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Gaining Access: Using Legal Tools to Get Information 

In civil litigation, accessing and preservation of evidence is critical to successfully proving allegations, including matters relating to fraud, copyright infringement or intellectual property disputes. Judicial orders are available to assist with identifying, accessing and preserving critical evidence and information. For plaintiffs, such orders may be available and valuable tools to assist with advancing their case. Similarly, those that are or may become defendants in such matters may find themselves in receipt of such an order.
Gaining Access: Using Legal Tools to Get Information

An Anton Piller Order1 is often called a "civil search warrant" and it allows for the search and collection of material evidence from a defendant's premises. The Norwich Pharmacal Order2 is a disclosure order that requires that specific documents or other property be provided by a third party to the applicant. For example, this order may in the right circumstances be used to obtain from a bank, records of a suspected fraudster's account to allow funds taken to be traced.

 

Forensic accountants are often called upon to provide assistance to legal counsel with certain aspects of these types of orders. For example, such assistance may include establishing facts through investigation to support the application for an order and assisting with executing the order in some cases.

 

Anton Piller Orders


The Basics

 

An Anton Piller Order is a court order most often gained through an ex-parte, in camera process. This order grants access to a defendant's premises to allow for the search and collection of material and specified evidence. It is essentially a civil search warrant, except that it does not authorize forcible entry. As it is granted without the knowledge of the defendant(s), the defendant does not have an opportunity to challenge the order until after it is executed. In fact, the defendant normally learns of the order when it is served upon them by the independent supervising solicitor when the order is being executed. Obtaining an Anton Piller Order can be challenging as the bar is held at a high level; a strong legal team is critical.

 

There are a number of important issues that need to be addressed in the application for the order and the following are four important conditions that must be met:

 

  • The plaintiff must demonstrate a strong prima facie case;
  • The defendant's alleged misconduct, potential or actual, must be very serious;
  • There must be clear and convincing evidence that the defendant has incriminating documents in his/her possession; and
  • It can be shown that there is a real possibility that the defendant may destroy the incriminating documents.

 

A relevant aspect of the application for an Anton Piller Order is the undertaking for damages. In essence, the plaintiff will be required to undertake that any damages caused by the unwarranted issuance and execution of the order will be paid by the plaintiff. This requirement increases the very real risk related to a decision to pursue this extraordinary order.

 

Another relevant aspect of the process to obtain an Anton Piller Order is the need to make full and frank disclosure to the Court. This disclosure includes all facts that are materially relevant to the alleged case and includes facts that are potential weaknesses to the plaintiff's own position.

 

In 2006, the issue of Anton Piller Orders came before the Supreme Court of Canada in the case of Celanese Canada Ltd. v. Murray Demolition4 ("Celanese"). In the Celanese case, the Supreme Court provided clarification regarding the elements necessary to properly prepare and execute an Anton Piller Order, and set out provisions to protect the rights of the parties involved. The following points are among those relevant to the execution of the order:

 

  • The involvement of an independent supervising solicitor, who attends the premises and oversees the execution of the search;
  • The defendant(s) needs to be provided reasonable time to consult with legal counsel;
  • The premise is not to be searched except in the presence of the defendant or a responsible employee of the defendant;
  • The order should set out provisions for dealing with solicitor-client privilege;
  • A detailed list of the evidence seized should be made and provided to the defendants for inspection before removing the evidence;5 and
  • No material should be removed from the premises unless it is clearly set out in the order.

 

There are many serious and important issues to be addressed in planning for and executing an Anton Piller Order. It is for this reason that the right team needs to be retained. Deep and relevant experience of legal counsel and often forensic accountants is imperative.

 

Role of the Forensic Accountant

 

There are a number of ways in which forensic accountants can assist with Anton Piller Orders. The following highlights potential areas of forensic involvement:

 

  • Forensic accountants may be retained by the plaintiff(s) or legal counsel to assist in the investigation of the allegations and identification of facts that are relevant to the issue of interest. The facts will be directly relevant to the decision to seek an Anton Piller Order. It is the facts that will be used by legal counsel to meet the high standard required to have an order issued by the Court. Forensic accountants who conduct the investigation may provide evidence of the findings through an affidavit which is used in support of the order.

 

It is common for an Anton Piller Order to be challenged by the defendants. Often it is the allegation that material facts were not disclosed and full and frank disclosure provided which is the basis for the challenge of the order. As such, it is important that sufficient investigation be performed in advance of applying for the order.

 

Forensic accountants that are engaged to undertake investigations prior to obtaining the Anton Piller Order would generally be precluded from acting as an independent custodian responsible for the execution of the Order.

 

  • Forensic accountants may provide input during the drafting of the order by legal counsel. This is discussed later in this article.
  • Forensic accountants may be used to assist in the execution of the Order. In this role, the forensic accountant is responsible for searching for and collecting the evidence named in the order, under the oversight of the independent solicitor. Forensic technology experts who are knowledgeable about the collection, preservation and review of electronic evidence are also generally part of the team that executes the order and conducts the search.

