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You are here: BAILII >> Databases >> European Court of Human Rights >> AGOSI v. THE UNITED KINGDOM - 9118/80 [1986] ECHR 13 (24 October 1986)
URL: http://www.bailii.org/eu/cases/ECHR/1986/13.html
Cite as: (1987) 9 EHRR 1, [1987] 9 EHRR 1, 9 EHRR 1, [1986] ECHR 13
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In the AGOSI case*,
_______________
* Note by the Registrar: The case is numbered 14/1984/86/133. The
second figure indicates the year in which the case was referred to the
Court and the first figure its place on the list of cases referred in
that year; the last two figures indicate, respectively, the case's
order on the list of cases and originating applications (to the
Commission) referred to the Court since its creation.
_______________
The European Court of Human Rights, sitting, in accordance with
Article 43 (art. 43) of the Convention for the Protection of Human
Rights and Fundamental Freedoms ("the Convention") and the relevant
provisions of the Rules of Court, as a chamber composed of the
following judges:
Mr. G. Wiarda, President,
Mr. R. Ryssdal,
Mr. Thór Vilhjálmsson,
Mr. F. Matscher,
Mr. J. Pinheiro Farinha,
Mr. L.-E. Pettiti,
Sir Vincent Evans,
and also of Mr. M.-A. Eissen, Registrar, and Mr. H. Petzold, Deputy
Registrar,
Having deliberated in private on 23 January and on 22 September 1986,
Delivers the following judgment, which was adopted on the
last-mentioned date:
PROCEDURE
1. The present case was referred to the Court by the European
Commission of Human Rights ("the Commission") on 19 December 1984,
within the three-month period laid down by Article 32 § 1 and
Article 47 (art. 32-1, art. 47) of the Convention. The case
originated in an application (no. 9118/80) against the United Kingdom
of Great Britain and Northern Ireland lodged with the Commission on
Gold- und Silberscheideanstalt AG ("AGOSI").
2. The Commission's request referred to Articles 44 and 48
(art. 44, art. 48) and to the declaration whereby the United Kingdom
recognised the compulsory jurisdiction of the Court (Article 46)
(art. 46). The purpose of the request was to obtain a decision from
the Court as to whether the facts of the case disclosed any violation
of Article 1 of Protocol No. 1 to the Convention (P1-1).
3. In response to the inquiry made in accordance with
Rule 33 § 3 (d) of the Rules of Court, the applicant company stated
that it wished to take part in the proceedings pending before the
Court and designated the lawyer who would represent it (Rule 30).
4. The Chamber of seven judges to be constituted included, as ex
officio members, Sir Vincent Evans, the elected judge of British
nationality (Article 43 of the Convention) (art. 43), and
Mr. G. Wiarda, the then President of the Court (Rule 21 § 3 (b) of the
Rules of Court). On 23 January 1985, the President drew by lot, in
the presence of the Registrar, the names of the five other members,
namely Mr. R. Ryssdal, Mr. Thór Vilhjálmsson, Mr. F. Matscher,
Mr. J. Pinheiro Farinha and Mr. L.-E. Pettiti (Article 43 in fine of
the Convention and Rule 21 § 4) (art. 43).
5. Mr. Wiarda assumed the office of President of the Chamber
(Rule 21 § 5). He ascertained, through the Registrar, the views of the
Agent of the Government of the United Kingdom ("the Government"), the
Delegate of the Commission and the lawyer for the applicant company
regarding the need for a written procedure (Rule 37 § 1). Thereafter, in
accordance with the Orders and directions of the President of the Chamber,
the following documents were lodged at the registry:
- on 26 April 1985, the memorial of the applicant;
- on 6 May, the memorial of the Government;
- on 18 and 19 July, the applicant company's claims under Article 50
(art. 50) of the Convention;
- on 30 December, the Government's written observations on these
claims, together with a domestic judgment;
- on 10 January 1986, various documents requested from the Commission.
6. On 22 October 1985, after consulting, through the Registrar,
the Agent of the Government, the Delegate of the Commission and the
lawyer for the applicant company, the President directed that the oral
proceedings should open on 20 January 1986 (Rule 38).
7. The hearings were held in public at the Human Rights Building,
Strasbourg, on the appointed day. Immediately before they opened, the
Court held a preparatory meeting.
There appeared before the Court:
- for the Government
Mr. M. Eaton, Legal Counsellor,
Foreign and Commonwealth Office, Agent,
Mr. D. Latham, Q.C., Counsel,
Mr. Fotherby, Customs and Excise,
Mr. Allen, Customs and Excise,
Mr. Robinson, Customs and Excise, Advisers;
- for the Commission
Mr. J.A. Frowein, Delegate;
for the applicant company
Mr. R. Graupner, Solicitor, Counsel,
Mrs. G. Dymond, Solicitor, Adviser.
8. The Court heard addresses by Mr. Eaton and Mr. Latham for the
Government, by Mr. Frowein for the Commission and by Mr. Graupner for the
applicant company, as well as their replies to questions put by the Court
and several judges.
9. On various dates between 15 January and 7 March 1986, the
Government and the applicant company, as the case may be, lodged a number
of documents with the registry, either at the request of the President or
of their own motion.
10. By letter received on 21 March 1986, the applicant sought leave to
file a further memorial. Such leave was however refused by the President
on 28 June 1986.
AS TO THE FACTS
I. The particular circumstances of the case
11. The applicant company, AGOSI, is a joint stock company
(Aktiengesellschaft) incorporated and having its registered office in
the Federal Republic of Germany. Its principal business is metal smelting,
but at the relevant time it also dealt in gold and silver coins.
A. The seizure of the coins
12. In 1974, AGOSI began doing business with a British citizen, X. In
the course of this business, between August 1974 and May 1975, AGOSI
bought from X a large quantity of pre-1947 British coinage which had a
high content of silver. However, it appears that unbeknown to the company
the coins had been illegally exported from the United Kingdom.
13. On Saturday, 2 August 1975, after normal business hours, X visited
AGOSI's factory with Y, whom he introduced as a wealthy businessman.
Together they asked to make an immediate purchase of 1,500 Kruegerrands,
gold coins minted in South Africa, where they are also legal tender,
having a value of some £120,000. The sale was agreed and the coins were
loaded into a car bearing United Kingdom number plates. Payment was
accepted in the form of an unguaranteed cheque drawn on an English bank.
The cheque bore no sign of having been cleared for exchange control
purposes. On Monday, 4 August, the cheque was handed to AGOSI's bank for
collection. However, on 11 August, the bank notified AGOSI that the
cheque had been dishonoured. The contract of sale contained a provision
according to which ownership of the coins remained with AGOSI until full
payment for them had been received by it.
14. Meanwhile, on 2 August, the buyers attempted to smuggle the gold
coins by car into the United Kingdom. The coins were, however, discovered
hidden in a spare tyre and were seized by the customs authorities in Dover.
