England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM
THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
THE ADMINISTRATIVE COURT
Mark Ockelton, Deputy High Court Judge
[2014] EWHC 4674 (Admin)

		Royal Courts of Justice Strand, London, WC2A 2LL
		18/07/2018

Lord Justice Irwin:

Introduction

1. This case concerns the requirements for the lawful exercise of the power of stop and search of baggage laid down in Section 78(2) of the Customs and Excise Management Act 1979, as amended. The Appellant contends that such powers can only be lawfully exercised when there is an objective necessity to stop and search the individual concerned, as distinguished from a necessity for a system of search. As a secondary or adjectival ground, the Appellant submits there is a common law requirement that proper reasons for search should be provided to the individual searched.

The Facts

2. The facts were summarised by Mr Mark Ockelton, sitting as a Deputy High Court Judge, in his judgment of 14 October 2014. This account of the facts is not challenged.

"7. The claimant came to Southampton airport from Amsterdam on 27 September 2012. He attempted to leave the airport by the channel for those not arriving from another Member State. He was stopped by an officer who questioned him; and following the questions there was an examination, which was no doubt intrusive and embarrassing. I have read the claimant's witness statement in relation to that, in the context of his assertion to the officer that he had been away for such a short time that he had not needed to buy anything at all whilst he was outside the United Kingdom.

8. There was first of all a question about where he had come from and he responded that he had come from the Netherlands. As a result, it is common ground that the provisions of section 4 of the 1992 Act as amended applied to whatever else the officer was going to do.

9. He was asked a number of other questions, and he was required to submit his baggage for examination. The examination revealed nothing that should not have been in the bag.

10. He asked for the reasons why he had been selected for searching. There was a discussion between him and the officer which may have engendered some animosity but so far as the outcome is concerned, the claimant was told that the examination of his bag was that permitted by Section 78 of the 1979 Act, and that no other reason for the selection of him would be given.

11. He was given the officer's number, that is to say her number in the Border Agency. He was told that no records in relation to searches were kept and that none were accessible to him and he declined the officer's offer to read, check and sign her notebook."

The Procedural History

3. The Appellant sought to bring judicial review proceedings, issuing the application on 12 November 2012. Permission to appeal was refused on paper by HHJ Pelling QC (sitting as a Judge of the High Court) on 16 April 2013. The application was renewed by oral application, and permission to apply was granted by Mr Steven Kovats QC, sitting as a Deputy High Court Judge, on 17 October 2013. Following that, the matter came before Deputy Judge Ockelton on 14 October 2014. Thereafter, the Appellant sought permission to appeal. On 13 July 2015, Floyd LJ gave limited permission in the following terms:

"I grant permission under CPR 52.3(6)(b) because whether customs officers searching EU citizens travelling between member states have to give reasons for doing so is an important point of principle which this court has not considered since Commissioner of Customs & Excise v The Queen on the application of Hoverspeed and others, a decision under a differently worded provision. There is therefore a compelling reason to her (sic) the appeal."

4. The matter was first listed before this Court on 15 June 2017. It transpired that the Appellant was seeking to expand the appeal beyond the limits set by the grant of permission. The matter was adjourned. Thereafter the Appellant's application to broaden the appeal was refused by Sales LJ on 7 June 2018. The matter thus comes before us on the limited grounds summarised above.

The Legislation

5. The power to search (and the obligation to answer questions) arises from ss.78(2) and 78(3) of the Customs and Excise Management Act 1979:

"78 - Customs and excise control of persons entering or leaving the United Kingdom.

…

(2) Any person entering or leaving the United Kingdom shall answer such questions as the proper officer may put to him with respect to his baggage and any thing contained therein or carried with him, and shall, if required by the proper officer, produce that baggage and any such thing for examination at such place as the Commissioners may direct.

…

(3) Any person failing to declare any thing or to produce any baggage or thing as required by this section shall be liable on summary conviction to a penalty of three times the value of the thing not declared or of the baggage or thing not produced, as the case may be, or level 3 on the standard scale, whichever is the greater."

