England and Wales Court of Appeal (Criminal Division) Decisions

Royal Courts of Justice

Strand

London WC2

Friday, 21st March 1997

B e f o r e:

LORD JUSTICE HUTCHISON

MR JUSTICE McKINNON

MR JUSTICE NEWMAN

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REGINA

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MOHAMMED NAVIEDE

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(Handed Down Judgment of

Smith Bernal Reporting Limited, 180 Fleet Street,

London EC4A 2HD

Tel: 0171 831 3183

Official Shorthand Writers to the Court)

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MR R RHODES and MR S STAFFORD-MICHAEL appeared on behalf of the Appellant

MR LATHAM QC and MR D SWEETING appeared on behalf of the Crown

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J U D G M E N T

(As approved by the Court )

Crown Copyright

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LORD JUSTICE HUTCHISON: The appellant appeals with leave of the single judge against his conviction by a jury on 7th July 1995 of a number of offences relating to a company , Arrows Ltd., which he owned and ran. The trial had lasted some six months, inclusive of an adjournment for five weeks when the appellant was ill. He had throughout that period appeared in person, by his own wish, though he had solicitors in court to advise him.

The first hearing of the appeal was in the summer of 1996 and we reserved judgment. On 24th July, just before we were to deliver the judgment we had prepared, we were informed that the appellant wished in the light of the decision of the House of Lords in R v Preddy [1996] 3 WLR 255, to amend his grounds of appeal and address to us further arguments. The respondent did not oppose the application, to which we acceded, giving directions as to draft amendments, skeleton arguments and so on. Various matters, including the difficulty of reconvening this constitution of the court, have prevented the resumed hearing taking place earlier. It was implicit in those directions that at the resumed hearing we would grant leave for properly drafted amendments arising out of the decision in Preddy and the expectation was that the amendments would be confined to points arising out of that decision, where it was held that a charge of obtaining property by deception contrary to s.15 (1) of the Theft Act 1968 was inappropriate in a case where the allegation was that the dishonest deception had caused the lender to make a loan effected by debiting his bank account and arranging a corresponding credit to the account of the defendant, because the defendant did not in such circumstances obtain property belonging to another. In the event, as we shall show, the amendment sought by Mr. Rhodes Q.C. was significantly more extensive, involving as it did a contention which does not depend on anything decided in Preddy. At the beginning of the resumed hearing we gave leave for the Preddy amendments, but reserved until we had heard Mr. Rhodes's arguments the decision whether to grant leave for the others. In the event we refused it.

We should mention that at the hearing on 24th July we did not deliver the judgment we had prepared but we did indicate to counsel that the decision we had reached on the basis of the arguments we had heard was that the appeal against conviction should be dismissed and the appeal against sentence should be allowed to the extent that the total term should be reduced by two years.

The offences of which the appellant was convicted were the following:

Counts 1 and 3, obtaining property by deception, in respect of which he received seven years imprisonment on each count concurrent.

Counts 2 and 4, obtaining services by deception: four years concurrent.

Counts 5 and 7, being a company officer who published a false statement to creditors: five years concurrent.

Count 8, trading with intent to defraud creditors: two years consecutive.

It is important to appreciate from the outset what was the nature of the case which the appellant faced, and we begin by referring in a little detail to the content of the counts in the indictment.

Counts 1, 2 and 3 were concerned with the obtaining by deception of credit facilities from a bank, NMB Postbank Groep NV. (NMB).

Counts 1 and 3 charged Nr. Naviede with dishonestly obtaining £3 m. and £1 m. for Arrows Ltd. from NMB by deception contrary to section 15 (1) of the Theft Act 1968. The wording of the particulars in each count was, save as to date and amount, identical and involved four alleged false representations, namely that:

(1) the business of Arrows Limited had been and remained that of providing trade finance;

(2) the money was required by Arrows Limited for use in such business and in particular that the sum would be used by Arrows Limited to enter into trade finance transactions with its trade finance customers;

(3) each such transaction entered into and thereafter to be entered into by Arrows Limited with its customers had been and/or would be insured against loss through Arrows Insurance Limited and Trade Indemnity plc;

(4) the said bank had been well and effectively added to the said Insurers' respective lists of banks and financial institutions to which payments would be made by such insurers in settlement of claims made under their respective policies concerning the trade finance business of Arrows Limited.

Count 2 charged Mr. Naviede with obtaining services by deception contrary to section 1 of the Theft Act 1978 and section 18 of the Theft Act 1968 by consenting to or conniving at the dishonest obtaining by Arrows from NMB of a £30 m. revolving credit facility. Subject to minor variations in wording appropriate to the different offence, the same four false representations were relied on.

Count 4 related to the obtaining of credit facilities from Girozentrale und Bank der Osterreichischen Skarkassen AG (Giro) and, save that it relates to a syndicated loan facility of £11 m. and a different date, is otherwise in terms essentially the same as Count 2.

It will be seen, therefore, that these four counts, though involving the obtaining by or for Arrows on various dates of monies or credit facilities, had a marked similarity. The essential issues for the jury on all four were the same - namely had the Crown proved that:

(1) One or more of the representations was made by or with the consent or connivance of Mr. Naviede;

(2) the representation in question was and was known by Mr. Naviede to be false and was made with the intention of deceiving the Bank;

(3) the false representation or representations caused the payment (Counts 1 and 3) or the grant of the facility (Counts 2 and 4)

(4) Mr. Naviede intended permanently to deprive NMB of the £3 m. and £1 m. (Counts 1 and 3)

(5) Mr. Naviede was acting dishonestly.