 

    Where the order is executed at a personal residence, consideration should be given to conducting
    surveillance to gain insight into the comings and goings of the defendants. Not only should the Order be executed when it is most likely to find the defendant(s) at home, awareness of potentially dangerous situations such as aggressive dogs, existence of firearms, etc. is advisable. Consideration should also be given to notifying the local police and requesting their presence at the time the order is served, particularly where there is a risk of an aggressive or violent response by the defendant.

     

  • The Order will typically identify the firm that will act as the custodian of the evidence seized. The Order should set out requirements for the handling of evidence obtained during the search and managing issues related to access to the evidence collected.

 

Considerations in Drafting and Planning the Anton Piller Order


Clearly, the drafting of the Court materials is a legal issue. Some input by accountants, however, can be useful in select areas:

 

  • The forensic accountant will be positioned to detail for the Order the types of documents and information that may exist which would be relevant to the allegations.
  • In today's business and home computing environment, in addition to computers or laptops, various types of electronic storage devices including but not limited to CDs, DVDs, thumb drives, smart phones, tablets, etc. will likely be found. When drafting the order, consideration should be given to the extent to which such electronic storage devices will be specifically included.
  • The Order should require that the defendant provide all passwords used on the targeted electronic devices. This will save time and cost that would otherwise be expended in accessing protected devices or applications.
  • Given the potentially large volume of electronic media and storage devices, it is often not practical to conduct a detailed on-site review of all electronic storage media. Therefore, consideration should be given to the court's approval of the removal and offsite imaging of computers and other electronic storage media.
  • Searches can be time consuming and, therefore, the order should allow for and name a sufficient number of experienced searchers, including individuals with the required computer forensic expertise.

 

Norwich Pharmacal Orders

 

Norwich Pharmacal Orders are important and powerful tools to gain critical information necessary to properly prove one's case. For example, in a fraud-related case, the ability to gain access to bank account statements and documents used by the fraudster to transfer funds is critical to tracing the use of monies improperly taken. This information will be essential to determine how the funds in question were used, whether there are assets available for potential recovery and if others might be involved.

 

In comparison to Anton Piller Orders, Norwich Pharmacal Orders have fewer issues. Given that the request is made of often disinterested third parties, many of the concerns and complexities associated with Anton Piller Orders are not present. There is no search to be undertaken. Once the Order is issued and presented, the information is generally provided quickly and with little fuss.

 

In order to obtain the Norwich Pharmacal Order, there will, similar to Anton Piller Orders, be a need to obtain and present the relevant facts to the Court. Again, it is common for a forensic accountant's investigation to form the support required for presentation to the Court. For example, in addition to underlying facts from the investigation, the forensic accountant may provide the evidence of where the requested documents reside and the reason that the information is needed. Again, it is common that the forensic accountant will prepare an affidavit to support the application for the Order.

 

Conclusion

Appropriate planning and thorough consideration of issues likely to be encountered will aid in drafting the Anton Piller Order and ensuring the successful execution of the Order. Forensic accountants and forensic computer specialists can play an important role in gathering the evidence required to support the application for both Anton Piller and Norwich Pharmacal Orders.

 

These Orders are useful tools that can be critical in appropriate cases. Their use does not come without risks and it is, therefore, of prime importance to ensure that skilled and experienced counsel and forensic accountants are retained.

 


Footnote:

 

1 The Anton Piller Order is named after the order granted in the case of Anton Piller KB v. Manufacturing Processes Ltd., [1976] Ch. 55, [1976] 1 All E.R. 779 (C.A.)
2 Norwich Pharmacal Orders are named after the order granted in the case of Norwich Pharmacal Co. v. Customs and Excise Commissioners, [1973] A.C. 133, [1973] 2 All E.R. 943.
3 Summarized in the Supreme Court of Canada decision in respect of Celanese Canada Inc v. Murray Demolition Corp., 2006 SCC 36; [2006] 2 S.C.R. 189; July 27, 2006.
4 Celanese Canada Inc. v. Murray Demolition Corp., [2006] 2 S.C.R. 189, 2006 SCC 36
5 If this is not practical, "documents seized should be placed in the custody of the independent supervising solicitor, and defendant's counsel should be given a reasonable opportunity to review them to advance solicitor-client privilege claims prior to release of the documents to the plaintiff". Celanese Canada Inc. v. Murray Demolition Corp., [2006] 2 S.C.R. 189, 2006 SCC 36, paragraph 40.


 

Suzanne Schulz is a Senior Vice President of KPMG Forensic and a Partner of KPMG LLP, and she is responsible for the Forensic practice in Vancouver. She is a Chartered Accountant and a Chartered Business Valuator, and has been recognized as a specialist in Investigative and Forensic Accounting by the Canadian Institute of Chartered Accountants. Suzanne's diverse area of practice includes conducting investigations, quantifying economic losses and providing litigation support services in a variety of areas, as well as advising on anti-fraud programs and controls. Suzanne is also responsible for Anti-Bribery and Corruption services, including investigations and proactive compliance related work.

 

Contact: saschulz@kpmg.caor (604) 691-3475

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