15. On 16 April 1975, the importation of gold coins had been
prohibited by the Secretary of State for Trade and Industry, by an
amendment to the Open General Import License of 5 July 1973. The
prohibition was withdrawn on 16 June 1979.
16. On 14 August 1975, criminal proceedings were instituted in the
United Kingdom against X and Y; they were charged, inter alia, with
fraudulent evasion of the prohibition on importation of gold coins,
contrary to section 304 (b) of the Customs and Excise Act 1952
("the 1952 Act").
17. On 18 and again on 28 August, AGOSI requested the Customs and
Excise to return the coins on the basis that the company was their rightful
owner and had been the innocent victim of fraud.
18. On 20 August, officers of the Customs and Excise visited AGOSI's
factory in Germany to inquire into the circumstances of the sale. AGOSI
continued to co-operate with the Customs and Excise throughout the
criminal investigation.
19. On 1 October, AGOSI made a declaration of avoidance of the contract
of sale by virtue of which the sale of the coins became void ab initio
under German law.
20. On 13 October 1975, AGOSI's lawyers wrote to the Commissioners of
Customs and Excise, who had taken over responsibility for the case,
requesting that the Commissioners exercise their discretion under
section 288 of the 1952 Act (see paragraph 35 below) and return the coins
to the company, as they did not constitute goods liable to forfeiture under
the 1952 Act interpreted in the light of the Treaty establishing the
European Economic Community (the Treaty of Rome), general principles of
public international law and the Convention, especially Article 1 of
Protocol No. 1 (P1-1).
21. In their written reply of 29 December 1975, the Commissioners
inquired whether it was contended by AGOSI that it had made a valid claim
that the coins were not liable to forfeiture. The Commissioners stated
that, if so, they would be required to institute condemnation proceedings
before the High Court under paragraph 6 of the Seventh Schedule to the
1952 Act in order to have the coins forfeited. With regard to the
company's contention that the coins were not liable to forfeiture (see
paragraph 20 above), the Commissioners observed, inter alia, that
"there [was] no discretion [vested in the courts] to refuse condemnation
[of the coins as forfeited] on the ground of hardship to an innocent
owner". The coins were not restored.
B. The criminal proceedings against X and Y
22. At their trial in January 1977, at which AGOSI's director
Dr. Rose testified for the prosecution, X and Y argued that the
prohibition on importation of gold coins was in breach of Article 30
of the Treaty of Rome, which guarantees the free movement of goods,
and that accordingly the criminal charges brought against them were
void.
23. The judge at first instance did not accept this argument; in
his judgment of 31 January 1977, he held that the prohibition fell
within the "public policy" provision of Article 36 of the Treaty and
that the coins were capital rather than goods within the terms of
Article 67.
24. X and Y appealed to the Court of Appeal which, on
15 December 1977, referred the question to the Court of Justice of the
European Communities in accordance with Article 177 of the Treaty.
25. The Court of Justice of the European Communities confirmed in its
judgment of 23 November 1978 that the Kruegerrands were capital rather
than goods (case 7/78, [1978] European Court Reports 2247). Accordingly, X
and Y's appeal failed and they were convicted and fined.
C. AGOSI's civil proceedings for recovery of the coins
26. When, at the close of the criminal proceedings at first
instance, the Commissioners of Customs and Excise did not return the
coins, AGOSI, on 14 April 1977, issued a writ against them in the High
Court. The statement of claim, in so far as relevant, read:
"7. ... the provisions of section 44 and section 275 of the Customs
and Excise Act 1952, and the Seventh Schedule to the said Act, are to
be construed in the light of and subject to the general principle of
public international law which prohibits the unjustified confiscation
of property belonging to friendly aliens.
8. Further or in the alternative the provisions of section 44 and
section 275 of the Customs and Excise Act 1952 and the Seventh
Schedule to the said Act are to be construed in accordance with
Article 1 [of Protocol No. 1] of the European Convention for the
Protection of Human Rights and Fundamental Freedoms (P1-1).
9. In the premises mentioned in paragraphs 7 and 8 herein, the ...
coins are not liable to forfeiture.
10. Alternatively to paragraph 9, if the said coins are liable to
forfeiture, then in the premises mentioned in paragraphs 7 and/or 8
herein the Defendant is bound to exercise his powers under section 288
of the Customs and Excise Act 1952 and/or paragraph 16 of the Seventh
Schedule to the said Act to restore without imposition of any
condition the said coins to the plaintiffs.
And the plaintiffs claim:
(i) a declaration that the ... coins are [AGOSI's] property;
(ii) a declaration that the ... coins are not liable to forfeiture
...;
(iii) a declaration that [AGOSI is] entitled without imposition of any
condition to the return of the ... coins".
The Commissioners counterclaimed that the coins should be condemned as
forfeited as they were liable to forfeiture, inter alia, under section
44 (b) and section 44 (f) of the 1952 Act (see paragraph 33 below).
27. On 2 February 1978, AGOSI also issued an originating summons
requesting the High Court to determine the compatibility with the
Treaty of Rome of the prohibition on the importation of Kruegerrands
into the United Kingdom and of their confiscation without
compensation. The case was heard on 20 February and AGOSI sought to
have these questions referred to the Court of Justice of the European
Communities for decision.
28. Mr. Justice Donaldson dismissed the originating summons on the
same day and indicated that he would also have dismissed the action on
the writ had it been brought before him for determination (paragraph
26 above). The applicant company nonetheless pursued the latter
action. On 10 March 1978, Mr. Justice Donaldson dismissed the action
on the writ and ordered, in accordance with the Commissioners'
counterclaim, that the coins be forfeited as constituting goods liable
to forfeiture under section 44(f) of the 1952 Act (see paragraph 33
below).
29. AGOSI appealed to the Court of Appeal arguing that, as the
European Court of Justice had in the meantime found that the coins
were not goods (see paragraph 25 above), section 44 (f) could not be
applied, and reiterated its submissions as to Article 1 of Protocol
No. 1 (P1-1) and general principles of international law.
30. The Court of Appeal gave its ruling on 10 December 1979
([1980] 2 All England Law Reports 138-144). The main judgment was
delivered by Lord Denning, with whom the other two judges,
Lord Justice Bridge and Sir David Cairns, concurred.
With regard to AGOSI's claim that it was entitled to the restoration
of the Kruegerrands in view of its alleged innocence, Lord Denning
first made the following observations:
"Before going further, I may say that in any event the customs
authorities have a discretion in the matter. It happens sometimes
that goods are forfeited and then afterwards the true owner comes up
and says that he was defrauded of them. If the customs authorities are
satisfied of his claim, they may waive the forfeiture and hand them to
him. There is a very wide discretion given to the commissioners under
s 288 of the 1952 Act under which they can forfeit the goods or
release them, or pay compensation and so forth. That may arise at a
later time. But the German company says that in this case the customs
authorities had no right to forfeit the goods at all. It would suit
the German company much better to have the actual Kruegerrands
returned to them, when you consider the value of gold itself, instead
of compensation at 1975 figures."
