judge’s condition, although he did not then swear or serve any affidavit. An employee of Mishcon de Reya took a contemporaneous note of the proceedings at the meeting which lasted from 9.30 am to 11.10 am.[17]Following the meeting, the claimant pursued disclosure from third parties and on 17th and 26th March also obtained further disclosure from the defendant. On 31st March the defendant swore his affidavit of asset disclosure.[18]On 4th April 2008 Evans-Lombe J gave directions by consent for the Committal application.[19]On 28th April the claimant discovered that on 29th February, shortly before the ITAC administration order, the defendant had transferred a house in Middleton, Manchester into the name of his partner’s daughter. That transfer had not been disclosed.[20]On 12th June 2008 Master Moncaster ordered disclosure from ITAC by its administrators.[21]The substantive hearing of the committal application came before Sir Donald Rattee on 16th July 2008 but was adjourned on the joint application of the claimant and the defendant. The two reasons for the adjournment were, first, that Mr Philip Davis was unavailable to attend court for cross-examination on that day and, secondly, in order to enable the parties to conduct settlement talks.[22]The defendant instructed a licensed insolvency practitioner, a Mr Gordon Craig, to try to negotiate a settlement between the defendant, the claimant and the defendant’s principal creditor Barclays Bank plc but he was unable to do so. The claimant, as it was entitled to do, proceeded by way of separate action for a charging order on the defendant’s second home, the Old Piggery, Kendal, Cumbria.[23]On 23rd September 2008, and unknown to the claimant at that time, the defendant was arrested on suspicion of committing conspiracy to defraud and money laundering. In late October 2008, the claimant became aware of this when contacted by the City of London police. Detective Sergeant Jason Verrall told the claimant’s solicitors Mishcon de Reya that the defendant was engaged in an ongoing property transaction with a company called Matrix Financial Solutions (which I shall call “Matrix”) and that he had instructed privately paid solicitors, Pannone LLP, to act for him in criminal matters. Subsequently DS Verrall confirmed the information in a letter dated 17th November 2008. At first this information was provided on the basis that it was not to be used in the committal proceedings but only to forestall further breaches of the 5th March Orders. This restriction was lifted at the claimant’s request on 11th November 2008. In the meantime, the claimant made inquiries of Matrix and a new and discrete set of allegations of dissipation of assets emerged.[24]The adjourned hearing of this application came before Arnold J on 13th November 2008. That hearing too was adjourned, this time in order to permit the defendant to serve additional evidence in response to a witness statement of Mr Hertzog which had been served on that day in relation to the new information. The defendant served a short witness statement in answer on 20th November.[25]On 18th and 19th November the claimant received letters from Pannone LLP and from a corporate services company Murphy Thompson Moore LLP (which I shall call “MTM”) with further information about which Mr Morallee immediately made a witness statement.[26]At the second adjourned hearing on 25th November 2008, Sir Donald Rattee acceded to the defendant’s request for a further adjournment to answer this evidence. He made it clear that the Court would take a dim view of any further application to adjourn.[27]After the hearing the defendant took advice from solicitors, Messrs Ralli, in relation to the criminal investigation and they advised him that (I quote from a letter from the defendant’s solicitors in these proceedings):
“with the criminal investigation under way and the co-operation between your firm [i.e. Mishcon de Reya] and the investigating officers, there is a serious risk to his potential future defence in making a statement that must necessarily deal with issues that may prove germane to the investigation. In that regard we are informed that our client is due to be interviewed by the police in January 2009 and any statement made in the Contempt proceedings could undermine his rights and position in terms of that interview.”
[28]As a result of that advice, the defendant did not serve a witness statement in answer to Mr Morallee. He also maintained his right to silence under cross-examination at the hearing before me in relation to all the dissipation allegations.[29]On 13th January 2009, the first day of the effective hearing of the application to commit, Mr Walker QC made an application on the defendant’s behalf to stay the committal proceedings on the ground that to continue with the hearing would cause prejudice to the defendant in the criminal investigation. I rejected that application for the reasons I gave on that day. I also (as contemplated by Sir Donald Rattee at the last hearing and without objection from the defendant) gave permission to the claimant to amend the application notice to add the new allegations of dissipation.[30]After that somewhat lengthy history of this application, I now turn to the application itself. Alleged breaches of the 5th March Orders[31]The claimant relies upon breaches of the following provisions of the 5th March Orders:(1) Paragraph 8 (1) of the Freezing Order which ordered disclosure of the defendant’s worldwide assets.(2) Paragraph 9 of the Freezing Order which ordered the defendant to swear and serve an affidavit dealing with the defendant’s worldwide assets.(3) Paragraphs 10J and 10K of the Freezing Order which ordered the defendant to write so-called Annex A letters (that is to say letters of authority in a specified form annexed to the Order) to third parties to request documents relating to his assets.(4) Paragraph 10L of the Freezing Order ordering the defendant to deliver up any current passports belonging to or controlled by him.(5) Paragraph 18 of the Search Order ordering the defendant to disclose any e-mail account used by him in which any Listed Item (as defined in Schedule B to the Order) might be found.(6) Paragraph 4 of the Freezing Order prohibiting the defendant from disposing or dealing with any of his assets up to the value of £2.5m.[32]The matters relied on as constituting breaches fall into two groups: acts of the defendant that occurred in March 2008, in immediate disobedience to the 5th March Orders, and later dissipation of assets I propose to deal with each in turn. OCRA companies (non-disclosure: paragraph 8(1) of the Freezing Order)[33]It is claimed that in breach of paragraph 8(1) of the Freezing Order the defendant failed to disclose a network of offshore companies and associated bank accounts which had been set up for him by the Swiss Branch (OCRA Switzerland Sarl) of the corporate services provider OCRA Worldwide. Those companies (to which I shall refer as “the OCRA companies”) and bank accounts (to which I shall refer compendiously with the OCRA companies as “the OCRA assets”) are as follows:• Proteas International Limited (“Proteas”) (incorporated in the Republic of the Marshall Islands)• Carnegie Foundation (“Carnegie”) (a private interest foundation incorporated in the Republic of Panama)• Specified bank accounts for Carnegie at FMBE Bank, Nicosia, Cyprus• Rotos Investments Management Limited (“Rotos”) (incorporated in the Republic of the Seychelles)• Specified bank accounts held in the name of Rotos at the Bank of Cyprus, Nicosia• Demoines International LLC (“Demoines”) (incorporated in the state of New York)• Specified bank accounts held in the name of Demoines.[34]The defendant accepted in cross-examination that he is the beneficial owner of all four of the OCRA companies and that he is the sole signatory on all the bank accounts. It is therefore accepted that, subject to the question of construction of the Freezing Order and the question of value, he was required to disclose all the OCRA assets. The defendant admitted that he did not initially make disclosure of the existence of the OCRA companies or of their bank accounts. Construction of paragraph 8(1) of the freezing order[35]The defendant’s first line of defence was to submit that paragraph 8 (1) of the Freezing Order is ambiguous in relation to bank accounts so that objectively it was not clear what the defendant had to do to comply with it. I shall deal with that issue as a discrete matter.[36]Paragraph 8 (1) required the defendant to inform the claimant’s solicitors:
“of all details of his assets worldwide exceeding £1,000 in value whether in his own name or not and whether solely or jointly owned, giving the value, location and details of all such assets. The terms assets and details of assets shall have the meanings set out below. For the avoidance of doubt, a bank account shall count as an asset whether it has a positive, zero or negative balance.”
