Forfeiture of Property to the Crown in the Cayman Islands

• Author: John Arnold Epp
• Position: Cayman Islands Law School. An affiliated institution of the University of Liverpool
• Pages: 271-313

Forfeiture of Property to the Crown in the Cayman Islands

John Arnold

Epp*

I. Introduction

Residents of the "Western World" enjoy the fundamental

freedom to own real and personal property, and not to be deprived

of it by the state without just compensation or cause. Criminal

penalties post conviction, including fines or forfeiture of the

instruments of crime1, provide a common example of the

depravation of property for a constitutionally justifiable cause. This

is by no means the only example, however. The laws of the

Cayman Islands, as in many other jurisdictions2, provide for

forfeiture to the state without compensation in the absence of a

criminal conviction in a number of circumstances. These may be

broadly described as forfeiture through administrative powers or

civil process.

Recent legislation, and renewed reliance on a long forgotten

provision, evidence a growing trend to further expand the situations

where alleged ill-gotten property will be subject to forfeiture to the

Crown through criminal and civil process.

This article will address in a general overview the constitutional

Cayman Islands Law School. An affiliated institution of the University

of Liverpool. The author is indebted to Richard L. Finlay, attorney at

law, for his comments in the preparation of earlier drafts.

1 Penal Code (Law 12/1975) (1995 Revision) ss. 297 (instruments of

counterfeiting),

2 Baldwin, F. and Munro, R., "The United States: Forfeiture and Asset

Freezes", "United Kingdom", "Canada", Asset Forfeiture and

International Financial Crimes (Oceana Publications: New York,

1993).

basis for the protection from forfeiture and the exceptions thereto,

as well as the process by which forfeiture is achieved in Cayman

statute law. Recent developments3 and proposed legislation4 will be

highlighted. Special attention and comment will be given on the

apparent rebirth of section 190 of the

Criminal Procedure

Code.5

The discussion will range afield to raise the issue of local

enforcement of foreign forfeiture orders as well as a potential

reform to the Cayman position.

II.

Constitutional Issues

The assertion that residents of the "Western World" enjoy the

freedom not to be deprived by the state of their property without

just compensation or cause is sufficiently exemplified by a brief

review of selected constitutions. The Fifth and Fourteenth

Amendments to the Constitution of the United States of America

provide that "[n]o person shall be ... deprived of life, liberty, or

property without due process of law; nor shall private property be

taken for public use without just compensation". This is subject to

the public interest exception in the Ninth Amendment. Members of

the European Community have, for the most part, modeled their

protection of this right on Protocol No. 1 of the European

Convention on Human Rights. Protocol No. 1 Article 1 states that

"[n]o one shall be deprived of his possessions except in the public

3 Proceeds Of Criminal Conduct Law, 1996 (Law 15/1996), effective

December

23,

1996.

4

The Mutual Legal Assistance (1988 United Nations Conventions) Bill

1997;

Readings are scheduled for May, 1997.

Law 13/1975 (1995 Revision), formerly s. 182, "No Rights Bill Now,

Committee Says" Caymanian Compass, October 1, 1996, p,l.

interest and subject to the conditions provided for by law ...".6

Similar provisions are found in the Constitutions of Jamaica7, the

Bahamas8, and Barbados.9

In the United Kingdom, where the constitution is not comprised

of one written document but a collection of well established

customs, principles, common law precedents and statutes, it is also

a fundamental right of the citizen not to be deprived of his property

except in the public interest.10 The same is true of the Cayman

Islands, even though the Islands have a constitution statute.11

As is self evident from the passages quoted, each

pronouncement of the right to property is accompanied by a

limitation or "clawback" clause. The protection offered by the

selected constitutions is subject to limitations that can be adjudged

appropriate in a free and just society. The practical effect of a

"clawback" clause is that certain acts by the state which are

authorized by legislation will be allowed even though the acts

appear to violate the constitutional rights of a citizen. It is in this

context that laws exist whereby the state can require a citizen to

Brownlie, I., Basic

Documents

on Human Rights (Clarendon: Oxford,

1981)

p.

256.

7 Chapter III, s. 18(2).

8 Article 27, s. 2(b) and 2(j).

9 Chapter III ss. 11

(b)

and 16.

10 James v United Kingdom (1986) 8 E.H.R.R. 123.

Caribbean and North Atlantic Territories, The Cayman Islands

(Constitution) Order

1972,

S.I. 1972 No. 1101 (UK). The Law does not

profess to displace rights found in the unwritten Constitution common

to England and this Dependent Territory. Prior to the 1996 general

election, the Cayman Islands Legislative Assembly actively considered

the Constitution Bill 1992 which included the contents of Protocol No.

1 Article 1. It is not clear whether the Bill will be revived.