Capture, Treasure and Hidden Identities

An on-going issue for the TIB was the fact that the two central characters of this troubled tale had disappeared before their nefarious dealings as directors had been uncovered. Despite numerous attempts to locate the Bankrupts, it soon became apparent that they could have been in any number of global locations.

As the battle to obtain recognition of the TIB's rights and powers in France rumbled on, there was an unexpected turn of events with unforeseen consequences for the TIBs. Fortuitously, one of the absent Bankrupts suddenly turned up in a French post office purportedly to collect several unidentified packages. A suspicious postal worker decided to call the French police and our elusive Bankrupt was arrested.

At first glance a most fortunate turn of events for the TIBs.. Unfortunately, all was not as it seemed. As the TIBs were not (at that point) recognised in France and therefore did not automatically have the powers and rights allotted to them under English law, any  treasure associated with the Bankrupt was commandeered by the French police and more specifically, the Agence de gestion et de recouvrement des avoirs saisis et confisques (also known as the Agency for the Management and Recovery of Seized and Confiscated Assets or AGRASC). Suddenly, instead of being able to identify and recover significant assets for the benefit of creditors in line with their statutory duties, the TIBs became embroiled in a further unforeseen quest to prove their entitlement to any treasure.

The Battle for the Treasure

The first challenge to be addressed was which of the competing interests in any seized assets had the best chance of success in a French criminal court:

• On the one hand, there was the TIB to which the seized assets automatically vested under English law and should do so if and when recognition was obtained in the French civil court. The issue being that this would amount to an entirely untested application for vesting under an exequatur in French criminal proceedings.
• On the other hand, there were the creditors of the Bankrupt who, under French law, could apply for "compensation" by way of damages from the assets as "victims" of the Bankrupt's wrongdoing. The issue with the compensation claim being that it would be difficult to directly link the Bankrupts wrongdoing to English creditors as victims to the unconnected crimes that the Bankrupt had been arrested for under French law.

As set out in Chapter one, in order for the TIBs to be recognised in French law, the judicial decision appointing the TIBs must first of all be recognised and transposable into French law i.e., by way of the exequatur judgment. While the TIBs were only days away from obtaining the exequatur judgment at this stage, it soon became apparent that this would not necessarily result in a happy ending with regard to the criminal proceedings.

Although under English law, any treasure vested automatically in the TIBs on appointment, even after the exequatur judgment was obtained, it may not be sufficient for the TIB to be able to immediately produce all its legal effects (as perceived by English law) in France on the basis of the on-going issue that the legal principle of the trustee does not exist in French law.

Furthermore, although it had been possible to almost convince a Parisian civil Judge of the TIB's rights and powers in respect of the French assets at this point (pursuant to the exequatur application process), the TIBs were now dealing with assets seized by the AGRASC and a new criminal judge with no concept of the TIBs proprietary rights over the Bankrupts foreign assets or the power to realise those assets for the benefit of creditors.

Despite the clear obstacles on this untrodden road, with the assistance of French criminal law experts, the TIBs decided to continue along the treacherous path that they were already on and push the French court not only to recognise their appointment and powers by way of exequatur but also to acknowledge and apply for the vesting of assets in the TIBs under English law. This option was preferred to commencing a more uncertain and fragile claim for damages as compensation for the creditors (or "victims") of the Bankrupts. It was the TIBs position that they had a proprietary right to the assets under English law meaning that all those assets should rightly and properly be returned to them as opposed to an unascertainable compensation claim which depended on the discretion of the French criminal court based on the "harm" caused to the "victims" (although this claim was of course, argued in the alternative).

Follow the Yellow Brick Road…

And so, the TIBs bravely returned to Court with parallel proceedings – a recognition application which was only days away from being finalised in the Civil Court and a restitution claim in respect of seized assets in a French criminal Court in a different town in a separate region of France. Sacré bleu!

Despite the untested nature of the restitution application in the French criminal court in a post-Brexit landscape, the TIBs position was immediately bolstered by the exequatur judgment. Although this had taken some 13 months to obtain, the judgment was granted at the very outset of the restitution application. This proved to be a critical document in convincing the French Criminal Court of the TIBs right to the assets, alongside a further legal opinion clearly setting out again the roles and powers of the TIB under English law with a specific and detailed focus on the vesting of assets.

As a result, in a comparatively rapid sequence of events, the restitution application was heard within 3 months of obtaining the exequatur and it was accepted by the French Criminal Court that the TIB indeed had the best and strongest claim with all seized treasure rightfully being "restored" to the TIBs with immediate effect.

The Story Continues

Another victory for the TIBs in entirely foreign territory but the tale continues. Although the TIBs had recovered the seized assets in an unexpected detour involving French criminal proceedings, challenges regarding the French property assets loomed on the horizon.

To be continued….