Lord Denning thereafter went on to deal with the different objections
advanced by AGOSI against the Commissioners' contention that the
Kruegerrands were liable to forfeiture. Lord Denning held that the
definition of goods in the Treaty of Rome was irrelevant for the
purposes of section 44 (f) and that there was nothing in Article 1 of
Protocol No. 1 (P1-1) or general international law prohibiting
forfeiture in the instant case. He concluded:
"It seems to me that the customs authorities are right. These
Kruegerrands are forfeitable to the Crown ... It is entirely a matter
for the discretion of the Customs and Excise to consider whether the
claim of the German company is so good that they should see fit in
this case to release them to the German company or retain them and pay
them some compensation. That is within the discretion of the Customs
and Excise."
Lord Justice Bridge added:
"If I were satisfied, which I am not, that there is such a principle
in international law as that for which the [German company's counsel]
contends, I should still be wholly unconvinced that it would be open
to us to write into the Customs and Excise Act 1952 the extensive
amendments which it would be necessary to introduce in order to give
effect to that principle and to make an exception from liability to
forfeiture, where there had been a plain case under the language of
the statute giving rise to forfeiture, in favour of a foreign owner of
goods who could show he had not been a party to the act out of which
the liability to forfeiture arose."
Sir David Cairns remarked:
"If [a foreign owner] is innocent of any complicity in the smuggling,
it is appropriate that there should be an opportunity for him to apply
for the exercise of discretion in his favour, but I cannot see that it
would be possible so to construe the Act as to exclude from the
forfeiture provision any goods belonging to such a [foreigner].
The appeal was dismissed.
31. The Court of Appeal did not grant leave to appeal to the House
of Lords. On 27 March 1980, AGOSI petitioned the House of Lords for
leave to appeal, but such leave was refused.
32. On 1 April 1980, AGOSI's solicitors again wrote to the
Commissioners of Customs and Excise requesting the return of the
goods. The solicitor for the Commissioners replied in the negative on
1 May 1980, without giving any reasons.
II. The relevant legislation
A. The condemnation proceedings
33. Under section 275 of the 1952 Act, goods being liable for
forfeiture under, inter alia, section 44 of the Act may be seized or
detained by the customs authorities.
Section 44 reads in relevant parts:
"Where:
...
(b) any goods are imported, landed or unloaded contrary to any
prohibition or restriction for the time being in force with respect
thereto under or by virtue of any enactment; or
...
(f) any imported goods are concealed or packed in any manner
appearing to be intended to deceive an officer,
those goods shall be liable to forfeiture ..."
34. The procedure to be followed after seizure is set out in the
Seventh Schedule to the Act.
According to paragraph 1, the Commissioners of Customs and Excise
shall give notice of seizure to any person who to their knowledge was
at the time of the seizure the owner of the seized goods.
Any person wishing to claim that the goods are not liable to
forfeiture must, in accordance with paragraphs 3 and 4, give the
Commissioners notice of his claim in writing within one month of the
date of notice of seizure or, if no such notice has been served on
him, within one month of the date of seizure.
Paragraph 6 provides that if notice of a claim is duly served, the
Commissioners shall take proceedings for the condemnation of the
seized goods by the courts. This paragraph further specifies that "if
the court finds that the [items were] at the time liable to forfeiture
the court shall condemn [them] as forfeited." According to
established case-law, the courts will only examine whether the seized
goods fall into any of the categories of goods mentioned in the law as
liable to forfeiture; they will not examine the question of the
owner's innocence. Condemnation proceedings are, according to
paragraph 8, to be considered as civil proceedings.
If no notice of claim has been given to the Commissioners in
accordance with paragraphs 3 and 4, then the goods seized are deemed,
in accordance with paragraph 5, to have been duly condemned as
forfeited.
35. Under section 288 of the 1952 Act:
"The Commissioners may, as they see fit,
(a) ...
(b) restore, subject to such conditions, if any, as they think
proper, any thing forfeited or seized under the said Act ..."
B. Judicial review of administrative decisions
36. Prior to 11 January 1978, judicial review of certain decisions
by administrative authorities could be obtained by application for a
prerogative order (mandamus, certiorari or prohibition) in accordance
with section 10 of the Administration of Justice Act 1938 and Order 53
of the then Rules of the Supreme Court. In addition, litigants were
entitled to bring ordinary actions for declarations, injunctions or
damages in appropriate cases.
In the words of the Government, "the multiplicity of remedies, each
with their own procedural idiosyncracies, was considered to be a real
disadvantage to litigants, and an inhibition on the ability of the
courts to develop a coherent corpus of law in this area". In
particular, an application for a prerogative order might not have been
effective if the challenged decision did not contain the reasons on
which it was based, since the law did not permit the obtaining of
evidence on facts or other matters not appearing on the record of the
decision (see Report on Remedies in Administrative Law, Law Commission
no. 73, Cmnd. 6407 (1976)).
37. The Rules of the Supreme Court were amended in 1977 by
Statutory Instrument so as to provide for one specific procedure, now
known formally as judicial review, for all litigants seeking relief in
matters relating to public law. The amendments came into force on 11
January 1978 and were thus applicable when the Commissioners took
their decision on 1 May 1980 (see paragraph 32 above).
38. According to the Supreme Court Practice, the new Order 53
introduced inter alia, the following changes:
"- It created a new procedure called 'application for judicial' review
and in this single application, the applicant may apply for any of the
prerogative orders, either jointly or in the alternative, without
having to select any particular one appropriate to his case.
- The machinery of interlocutory applications such as discovery of
documents and interrogatories and orders for the respondent of an
affidavit to attend for cross-examination has been introduced into
applications for judicial review and such applications may be heard by
a Judge or by a Master of the Queen's Bench Division.
- If the claim for relief is an order of certiorari, the Court is
empowered, in addition to quashing the decision, to remit the matter
to the authority concerned with a direction to reconsider it and reach
a decision in accordance with the findings of the Court so that the
Court may operate not only as a 'Court of Cassation' but also as a
Court of review." (Rules of the Supreme Court, RSC, 1985, Vol. 1,
Order 53, pp. 757-758 para. 53/1 - 14/6).
39. The procedure whereby an application for judicial review had
to be made in two stages was left unchanged by the reform. It is
first necessary to obtain leave of the Court, and, according to the
Supreme Court Practice, "only if and to the extent that such leave is
granted will the Court proceed to hear the substantive application for
judicial review". "Leave should be granted, if on the material then
available the Court thinks, without going into the matter in depth,
that there is an arguable case for granting the relief claimed by the
applicant" (RSC, loc. cit., p. 757, para. 53/1 - 14/23).
40. The grounds on which judicial review under the new Order 53
can be granted are the same as those held valid for the earlier
applications for prerogative orders. They are stated by the Supreme
Court Practice to fall under the following main headings:
"1. Want or excess of jurisdiction ...