At the heart of the Crown's case in relation these four counts were the following contentions (which we state only in brief outline):

(1) The nature of Arrows' business had been to provide finance to traders requiring extra short term credit over and above such normal facilities as they might have. This was achieved by Arrows buying the trader's stock at a discount and immediately re-selling it to him at full value in return for a bill of exchange. Arrows at first financed the business by discounting the bills with banks or discount houses and though, in the course of time, the methods by which the business was financed were refined or varied, its essential elements were and remained that;

(a) Arrows' overall charge to a trader exceeded the cost to Arrows of borrowing from the bank, and the difference represented their profit;

(b) The risk that the trader would not be able to pay on maturity of the bill was off-set by the fact that Arrows were able to and did insure against loss occasioned by such an eventuality. This was, naturally, an attractive feature so far as the banks who lent money to Arrows were concerned.

2. From about the end of 1989 Arrows, whose normal trade financing business may even then already have been under strain, began to speculate in property, by means of complicated purchase and leaseback arrangements. This business was quite unlike their stock financing business, in that it was risky, any returns were long rather than short term, and it was not covered by insurance. At the same time Arrows reduced the level of their normal trade financing business.

3. Notwithstanding this very significant change of direction, Arrows through the appellant, continued to represent to potential lenders that the relevant part of their business was wholly or almost wholly trade finance as previously and that it was insured in the manner described.

4. These representations, dishonestly made, were what induced NMB and GIRO to advance the monies and make available the facilities with which Counts 1 to 4 are concerned.

A document of particular importance so far as the first bank, NMB, were concerned was the Information Memorandum which was prepared for a presentation to banks not yet doing business with Arrows to inform them of the nature of its business. A first draft of this document was prepared by Mr. Endersby of NMB, who drew on all the information he had about Arrows, with whom NMB had already done business in previous years. In preparing that first draft he left a number of blanks to be completed with information obtained from the appellant. The Crown's case, based on Mr. Endersby's evidence and supporting documentation, was that the appellant did produce that information and approved the final version of the memorandum. The appellant's case was that the document was all Mr. Endersby's own work and that all the mis-statements as to the nature of Arrows' business derived from him alone. The appellant, it was conceded, saw the final version and he said that his response was, in effect, that if Mr. Endersby wished to present the picture in that way he would go along with it.

It has to be said that there was documentary evidence, to the detail of which it is unnecessary to refer, which strongly supported the Crown's case that the appellant had - as one would expect - provided the detail. Nevertheless, there was this acute issue between the appellant and Mr. Endersby.

What was undeniable was that the Information Memorandum wholly mis-stated the nature of Arrows' business in 1990. This will be apparent from a brief summary comparing what the Memorandum asserted with what was the true state of affairs. It stated:

That the information it contained had been provided by Arrows.

That Arrows maintained 100% insurance cover over its trade debtors; and that it had been and remained Arrows' policy to insure its debtor book. There was cover of 100% of loss in the event of a client's insolvency. The insurance discretionary limit was £200,000, and authority for larger loans was only sought where Arrows was satisfied as to the client's creditworthiness.

That Arrows provided three main services, namely Stock Financing, Bill Discounting and Documentary Credits, of which by far the most important was Stock Financing which accounted for about 98% of Arrows' turnover during the financial year to 31st August 1990. Their philosophy was to provide short term seasonal working capital financing to corporate clients with a turnover in excess of £1 m. and "it cannot be over-emphasised that it is not Arrows' policy to replace a client's clearing bank, but merely to fulfil top-up, cyclical cash flow requirements". It was Arrows'

active policy to ensure that clients did not use their Arrows' facility 365 days a year. The customer base comprised a wide variety of traders, specifically listed by types of business, not including property. Arrows' main objective was to transact its trade with companies of high credit standing, particularly in businesses which could be considered of a conservative nature.

The average facility was £150,000 and although in the past it had offered facilities up to £1 million to particularly strong corporates, it was now policy to grant maximum facilities of £250,000.

Arrows would continue to build on its success in its "niche sector", no deviation was planned and it remained committed to its uncompromising credit procedures.

The true position was that Arrows were doing very little trade (stock) finance business and what there was - some £10 m. - was very precarious. It was owed £75 m. on one outstanding bill from ECC Ltd. in respect of which it held no security and which did not figure in its accounts. The money it sought to borrow was not required for trade fiance of the sort described in the memorandum but was needed principally to repay existing borrowing and deal with the consequences of its real business - commercial property acquisition.

By October 1990 Arrows had disposed, for £750,000, of

£10 m. worth of debts due on 90 day trade finance bills - reflecting, said the Crown, a state of affairs that must have been known in July. No claim was made on their insurers in respect of these bad debts.

As we have said, the appellant's case was that all the mis-representations in the Information Memorandum were Mr. Endersby's work, which he "went along with". He agreed however that at a presentation meeting at the Overseas Banking Club at which he spoke to bank representatives at this time he never mentioned property dealing or the weakness of the rump of the stock financing business.

The other banks whom it was sought to involve in the syndicate were not prepared to join - but NMB itself provided the £30 m. facility, allowing Arrows to draw down the first £5 m. at the end of July 1990. The formal documentation was executed in October 1990.