By paragraph 15A the term “assets” is defined. By subparagraph (g) it includes: “(g) any bank account (whether in the name of the Respondent or not and irrespective of whether its balance is zero, positive or negative) and in respect of which the Respondent is an authorised signatory or in respect of which the Respondent is a signatory on the mandate or in respect of which the signatory habitually obeys the instruction of the Respondent or over which the Respondent exercises de facto control”.[37]Thus a bank account is an asset even if it has a zero or negative balance, but the Order only requires disclosure of assets exceeding £1,000 in value. So any bank account is an asset in strict drafting terms but an asset is only disclosable if it is worth more than £1,000. However in my judgment it is plain beyond argument that a bank account has to be disclosed whether or not it exceeds £1,000 in value. That is evidently the case or the specific provisions about zero or negative balances would be meaningless. The words “For the avoidance of doubt” in paragraph 8(1) emphasise that all bank accounts, whatever their balance, must be disclosed. I do not see any ambiguity or room for misunderstanding on the defendant’s part about what he was required to disclose. Value[38]Secondly, the defendant asserts that the OCRA companies did not have to be disclosed because each was merely a shell company worth less than £1,000.[39]Thirdly, he says that the reason he did not disclose the bank accounts was because they were not yet activated, no deposits having been made, and thus had no value. Whatever the Freezing Order in fact meant, he believed that it only required him to disclose bank accounts with a balance of more than £1,000. He prayed in aid the complexity of the 5th March Orders and the stress caused by the collapse of ITAC and by the search itself, saying that he only read and took in the first part of paragraph 8(1) of the Freezing Order. In other words, any breach was unintentional.[40]Mr Walker QC submitted on the defendant’s behalf that although there had been breaches, they should not be regarded as serious ones. He repeated his instructions that the breaches as to the bank accounts were not intentional and that the OCRA assets were of little value. However the principal ground for the submission was that there was no damage suffered as a result of the initial non-disclosure. The claimant found out about the assets quite quickly and, he further submitted, the court could not be sure what would have happened if Mishcon de Reya had not made their own enquiries. He suggested that it was quite possible that, after the defendant’s initial shock and stress had worn off, and he had taken advice from his solicitors, he would have made full and proper disclosure.[41]In order to evaluate these submissions, I must set out the history of the defendant’s reaction to the Freezing Order.[42]First, when answering questions during the search about his assets and bank accounts, the defendant said nothing about offshore companies. He admitted as much in evidence. Even now, the defendant has chosen not to produce a full set of documentation or any detailed information about the OCRA assets. Indeed it was only under cross-examination at this hearing that he finally admitted that he was the beneficial owner of the OCRA companies.[43]Secondly, the computer specialist produced an image taken from the defendant’s laptop of an e-mail to the defendant dated 29th February 2008 from a Ms Fatima Lajnef of OCRA Switzerland. That email named Proteas, Carnegie, Rotas and Demoines.[44]At the hearing before Evans-Lombe J on 12th March 2008, the defendant agreed to, and did, sign the Annex A letters, including a letter addressed to OCRA Switzerland. Even then, however, when the defendant knew that he needed to cooperate in order to obtain his release from custody, the signature he appended to the Annex A letters was manifestly different from that on other documents before the Court. In evidence the defendant said that he signed the Annex A letters with the same type of signature that he uses for cheques. However, in the light of subsequent events, it is the inescapable conclusion that the defendant deliberately employed a signature on the Annex A letter to OCRA which he hoped would not be recognised as authentic.[45]At the meeting at Mishcon de Reya on 13th March 2008 the defendant was taken item by item through the e-mail from Ms Lajnef. Notwithstanding that he had just been released from custody on condition that he would attend the meeting for the purposes of disclosure by affidavit, the defendant made the following claims:-• He did not know Ms Lajnef.• The e-mail from her was spam and a spoof.• He had never heard of the OCRA companies.• He had had nothing to do with OCRA since October 2007.• Money paid to OCRA in October 2007 was money paid to it as trustee to hold moneys due to an unnamed Chinese supplier in respect of certain intellectual property.[46]On the same morning, OCRA’s lawyer Mr Daultrey spoke to Mr Morallee and told him that copies of documents were being prepared for disclosure. However, that afternoon, Mr Daultrey rang to say that the defendant had contacted Mr Corbi of OCRA Switzerland and instructed him not to release any documents. It was subsequently confirmed in a witness statement from Mr Dixon, the Chief Executive of OCRA London, that the defendant had telephoned Mr Corbi on the evening of 12th March (that is to say only a few hours after his release from custody) and told him not to provide the information. In addition, Mr Corbi was concerned about the discrepancy between the signature on the Annex A letter and that held by OCRA on file.[47]The defendant now accepts that what he said at the meeting on 13th March about the OCRA assets was untrue, and has apologised to the Court. He said that he was under great stress on that day. Not only had he just been released from custody but his partner had been rushed into intensive care and was dangerously ill. In addition his company ITAC had recently been put into administration and a Search Order had been carried out at his home.[48]I note that the defendant did not ask Mishcon de Reya to be released so that he could visit his partner in hospital. Further, his story about the Chinese supplier was not merely, as he asserted, misleading, but a total and elaborate fiction.[49]Eventually, on 17th March, the defendant’s solicitors provided disclosure of 77 pages of company documents about the OCRA assets. These enabled the claimant to obtain further information from FBME Bank in Cyprus.[50]In the witness box the defendant admitted that he called Mr Corbi on the evening of 12th March. However he insisted that the purpose of the call was merely to instruct Mr Corbi to send information in accordance with the Annex A letter. I accept the evidence from Mr Daultrey and Mr Dixon to the effect that, on the contrary, the defendant countermanded the Annex A letter. Although the defendant objected to that evidence on the ground that it is hearsay it is admissible and in the context of the defendant’s lies I attach weight to it. There is no reason why Mr Corbi or Mr Dixon should lie and no grounds for mistake.