Fraudsters like moving things around: their money, their assets and even themselves, because it helps them to become judgment proof. If a victim of fraud wants to obtain an order compelling a fraudster to provide information or documentation, but the fraudster might flee the country so that the order cannot be enforced, what can a victim do?
The answer is to apply for a 'passport order', forcing the fraudster to hand over their passport and travel documents. Whilst this undoubtedly impacts on the fraudster's human rights, the English courts will do whatever is necessary to ensure that its orders are complied with.
Passport orders are typically sought as ancillary orders to freezing injunctions. Most are granted so as to enable effective disclosure to be given, however they can also be used after judgment when seeking information as to a judgment debtor's assets.
Lakatamia Shipping Company Ltd v Su contains a helpful overview of passport orders by the Court of Appeal. Amongst other things, the court said that the interference with liberty under a passport order must be for no longer than is necessary to achieve the purpose for which it was granted, and that order cannot be used as a means of enforcing judgments by requiring a person to remain within the jurisdiction until the judgment debt is paid. In Lakatamia Shipping, the passport was order was granted until the judgment debtor had attended a court hearing to give information as to his assets, under Civil Procedure Rule Part 71.
Passport orders are a useful litigation tool as there is always a risk that fraudsters will flee the country to frustrate court orders. From a practical perceptive, they also ensure any court documents can be served easily, since the fraudster will be in England. Not only that, the consequences of non-compliance are serious: in the case of Palmer v Tsai, Mr Tsai was sentenced to 15 months’ imprisonment for breaching a passport order. So, in summary, whilst passport orders are difficult to obtain, they can be extremely effective weapons in the fight against fraud.
Other articles in this series:
- Catching fraudsters: little-known litigation tricks (Part 1) - Burner phones and the pursuit of stolen money
- Catching fraudsters: little-known litigation tricks (Part 2) - Finding fraudsters' hidden property
- Catching fraudsters: little-known litigation tricks (Part 3) - Secret Service rule: No time to hide
- Catching fraudsters: little-known litigation tricks (Part 4) - Obtaining evidence from overseas banks
- Catching fraudsters: little-known litigation tricks (Part 5) - #youvebeenserved
- Catching fraudsters: little-known litigation tricks (Part 6) Obtaining information from fraudsters lawyers
- Catching fraudsters: little-known litigation tricks (Part 7): Can you bank on a Bankers' Books Order?
- Catching fraudsters: little-known litigation tricks (Part 8) - A passport to fortune
- Catching fraudsters: little-known litigation tricks (Part 9) - Non-party search orders
Contact Darren Kenny or Stephanie Sandford-Smith for more information.