It will readily be appreciated why Mr. Endersby was an important witness, and why the conflict between his account and that of the appellant was central to the case.

Giro was one of the banks with whom Arrows had had a satisfactory relationship for some years, beginning in December 1987. At the end of April 1990 the appellant sought to interest Giro in setting up a syndicated facility with other Austrian banks to provide Arrows with additional funds with which to conduct its expanding trade finance business. In May Giro was sent Arrows' Group Balance Sheet and Accounts to 31st March 1990 together with a report which indicated that the level of business enquiries continued to grow; that Arrows was ever conscious of its responsibilities to its bankers to adopt a more vigorous approach to credit control and ensure that only the best business was written; that during the period under review its main business had continued to be that of stock financing; and that the directors were confident of future steady growth of Arrows' core business and had taken a policy decision to limit new business to a maximum of £250,000 per client irrespective of credit- worthiness and to limit clients' usage of their credit lines to two drawings a year.

On 5th July 1990, the appellant attended a presentation in Vienna when he explained the reasons for seeking a syndicated loan and the nature of Arrows' business. The evidence of the Giro witnesses - in particular Mr. Beitz the deputy general manager - was that the appellant represented matters in a manner entirely consistent with the information contained in the Information Memorandum involved in the NMB counts. In this case some of the other banks, as well as Giro, were interested and participated in the facility which was, as a result of the appellant's representations, obtained - the formal documentation was signed in September. It was to this that Count 4 related.

Mr. Naviede's case was, in barest outline, that the banks were told about the change into property investment; that such was in any event within the description trade finance, so there was no misrepresentation; and that there was insurance cover and/or full security for the property part of Arrows' business. He had not been dishonest. That there had been a massive shift from the sort of trade finance involving stock purchase and resale into property was not in dispute.

In addition to the Preddy amendment for which we granted leave, Mr. Rhodes put forward amendments by which he sought to contend (i) that counts 2 and 4 were also misconceived, because the granting of the £3 m. and £1 m. loans did not constitute services within the meaning of s.1 of the Theft Act 1978, or if it did, the counts should nevertheless have been withdrawn from the jury because the evidence was that Arrows had paid in full for such services, or because the judge had misdirected the jury in relation to them; and (ii) to assert that in consequence the convictions on the remaining counts, the details of which we are about to relate, were unsafe.

Counts 5 and 7 charged Mr. Naviede with publishing false statements with intent to deceive creditors of Arrows contrary to section 19 of the 1968 Act. Count 5 related to Arrows' interim management accounts for the six months to 30th September 1990 and the misleading false or deceptive statements to the publication of which he was alleged to be a party were that

(1) the volume of trade finance business undertaken by Arrows during the period had grown; and

(2) that the whole of the debts owed by its customers to Arrows was insured through Arrows Insurance Ltd. and Trade Indemnity plc.

Count 7 related to the publication in April 1991 of a document entitled "Group Accounts 1991" asserting that "The principal activity of the Group remains that of trade financiers", and said thereby to represent that the largest element in the figures given in the Annual Accounts in respect of turnover, cost of sales and bills recoverable was in each case attributable to trade finance business.

Count 6, on which the jury failed to agree, was a charge under section 389A (2) of the Companies Act 1985 of making false or misleading statement to Arrows' auditors, as to the nature of the relationship between Arrows and various companies (the ICE companies) and to the effect that neither Arrows nor he were in any way connected with those companies.

Count 8 was a charge under section 458 of the Companies Act 1985 of fraudulent trading in relation to Arrows in respect of the period 1st February 1989 to 30th July 1991.

In relation to the new grounds, which we shall consider in detail at the appropriate place in this judgment, the respondents' stance is (i) that the convictions on counts 1 and 3 must, by reason of Preddy, be quashed but that convictions for alternative offences can and should be substituted; (ii) that the attack on counts 2 and 4 should be rejected; and (iii) that there is no reason to consider that the convictions on the remaining counts are unsafe.

There are six grounds of appeal (1A - 3B) which it is convenient to consider as a group since they all relate to the appellant's ability properly to present his case at trial. The contention is that by reason of errors or omissions on the part of the judge the appellant was deprived of representation and was compelled to conduct his defence when he was not fit to do so and without being allowed sufficient time for preparation during the trial.

The case had been transferred pursuant to s. 4 of the Criminal Justice Act 1987 at the end of 1992 and was first listed before the judge in March 1993. The appellant was represented by solicitors and leading and junior counsel, all very experienced in the conduct of long criminal trials. In the latter part of 1993 they intimated that an application to dismiss was to be made, and a date for this to be argued was fixed for just after Easter 1994. However, it was not pursued, and the appellant's adviser instead sent to the Serious Fraud Office detailed submissions supported by seventeen files of documents as to why the prosecution should be discontinued.

Meanwhile, on 24th May 1994 the trial formally began with the appellant's arraignment. The hearing was fixed for September 1994 but that date was, by reason of the written submissions already referred to, vacated. Following the rejection of the submissions on 11th October 1994 the appellant decided that he wished to represent himself. On 13th October 1994 Mr Julian Bevan Q.C. and his junior Mr. Chawla appeared before the judge and asked to be allowed, together with their solicitors, to withdraw from the case. They equated that with an application to have the appellant's legal aid certificate discharged.