[51]By contrast, the defendant continued to lie about his contact with OCRA. In an affidavit dated as late as 20th June 2008 he continued to maintain(i) that the e-mail from Ms Lajnef had been unsolicited spam and(ii) that he had not had any dealings with OCRA since October 2007 save an instruction to disclose documents and a complaint about the alleged spam. At the beginning of his evidence at this hearing the defendant confirmed the truth of that affidavit which therefore formed part of his evidence in chief to the court for the purposes of this hearing.[52]An itemised phone bill was put to the defendant in cross-examination showing incontrovertibly that in the relevant period he had made several phone calls to OCRA, to the Bank of Cyprus, where bank accounts were held by OCRA companies, and to numbers in Panama City, where Carnegie was registered. He gave no plausible explanation for these calls but he continued to maintain that he had had no dealings with the OCRA assets, that they were of minimal value and none of the bank accounts in Cyprus had been activated. He still has not produced any information to confirm his allegation that the OCRA assets are each worth less than £1,000.[53]In all these circumstances I have no doubt at all that the defendant’s failure to disclose the OCRA assets and his lies at the meeting of 13th March were a deliberate exercise in asset concealment.[54]Such documentary evidence as there is supports the case that the OCRA assets are of substantial value. The defendant paid at least $US12,000 to incorporate the OCRA companies. The patrimony (paid up capital) of Carnegie (a company wholly owned by Proteas) is $US 10,000. In his applications for bank accounts the defendant represented that both Carnegie and Demoines were trading entities with an actual or expected annual turnover of $US 20,000.[55]At the end of February 2008 the defendant’s telephone records show that he spoke to the Bank of Cyprus for 25 minutes which does not suggest that the bank accounts had not been activated. Some few months later, substantial assets surfaced in companies set up by the defendant through MTM. There is also one document which specifically links the OCRA companies with those later companies. Papers supplied by Matrix show a HSBC statement in the name of one of the nominee directors of Sphere Global Properties Limited, a company associated with the defendant to which I shall refer later in this judgement. At the bottom is a stamp from an office in Nicosia, Cyprus, where the OCRA companies had 10 bank accounts. The evidence indicating a possible link between the OCRA companies and the asset-rich companies set up by MTM is very far from adequate by itself to establish that the OCRA companies were of substantial value, but it affords some additional support for the rest of the evidence adduced by the claimant about value.[56]I am satisfied beyond reasonable doubt that the OCRA companies were all worth more than £1,000. This is evident from the defendant’s elaborate persistent and continued attempts at concealment, coupled with the documentary evidence referred to above as to value. There is some small support also from other circumstantial evidence. Although the defendant was liable to disclose the bank accounts whatever the balances I am satisfied, for similar reasons, that they too had balances of more than the threshold amount. The defendant insisted that the accounts had not been activated and were never used, but that was mere assertion and is contrary to the weight of what I regard as overwhelming contrary evidence.[57]I therefore unhesitatingly reject the defendant’s defences to the allegations of breaches in respect of the OCRA assets. I equally unhesitatingly reject Mr Walker’s submissions that the breaches were neither intentional nor serious and that I cannot be sure that the defendant would not have made full disclosure if the claimant had not been diligent in finding out about the OCRA assets. On the contrary, I have no doubt that if the claimant had not made its own enquiries of OCRA the defendant would have persisted in breaching his disclosure obligations in relation to the OCRA assets. Virtually all important disclosure from the defendant in this case has only been made, and moreover made reluctantly and imperfectly, when the claimant has demonstrated that it has already discovered the assets in question. Very many of the explanations the defendant put forward to justify his conduct and his earlier lies, must themselves be rejected as untruthful. There was a pattern of disclosure only after the claimant had itself discovered the salient facts, and even then the defendant gave only such additional information as he thought he could get away with. Even where discovery was inevitable, the defendant continued to lie, and I can only infer that this was to defer disclosure to give the defendant as much time as possible to cover his tracks.[58]Since the defendant persisted in his lies after the meeting of 13th March, his apology to the Court for the “misleading statements” at that meeting is worthless. Countermanding the Annex A Letters (frustration of paragraphs 10J and 10K of the Freezing Order)[59]I am satisfied beyond a reasonable doubt that the defendant telephoned Mr Corbi to countermand the Annex A letter to OCRA with the deliberate intention of concealing the OCRA assets. This follows from what I have already said about the evidence, including the defendant’s lack of credibility and his use of an uncharacteristic signature on the letters which he signed in the presence of the claimant’s solicitors. ITAC bank account in India (Non-disclosure: Breach of paragraph 8(1) of the Freezing Order)[60]The defendant was the sole signatory of an account in the name of ITAC with ICICI Bank in West Mambalam, India. Bank statements show that substantial sums passed through the account and that at relevant times it had a balance of many thousands of pounds.[61]It is not challenged that, as Mr Morallee’s note shows, the defendant was asked during the search on 6th March 2008 whether ITAC had a bank account in any foreign country and that he replied that it had not.[62]It does not now appear to be seriously disputed that this bank account ought to have been disclosed. The excuse which the defendant proffered in evidence for not doing so was that because ITAC was in administration and thus all assets were a matter for the administrators with the effect that ITAC, strictly speaking, had no bank account. This is not a mere question of a wrong perception of the law. It is another instance of deliberate concealment. The defendant was asked a straight question about whether ITAC had a foreign bank account and he told another direct lie. The Grange Road property (Non-disclosure: Breach of paragraph 8(1) of the Freezing Order)[63]Towards the end of April 2008 the claimant discovered from ITAC’s administrators and a Land Registry Search that on 29th February 2008 the defendant had transferred an unencumbered property at Grange Road, Middleton, Manchester, to his partner’s daughter for no consideration. The fact of the transfer was required to be disclosed because the property was an asset of the defendant within paragraph 15A(j) of the Freezing Order.