2. Where there is an error of law on the face of the record ...
3. Failure to comply with the rules of natural justice ... Broadly
the rules of natural justice embody a duty to act fairly ... The
rules of natural justice will normally apply where the decision
concerned affects a person's rights, for example where his property is
taken by compulsory purchase ... The rules of natural justice can
also apply where the applicant for judicial review does not have a
right, for example where he is applying for some requisite statutory
licence: in such cases, although he has no right to a licence unless
and until it is granted, there is a duty to comply with the rules of
natural justice and to act fairly because a legal power which affects
his interests is being exercised. ...
4. The Wednesbury principle - A decision of a public authority will
be liable to be quashed or otherwise dealt with by an appropriate
order in judicial review proceedings where the Court concludes that
the decision is such that no authority properly directing itself on
the relevant law and acting reasonably could have reached it ...."
41. The requirement that administrative authorities direct
themselves properly on the relevant law and act reasonably has been
expounded upon in several cases before English courts (see also
"Administrative Law", H.W.R. Wade, 5th edition (1980), pp. 348-349 and
354-355). Thus in Breen v. Amalgamated Engineering Union [1971] 2
Queen's Bench Division, p. 190, Lord Denning stated:
"The discretion of a statutory body is never unfettered. It is a
discretion which is to be exercised according to law. That means at
least this: the statutory body must be guided by relevant
considerations and not by irrelevant. If its decision is influenced
by extraneous considerations which it ought not to have taken into
account, then the decision cannot stand. No matter that the statutory
body may have acted in good faith; nevertheless the decision will be
set aside."
Due regard must be had, inter alia, to the scope and object of the
enactment conferring the power. According to Lord Reid in Padfield
v. Minister of Agriculture, Fisheries and Food [1968] Appeal Cases
p. 997: "Parliament must have conferred the discretion with the
intention that it should be used to promote the policy and objects of
the Act".
42. The Government have conceded that, except for a decision by the
High Court of 17 July 1985 (R v. Commissioners of Customs and Excise, ex
parte Leonard Haworth), there have been no cases applying the
above-mentioned principles to the exercise of discretion by the
Commissioners with regard to restoration of forfeited goods.
The Haworth case concerned the seizure by the customs authorities of a
yacht involved in a drug smuggling attempt and the Commissioners'
exercise of discretion under section 152 of the Customs and Excise
Management Act 1979. Under this provision, the wording of of which is
almost identical to that of section 288 of the 1952 Act, "the
Commissioners may as they see fit, ... restore subject to such
conditions (if any) as they think proper, any thing forfeited or
seized". The owner of the yacht, who claimed to be innocent of any
smuggling attempt, made an application for judicial review of the
Commissioners' failure or refusal to exercise their statutory
discretion to restore the yacht. The High Court (Mr. Justice Forbes)
found that the exercise of the Commissioners' discretion under section
152 involved a consideration of the culpability of the owner and held
that the Commissioners had not properly exercised their discretion
under section 152 in the case before it, as they had not provided the
owner with the necessary information regarding the matters held
against him and had not given him the opportunity to reply thereto.
PROCEEDINGS BEFORE THE COMMISSION
43. In its application of 17 September 1980 to the Commission
(no. 9118/80), AGOSI complained that the forfeiture of the coins
constituted a breach of Article 6 § 2 of the Convention and of Article 1
of Protocol No. 1 (art. 6-2, P1-1).
44. The application was declared admissible by the Commission on
9 March 1983. In its report of 11 October 1984 (Article 31)
(art. 31), the Commission expressed the opinion, by nine votes to two,
that there had been a breach of Article 1 of Protocol No. 1 (P1-1).
The full text of the Commission's opinion and of the two dissenting
opinions contained in the report is reproduced as an annex to the
present judgment.
FINAL SUBMISSIONS TO THE COURT
45. At the hearing on 20 January 1986, the Government submitted that
Article 6 (art. 6) was not applicable in the present case and they
confirmed in substance the final submission set out in their memorial
whereby they requested the Court "to decide and declare that there has
been no breach of the rights of the applicant company under Article 1
of the First Protocol to the Convention (P1-1)".
46. The applicant company likewise reiterated in substance at the
hearing the final submissions made in its memorial whereby it asked the
Court "to find that the Government has violated Article 1 of the First
Protocol ... and Article 6 of the Convention ... (P1-1, art. 6)".
AS TO THE LAW
I. ARTICLE 1 OF PROTOCOL NO. 1 (P1-1)
47. The applicant company did not complain of the original seizure
of the Kruegerrands by the customs authorities. Its grievance is
directed at the forfeiture of the coins and the subsequent refusal of
the Commissioners of Customs and Excise to restore them. It alleged
that these decisions were contrary to Article 1 of Protocol No. 1 of
the Convention (P1-1), which reads:
"Every natural or legal person is entitled to the peaceful enjoyment
of his possessions. No one shall be deprived of his possessions
except in the public interest and subject to the conditions provided
for by law and by the general principles of international law.
The preceding provisions shall not, however, in any way impair the
right of a State to enforce such laws as it deems necessary to control
the use of property in accordance with the general interest or to
secure the payment of taxes or other contributions or penalties."
AGOSI contended that the confiscation of the coins was not justified
in accordance with this Article (P1-1), since it was the lawful owner
of the coins and innocent of any wrongdoing, and that it was not given
the opportunity under the relevant provisions of English law to
establish its innocence before a court.
A. General considerations
48. Article 1 (P1-1) in substance guarantees the right of property
(see the Marckx judgment of 13 June 1979, Series A no. 31, pp. 27-28,
para. 63). It comprises "three distinct rules": the first rule, set
out in the first sentence of the first paragraph, is of a general
nature and enunciates the principle of the peaceful enjoyment of
property; the second rule, contained in the second sentence of the
first paragraph, covers deprivation of possessions and subjects it to
certain conditions; the third rule, stated in the second paragraph,
recognises that the Contracting States are entitled, amongst other
things, to control the use of property in accordance with the general
interest (see, inter alia, the Sporrong and Lönnroth judgment of 23
September 1982, Series A no. 52, p. 24, para. 61). However, the three
rules are not "distinct" in the sense of being unconnected: the second
and third rules are concerned with particular instances of
interference with the right to peaceful enjoyment of property and
should therefore be construed in the light of the general principle
enunciated in the first rule (see the Lithgow and Others judgment
of 8 July 1986, Series A no. 102, p. 46, para. 106).
49. The forfeiture of the smuggled Kruegerrands amounted to an
interference with the applicant company's right to peaceful enjoyment
of their possessions as protected by the first sentence of Article 1
(P1-1). This point has not been in dispute.
50. The Court must first determine whether the material provision
in the present case is the second sentence of the first paragraph or
the second paragraph.
51. The prohibition on the importation of gold coins into the
United Kingdom clearly constituted a control of the use of property.