Mr. Bevan explained to the judge that his instructions from the appellant were that, whereas he wished himself to present the factual side of the case - examine and cross-examine witnesses and address the jury - he wanted to be allowed to have his solicitors and counsel to advise him upon and argue on his behalf such matters of law as might arise in the course of the case. Mr. Bevan told the judge that the appellant had instructed him that this was his firm and final decision.

The judge heard submissions from not only Mr. Bevan but also from the solicitor Mr. Burton. Mr. Bevan said that he knew of cases where a defendant had retained solicitors and counsel to argue the law and Mr. Latham for the Crown seems to have accepted that, provided proper "ground rules" were established, such a thing could happen.

Mr. Burton told the judge that he had made clear to the appellant his view that he must be represented by counsel if his case was to be properly conducted but that Mr. Naviede was not prepared to accept his advice. He said that there had been a serious breakdown of confidence between him and his client and that in the circumstances, unless directed to the contrary, he wished to withdraw. The judge - in our view rightly and understandably - said that he considered Mr. Burton was the best judge of whether he could properly continue. Mr. Bevan and his junior told the judge that they also felt that they could not properly continue to represent the appellant.

The judge had earlier asked the appellant if he wished to say anything and the appellant told him, in the strongest terms, of his determination to represent himself on the facts and his reasons for that decision. The judge said:-

It is your perfect right, Mr. Naviede, to represent yourself, but I take it you have given the matter very careful thought before you have come to this decision, and it is a firm decision.

The appellant assented - though in terms which re-enforced his desire to have representation on matters of law.

Following a short adjournment there was further discussion. The judge said that he had been thinking about the proposal. It seemed to him, he said, that it would put counsel in a wholly impossible position: counsel in conducting a case must have control over it. The judge continued:-

The idea that you have a defendant conducting his own defence and then instructing counsel, it seems to me, is quite impossible. I see Mr. Bevan agrees. I have been thinking about it a good deal today. Do all counsel agree with that proposition?

Junior counsel for the Crown confirmed that that was the view the Crown had come to. He explained that their view was that it would simply not be feasible. When Mr. Naviede advanced further argument in support of his wish for representation throughout only on the law the judge reiterated that in his view it would be completely wrong and that he was not prepared to allow it, and said that that must be quite clear to Mr. Naviede before he made his decision. Pressed to reconsider the judge again stated his decision in similar terms. He again enquired whether Mr. Naviede's decision to represent himself was a firm one and was told that it was.

The case was before the judge again on 21st October 1994 when the judge summarized - as it were by way of embodying them in a formal ruling - the decisions he had reached on the 13th October. There was also discussion about the substitution of the appellant's present solicitors, who at all times subsequently - in particular throughout the trial - advised him. They also had access to advice from counsel on particular matters, and we know that Mr. Rhodes was consulted and gave advice on many occasions. The judge allowed Mr. Bevan and his junior and their solicitors to withdraw.

On a number of subsequent occasions the appellant repeated his wish to have the sort of representation described, contending that without it the trial would not be fair: and the judge reaffirmed his earlier ruling. The judge on at least one such occasion (4th November 1994) again sought and received confirmation that the appellant had decided to represent himself. The judge's last pre-trial reiteration of his ruling was on 3rd January 1995, and in the course of it he said this:

It is an absolute right for someone to represent themselves; and Mr. Naviede has decided to represent himself in this trial. I have considered the question of whether I should extend his legal aid for leading and junior counsel to represent him; and I have come plainly to the conclusion that it would be wholly inappropriate in this case for Mr. Naviede to represent himself, have control of cross-examination and the calling of witnesses [on] issues of fact, then instruct counsel to represent him on points of law throughout the course of the case. It seems to me that that would be wrong. It would involve, were I to grant this application, an adjournment of this case for ... a considerable period ... and, in all the circumstances, I have no alternative but to reject the application that is made. The defendant has had ample time to prepare himself for this trial ... [A] great deal of work has been done on his behalf. The documents have all been got in order and, in my view, the representation that he has - which in the representation of experienced solicitors, who no doubt are knowledgeable in the law - is a proper basis on which we ought to proceed.

On 9th January - the day on which the trial began, and on which the judge rejected an application for an adjournment on medical grounds to which we shall have to refer in more detail later - the judge in relating the history of the matter said this:-

Now that the defendant had taken the firm decision to represent himself, his own solicitors and counsel had withdrawn from the case. The question arose as to whether he should have counsel to represent him, on the law; and it was clear to me then and it has remained clear to me, that Mr. Naviede wishes to have total control over the way his case is presented to the court. At one stage, there was reference to him being in the role of leading counsel being assisted by junior counsel. I decided, on everything that was placed in front of me, that it would not be in the interests of justice that a trial should proceed in a way that was envisaged. [The judge went on to explain why].

On these decisions by the judge are founded the first three grounds of appeal. Ground 1A alleges that it was an error of discretion on the part of the judge to allow counsel and solicitors to withdraw or that at least he should have required them to remain until the conclusion of the preparatory hearings and that he failed to give them adequate directions when they sought to withdraw. Ground 1B asserts that the judge failed to give the defendant proper warning as to the great disadvantages that would flow from his decision to represent himself - the implication being that had he had these fully explained he would or might not have persisted in that decision. Ground 1 challenges as an irregularity the judge's refusal of leading counsel to argue the law.