6. There are statutory limits on the exercise of the power of search, arising from s.4 of the Finance (No 2) Act 1992 (in recent times, as amended by the Finance Act 2009). The relevant text reads:

"S4 Enforcement Powers

(1) Except in a case falling within subsection (1A) or (2) below, the powers to which this section applies shall not be exercisable in relation to any person or thing entering or leaving the United Kingdom so as to prevent, restrict or delay the movement of that person or thing between different member States.

(1A) The first case in which a power to which this section applies may be exercised as mentioned in subsection (1) above is where it is necessary to exercise the power in order to ascertain whether the movement in question is or is not in fact between different member States.

(2) The second case in which a power to which this section applies may be exercised as mentioned in subsection (1) above is where it is necessary to exercise the power for purposes connected with—

(a) securing the collection of any EU customs duty or giving effect to any EU legislation relating to any such duty;

(b) the enforcement of any prohibition or restriction for the time being in force by virtue of any EU legislation with respect to the movement of goods into or out of the member States;

(c) the enforcement of any prohibition or restriction for the time being in force by virtue of any enactment with respect to the importation or exportation of goods into or out of the United Kingdom; or

(d) searching for cash that is recoverable property or intended for use in unlawful conduct.

(3) Subject to subsection (4) below, this section applies to any power which is conferred on the Commissioners of Customs and Excise or any officer or constable under any of the following provisions of the Customs and Excise Management Act 1979, that is to say—

…

(g) section 78 (questions as to baggage of person entering or leaving the United Kingdom);

…

(h) Section 164 (powers of search)"

7. S.164, in its relevant parts reads:

"164 Power to search persons

(1) Where there are reasonable grounds to suspect that any person to whom this section applies [(referred to in this section as "the suspect")] is carrying any article—

(a) which is chargeable with any duty which has not been paid or secured; or

(b) with respect to the importation or exportation of which any prohibition or restriction is for the time being in force under or by virtue of any enactment.

[an officer may exercise the powers conferred by subsection (2) below and, if the suspect is not under arrest, may detain him for so long as may be necessary for the exercise of those powers and (where applicable) the exercise of the rights conferred by subsection (3) below].

[(2) The officer may require the suspect—

(a) to permit such a search of any article which he has with him; and

(b) subject to subsection (3) below, to submit to such searches of his person, whether rub-down, strip or intimate,

as the officer may consider necessary or expedient; but no such requirement may be imposed under paragraph (b) above without the officer informing the suspect of the effect of subsection (3) below.

(3) If the suspect is required to submit to a search of his person, he may require to be taken—

(a) except in the case of a rub-down search, before a justice of the peace or a superior of the officer concerned; and

(b) in the excepted case, before such a superior;

and the justice or superior shall consider the grounds for suspicion and direct accordingly whether the suspect is to submit to the search.]"

8. It is relevant to note that the previous version of the legislation, before the 2009 amendment, read rather differently. There, the powers arose:

"s.4(2)

… where it appears to the person on whom the power is conferred that there are reasonable grounds for believing that the movement in question is not in fact between Member States, or that it is necessary to exercise the power ..."

The text underlined above was excised from the Act by the amendment in the Finance Act 2009.

The Decision of the Deputy Judge

9. Mr Ockelton rejected the Appellant's argument that there was a requirement for a specific reason for search connected with the individual. Rather he concluded that the requirement of "necessity" was for the existence of a system of search. His central logic appears from the following passage in his judgment:

"14. The arguments put on the claimant's behalf by Mr Field are that the requirement of necessity, expressed as it is throughout section 4 as applied to singular nouns, a case in the opening words of sub-section 1, "the first case" in sub-section 1(A), "the second case" in sub-section 2 and, going back to sub-section 1, "any person or thing", "that person or thing" implies that the necessity must relate to the individual act of exercise of the power under Section 78. That is to say that it is not sufficient to establish a general necessity to have a system of examination of such persons as may be examined, but that there must be a reason justified by section 78 as restricted by section 4 of the 1992 Act in relation to each individual exercise of the power.

