Law Report: SFO questions must be answered: Regina v Metropolitan Stipendiary Magistrate, ex parte Serious Fraud Office - Queen's Bench Divisional Court (Lord Justice Butler-Sloss, Mr Justice Macpherson), 23 June 1994

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Since the powers of the SFO to compel answers to questions on pain of punishment continue after the person under investigation has been charged, the defence of reasonable excuse to answering such questions cannot arise.

The Divisional Court decided that the magistrate was wrong to acquit Larry Trachtenberg of charges under section 2(13) of the Criminal Justice Act 1987.

In the course of the SFO's investigation into the Maxwell group of companies, Mr Trachtenberg was charged with six offences. He was required to answer questions under section 2. He refused to answer a number of questions on the grounds that he had a reasonable excuse not to give answers.

The magistrate dismissed a charge against Mr Trachtenberg that he failed to comply with section 2.

Nigel Pleming QC and Paul Garlick (Treasury Solicitor) for the SFO; Michael Hill QC and James Richardson (Russell Jones & Walker) for Mr Trachtenberg.

LORD JUSTICE BUTLER SLOSS, giving the court's judgment, said that this was a case for judicial review rather than a case stated. The grant of judicial review in cases where there was an alternative appeal route was exceptional. It was right that this court should guard the limits of judicial review and not permit any party to avoid appropriate and available alternative remedies.

This case was exceptional. The long reasoned judgment by the magistrate rendered the case ripe for judicial review. The case stated route was in this particular case inapposite.

In the light of the House of Lord's decision in R v SFO, ex p Smih (1993) AC 1 that the powers of the SFO to compel answers to questions on pain of punishment continue after the person under investigation had been charged, the defence of reasonable excuse in section 2(13) to answering such questions could not arise. The argument that the House of Lords did not consider 'reasonable excuse' was unsustainable: see the Court of Appeal's decision in the later case of Re Arrows (no 4) (1993) 3 WLR 516.

The argument that section 2 required elucidation and came within the principle in Peppar v Hart (1993) AC 593 so as to warrant resort to Hansard received short shrift in the Arrows case. The whole matter was covered by the clear words of the section and by judicial authority.

The stipendiary magistrate's approach was fundamentally flawed and he was wrong to acquit Mr Trachtenberg.

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