[64]The defendant’s case about this asset was that he did not intend to put this asset beyond the reach of his creditors and the only purpose of the transfer was as a gift to his step-daughter “to allow her a place to live”. I observe that when the claimant found out about the transfer the defendant was able to procure a re-transfer to himself for the purpose of trying to achieve a settlement with the claimant and Barclays Bank.[65]The defendant does not deny that non-disclosure of the Grange Road property was a breach of the Freezing Order. He says, again, that it was not a serious breach because the transfer was made in good faith and the breach was unintentional as he had not read and understood the detail of the 5th March Orders.[66]By 28th April 2008 the defendant had received legal advice about the 5th March Orders. He had already taken steps to conceal assets from the claimant. It is inconceivable in my judgment that he was unaware of his obligations to disclose the transfer of the property and that this non-disclosure was not another attempt to evade the Freezing Order. I therefore find not only that this was another breach but also that it was a deliberate and calculated one.[67]Mr Walker tried to make some capital of the fact that the claimant had not made serious efforts to participate in Mr Craig’s attempts to broker a settlement with the defendant. He said that the claimant’s motive was not to achieve satisfaction from the defendant but to make an example of him as a warning to potential infringers. In my judgment this argument gets the defendant nowhere in this application provided the claimant makes out its case. Failure to swear an affidavit giving details of assets (Breach of paragraph 9 of the Freezing Order)[68]The Freezing Order required the defendant to swear an affidavit providing prescribed information about his assets within 3 working days of service. Thus the affidavit ought to have been sworn by 11th March 2008. The defendant was however in custody from the evening of the 9th March until the early afternoon of the 12th March and unable to comply. Evans-Lombe J’s Order of 12th March 2008 contained the following provision:
“The Defendant is released from custody on condition that he attend the offices of Mishcon de Reya…by no later than 9.30 am on 13 March 2008 in order to prepare swear and serve the Affidavits required by the Freezing Order and Search Order made in this action. If the Defendant does not attend at Mishcon de Reya by 9.30 am or otherwise fails to comply with this condition, the Claimant has permission to apply without notice to Evans-Lombe J for a further bench warrant against the Defendant.”
[69]The defendant did attend but did not swear the affidavit. The claimant did not apply for a further bench warrant. The defendant finally swore an affidavit on 31st March. I have no doubt that the defendant deliberately put off the task of swearing the affidavit as part of his scheme to conceal assets. It is very likely indeed that he wanted to defer being pinned down in writing (and going on oath) about his assets for as long as possible.[70]However, I bear in mind that the strict terms of the 5th March Orders were frustrated by the claimant’s action in securing the imprisonment of the defendant. Evans-Lombe J’s Order of 12th March did not extend the time for compliance. Nor did it directly order the defendant to swear the affidavit on the 13th March. Although swearing the affidavit could be said to have been a condition of the defendant’s release from custody the remedy for non-compliance was stated to be an application for return to custody pending the committal hearing. In those circumstances I believe that the defendant is entitled to the benefit of the doubt and I make no finding of contempt under this head. Failure to deliver up the defendant’s passport: (Breach of paragraph 10L of the Freezing Order)[71]Much of the evidence was taken up with this issue, and on any basis the tale is an extraordinary one.[72]The following facts are now common ground. First, the defendant had held a British passport in the name Barry Ejiofor Omesuh which was issued on 4th March 1988. That passport would have expired 10 years thereafter. Secondly, a new passport was issued in the same name and specifying the same birth date on 4th March 2008. It was collected in person from the Passport Office in London on the same day by a man claiming to be the holder, Barry Ejiofor Omesuh. Thirdly, the Passport Office’s fast track procedure used on that occasion required the production of an existing passport. Fourthly, if the defendant had a current passport at the time of the search he would have been obliged to deliver it up and that obligation extended to passports in the hands of a third party.[73]What was said on the occasion of the search is not however common ground. I should make it clear that wherever the defendant’s evidence conflicts with that of Mr Hertzog, Mr Morallee and Mr Davis, I unhesitatingly accept their version of events. Their evidence is coherent, cohesive and corroborated by others. It is consistent with the documentation. They had no reason to lie or exaggerate their version of events (as at one point in his oral evidence the defendant seemed to be alleging in relation to Mr Hertzog and Mr Morallee) and there is no evidence whatsoever that they did so. By contrast, as I have already said, the defendant was a wholly unreliable witness who on his own admission told a number of bare-faced lies (although he preferred to describe them as “misleading statements”) about relevant matters over a period of time and in my judgment persistently told other lies which he has not admitted.[74]Mr Davis’s evidence is contained in his Report and affidavit made shortly after the event. He says that at the beginning of the search, before the entry of Mr Hertzog and Mr Morallee, the defendant said in answer to a request for his passport, “It’s with the Passport Office”. Mr Davis’s evidence about that statement was not challenged in cross-examination. Indeed Mr Davis’s evidence was hardly challenged at all.[75]I quote from Mr Davis’s affidavit as to what happened next, shortly after 8.02 am when Mr Hertzog and Mr Morallee gained entry to the premises:
“… Mr Hertzog enquired of me as to the location of Mr Omesuh’s passports. I told him, in the presence of Mr Omesuh, that I had been told earlier that he did not have a passport. Mr Omesuh then told Mr Hertzog that he had lost his passport one or two years ago, that an application was now with the passport office but that he had done nothing further about it.”