15. I asked Mr Field in that context to explain precisely what "necessary" meant following the removal of the requirement for reasonable grounds in the 2009 Act. With the greatest of respect it appears to me that he was unable to give the word "necessary" any coherent meaning consistent with his claim that the requirement applied individually to each exercise of the power. He was driven to say that although the subjective element of reasonable belief or reasonable suspicion had been excised from the statute by the amendment in 2009, nevertheless what was required was not actual necessity but an individual judgment of necessity by an officer. That it seems to me is simply inconsistent with both the words of the statute and the history of the statute in its present form. Clearly the concept of necessity is an objective matter not dependent upon the individual officer's opinion as to the desirability of any individual search.

16. Although the matter is expressed in the singular throughout section 4, it seems to me that the reference in section 4 to the case and to the individual are references to the circumstances in general in which an exercise of the Section 78 power is nevertheless permitted, and that it is open to the defendant to express necessity by reference to the need for a system or process and not to the need for the search in any individual case. Indeed, were it otherwise, it is difficult to see that any process of customs examination could take place within the context of the statutory provisions to which I have referred. Any individual who sought an explanation of the choice of him would be entitled to a demonstration that the search made in his case was necessary for purposes connected with one of the four matters set out. Bearing in mind that under those circumstances, the defendant would have the burden of proof and the claimant would have the option of providing any alternative process that he chose, it seems that the defendant would never be able to establish the necessity of any individual interference.

17. For example, supposing that the search revealed contraband. The defendant would have the task not merely of showing that it had revealed the contraband but that the contraband could not have been revealed by any other process and, indeed, that the duty could not have been collected save by engaging in the search that did take place. That, it seems to me, is a much higher test than can possibly have been envisaged by the draughtsman of the statute and by Parliament when enacting both these powers and the restrictions on them.

18. The defendant's position is that what is necessary is a system under which there are from time to time checks of those who pass through the borders and that that system is necessary because of the effect it has on the general enforcement of the border controls, which even within member States relate to the importation of some types of goods and cash.

19. The necessity is that people pass through a customs post and may be examined. If it were not for that possibility, the restrictions imposed at the borders would effectively be null. I therefore hold that the requirement of necessity referred to in sub-sections 1(a) and 2 of section 4 of the 1992 Act (as amended) is sufficiently satisfied by establishing necessity of a process which is applied to the entry of individuals into the United Kingdom through customs posts."

10. The deputy judge also addressed the ancillary argument that there existed a discrete obligation to provide reasons for any stop and search. On this issue, the judge had evidence from a senior customs officer, Mr David Huke. The witness explained:

"In order to protect Border Force selection techniques Border Force adopts a policy of not revealing the reason/s for selecting any individual. Routinely disclosing the reason for the intervention is likely to substantially prejudice the operation of our border controls. Continued disclosure of these reasons could inform and assist potential offenders, such as those wishing to smuggle goods or evade a tax or duty by providing knowledge which may assist them in building an accurate picture of Border Force anti-smuggling activity. This could assist them in circumventing Border Force controls and procedures set in place to protect the revenue and prevent cross border criminality."

11. In support of this argument, counsel then appearing for the Appellant relied on the decision of this Court in Hoverspeed Ltd and Others v Commissioners of Customs and Excise [2002] EWCA Civ 1804. In that case the original form of s.4 was in question; and the decision was therefore explicitly concerned with a requirement that the person exercising the power should have "reasonable grounds for believing" in the predicate facts governing the power.
12. The deputy judge concluded that the Hoverspeed case was of limited assistance, given that it turned upon the previous version of the Act, which he concluded obliged "the customs" to "defend their actions only by demonstrating a reasonable cause to suspect the necessity" of the stop and search.
13. From that premise, the deputy judge rejected the obligation to give reasons, because it arose from the need to demonstrate a "reasonable cause":

"29. Identification of any more specific requirement to give reasons for the choice of the claimant for a search has led Mr Field to make a number of general propositions to which I do not need to refer in detail because he was not able to support any of them by authority. The truth of the matter is that the search for what are specifically called "reasons" is in a sense begging the question. Where there is an obligation to provide a reasoned choice in respect of any exercise of a power, the duty to have the reasons naturally arises and the duty to disclose them may follow. The present statutory power is not one that requires any reasons for selection of any individual.