In support of his arguments on Ground 1A Mr. Rhodes referred us to the relevant Legal Aid Regulations, the Legal Aid Act 1988 and to a number of authorities, but we do not consider that much help is to be derived from any of these sources. For present purposes we are prepared to accept that a judge has a wide discretion in relation to the approval of a request by legal advisers to withdraw, in relation to the discharge of legal aid, and in regard to representation by solicitors and counsel either in combination or individually. However, even assuming all this in the appellant's favour, we were entirely unconvinced by the basic contentions on which Mr. Rhodes relied. Thus:

(a) We reject the contention that the judge should have taken a much more active and positive role when the appellant's decision to represent himself was made known. In effect, what is being suggested is that it was incumbent on the judge, by emphasising the disadvantages, to seek to dissuade him from that course. In our view, in the circumstances of this case, the judge did all that was reasonable and necessary. He knew that the appellant, an intelligent and obviously able man, had taken a firm decision at a time when he was represented by very experienced and able advisors. He knew that it was not a spur of the moment decision. He obviously had - and discharged - a duty to satisfy himself that it was a firm decision. He may well have felt inhibited about appearing to exert pressure on the defendant to abandon such a decision, given that it was said to be firm and that reasons for it which were perfectly understandable had been given. It is in our view simply impossible to criticize the way the judge - who for obvious reasons must have been concerned at the prospect of the defendant's being unrepresented - dealt with the matter.

The submission that he should at least have insisted on the advisers continuing to act for the remaining preliminary hearings is unsustainable in the particular circumstances, because, as Mr. Latham satisfied us, the possibility of their doing so was raised by the judge, but they indicated that they felt in the circumstances unable to accede to such a proposal.

(b) In the situation with which the judge was presented we have no hesitation in saying that he was entitled to accept the assessment of solicitors and counsel that they felt unable to continue to act. We need not repeat what those circumstances were, and say only that given the reasons advanced by the appellant for his decision and the status and experience of the advisers we can readily understand why the judge was prepared, as we would have been, to accept their assessment. Moreover, we believe the judge may, for reasons which we can well understand, have felt a certain inhibition about pressing them to take a different view.

(c) For these reasons we reject Grounds 1A and 1B.

As to Ground 1 - which is, of these three, that on which Mr. Rhodes placed the greatest emphasis - we reject his attack on the judge's exercise of his discretion. Mr. Rhodes, rightly pointing out that this ground was linked to the other two, criticised the judge for not seeking the assistance of counsel: but it seems to us that, as one of the passages to which we have referred shows, he was aware that counsel on both sides considered the proposal inappropriate. We do not accept that the judge was rejecting the application out of hand on the basis that it was one to which he could not, whatever the circumstances, accede: his observations, taken as a whole, appear to us to embody an exercise of discretion on the particular circumstances of the case.

However, it is important to recollect that the appellant was not asking for the right to be represented by counsel on discrete issues of law. What he was asking for, and asserts before us to have had a right to be granted, was to represent himself on one aspect of the case and be represented by counsel on another; and for that purpose to have counsel in court throughout as his representative. If the judge had decided the matter on the basis that it was in principle inappropriate to permit such an arrangement, our view is that he would have been right to do so. We reject the argument that such a refusal would breach the appellant's common law or statutory rights to representation or constitute an infringement of Article 6 of the European Convention of Human Rights, or otherwise constitute an injustice. Mr. Rhodes argues that a criminal trial must be fair, and that the principle of equality of arms demands that an accused person be accorded representation commensurate with the seriousness and complexity of the proceedings and comparable to the facilities enjoyed by the prosecution. Since he is entitled to present the case himself, he must be entitled to the assistance which he needs and requests on the law. The fallacy inherent in this contention, in the circumstances of a case such as the present, is that it assumes that the entitlement to representation and the entitlement to represent oneself must be exercisable simultaneously. The truth is that the appellant was not denied legal representation. On the contrary he had had made available solicitors and counsel and chose not to avail himself of their services. We know of no principle which demands that he who makes such a choice must be permitted representation on his own terms. Whatever may be the position as to representation for the purposes of arguing discrete issues, we consider that there is no valid basis for contending that someone who has been offered and decided to reject ordinary legal representation is entitled to demand representation on the law only. Such a person cannot complain of inequality of arms, or assert that he has been unfairly treated or that his trial is unfair. In truth his only complaint - an invalid one - is of the refusal of a right to dictate the terms of the representation he is to have.

Moreover, we consider that to allow representation in the terms demanded by the appellant would indeed place counsel who - as was apparently the case here - was prepared to act in a most invidious position. Having no control over the presentation of the evidence, he could be faced with a demand to argue untenable propositions, or deprived of the opportunity to try to establish the necessary factual basis for the contentions which he would wish to argue. The task of the judge would be rendered infinitely more difficult and his ability to control the case impaired. None of the members of this court has experience of such an arrangement being permitted and we were not referred to any instance of its occurring.

It is no answer to submit that (as occurred here) a defendant who represents himself often has solicitors to advise him: indeed as we have said the appellant also had the advantage of advice from Mr. Rhodes. Advice is one thing, representation another, and there is no inconsistency between our view and the practice referred to. A right such as that for which the appellant contends is not one which principle or fairness demands, and we reject it.

Accordingly we consider that there is no substance in Ground 1 either.