When reporting on events at 10.45 am, Mr Davis went on to say, “Mr Omesuh sat at the table in the kitchen of the premises along with Mr Hertzog and Mr Morallee to take Mr Omesuh through the disclosures which were required to be given by him pursuant to the Search Order and the Freezing order. I was also present throughout this time. When the question of the passports was raised, Mr Omesuh said that he did not have a passport. He said that he had lost his passport 1 or 2 years ago and had reported it missing to the Police and the Passport office. A few minutes later, when pressed further by Mr Hertzog who said that he wanted Mr Omesuh to be absolutely clear on this, Mr Omesuh then said that he filled out the application form for a new passport but had not sent it off. He was therefore not expecting anything to be sent to him by the Passport Office. He said that he swore to this ‘on his mother’s life’.” Mr Hertzog’s evidence, also sworn the day after the search, was as follows:
“On entering the premises I was informed by the Supervising Solicitor that the Respondent did not have a passport. I asked the Respondent why he did not have a passport. He told me that he lost it about 1 or 2 years ago and that the application was with the Passport Office but they were ‘doing nothing about it’… At around 10.45 am I sat down with the Respondent, Supervising Solicitor and Adam Morallee and took the Respondent to the relevant parts of the Search and freezing Orders that required him to give disclosure. When we reached paragraph 10L of the freezing Order, I asked the Respondent again if he had a passport. He said no. I again asked why. He provided the following explanation, which was inconsistent with his earlier explanation: (i) The passport had been lost 1 or 2 years ago and the loss had been reported to both the Police and the Passport Office. He had not travelled abroad since he lost the passport.” (ii) He had never had possession of any other passport either before or after that date. In particular he had never had a Nigerian passport. (iii) After losing the passport, he had filled in a form for a new passport but had never sent it to the UK Passport Office. I asked him again if there was any current application with the Passport Office and whether or not he was expecting to receive a Passport. He said no. I reminded him that we were in the process of contacting the Passport office and that it would be easy to check if he were telling the truth or not. I told him this was a very important question. I asked him to think carefully about the answer and reminded him that a failure to comply with this paragraph of the Freezing order would amount to a contempt of Court. He responded by saying ‘I have no passport. I have not made a passport application and I am not expecting anything to be sent to me. I promise on my mother’s life.’”
[76]Mr Morallee confirmed Mr Hertzog’s evidence in a short affidavit. The handwritten note which he took during the search also bears it out on the salient points.[77]I accept the evidence from Mr Davis, Mr Hertzog and Mr Morallee that on the day of the search the defendant gave a number of explanations about his passport, some of them inconsistent with each other, namely:(i) the passport was with the Passport Office,(ii) the passport had been lost 1 or 2 years ago and an application for a new one was with the Passport Office but they were being dilatory,(iii) the passport had been lost 1 or 2 years ago and the loss had been reported to the police and the Passport Office,(iv) after losing the passport he had filled in a form for a new one but had never sent it in,(v) there was no current application for a passport,(vi) the defendant had no passport, had made no application for one and was not expecting a passport to be sent to him.[78]Later the same day Mishcon de Reya heard from the Passport Office that a Mr Barry Ejiofor Omesuh had collected a passport in person from the Passport Office on 4th March 2008. As the claimant knew, the person collecting the passport could not have been the defendant, as he was under surveillance in Manchester on that day. However, at that stage believing that there was only one Barry Omesuh, the claimant inferred that the defendant’s assumed brother had collected the passport in his name. Mr Davis had another conversation with the defendant, who persisted in his account that he had no passport and had not applied for one.[79]The defendant’s account of what was said at the search appeared in his third affidavit sworn on 20th June 2008. He said:
“I did not hold a passport. I do not recall the suggestion that the passport had been lost. The reason that I no longer hold a passport is that it had expired in 1998 and I have never made any application to renew it. I do not recall informing the Claimant’s representatives that I had filled in an application form for a passport but that I neglected to submit it. I confirm that I have made no application for a passport since the expiry of my last passport in 1998.”
[80]Thus the defendant did not in terms deny the conversations deposed to by the claimant’s witnesses; he merely said that he did not recall them. His formal response to the committal application, also dated 20th June 2008 and signed by his solicitors, is even more guarded. It reads:
“The defendant did not lie about his passport with an intent to deceive the claimant or to frustrate the Freezing order or at all. If asked had he a passport the defendant would have responded ‘no’ and declared that he had no intention to travel.”