…

31. This is not, therefore, an area of the law where reasons, specifically so-called, are required. What is required is for the defendant to be able to establish that the power was lawfully exercised. If the lawful exercise of the power does not require reasons, then no reasons specifically are required to be given by the defendant in his defence. Instead, he may be able to justify the exercise of the power by its existence and its rational and proportionate exercise. That will be a general matter and not related to the circumstances of any individual. It therefore seems to me that in a case such as the present, the search for individual reasons is simply misplaced."

The Issues

14. The parties formulated agreed issues from the appeal:

"1. Does the Respondent have a duty to give reasons for the exercise of the power set out in section 78 of the Customs and Excise Management Act 1979?

2. Does the Respondent have a duty to keep a record of the exercise of the power set out in section 78 of the Customs and Excise Management Act 1979?"

The Arguments

15. Counsel for the Appellant submitted to this Court broadly consistently with his predecessor below. The language of the statute, given its natural reading, required that there should be a "necessity" to perform the stop and search, relating to the individual not the system. That reading arose (in part) from the "tone" of the language, and from the use of the singular ("any person or thing"; "the movement in question"). When asked if the use of "any persons or things" would have altered the sense in this regard, however, Mr Gardner argued it would not.
16. Mr Gardner relied on the lead judgment of Mance LJ (as he then was) in Hoverspeed as providing important guidance on the approach, despite the change in statutory language. He referred to paragraph 22, in particular:

"22. We do not consider that it does. First, the burden of proof rests on Customs to show reasonable grounds to suspect. When claiming to interfere with an individual's person or property, Customs are "bound to shew by way of justification, that some positive law has empowered or excused" them: see Entick v. Carrington (1765) 19 St Tr 1030 , 1066, per Lord Camden CJCP; Ghani v. Jones [1970] 1 QB 693 ; and O'Hara v Chief Constable of R.U.C. [1997] AC 286 , 290B per Lord Steyn and 295F per Lord Hope (although the language of the statute there differentiated it in other respects from the provisions regarding reasonable grounds, with which we are concerned, as the Divisional Court observed at paragraph 160). Second, it is a matter of experience that, although a person with authority or responsibility may assert that he or she has always applied proper principles and procedures, departures and errors in particular cases still occur. We do not consider that it would be appropriate to take on trust, as Customs invite, their application of a proper approach in the three individual cases, in circumstances where it was Customs' choice and responsibility that no proper information exists. It is important that the law should be transparent not merely in its terms, but in their operation. As Customs themselves now appear to accept (since they have changed their procedures following the Divisional Court's decision), it is not appropriate to have a system whereby reasons are neither given nor recorded, and cannot therefore be ascertained or verified after the event. Such a system offers insufficient safeguards against unjustified stopping, and may even tend to abuse."

Those remarks still stated the law, irrespective of the change in statutory language.

17. Mr Gardner did not submit that there was any rule in EU law, or to be extrapolated from EU law, which would support his argument. Indeed, he conceded that EU law permitted "random searches" at airports.
18. Mr Gardner took the Court to the Explanatory Notes accompanying the Finance Act 2009, which statute amended s.4 of the Finance (No 2) Act 1992. He recognised that such Notes cannot affect the meaning of a statute. However, no doubt since the question here is what must be presumed to be the "mischief" addressed by Parliament in making the amendment, we were taken to the following passage:

"5. The effect of this amendment is that an officer of HMRC will no longer need reasonable grounds for believing that a passenger has come from outside the EU in order to exercise the specified customs powers. This is necessary because at large international airports passengers from several flights mix airside before reaching customs. The amendment will permit officers to conduct limited checks such as questioning the traveller and inspecting their travel documents in order to ascertain whether they are EU travellers or not.