Ground 3A relates to the judge's refusal on 9th January, the day fixed for the start of the trial, to accede to an application for an adjournment of four to six weeks by reason of the appellant's state of health.

It will be remembered that on 3rd January a renewed application for partial representation was refused. In the course of the hearing on that day a brief report from the appellant's doctor was shown to the judge. It spoke of his suffering from stress "as he believes his basic rights are being denied to him". The doctor said he had advised a complete break for up to a month. On that date however no application for an adjournment was made.

On 9th January the appellant did apply for an adjournment. He relied on reports from Dr. Nias and Dr. Wolfe and the Crown on reports from Dr. Shepherd and Professor Watson. All four doctors were called to give evidence. The complaint made in Ground 3A that the judge, confronted with evidence strongly weighed in favour of the view that the appellant was unfit by reason of mental exhaustion and stress, substituted his own opinion as to the fitness of the appellant and rejected the expert medical evidence. This had, it is said, a serious consequence in that the appellant had to cross-examine the most important and damaging prosecution witness when in no fit condition to do so.

This matter was very fully argued on behalf of the appellant, in written and oral submissions by Mr. Rhodes, which we have considered with care. We are satisfied (i) that there was material before the judge on the basis of which he was entitled to conclude that the appellant was fit to conduct the case, and that the judge accepted that evidence; and (ii) that to the extent that he made use of his own assessment of the appellant's abilities he was entitled to do so.

Mr. Rhodes argued that it was not clear from what the judge said when giving his reasons for refusing the application to adjourn whether he accepted the Crown's medical evidence or not, and that the decisive consideration appeared to be his own views. Our own view is that the language used by the judge - in what was a extempore ruling - implies that he did accept the Crown's evidence. Moreover, that this was the judge's conclusion is clear from what said later in the trial on 3rd March when ruling on a matter which figures in another ground of appeal - the appellant's fitness to continue after a physical illness he suffered during the trial. The judge said this:-

I should make it quite clear that, in my view, the opinion of these called by the prosecution at the outset - namely Dr. Wolfe and Dr. Shepherd - came to a correct conclusion, and Mr. Naviede's conduct of the case thereafter has shown his ability to deal with the matters that the prosecution raised against him.

As to making use of his own views, the judge had seen a great deal of the appellant and, on the day in question, had heard him argue other matters. While his medical condition was for the doctors to assess, there is in our view no reason why the judge should not have placed reliance on his own view of the appellant's capacity as demonstrated by his performance and demeanour.

We accordingly reject this ground.

Ground 3B concerns the judge's decision to continue with the trial after a five week break occasioned by the appellant's suffering a pneumothorax on 11th February. This, according to the medical evidence, was not occasioned by stress: but it was a serious illness, necessitating an operation under general anaesthetic followed by a period of recuperation.

On 15th March when the appellant returned to court he was still suffering from post-operative discomfort and wanted an adjournment of a week for further evidence followed by a review of the case in the light of such evidence. The judge, who had evidence (which he accepted) from Dr. Lightowler that the appellant was fit to continue, refused the application and directed that the case continue on the following Monday, 20th March. It is said that, while the judge's acceptance of Dr. Lightowler's evidence cannot be impugned, that evidence went only to the appellant's physical condition: and that the judge wrongly rejected uncontradicted evidence from Dr. Nias to the effect that the appellant was in a downward mental spiral and at risk of a nervous breakdown - again substituting his own judgment of the appellant's ability to represent himself.

In support of the contention that the judge was wrong Mr. Rhodes relies on what he submits is evidence of incapacity on the part of the appellant, both before the pneumothorax (incompetent cross-examination of the main prosecution witness Mr. Endersby) and afterwards, as evidenced by a number of passages in the transcripts to which he drew our attention, and which we have considered.

It is also contended that in any event the judge should at this stage have discharged the jury, and that he failed to take account of the effect upon them of the lengthy adjournment.

The first question is whether it can be said that the exercise by the judge of his discretion to continue with the trial when he did can legitimately be criticised. We do not think that it can. His acceptance of Dr. Lightowler's evidence is not criticised; and his own view that in the first part of the trial the appellant had displayed intelligence and ability to conduct his own defence is one which, contrary to Mr. Rhodes' submissions, we consider the judge was entitled to rely on. He gave a careful and fully reasoned ruling, and we see no ground for thinking that he was not fully alive to all material considerations.

Mr. Latham argued that after the resumption the appellant's conduct of his case did not raise concerns as to his health - in particular that he gave evidence in chief over five days in a lucid, structured and chronological manner. It was submitted that the passages relied on by Mr. Rhodes do not support the contrary view.

We have had the task of making our own assessment. There are two distinct strands to Mr. Rhodes's submissions. One is that the appellant was complaining from time to time of illness or tiredness, and seeking indulgence from the judge in the matter of early adjournments or postponement of cross-examination. References are made in this connection to passages gathered in Schedule 3, which we have carefully considered. Our view is that there is no reason to believe that the appellant was not sufficiently fit to conduct his defence, or that the judge was other than reasonably sympathetic and accommodating in dealing with his requests.

The second of these submissions relates to the manner in which the appellant conducted his defence, and the suggestion is that the lengthy extracts in Schedule 2 demonstrate incapacity due to unfitness. It is said that the appellant was unable to conduct an adequate cross examination, give clear evidence on his own behalf or properly address the jury; that he pursued at length issues which it was self-evidently disadvantageous to pursue and called witnesses obviously hostile who could only damage his cause; and that he placed before the jury documents which presented him in a bad light and were likewise damaging.