[81]In oral evidence the defendant maintained the assertion that he could not recall making the answers that he is said to have made. He also said several times that if asked if he had a passport he should merely have replied ‘no’.[82]In all the above circumstances I am sure that the claimant’s witnesses’ evidence about what the defendant said on 6th March 2008 was true.[83]Mr Walker QC accepted that there were difficulties with the defendant’s account of what was said on 6th March. However, Mr Walker pressed me to recognise that, if I were to find that the defendant told lies on that day, it was not an inevitable inference that he had a passport and that he was seeking to conceal the fact. Mr Walker in effect reminded me of the Lucas direction made to the jury in criminal cases, namely:
“The mere fact that a defendant tells a lie is not in itself evidence of guilt. A defendant may lie for many reasons, and they may possibly be 'innocent' ones in the sense that they do not denote guilt, for example, lies to bolster a true defence, to protect somebody else, to conceal some disgraceful conduct other than the commission of the offence, or out of panic, distress or confusion. ”
[84]Mr Walker put forward a possible explanation for the defendant’s unsatisfactory account on the day of the search. He submitted that what the defendant may have been trying to conceal was his real identity, the history of his flight from Nigeria and his recent application to the Home Office, about all of which he was very sensitive. There is a clue to this, submitted Mr Walker, in the fact that the defendant apparently lied by saying that he had never had a Nigerian passport, whereas the Home Office application shows that he had had one in the past in his real name. Mr Walker also drew attention to the fact that the search procedure was itself a very stressful event which could well have caused panic, distress and confusion for the defendant.[85]I therefore approach all the evidence about the passport with these possible explanations in mind.[86]There is no direct evidence that the passport collected on 4th March 2008 was the defendant’s passport. However, there is strong circumstantial evidence. I start my analysis of the evidence with the knowledge that the defendant’s company ITAC had gone into administration on 3rd March and that he was being pursued by Barclays Bank. I add to that the fact that the defendant accepts that he redirected his mail on 4th March. There is also the evidence of the private investigator in Manchester, although I attach little weight to that where his evidence is disputed because he was not subjected to cross-examination. On the 6th March the defendant made a number of inconsistent statements, one of which was that he had lost his passport “1 or 2 years ago”. That would be an odd lie to tell if he was merely intending to conceal the fact of his identity. Why not just say that he had no passport? The defendant was acknowledging that he did at some stage have a passport in the period March 1998 to March 2008. I add to all that the series of lies that the defendant told then, and continued to tell, about his assets.[87]That evidence must be added to a consideration of what might have actually happened if the defendant’s story were true. I would have to accept as a possibility that another, wholly unconnected Barry Ejiofor Omesuh with the same date of birth as that assumed by the defendant (let us say for the sake of argument, the ‘real’ Barry Omesuh), had applied for a passport in 1998 to run from exactly the same time as the defendant’s 1988 passport had expired. That other Barry Omesuh would have applied for another passport again exactly 10 years later at a time when the claimant had some reason to suspect that the defendant wanted to leave the country. Incidentally the Passport Office has confirmed that the passport issued on 4th March 2008 has been cancelled, indicating perhaps (although this may be illegitimate supposition) that the Passport Office also took the view that there was only one Barry Ejiofor Omesuh with the relevant date of birth.[88]I am permitted to come to commonsense conclusions on the basis of strong circumstantial evidence. I have no reasonable doubt that the passport collected on 4th March was collected on the defendant’s behalf with his knowledge and on his instructions. The coincidences that the defendant’s version of events necessitates are too far-fetched to be credible, particularly when set against all the other circumstantial evidence to which I have adverted.[89]I therefore find this head of contempt has also been made out. E-mail account and password: Breach of paragraph 18 of the Search order[90]It is common ground that the Search order required the defendant to give access to all his e-mail accounts with their passwords. It is also common ground that at the start of the search on 6th March the defendant handed his laptop to the computer expert and gave him the password to unlock the operating system. What the claimant’s witnesses say, however, is that the defendant did not tell them that he had a web-based e-mail account, easther2229@hotmail.com, nor did he give them the password to it.[91]The defendant’s account changed when he gave oral evidence. His original version of events (in his formal response and affidavit of 20th June 2008) and the basis upon which Mr Walker QC apparently had his instructions to cross-examine Mr Morallee, was as follows. The defendant said that all his e-mail to his web-based address was automatically forwarded to his e-mail account (barry 2229) with Microsoft Outlook. When he logged on to his laptop Microsoft Outlook could be opened without the webmail password. Accordingly, in giving the computer expert the password to open his laptop he automatically gave access to the contents of his web-based e-mail account.[92]However, in oral evidence the defendant said not only that he had afforded access to his e-mails because they were forwarded to Outlook, but that he had, during the search itself, given details of the web-based account and its password. That allegation is contrary to the evidence of Mr Hertzog and Mr Morallee. If it were true, it sits oddly with the fact that at Court on 12th March the defendant furnished his password to the web-based account. By then the claimant had discovered the web-based account because the computer imaging permitted by the Search Order had revealed the e-mail from Ms Lajnef. Most important of all, the assertion that the defendant had given the name of the account and associated password is inconsistent with the statements in the documents of 20th June to the effect that the web-based account was not deliberately withheld.[93]The claimant’s case is that the distinction between the Outlook account and the web-based account was crucial, notwithstanding any automatic e-mail forwarding, because the Search Order only gave the computer expert the power to perform the imaging exercise, not to go into the defendant’s Outlook mailbox. If the laptop had been opened on site during the search, the position might have been different, but once Mr Davis had acceded to the defendant’s request for the expert to take the laptop away for imaging there could be no access to Outlook without the express authority of the defendant or a further order of the Court. If however the defendant had given his web-based address and password, Mr Morallee could have obtained immediate remote access to the e-mails.[94]This in turn was important, says the claimant, because, by the time that the password was given on 12th March, all the e-mails had been deleted from the web account. The defendant gave a consistent answer to this, supported by some literature about the Outlook software. He said that when in default mode, e-mails were automatically and permanently deleted from the webmail account and the server once they had been forwarded to and downloaded from Outlook. Thus, said the defendant, there was no deliberate deletion; the e-mails were deleted automatically as soon as someone logged on to the laptop and Outlook connected with, and downloaded the e-mails from, the server.[95]Under cross-examination the defendant accepted that it was necessary to log on to the laptop for the download and thus the deletion to occur. The defendant’s evidence therefore provides a plausible explanation for the deletion of e-mails up to the time on the 6th March when the computer expert logged on to the laptop’s operating system. What it does not explain is why there were no e-mails on the server or in the btconnect account when Mr Morallee opened the mailbox on the 12th March. His evidence was that the btconnect mailbox was full of spam, which arrived that day, but that there were no incoming e-mails of any kind prior to the 12th March. The defendant did not have access to his laptop between the 6th and 12th March. It is the logical conclusion from this evidence, which I accept, that the defendant must have caused all e-mail in the account to be deleted during that period. It is true that he was in custody until the afternoon of 12th March, but, as Mr Hunter submitted on behalf of the defendant, he could still have arranged to effect the deletion by telephone or through a third person. This is the only plausible explanation for the empty mailbox on the 12th March.[96]I reject the defendant’s evidence that he told the claimant about the btconnect e-mail account and furnished the password on 6th March. I have no doubt that he did not. For the above reasons it is my judgment that this breach of the Search Order was, again, a calculated one. The defendant’s intention was to delay the claimant’s access to his e-mail and to cover his tracks as far as possible. The new allegations: dissipation of assets in breach of paragraph 4 of the Freezing Order.[97]Paragraph 4 (2) of the Freezing Order prohibits the defendant from disposing of, dealing with, or diminishing the value of any of his assets wherever situate up to the value of £2.5m. Paragraph 5 provides:
“Paragraph 4 applies to all the Respondent’s assets whether or not they are in his own name and whether they are solely or jointly owned. For the purpose of this order the Respondent’s assets include any asset which he has the power, directly or indirectly, to dispose of or deal with as if it were his own. The Respondent is to be regarded as having such power if a third party holds or controls the asset in accordance with his direct or indirect instructions. The term ‘assets’ shall include the items set out in paragraph 15A below.”