6. Another effect of this section is to amend the drafting of section 4 to clarify that officers do not need reasonable grounds for believing that it is necessary to exercise the relevant CEMA power before being able to do so for purposes connected with the collection of Community customs duties or the enforcement of any import prohibition or restriction. The section will now provide that the powers can be exercised where it is necessary to do so, as opposed to where there are reasonable grounds for believing that it is necessary to do so.

7. All checks on EU travellers are carried out in a selective and proportionate manner, and therefore will not interfere with an EU passenger's free movement rights."

19. Mr Gardner argued that the last sentence of paragraph 6 above, and the prescription of checks on EU travellers so as to be "selective and proportional", supported his interpretation of the amended section. There must be established a "necessity" to stop and search each particular person searched. That might derive from a general factor such as a particularly high terror threat assessment. Further, the basis of the necessity had to be recorded.
20. Ms Walker for the Respondent rejected all these arguments, save the last. She accepted, on instruction, that if there had to be established a "necessity" to search a given individual, then a record of those reasons would have to be made and kept.
21. However, the main thrust of the Respondent's argument is that the deputy judge was correct in his approach. The amendment was explicitly to remove the requirement for reasonable suspicion of the individual and to permit such searches because they are "necessary" as a matter of proper and efficient system. That flows from the language of the statute, the evidence of Mr Huke, and (for what it is worth) the Explanatory Notes. The natural meaning of the statutory language is clear: the searches in general must be "necessary", not the search of the individual. Even accepting the observations of the Court in Hoverspeed, the conclusion as to the requirements (including the requirements as to giving reasons) all arose from the need for reasonable suspicion. That had been deliberately removed by Parliament.
22. Moreover, Parliament cannot possibly be taken to have intended to raise the bar for such searches. A requirement that the search of a given individual was "necessary" would be markedly higher than the requirement of "reasonable suspicion", which suffices for an arrest. Further, it was noteworthy that the requirement of reasonable suspicion had been removed from s.4 of the 1992 Act (enforcement powers which apply to both sections 78 and 164 of the Customs and Excise Management Act 1979), but remains a specific requirement under s.164 of the 1979 Act (and indeed for power of arrest generally). It would be inconceivable that Parliament intended to enact a higher threshold for a s.78 stop and search, than for arrest and detention.

Conclusions

23. Essentially for the reasons outlined on behalf of the Respondent, I would dismiss the appeal.
24. In my view, the meaning of the amendment by Parliament is clear. The removal of the "reasonable suspicion" test bearing on an individual leaves a broader test of necessity. It is to my mind inconceivable that Parliament intended to narrow rather than broaden the basis of such stop and search powers. The legislative intention was clearly to broaden the exercise of the power, and the language of the statute seems to me consistent with that.
25. The requirements of the common law were analysed from the previous statutory language. The clear intention of Parliament must, to my mind, have had the effect of abrogating those requirements.
26. The deputy judge challenged counsel before him to ascribe a sensible meaning to "necessity" for an individual search, and records his view that that was not done. Mr Gardner was not able to do so before us. The examples he provided for the most part amounted to a necessity to search all those in the customs' control at a given point or period in time. The only example he advanced bearing on an individual was where a putative "sniffer dog" had reacted to an individual or their belongings. But it is arguable whether even this would amount to a "necessity".
27. In short, it appears to me clear that Parliament chose to remove the threshold of reasonable suspicion of an individual, so that a necessary process or system would be enfranchised by the Act as amended. If that is correct, and no individual "necessity" need be present, then any requirement to give individual reasons falls away. In the light of the answer we have given, the further argument that there was a duty to record reasons does not arise.

Lady Justice Arden:

28. I agree.