The seizure and forfeiture of the Kruegerrands were measures taken for
the enforcement of that prohibition. It is true that the High Court
based its decision to declare the Kruegerrands forfeited on
sub-paragraph (f) of section 44 of the 1952 Act, holding that they had
been goods concealed in a manner appearing to be intended to deceive
an officer. However, the Commissioners' counterclaim for forfeiture
also relied on, inter alia, sub-paragraph (b) of the same section,
which provided for the forfeiture of goods imported in contravention
of an importation prohibition (see paragraphs 26 and 33 above). It
does not appear material in this context that the High Court chose to
rely on one of these sub-paragraphs rather than the other.
The forfeiture of the coins did, of course, involve a deprivation of
property, but in the circumstances the deprivation formed a
constituent element of the procedure for the control of the use in the
United Kingdom of gold coins such as Kruegerrands. It is therefore
the second paragraph of Article 1 (P1-1) which is applicable in the
present case (see, mutatis mutandis, the Handyside judgment
of 7 December 1976, Series A no. 24, p. 30, para. 63).
B. Compliance with the requirements of the second paragraph
52. The second paragraph of Article 1 (P1-1) recognises the right
of a State "to enforce such laws as it deems necessary to control the
use of property ... in accordance with the general interest".
Undoubtedly the prohibition on the importation of Kruegerrands into
the United Kingdom was in itself compatible with the terms of this
provision. Nevertheless, as the second paragraph is to be construed
in the light of the general principle enunciated in the opening
sentence of Article 1 (P1-1) (see paragraph 48 in fine above), there
must, in respect of enforcement of this prohibition, also exist a
reasonable relationship of proportionality between the means employed
and the aim sought to be realised; in other words, the Court must
determine whether a fair balance has been struck between the demands
of the general interest in this respect and the interest of the
individual or individuals concerned (see the above-mentioned Sporrong
and Lönnroth judgment, p. 26, paragraph 69 and p. 28, paragraph 73,
and the James and Others judgment of 21 February 1986, Series A
no. 98, p. 34, paragraph 50). In determining whether a fair balance
exists, the Court recognises that the State enjoys a wide margin of
appreciation with regard both to choosing the means of enforcement and
to ascertaining whether the consequences of enforcement are justified
in the general interest for the purpose of achieving the object of the
law in question.
53. As the Commission pointed out, under the general principles of
law recognised in all Contracting States, smuggled goods may, as a
rule, be the object of confiscation. However, the Commission and the
applicant company took the view that, to justify confiscation, a link
must necessarily exist between the behaviour of the owner of the
smuggled goods and the breach of the law, so that if the owner is
"innocent" he should be entitled as of right to recover the forfeited
goods.
The Government contended that no such right is given by the Convention
or Protocol No. 1 (P1). They submitted that if the purpose of the
interference with the owner's peaceful enjoyment of his possessions is
justifiable in the terms of Article 1 (P1-1), then, provided the
forfeiture in question can properly be said to further that purpose,
the forfeiture is justifiable. However, they conceded that as a
practical matter, where a person is free of any fault which could
relate in any way to the purpose of the legislation, it is likely that
the forfeiture of that property could not on any sensible construction
of the legislation further the object thereof.
54. It is first to be observed that although there is a trend in
the practice of the Contracting States that the behaviour of the owner
of the goods and in particular the use of due care on his part should
be taken into account in deciding whether or not to restore smuggled
goods - assuming that the goods are not dangerous - different
standards are applied and no common practice can be said to exist.
For forfeiture to be justified under the terms of the second paragraph
of Article 1 (P1-1), it is enough that the explicit requirements of
this paragraph are met and that the State has struck a fair balance
between the interests of the State and those of the individual (see
paragraph 52 above). The striking of a fair balance depends on many
factors and the behaviour of the owner of the property, including the
degree of fault or care which he has displayed, is one element of the
entirety of circumstances which should be taken into account.
55. Accordingly, although the second paragraph of Article 1 (P1-1)
contains no explicit procedural requirements, the Court must consider
whether the applicable procedures in the present case were such as to
enable, amongst other things, reasonable account to be taken of the
degree of fault or care of the applicant company or, at least, of the
relationship between the company's conduct and the breach of the law
which undoubtedly occurred; and also whether the procedures in
question afforded the applicant company a reasonable opportunity of
putting its case to the responsible authorities. In ascertaining
whether these conditions were satisfied, a comprehensive view must be
taken of the applicable procedures (see among other authorities,
mutatis mutandis, the X v. United Kingdom judgment of 5 November 1981,
Series A no. 46, p. 26, para. 60).
56. In the present case, the question of forfeiture was dealt with
in two distinct stages: the condemnation proceedings before the courts
and the subsequent determination by the Commissioners under section
288 of the 1952 Act whether or not to exercise their discretion to
restore the Kruegerrands to the applicants. It is uncontested that
the question of AGOSI's behaviour was irrelevant in the proceedings
before the High Court under section 44 of the Act for the condemnation
of the Kruegerrands as forfeit. The question of the company's
behaviour was, however, implicitly raised in its application to the
Commissioners on 1 April 1980, that is after the coins had been
formally forfeited by the courts, for the restoration of the
Kruegerrands under section 288 (see paragraphs 32 and 35 above). In
accordance with the rules of English law, the Commissioners were bound
to be guided by relevant considerations (see paragraphs 40 and 41
above). In the present case, the relevant considerations certainly
included the alleged innocence and diligence of the owner of the
forfeited coins and the relationship between the behaviour of the
owner and the breach of the import laws.
57. The applicant company submitted that a purely administrative
procedure is insufficient for the purposes of the second paragraph of
Article 1 of Protocol No. 1 (P1-1): a judicial remedy is required to
protect the innocent owner.
The Government argued in reply that, should the Court accept that
contention, English law does ensure adequate control by providing for
judicial review of the Commissioners' decisions under section 288.
The applicant, however, disputed that judicial review was available in
regard to these decisions, and alternatively that, even if such review
was available, it was of sufficient scope to provide an effective
remedy.
58. The applicant company contended that the unavailability of
judicial review is evidenced from the judgments of the High Court and
the Court of Appeal in its case, having regard in particular to
sub-paragraph 10 of the statement of claim in the writ of summons
issued by the company on 14 April 1977 (see paragraph 26 above).
The Government contested AGOSI's interpretation of these judgments.
In the Government's submission, these judgments only show that the
company's request for a declaration that the Kruegerrands should be
restored to it was premature and could not be dealt with until the
coins had been condemned as forfeited and the Commissioners had
refused to exercise their discretion under section 288.
A reading of the judgments confirms the Government's interpretation
(see in particular the quotations from Lord Denning's judgment in the
Court of Appeal in paragraph 30 above). Admittedly, the procedural
difficulties under English law, notably the fact that the
Commissioners did not give any reasons for their decision, might,
before the reform of 1977/78, have justified the conclusion that the
procedure available to the applicant company did not allow it to
pursue the remedy of judicial review effectively (see paragraphs 36-38
above). However, by the time the Commissioners took their decision of
1 May 1980 under section 288, the reform of judicial review had come
into effect, so that these difficulties had been removed.