The paragraph 15A definition of assets includes: (a) any proprietary interest in any company or corporate body whether held by way of shares, loan notes, bearer shares or otherwise; (b) any right whether contractual or under a trust or otherwise to receive or be paid money or property, whether unconditional or contingent or present or future; (d) any right or power to deal with any property, whether through nominees, power of attorney, or by instructing another person who habitually obeys instructions; (e) any property held by or in the name of a third party or company who habitually obeys the Respondent’s instructions in relation to dealings with such property; (g) any bank account (whether in the name of the Respondent or not and irrespective of whether its balance is zero, positive or negative) and in respect of which the Respondent is an authorised signatory or in respect of which the Respondent is a signatory on the mandate or in respect of which the signatory habitually obeys the instructions of a [sic] respondent or over which the Respondent exercises de facto control; (i) any asset held by or in the name of or under the control of any [sic] respondent even if he claims that he is not beneficially entitled to such asset”.[98]In short, the order prohibits the defendant from dealings with any assets which he has the power to deal with directly or indirectly as if they were his own and any assets held or controlled by third parties who habitually act in accordance with his instructions with regard to those assets. The order prevents him dealing with any such assets even though the question of ultimate beneficial ownership has yet to be determined.[99]Mr Morallee has made a witness statement on 21st November 2008 about the provenance of documents supporting the dissipation claim. As a result of the information received from the police to which I have already referred, Mr Morallee wrote to MTM and to Pannone LLP enclosing a copy of the Freezing Order.[100]On 17th October 2008 Pannone LLP confirmed that they were acting for the defendant, but stated that their fees in that regard were being paid not by the defendant but by a “third party benefactor”. In a letter of 18th November Pannone LLP said that they no longer acted for the defendant but identified the third party funder as Sphere Global Properties Limited (“Sphere Global”). On 17th November DS Verrall had sent Mr Morallee a copy of a letter dated 30th October 2008 from Pannone LLP in which Pannone LLP disclosed to the police that they held money in their client account from Sphere Global to pay for funding for Mr Omesuh and another individual or individuals (whose names have been redacted from the letter) and also for a company called Information Technologies and Investments Limited (“ITIL”) “in respect of your recent investigation”.[101]I do not accept Mr Walker’s submission that it is insufficiently clear from the letter of 30th October 2008 that the defendant was one of the individuals whose fees were being defrayed by Sphere Global. Even if there were room for any doubt on the construction of that letter, it would be dispelled by the letters from Pannone LLP to Mishcon de Reya of 17th and 18th November.[102]A Mr Stephen Thompson of MTM replied to Mr Morallee’s letter to MTM on 19th November 2008. His letter says that in early June of that year MTM had agreed at the defendant’s request to provide nominee director services in relation to a number of companies, including Sphere Global and ITIL. The beneficial owner of both companies was said in the letter to be one Aaron (elsewhere called Arron) Tatlow. The letter from MTM enclosed a clip of documents (“the MTM documents”) about MTM’s services in relation to Sphere Global and ITIL.[103]Those documents show the following:(i) The covering letter from Mr Thompson states that the defendant gave MTM all instructions in relation to its corporate services.(ii) An e-mail from the defendant to MTM provided the names of the persons selected by the defendant to be the nominee directors of Sphere Global and ITIL.(iii) There is a letter from the defendant to Mr Thompson demonstrating that the defendant was the person with whom MTM communicated on all corporate matters, including the opening of bank accounts.(iv) There are two e-mails of 2nd October 2008 showing that the defendant, through his secretary, Linda O’Connell, instructed the nominee directors of Sphere Global and ITIL to issue letters of authorisation. I do not accept Mr Walker’s submission that it is unclear on whose instruction the letters of authority were issued. Further, it is evident from these e-mails that the nominee directors habitually obeyed instructions from the defendant.(v) The authorisation letter from ITIL (issued at the defendant’s direction) expressly conferred control over ITIL’s affairs on the defendant.(vi) The authorisation letter from Sphere Global (issued at the defendant’s direction) expressly confirmed that it would pay the professional and legal bills of ITIL.(vii) Evidence in the form of emails that ITIL transferred money to Pannone LLP on the defendant’s direction as consideration for his purchase of the assets of his former company Global Security One Limited from the administrators.[104]Turning to dissipation, Pannone LLP has confirmed to the police that Pannone LLP received £50,000 from Sphere Global for the legal expenses of the defendant, another individual or individuals and ITIL. The MTM documents show that the sum of £21,602 was in fact paid by telegraphic transfer by ITIL for the purchase of assets by the defendant for his own benefit.[105]I do not accept Mr Walker’s submission that there is a gap in the paper trail as to who was the purchaser of the assets of Global Security One Limited. An e-mail from Sonio Singh at Pannone LLP sent on 12th September 2008 establishes beyond doubt that it was the defendant.[106]There is separate evidence of dissipation in relation to a bank account held by ITIL with ICICI Bank. Mr Morallee’s witness statement shows that after the Freezing Order was served on that Bank, there was an exchange of e-mails with Mr Manoj Masuria, the Manager of the Bank’s Financial Crime Prevention Unit, resulting in the information that the defendant was a signatory on the ITIL Bank account. ICICI Bank also provided a single page bank statement for ITIL. That statement shows that payments totalling over $US 10m were made from the account In September and October 2008.[107]It is evident from the MTM documents that during this period the defendant was the only person issuing instructions to ITIL, including instructions as to disposition of its assets. Moreover, the ITIL letter of authority in the MTM documents gave the defendant unlimited control over all ITIL’s affairs wide enough to cover all banking matters.[108]The defendant exercised his right to silence when asked questions in cross-examination on this issue. Mr Walker was unable to put any positive case for the defendant in relation to the dissipation allegations because neither he nor the defendant’s solicitors in this litigation have instructions about them. He was therefore severely constrained in the submissions he could make. However he did make two submissions in addition to those about potential gaps in the continuity of the paper trail with which I have already dealt.