Anyone who has experience, as we have, of trying cases in which defendants are unrepresented will know that frequently such litigants do find the task of presenting their case and cross-examining witnesses difficult and that even able and intelligent people are prone to pursue matters which an experienced advocate would leave alone. This ground is not - as others are - concerned with the question whether the appellant has any valid complaint in relation to his being unrepresented: it is concerned with a complaint that he was not fit to conduct his case. We are being invited to infer from the content of Schedule 2 that this was so. There are undoubtedly passages which evidence confusion and display the faults often characteristic of litigants in person: but our own view is that it certainly cannot be said that there is evidence in the transcripts to justify the conclusion that subsequent events demonstrated that the judge's decision on 15th March was erroneous. That some of the contentions pursued by the appellant - particularly of a conspiracy against him - were hardly credible and probably damaged his case is true: but there is nothing to suggest that they were the product of illness.

In our view this ground of appeal is unsustainable.

Ground 2 alleges that the judge refused to allow the appellant sufficient time to prepare his defence, in that at no time during the trial did he make adequate provision for preparation by the appellant notwithstanding his precarious mental and physical health. A particular point is made of the fact that at one stage during the presentation of the defence case the judge erred in saying to the appellant that his conduct (in not having his witnesses available to give evidence as and when required) verged on contempt; and of the fact that counsel for the Crown at that juncture invited the judge to threaten the appellant with imprisonment for contempt. It is said that this was oppressive.

Mr. Rhodes first complained of the judge's refusal at the beginning of the trial to accede to the appellant's request that the court should sit only three days a week. However, he came to recognize that it was impossible to challenge this exercise of discretion and the submission he pursued was that, following the break caused by the appellant's pneumothorax the judge should on his own initiative have instituted a regime such as is common in long trials of sitting only four days a week. He rightly submitted that, particularly in circumstances such as obtained in this trial, it was for the judge to keep matters under review and ensure that the appellant was able to cope. To a considerable extent Mr. Rhodes relied on matters germane to Ground 3B as being indicative of a failure on the judge's part to do this.

Mr. Rhodes also relies on what he submits are specific instances of refusal by the judge to allow the appellant additional time reasonably requested for the preparation of his defence, and in this context took us to Schedule 1. Mr. Rhodes took us to a number of passages in this Schedule and it is fair to say, we think, that he was not really suggesting that, with one exception, the judge could be seriously criticised: his main contention was that the cumulative effect of these extracts, coupled with the judge's not having allowed a day a week for preparation and the threat of contempt, were such as to amount to an irregularity and unfairness.

The contempt episode occurred on 14th May, in the absence of the jury. A defence witness was not at court when needed. He should have been available and the judge was understandably concerned at the waste of time that his absence was to cause. The judge said:

Mr. Naviede, I would like you just to think of this: imagine what I would have done if the prosecution had treated me like this while they were presenting their case. Imagine what I would have said to them. Now in my view you are treating the court with contempt by the way you are behaving and it must not happen again.

The appellant apologised and the judge, in conciliatory language, said he would not have spoken as he had but for the fact that probably nearly a week had been wasted in the course of the defence, which was serious. Mr. Latham then invited the judge to make clear to the appellant that he had powers to imprison him of contempt and the judge again emphasised the seriousness of the matter, without mentioning imprisonment.

Mr. Rhodes' complaint is confined to Mr. Latham's intervention, which he alleges was gratuitous and oppressive.

Of the individual instances covered by Schedule 1 that particularly relied on - the one exception mentioned above - related to an occurrence on 25th May, the Thursday before Whit Monday, when the appellant himself had just completed eleven days in the witness box, and in the absence of the jury sought to be allowed to start calling his witnesses on Tuesday. The judge indicated that he thought the rest of Thursday would afford the appellant the opportunity for the discussion he wished to have with his lawyers about the future presentation of the case, and insisted on sitting on the Friday. This, Mr. Rhodes submitted, was and would have been perceived by the appellant to be unfair.

Finally, Mr. Rhodes submitted that the trial chronology helpfully prepared by the Crown - and on which they relied - did not present a picture of excessive time wasted or lost.

We have considered all these submissions and the various transcripts relied upon. It has to be remembered how difficult is the task facing the judge in a case such as this of balancing on the one hand the need to ensure that a defendant in person has adequate time for out of court work and preparation and on the other ensuring that the trial progresses in a reasonably expeditious way. He has to consider all sorts of interests, including those of jurors and the public - though of course his paramount concern must be to ensure that the defendant is treated fairly and has a fair trial. This does not involve acceding to every request he makes for extra time; it requires that the judge should exercise sympathetic but firm control.

It may be that there were occasions when some would think that the judge might have been a little more accommodating - for example on 26th May: and it might have been preferable if Mr. Latham had left it to the judge to admonish the appellant for what seems to have been a culpable failure to get a witness to court. But looking at the matter in the round we are satisfied that the judge, who was in a position far better than we are to judge what was required, dealt in a fair and accommodating manner with the appellant's requests for time. If has to be remembered that, heavy though the burdens of conducting his own defence were, the appellant had the advantage of a very fully prepared case (see the seventeen files presented on the request of the Serious Fraud Office to abandon the prosecution); of legal assistance; and of his own intimate knowledge of the events with which the trial was concerned.

