06 June 2023
Today, Tuesday 6 June 2023, the Judicial Committee of the Privy Council (the ‘Board’), the highest appeal court for
Jersey, handed down its judgment in three appeals arising from the same dispute over the
scope of two saisies judiciaires (freezing orders) granted by the Royal Court of Jersey. The
saisies judiciaires were granted under the Proceeds of Crime (Jersey) Law 1999 (‘POCL
1999’) and the Proceeds of Crime (Enforcement of Confiscation and Instrumentalities
Forfeiture Orders) (Jersey) Regulations 2008 (the ‘2008 Regulations’) which modify the
POCL 1999 provisions relevant to foreign confiscation and forfeiture orders (the ‘Modified
Law’). The legislation is central to Jersey’s powers to tackle financial crime. HM Attorney
General Mark Temple KC was successful in all three appeals.
The Attorney General was acting in response to requests for assistance from the Republic of
Indonesia. Other parties to the proceedings included Robert Tantular and his family members,
the trustee of the assets and the Viscount of Jersey, who administered the assets subject to
the saisies judiciaires. Two of the appeals were brought by the Attorney General against
judgments of the Jersey Court of Appeal. The third appeal was brought by Robert Tantular
and his family members against a judgment of the Jersey Court of Appeal.
The Board consisted of Lord Sales, Lord Hamblen, Lord Leggatt, Lady Rose and Lord
Stephens. The hearing took place in London on 8 and 9 February 2023.
Facts
The Board’s combined judgment summarises the relevant facts and sets out the procedural
history of the case back to 2013. Mr Tantular had been the president director of two
companies that owned shares in an Indonesian Bank called PT Bank Century Tbk. He was
convicted of fraud and money laundering offences in Indonesia, which were upheld by the
Indonesian Supreme Court, following the collapse of Bank Century. In 2004 Mr Tantular had
created the Jasmine trust by settling assets on its trustee in Jersey, the original trustee being
ING Trust Company (Jersey) Ltd. In 2005 a holding company of the trust had bought an
apartment in Singapore for Singapore$7.1 million in which Mr Tantular’s wife and children
lived. The apartment was mortgaged to Credit Suisse in the sum of about Singapore$4.4
million at the time that the first saisie judiciaire was applied for and granted by the Royal Court
in 2013. A second saisie judiciaire was granted by the Royal Court in 2014.
The first appeal – jurisdiction
The first appeal (brought by the Tantular beneficiaries of the trust) concerned whether POCL
1999 and the 2008 Regulations permit saisies judiciaires to be made in relation to property
situated outside Jersey, at least where the persons who can exercise the rights of ownership
or control of that property (in this case the Jersey based trustee) are subject to the jurisdiction
of the Jersey courts. The Tantular beneficiaries argued that because the trust property was
situated in Singapore and was held through a BVI incorporated holding company the Jersey
Court did not have jurisdiction under the Modified Law to order the saisies judiciaires over
foreign situate assets. However, the Board agreed with the judgment of the Court of Appeal
(Lord Anderson of Ipswich, Sir Wyn Williams and Sir William Bailhache) on this point, and with
the judgment of the Royal Court (Commissioner Clyde-Smith), at first instance.
Significantly, the Board held that a wider interpretation of the legislation allowed Jersey to
provide more effective co-operation and asset recovery, and that there are particular reasons
why it is appropriate for Jersey to provide such assistance (paragraph 72). The Board noted
that Jersey has a very substantial trust industry and that the trust structure in this case (a
discretionary Jersey law trust, with a BVI incorporated asset holding company holding
underlying assets situated abroad) is a common form of Jersey based trust. It agreed with the
Court of Appeal that an interpretation of the legislation which allows the Court to make interim
orders, such as the saisie judiciaires in this case, which ensured that the assets of a criminal
or suspected criminal are retained in Jersey pending a resolution of the issues relating to
confiscation will ‘without doubt, provide significant assistance in helping to protect Jersey’s
reputation in financial matters’ (paragraph 73).
The second appeal – assignment of the mortgage
The second appeal (brought by the Attorney General) concerned whether the Court of Appeal
was right to grant a declaration that Credit Suisse as the holder of the mortgage over the
apartment in Singapore was entitled to assign its rights under that mortgage to a third party.