[109]First, he submitted that I could not be sure that the defendant had control of Sphere Global and ITIL. The only clear evidence on the face of the documents as to ownership was that the beneficial owner of both of those companies was Aaron Tatlow. On that basis it would be wrong, Mr Walker submitted, for the Court to proceed on the basis that the defendant, rather than the named beneficial owner, had ultimate control and made the ultimate decisions. In other words, I could not be sure that the defendant was not acting at the direction of Aaron Tatlow. In my judgment the issue of who is or may be the ultimate beneficial owner is not one that needs to be resolved at the freezing stage. The issue is whether the directors hold the assets in accordance with the defendant’s instructions, or habitually obey his instructions in relation to dealings with the property of the company. If they do, the assets are treated as his for the purposes of the Order.[110]Secondly, Mr Walker submitted that I cannot fairly treat the assets of Sphere Global and ITIL as the defendant’s assets when there is evidence before the Court that the police believe them to be proceeds of crime belonging to the victim of that crime. In my judgment that is irrelevant to the question of whether or not there has been a breach of the freezing order.[111]At one point Mr Walker said that to find a breach in relation to these assets “would be doing the police’s work for them”. But the role of the Court in contempt proceedings is not to investigate and punish underlying criminal offences. They perform the quite different function of ensuring that the orders of the Court are obeyed through the imposition of effective sanctions if they are not.[112]There is no reason to doubt the authenticity of any of the MTM documents or the ICICI Bank document, provided as a result of service of the Freezing Order, or indeed the truth of the matters set out in the letters from Pannone LLP. In my judgment there is ample documentary evidence demonstrating that the defendant had control over the assets of Sphere Global and ITIL such that those assets fell within the ambit of paragraph 4 of the Freezing Order.[113]There is also ample evidence that the defendant made payments from Sphere Global and ITIL for his own personal benefit and of the further very substantial payments from ITIL’s bank account (on whom the defendant was the signatory) to persons unknown.[114]Mr Hunter has asked the Court to draw an adverse inference from the defendant’s silence when asked questions about these matters, his failure to provide any exculpatory explanation and to call any evidence of his own. Mr Hunter relied on the principles set out by Brooke LJ in Wisniewski v. Central Manchester Health Authority [1998] EWCA Civ 596, namely,(1) The Court may be entitled to draw adverse inferences from the silence or absence of a witness who might be expected to have material evidence to give on a particular issue.(2) If the Court is willing to draw such inferences they may go to strengthen the evidence adduced on that issue by the other party or to weaken the evidence, if any, adduced by the party who might reasonably have been expected to call the witness.(3) There must have been some evidence adduced by the other party on the matter in question before the court is entitled to draw the desired inference: in other words, there must be a case to answer on that issue.(4) If the reason for the witness's absence or silence satisfies the court, then no such adverse inference may be drawn. If, on the other hand, there is some credible explanation given, even if it is not wholly satisfactory, the potentially detrimental effect of the silence or absence may be reduced or nullified.[115]In the present case, it does seem to me that the claimant’s case is so strong in relation to the allegations about Sphere Global and ITIL that it calls for an answer from the defendant. However, I am not satisfied that the only sensible explanation of the defendant’s silence is that he has no answer to the allegations. The reason proffered for his silence is that, on advice from the solicitors representing him in the criminal investigation, he fears that any evidence he gives may tend to incriminate him or at any rate prejudice him in that investigation. As far as I can tell from the limited information before the Court, the investigation is by no means on all fours with the present case. In those circumstances it would not be fair or proper to draw the inference.[116]However the evidence is in my judgment sufficiently persuasive as it stands. I am again satisfied beyond a reasonable doubt that there have been breaches of paragraph 4 of the Freezing Order in relation to each of the dissipation allegations. Summary[117]Each of the breaches is very serious. There has been deliberate and active concealment and attempts to prevent, or, failing that, delay discovery by the claimant of assets covered by the 5th March Orders. What is particularly serious is that even though the defendant faced ongoing committal proceedings for previous breaches of the 5th March Orders, and even though he was remanded in custody for a time, he determined to engage in a course of conduct which involved yet further serious breaches of the same orders. His disregard of the Court’s authority is thus very serious indeed. There is every reason to suppose that even now the defendant has not made full or proper disclosure.[118]I therefore find that the following allegations of contempt of court have been proved by the claimant according to the criminal standard of proof:• Breach of paragraph 8(1) of the Freezing Order by non-disclosure of the OCRA companies and their bank accounts.• Breach of paragraph 8(1) by non-disclosure of ITAC’s bank account in India.• Breach of paragraph 8(1) by non-disclosure of the defendant’s former property at Grange Road Middleton. I should add that this property is not mentioned by name in the Application Notice. However the supporting affidavit specifies and particularises non-disclosure of it as one of the breaches of paragraph 8(1) relied upon. Mr Walker does not object to its inclusion; the defendant accepts that he has at all times been aware of the inclusion of the allegation.• Breach of paragraphs 10J and K of the Freezing Order by countermanding the Annex A letter to OCRA.• Breach of paragraph 10L of the Freezing Order by failing to deliver up the defendant’s passport and making false statements in order to frustrate the passport provisions.• Breach of paragraph 18 of the Search Order by failing to disclose an email address and password and by deleting some of th e-mails from that account.• Breach of paragraph 4 of the Freezing order by dissipating assets of Sphere Global.• Breach of paragraph 4 of the freezing Order by dissipating assets of ITIL.