59. The applicant company, however, also argued that a remedy by
way of judicial review would have been of no avail because the
Commissioners' discretion under section 288 is so wide as to be
unreviewable. The Government contested this and submitted that
judicial review of the exercise of administrative discretion is always
possible.
The Court notes that the availability of the remedy in circumstances
comparable to those of the applicant's case was recently demonstrated
by the judgment of 17 July 1985 in R. v. H.M. Customs and Excise, ex
parte Leonard Haworth (see paragraph 42 above). In this case, the
High Court carried out a judicial review of the Commissioners'
exercise of discretion under section 152 of the Customs and Excise
Management Act 1979, which section confers on the Commissioners the
same wide discretion as section 288 of the 1952 Act (see paragraph 35
above). Whilst this judgment was delivered subsequent to the facts of
the present case, there is no indication that it marked a new
departure in the law.
In these circumstances AGOSI's submission on this point appears
unfounded.
60. In the alternative, the company argued that such judicial
review as may have been available was of insufficient scope for the
purposes of the second paragraph of Article 1 of Protocol No. 1
(P1-1).
In the Court's view, this submission also fails. One of the grounds
for challenging the decision of an administrative authority such as
the Commissioners is - and on this point there was no dispute - that
"the decision was one which a public authority properly directing
itself on the relevant law and acting reasonably could not have
reached" (the so-called "Wednesbury" principle), for example because
the administrative authority exercising discretion had failed to take
into account relevant considerations (see paragraph 41 above). More
particularly, the nature and effectiveness of the remedy by way of
application for judicial review in the context of seizure and
forfeiture of goods by the customs authorities are illustrated by the
recent judgment in the Haworth case (see paragraphs 42 and 59 above).
In that case, the High Court held that, in exercising their discretion
in circumstances comparable to the present case, the Commissioners had
acted unreasonably, in that they had not given the owner of the goods
seized in a smuggling attempt the necessary information about what
matters were held against him and no opportunity to reply thereto or
to establish his lack of complicity in anything either criminal or
irresponsible.
The Court considers that in the circumstances the scope of judicial
review under English law is sufficient to satisfy the requirements of
the second paragraph of Article 1 (P1-1).
61. AGOSI further contended that it was not required to pursue
this remedy since English law lacked the requisite certainty in the
matter. However, as appears from paragraphs 58 to 60 above, this
submission is not supported by the evidence adduced.
C. Conclusion
62. The Court finds therefore that the procedure available to the
applicant company against the Commissioner's refusal to restore the
Kruegerrands cannot be dismissed as an inadequate one for the purposes
of the requirements of the second paragraph of Article 1 (P1-1). In
particular, it has not been established that the British system failed
either to ensure that reasonable account be taken of the behaviour of
the applicant company or to afford the applicant company a reasonable
opportunity to put its case.
The fact that the applicant, for reasons of its own, chose not to seek
judicial review of the Commissioners' decision of May 1980 and hence
did not receive full advantage of the safeguards available to owners
asserting their innocence and lack of negligence cannot invalidate
this conclusion. Accordingly there has been no breach of Article 1 of
Protocol No. 1 (P1-1).
II. ARTICLE 6 (art. 6) OF THE CONVENTION
63. The applicant company also alleged a breach of the following
provisions of Article 6 (art. 6) of the Convention:
"1. In the determination ... of any criminal charge against him,
everyone is entitled to a fair ... hearing ... by an independent and
impartial tribunal ...
2. Everyone charged with a criminal offence shall be presumed
innocent until proved guilty according to law.
..."
AGOSI complained that the decisions taken by the English courts in the
condemnation proceedings and by the Commissioners of Customs and
Excise on the request for restoration of the Kruegerrands amounted to
a determination of a criminal charge, within the meaning of Article 6
(art. 6), against it. Its complaint was mainly that its right to be
presumed innocent had not been observed in the first set of
proceedings and that its right to have the determination of a criminal
charge made by a court had not been respected in the second set of
proceedings.
64. It must first be determined whether or not the procedures
complained of can be seen, separately or jointly, as involving the
determination of a criminal charge against AGOSI, something which both
the Government and the Commission's Delegate have contested.
65. On this point, the Court shares the opinion of the Government
and the Delegate.
The forfeiture of the Krügerrands by the courts and the subsequent
refusal of the Commissioner of Customs and Excise to restore them were
measures consequential upon the act of smuggling committed by X and Y
(see paragraphs 28 and 32 above). Criminal charges under domestic law
were brought against the smugglers but not against AGOSI in respect of
that act (see paragraphs 22-25 above).
The fact that measures consequential upon an act for which third
parties were prosecuted affected in an adverse manner the property
rights of AGOSI cannot of itself lead to the conclusion that, during
the course of the procedures complained of, any "criminal charge", for
the purposes of Article 6 (art. 6), could be considered as having been
brought against the applicant company.
66. The compatibility of the consequential measures with the
applicant's Convention rights has been examined in the present
judgment on the basis of Article 1 of Protocol No. 1 (P1-1).
None of the proceedings complained of can be considered to have been
concerned with "the determination of [a] criminal charge" against the
applicant company; accordingly, Article 6 (art. 6) of the Convention
did not apply in this respect.
67. The applicant company has not invoked Article 6 (art. 6) in so
far as it relates to "civil rights and obligations" and the Court does
not find it necessary to examine this issue of its own motion.
FOR THESE REASONS, THE COURT
1. Holds by six votes to one, that there has been no violation of
Article 1 of Protocol No. 1 (P1-1);
2. Holds by six votes to one, that Article 6 (art. 6) of the
Convention did not apply in the present case in so far as it relates
to the determination of a criminal charge;
3. Holds by five votes to two that it is not necessary to take into
account Article 6 (art. 6) in so far as it relates to the
determination of civil rights and obligations.
Done in English and French, and delivered at a public hearing at the
Human Rights Building, Strasbourg, on 24 October 1986.
Signed: Gérard WIARDA
President
Signed: Marc-André EISSEN
Registrar
In accordance with Article 51 § 2 (art. 51-2) of the Convention and
Rule 52 § 2 of the Rules of Court, the dissenting opinions of Judges
Thór Vilhjálmsson and Pettiti are annexed to the present judgment.
Initialled: G. W.
Initialled: M.-A. E.
DISSENTING OPINION OF JUDGE THÓR VILHJÁLMSSON
To my regret, I am not able to agree with the majority of the Chamber
in this case. I think that there was a violation of Article 6 § 1
(art. 6-1) under its civil head, but no violation under its criminal
head. To my mind, the question whether there was a violation of
Article 1 of Protocol No. 1 (P1-1) is absorbed by the issue raised
under Article 6 (art. 6). These finding prompted me to join the
majority in all but the last vote on the operative part of the
judgment.
