Commentary on Sections Part 5: Civil Recovery of the Proceeds etc. of Unlawful Conduct Miscellaneous Section 283: Compensation
392.This section deals with the case where any property has been made subject to an interim receiving order, or in Scotland an interim administration order, but has not in the end been held to be recoverable or associated property, either because the court has so determined or because the claim or the application has been withdrawn. Subjection to the interim receiving order or interim administration order may, despite the duties of the interim receiver or interim administrator to preserve its value, have resulted in losses to the owners of the property.
393.Under subsection (1), the person whose property it is may apply to the court for compensation for such losses; under subsection (5), the court may order the enforcement authority to pay compensation. Under subsection (2), no application for compensation may be made if the right of the victim has defeated that of the enforcement authority by virtue of section 281, or if an order has been made following an agreement by virtue of section 276.
394.An application must be made within three months of the date on which the court makes a decision the effect of which is that a recovery order cannot be made (subsection (3)). If an application is made for leave to appeal, the three months is to run from the date the appeal proceedings are finally concluded; or the date the application for leave to appeal is withdrawn or refused. In England and Wales and Northern Ireland, if the proceedings are discontinued, an application must be made within three months of the date on which they were discontinued (subsection (4)).
395.Subsections (6) to (8) provide for compensation in respect of rights of pre-emption etc which have become inoperable when the property to which they relate vests under a recovery order.
396.Subsection (9) provides for the measure of compensation to be at the court’s discretion, having regard to the losses suffered and to all other circumstances. If therefore the claimant has himself contributed to the losses through delays, for example, that may be taken into account here.