In 2018 Credit Suisse had been granted a variation to the saisies judiciaires to allow it to sell
the apartment in Singapore. However, members of Mr Tantular’s family had subsequently
applied for a declaration that the saisies judiciaires did not prevent Credit Suisse from
assigning its rights under the mortgage to a third party. The family also proposed that the
rights be assigned to an old family friend in Indonesia who would then pay off the debt to Credit
Suisse and be more flexible about repayment of the loan, thereby allowing them to stay in the
apartment. The Royal Court at first instance (Commissioner Clyde-Smith and Jurats Ramsden
and Pitman) had refused to grant the declaration, but following an appeal by the Tantulars,
the Court of Appeal had granted the declaration sought.
The Board disagreed with the decision of the Court of Appeal on the grounds that the proposed
assignment to the old family friend could have aided or abetted a breach of the saisie judiciaire
and would have permitted a transfer that interfered with the administration of justice. It
confirmed that the mortgage itself was not subject the saisies judiciaires which applied to the
net equity in the property. The Board gave guidance to banks in the position of Credit Suisse
and found that in this case the differences between Credit Suisse, as a regulated global
financial institution acting at arm’s length to the Tantulars, and the old family friend who was
an unregulated individual “could not be more clear cut’ (paragraph 156).
The third appeal – sovereign immunity
The third appeal was also brought by the Attorney General, on the grounds that a costs order
made by the Court of Appeal was contrary to the regime for providing effective mutual legal
assistance to foreign states. It concerned whether the state of Indonesia can be made liable
for legal costs on the basis that it had submitted to the jurisdiction of the Royal Court, either by instituting the proceedings brought by the Attorney General, or by taking steps in those
proceedings to support the making of the saisies judiciaires. The Court of Appeal had ordered
that the Indonesian Ministry of Justice should be made jointly and severally liable with the
Attorney General to pay the costs of the application concerning the declaration in relation to
the mortgage assignment. This was on the basis that the commencement of the process of
applying for the saisies judiciaires should be characterised as institution of proceedings by the
Indonesian Ministry of Justice, albeit with the assistance of the Attorney General. The Court
of Appeal had also relied on the conduct of an official from the Indonesian Ministry of Justice
in relation to applying for the second saisie judiciaire in 2014 as showing direct involvement in
how the applications were progressed.
The Board held that the Court of Appeal fell into error in making the costs order. After
reviewing the UN Convention against Transnational Organised Crime 2000 (the ‘Palermo
Convention’) and relevant caselaw, it held that it is the Attorney General who brings the
proceedings on his own behalf, albeit for the benefit of the foreign Government that makes the
request. The Republic of Indonesia was not a party to the proceedings. The involvement of
the official from the Indonesian Ministry of Justice did not show that the proceedings were
instituted by Indonesia, and that nothing done by the official amounted to an intervention or
step in the proceedings by Indonesia for the purposes of the State Immunity Act 1978, as
extended to Jersey by the State Immunity (Jersey) Order 1985.
Next steps
The Board’s judgment records (paragraphs 61 and 62) that the parties settled the proceedings
by agreement after the hearing before the Board, but that the Attorney General had requested
that the Board nevertheless proceed to give its judgment on the three appeals since they
raised issues of wider public importance. The settlement draws a line under the dispute and
finally allows the Attorney General to proceed to negotiate an asset share agreement with
Indonesia, which he has now commenced. The net assets available are a sum of £1,325,000
which is ring-fenced in the Criminal Offences Confiscation Fund.
The Attorney General Mark Temple KC commented:
“The judgment of the Board of the Judicial Committee of the Privy Council is significant and
helpful in clarifying important aspects of Jersey’s financial crime legislation. It provides
confirmation at the highest appellate level concerning the Jersey Courts’ jurisdiction to freeze
and confiscate the proceeds of crime in an effective way where the Attorney General receives
requests for assistance from foreign Governments. Whilst the case has taken ten years to
reach a conclusion, it shows the extent of the Law Officers’ Department’s commitment to
defending Jersey’s reputation for tackling international financial crime.”
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