I concur with the majority when, in paragraph 55 of the judgment, it
states that what is decisive for the outcome of the case is whether or
not sufficient procedural guarantees were given in English law to the
applicant company. But, as already indicated, I part ways with the
majority when it reasons on the basis that an insufficiency of
procedural guarantees would entail a violation of Article 1 of
Protocol No. 1 (P1-1). In my opinion, this would entail a violation
of Article 6 § 1 (art. 6-1) in relation to a determination of the
applicant company's "civil rights". It is immaterial whether or not
this provision was cited in argument by the applicant company, be it
under the civil or criminal head or under both. My main reason for
applying Article 6 (art. 6) and not Article 1 of Protocol No. 1 (P1-1)
is that Article 6 (art. 6) enunciates a clearly stated rule on the
right to a fair trial. Such a rule is not expressly set out in the
Article relied on by the majority, which finds that it is implied in
the provision. Such an interpretation of the Convention is in my
opinion not necessary in the present case and somewhat strained.
Having come to the conclusion that Article 6 (art. 6) is the material
provision, the next question to be answered is whether or not a civil
right of the applicant company was at stake. It would be out of place
to try to formulate, in this dissenting opinion, a general rule on the
dividing line between civil rights and public-law rights in the field
of customs and excise. It suffices to say that the rather special
circumstances of the present case lead me without hesitation to
classify AGOSI's claim for recovery of the gold coins as an assertion
of a "civil right" for the purposes of Article 6 § 1 (art. 6-1) of the
Convention.
It then remains to determine whether or not the procedure used or
available satisfied the requirements of Article 6 § 1 (art. 6-1).
This provision requires, inter alia, a fair hearing before a tribunal.
This means that one has to examine the following three questions, as
the majority does in paragraphs 58, 59 and 60 of the judgment, namely
- was the remedy of judicial review available?
- was the Commissioners' discretion in the present case so wide as to
be unreviewable?
- was such judicial review as may have been available of sufficient
scope?
It is strictly speaking correct, as found by the majority in
paragraph 58 of the judgment, that judicial review was available
according to the law and, as stated in paragraph 59 and shown by the
Haworth case in 1985, the decision challenged by the applicant company
was in theory reviewable. It is clear, in my opinion, that, under
English law as it stands, this is an extraordinary remedy which can be
exercised only very rarely. This is of importance especially since
circumstances where a judicial remedy could be sought cannot be
infrequent. Moreover, the grounds on which review can be granted are
limited in scope. They are set out in paragraph 40 of the judgment
which cites an extract from the part of the Supreme Court Practice
(1985) relating to the so-called Order 53.
Having regard to the content of paragraph 40 of the judgment, I am not
satisfied that the applicant company had available to it under English
law a judicial remedy of sufficient scope, for the purposes of Article
6 § 1 (art. 6-1) of the Convention, in which the civil right it
asserted could be determined.
DISSENTING OPINION OF JUDGE PETTITI
(Translation)
I disagree with the majority in this case, since I consider that there
has indeed been a breach of Protocol No. 1 and of Article 6 of the
Convention (P1, art. 6).
It is true that the scope of the judgment in relation to rules
applicable to customs authorities is limited. The Court has held that
Protocol No. 1 (P1) has not been violated and that Article 6 (art. 6)
does not apply. Essentially, it takes the view that the applicant
company had available to it a procedure allowing adequate judicial
review of the decision of May 1980 by the Commissioners of Customs and
Excise.
Concerning Article 1 of Protocol No. 1 (P1-1)
With regard to the second paragraph of Article 1 of the Protocol
(P1-1), the Court states that forfeiture of goods is permissible only
if the explicit requirements of this Article (P1-1) are respected and
if the State strikes a fair balance between its own interests and
those of the individual concerned (paragraphs 52 and 54).
In the Court's opinion, it has not been established that the British
system failed to ensure that reasonable account was taken of the
conduct of the applicant company, and the latter must be held
responsible for its failure to seek judicial review of the
Commissioners' decision of May 1980 and thereby to receive full
advantage of the safeguards which ought to be available to property
owners who have committed no customs offence.
In my view, however, the applicant company was effectively prevented
from availing itself of the safeguards to which it was legitimately
entitled.
AGOSI attempted to use all the generally known remedies. Following
the decision of the court of first instance, ordering forfeiture of
the coins under section 44(b) of the Customs Act 1952, the company
took the matter to the Court of Appeal, which rejected the appeal,
having considered the legal definition of goods or capital in the
Treaty of Rome.
The Court of Appeal refused leave to appeal to the House of Lords.
On 27 March 1980, AGOSI unsuccessfully sought leave to appeal from the
House of Lords itself.
In the Court of Appeal, however, Sir David Cairns observed:
"Whatever may be the extent of the principle of international law
about the confiscation of goods belonging to aliens, that principle in
my view clearly cannot apply to the forfeiture of smuggled goods. If
an alien can show that such forfeiture would involve depriving him of
his property and that he is innocent of any complicity in the
smuggling, it is appropriate that there should be an opportunity for
him to apply for the exercise of discretion in his favour, but I
cannot see that it would be possible so to construe the 1952 Act as to
exclude from any forfeiture provision any goods belonging to such an
alien" ([1980] All England Law Reports 144).
The following events had pre-dated these proceedings before the Court
of Appeal.
AGOSI first applied to the customs authorities for return of the coins
on 18 and 28 August 1975. Customs officials inspected AGOSI's factory
and found no evidence that an offence had been committed. A further
request to the customs authorities on 13 October 1975 was
unsuccessful. However, AGOSI co-operated with the customs authorities
in the criminal proceedings against X and Y. The civil proceedings
for return of the coins were instituted against the Commissioners of
Customs and Excise in the High Court on 14 April 1977. This action
was dismissed.
A procedure for forfeiture was first introduced in English law by the
Customs Consolidation Act 1853, but this Act did not abolish the
authorities' discretionary power to restore confiscated property.
Between 1836 (case of R. v. Commissioners of Customs and Another) and
1985 (Haworth case), there was apparently no case involving judicial
review of the exercise of the customs authorities' discretionary power
to restore seized property.
The judgment in the Haworth case cannot be cited as a precedent
against AGOSI, since it came after the High Court's decision in the
AGOSI case. AGOSI argued that the word "may" in the Customs
Consolidation Act 1876 had to be interpreted as conferring on the
courts discretionary power with regard to restoration of seized
property. The House of Lords might have given a useful ruling on this
important point if it had granted the applicant company leave to
appeal.
It seems to me that the procedure followed did not sufficiently
distinguish between criminal and administrative law, between
confiscation in the English sense of "forfeiture" and final
confiscation, with transfer of ownership to the State - a distinction
needed to protect the rights of lawful owners innocent of any criminal
or customs offence. In the present case and having regard to the
goods confiscated, there was no State interest making it necessary to
maintain the confiscation. The gold coins in dispute were indeed
within the meaning of Article 1 of Protocol No. 1 (P1-1). In my view,
this Article (P1-1) implies that an innocent owner, acting in good
faith, must be able to recover his property.
