Fidelity Management Limited (Appellant) v HM Comptroller and another (Respondents) (Guernsey)

Permission to Appeal application lodged

Case summary
Permission to Appeal
Previous proceedings

Case summary

Case ID

JCPC/2026/0010

Jurisdiction

Guernsey

Parties

Appellant(s)

Fidelity Management Limited

Respondent(s)

HM COMPTROLLER

Royal Bank of Canada (Channel Islands) Limited

Issue

Should s13 of the Forfeiture of Money etc. in Civil Proceedings (Guernsey) Law 2007 be interpreted so as to impose on the applicant for a forfeiture order an obligation to demonstrate a causal nexus between identified or identifiable acts of unlawful conduct and the funds sought to be forfeited?

Facts

This appeal concerns an application made by the first respondent (His Majesty’s Comptroller, “HMC”) for the forfeiture of funds of $14.4 million (plus accrued interest) held by the appellant (“FML”) in an account with the second respondent (Royal Bank of Canada, Guernsey Branch, “the Bank”). FML is a company which was originally incorporated in the Turks and Caicos Islands by someone purporting to be ‘Clive Knowles’. In fact, this was one of several aliases used by a Mr Frank Laport. Mr Laport set up FML in the name of Clive Knowles by using a forged Australian driving licence under that name. The Account was opened in December 1995 by someone purporting to be ‘Thomas Henry Magill’, who claimed to be a director and secretary of FML. In fact, this was again an alias used by Mr Laport. Mr Laport posed as Thomas Henry Magill via a fraudulently obtained Canadian passport in that name. Mr Laport died in 2005. Prior to his death, he had been a practicing lawyer in Chicago apparently specialising in personal injury law. From 1996 to 1998, he was investigated by the FBI in relation to links to organised crime. He refused to cooperate with the investigation, which was ultimately unable to ascertain that he had links to organised crime. He was also investigated twice by the US Internal Revenue Service. The first investigation concluded with a monetary settlement but no criminal charges. The second investigation discovered no evidence which would support criminal or forfeiture action. Following his death, his affairs were overseen by two of his associates. Since 2007, the Account has been the subject of an ‘informal freeze’ by the Guernsey authorities. This came about when one of the associates requested in (in 2007) that the funds in the Account be transferred to a Swiss bank account. The Guernsey authorities refused this request, resulting in an ‘informal freeze’ on the Account. On 3 May 2023, HMC made an application under s10 of the Forfeiture of Money etc in Civil Proceedings (Guernsey) Law 2007 (“the 2007 Law”) for a formal freezing order over the Account. FML and the Bank were respondents to that application. The application was made on notice, and was supported by an affidavit by Mr Brian McCreight, who had been engaged by HMC to investigate the source of the funds in the Account. HMC relied on the fact that a false identity had been used by Mr Laport when opening the Account, and that the identity had been supported by a fraudulently obtained passport, as giving rise to reasonable grounds of suspicion that the funds in the Account were the proceeds of unlawful conduct or were intended for use in unlawful conduct. The Lieutenant Bailiff granted HMC’s application, and the funds in the Account were frozen on 27 June 2023. FML applied for the freezing order to be set aside. On 25 January 2024, before that application had been determined, HMC issued an application under s13 of the 2007 Law for a forfeiture order in relation to the funds held in the Account. At a hearing on 27 February 2024, the Lieutenant-Bailiff stayed FML’s application to set aside the freezing order, and directed that HML’s forfeiture application be heard in September 2024. FML appealed against the Lieutenant-Bailiff’s decision. The Guernsey Court of Appeal, in a judgment dated 14 June 2024, dismissed FML’s appeal. The forfeiture application therefore proceeded. In a judgment handed down on 17 January 2025, the Lieutenant-Bailiff dismissed HMC’s application for a forfeiture order. She held that on a proper construction of s13, in order to obtain a forfeiture order HMC was bound to establish a causal nexus between the Account and some specified unlawful conduct, and had failed to do so. In addition, she held that even if that construction was not correct and the burden lay solely on FML under s13(2) to prove on the balance of probabilities that the funds were not the proceeds of any person’s unlawful conduct, FML had discharged that burden on the evidence. HMC appealed to the Court of Appeal. The Court of Appeal (in a judgment dated 21 August 2025) allowed the appeal and granted the forfeiture application. The Court of Appeal held that the Lieutenant-Bailiff had been wrong to construe s13 as preserving an evidential burden on HMC to demonstrate a causal nexus between the funds in the Account and some specified unlawful conduct. The Court of Appeal then substituted its own evaluation of the evidence for that of the Lieutenant-Bailiff, and held that the evidence was not sufficient to prove on the balance of probabilities that the funds in the Account were not the proceeds of any person’s unlawful conduct. The Court of Appeal refused FML’s application for permission to appeal against its decision. FML now appeals to the JCPC.