Even if the State is allowed a margin of discretion in respect of its
administrative regulations, the action taken and maintained against
AGOSI violated its right to enjoyment of its possessions and was
disproportionate both in its aims and its effects.
At the hearing, the Commission's Delegate argued that judicial review
had not been a remedy sufficient, for the purposes of Article 1 of
Protocol No. 1 (P1-1), to allow AGOSI to vindicate its rights as an
innocent property-owner; this analysis would seem relevant here.
Firstly, the United Kingdom Government did not in fact raise the
question of judicial review in connection with the exhaustion of
domestic remedies before the Commission. Secondly, to use this
argument at the merits stage when it had not earlier been used in
connection with Article 26 (art. 26) at the Commission stage would
seem contradictory, even if the Government reserved the right to
return to this point when the merits were being considered. If the
remedy was so obvious, surely failure to use it should have been taken
as an argument?
The complexity of the English procedural system in this area was
evident both before the Commission and before the Court. It cannot be
compared with the continental legal systems which allow judicial
control of administrative action in individual cases through
administrative dispute procedures. It is true that the judicial
review procedure in the United Kingdom is moving in the right
direction, but it can still puzzle even experienced British lawyers,
the scarcity of decisions in this area being a sign of this.
The Commission's Delegate also noted that the British Government had
argued that the principle that confiscated goods must be restored to
an innocent owner could not be deduced from Article 1 of
Protocol No. 1 (P1-1). He thought this inconsistent with the same
Government's claim that the judical review procedure could be regarded as
sufficient.
In its decision on the admissibility of the application (report,
page 44), the Commission summed up the Government's position as
follows:
"The respondent Government contend that the applicant has failed to
exhaust available and effective domestic remedies within the meaning
of Article 26 (art. 26) of the Convention in that it has failed to
take proceedings against X and Y either on the cheque which they
issued or on the contract. The respondent Government accept for the
purposes of admissibility that the possibility to challenge the
refusal by the Commissioners of Customs and Excise to exercise their
discretion under section 288 of the Customs and Excise Act 1952 by way
of judicial review was not a remedy which Article 26 (art. 26) of the
Convention required the applicant to pursue.
The respondent Government contend that the requirement of Article 26
(art. 26) is that a remedy should be capable of providing redress for
the applicant's complaint, whether or not the remedy relates to the
alleged breach of the Convention. Thus a civil action against X and Y
would have provided the applicant with the financial remedy, the
contract price, to which it was entitled under the contract of sale.
Furthermore, this remedy reflects the nature of the applicant's
subsisting interest in the coins after their 'sale' to X and Y, which
was a contractual right to their return or to payment for them."
Such an action, had it been brought, would have been a subsidiary one,
leading only to a possible award of damages. The main civil action
was still that brought against the authorities holding the coins, in
order to secure their return.
The wording of section 288 of the 1952 Act shows that the
discretionary powers of the Commissioners of Customs and Excise are
exceedingly wide. In the case of AGOSI, the authorities were not
prepared, at any point, to return the coins.
However, the rule of law implies "that an interference by the
authorities with an individual's rights should be subject to effective
control .... This is especially so where ... the law bestows on the
executive wide discretionary powers" (Silver and Others judgment of
25 March 1983, Series A no. 61, p. 34, para. 90).
It does not emerge clearly from the decided authorities that judicial
review could have been usefully exercised, even supposing the courts
of last instance had jurisdiction in this respect. Order 53 of the
Supreme Court Practice spells out the difficulty of applying for
judicial review. On 1 May 1980, the Commissioners of Customs and
Excise replied that they were not prepared to use their power of
returning the coins under section 288 of the 1952 Act, even though
AGOSI had also relied on the general principles of English law in
asking to have them returned and had again applied unsuccessfully to
the High Court to have them returned.
The protection of the first paragraph of Article 1 of Protocol No. 1
(P1-1) does not extend to persons guilty of fraud, but it does extend
to property owners who are not guilty of fraud.
There was thus, in my view, a definite breach of Article 1 of
Protocol No. 1 (P1-1).
Concerning Article 6 para. 1 (art. 6-1) of the Convention
Apart from the question of Article 1 of Protocol No. 1 (P1-1), the
issue of violation of Article 6 (art. 6) of the Convention also
arises. Having decided that Protocol No. 1 (P1) had been violated,
the Commission did not consider this point.
The criminal proceedings were brought against the importers. AGOSI's
legal representative was not prosecuted - indeed, he was called as a
witness. AGOSI's claim was not made within the framework of the
criminal proceedings, to which it was not a "party" in the procedural
sense. On the contrary, its applications to establish title and
secure restitution of the gold coins of which it was the lawful owner
both under the original contract and in domestic law were clearly
concerned with "civil rights and obligations" within the meaning of
Article 6 para. 1 (art. 6-1).
This meant that the rules concerning a "fair trial" had to be applied.
Yet, in the first place, AGOSI was not able effectively to assert its
rights in a civil or administrative procedure allowing proper
participation of the contending parties (procès contradictoire) and
leading to a decision on its claim. Secondly, a remedy enabling
judicial review of the customs authorities' decisions was not
effectively available; in any event, such judicial review as was
possible was not wide enough in scope and did not satisfy the demands
of legal certainty.
The Government had referred, at the admissibility stage, to the
possibility of AGOSI's bringing an action against X and Y, but any
such action would have encountered insurmountable obstacles, quite
apart from the insolvency of X and Y. Moreover, the appropriate civil
action was clearly the action brought against the customs authorities
for return of the coins.
If the customs authorities had brought criminal proceedings against
the director of AGOSI for alleged complicity, the latter would have
received a fair trial. But since the customs authorities brought no
charges against AGOSI, it is unfair to bar them from civil remedies or
to disregard the rules embodied in Article 6 (art. 6) concerning
"civil rights and obligations", such rights and obligations
undoubtedly being at issue in the present proceedings. The end result
here is maintenance of an administrative sanction imposed by the
customs authorities and not justified by any guilt on AGOSI's part.
Article 6 para. 1 (art. 6-1) definitely implies that one cannot, on the
pretext of changing the jurisdictional field and legal classification,
deprive a litigant of the safeguards customary in proceedings in
connection with such matters. This is the line followed in the
European Court's judgment in the Öztürk case. A State which, because
of the way in which it has structured its administration of justice,
has not prosecuted a person under the criminal law may not deprive him
of the guarantees provided by Article 6 (art. 6) on the ground that
there have been no criminal proceedings, and yet at the same time
prevent the bringing of civil proceedings. Thus, AGOSI was denied the
opportunity both of proving its innocence in criminal proceedings and
of asserting its rights in civil proceedings. It was treated less
well in its case than were the actual offenders.
As the law and the precedents stood prior to 1985, judicial review was
an extraordinary remedy and AGOSI's own failure to have recourse to it
cannot, in my view, be taken as the reason for considering that it had
not received the benefit of the safeguards required by the Convention.
In my opinion, there was accordingly a breach of Article 6 para. 1
(art. 6-1).