Our conclusion is that this ground of appeal has not been established.

By Ground 3 it is contended that the judge was in error in refusing to sever Count 8 (fraudulent trading) from the other counts. Though the circumstances in which the application came to be made are a little unusual, we can deal with this ground, which we are satisfied is without merit, quite shortly.

It is common ground that Count 8 was properly joined in the indictment. The only point taken is that, in the light of the fact that the appellant was unrepresented, the judge should have severed the indictment so as to eliminate Count 8 in the interests of simplifying and shortening the trial.

At a time when the appellant was still represented by counsel and solicitors the judge had at a preliminary hearing raised the question of severance and the stance of counsel on both sides was that justice demanded that Court 8 should be tried with the other counts.

On 3rd January 1995, however, the appellant applied for severance, submitting that there would be a considerable time saving and that the issues would be simplified if that occurred. It is worth noting that in the course of his submissions the appellant argued that the Crown's case essentially involved the assertion of Arrows' insolvency and "if the insolvency were to be decided first, then in the event that the company was solvent - obviously ... it would be much simplified".

The judge rejected the application, saying that the matter had been looked at with great care the previous May, that nothing that he had heard caused him to change his mind and that he had concluded that the jury should consider all counts including count 8.

Mr. Rhodes, recognizing the difficulty that confronts an appellant in seeking to persuade this court to interfere with the exercise by a judge of his discretion whether or not to sever, submitted that the judge failed to attach any weight to the fact that the situation had changed because the appellant was now in person, and to the consequent imperative to try to simplify and shorten the trial and the issues in it. The retention of Count 8 complicated the trial, made it much longer and necessitated the calling of more witnesses, including experts.

We do not find these arguments persuasive. The judge must, in our view, be credited with having in mind that a significant factor was that Mr. Naviede was by now in person, with the consequences that that entailed. However, as Mr. Latham submitted, he would also have had in mind that (as the appellant himself rightly accepted) the solvency of Arrows was of crucial importance in resolving most of the other counts, and was inevitably going to be an issue in the trial whether or not Count 8 was severed. We see absolutely no ground for thinking that the judge exercised his discretion without regard to material matters or otherwise improperly.

Ground 3C raises an alleged irregularity which occurred in the course of the trial, when the judge was rightly and properly intent on explaining to the appellant the purpose and scope of cross-examination. He said this, in the presence of the jury:

The purpose of cross-examination is firstly, if you can, to obtain evidence from the witness that is favourable to your case; secondly to undermine or destroy evidence that is not favourable to your case. If you propose to call evidence that contradicts evidence of the witness, you should make that clear to the witness so that he or she may have an opportunity to deal with it, if you are proposing to call evidence that contradicts evidence that the witness gives.

It is contended (i) that this direction was wrong in law because there is no obligation to do more than simply put your case; (ii) that it could reasonably be interpreted as imposing on a litigant in person a requirement to give evidence if he challenges part of the evidence of a prosecution witness; and (iii) that the wording of the direction was sufficiently ambiguous to be understood by the jury as shifting the persuasive burden of proof on particular issues and therefore to undermine such directions as the judge later gave on the burden of proof.

We consider that these submission are quite without merit, and at best involve a fanciful and highly artificial interpretation of what the judge was intent on conveying - namely that the obligation on the cross-examiner is to challenge those material parts of the witness's evidence which are disputed.

Mr. Rhodes confined his criticisms to the second sentence of the quoted passage. It is of course correct that, insofar as the words used conveyed that the appellant had to make it clear if he proposed to call a witness , that was strictly incorrect. Mr. Rhodes conceded, however, that if the judge had said "If you propose to call evidence that contradicts the evidence of the witness, then you should make the effect of the contradiction clear to the witness so that he has an opportunity to deal with the point ..." that would have been unexceptionable.

We have no doubt that that is the overall message that the judge's actual words would have conveyed to the appellant and the jury. By the second sentence the judge was seeking to put some flesh on the legal formula accurately spelled out in the first. We cannot conceive that the jury would have understood the direction in the sense contended for in (ii) or (iii) above - even at the time, let alone months later when they were listening to the summing up. This ground involves a technical quibble, and merits no further attention.

There are two further grounds (13 and 14) which relate to matters involving the conduct of the trial and it is convenient to consider them before we turn to the remaining grounds, all of which relate to the summing up. The two grounds are closely related, and focus on what are said to be the unfair and prejudicial way in which the prosecution conducted the case against the appellant.

Ground 13 complains that in his closing speech Mr. Latham unfairly criticised the way the appellant had conducted his defence, suggesting that he was intentionally evading the truth and not permitting witnesses to give evidence on important issues in the case. The implication, it is contended, was to suggest that the defence was dishonest and so therefore was the appellant - a tactic which took unfair advantage of a litigant in person. This impropriety was compounded, so it is alleged, by counsel's suggestion in his closing speech that monies had been misappropriated by the appellant for the benefit of members of his family or dissipated in extravagant living; that the charitable works which figured large in Arrows' business publicly were done with the intention of "propping up the fraud"; and that these allegations, which did not figure in the prosecution's case statement, were inflammatory and unfair, especially to a litigant in person.

In order to give the flavour of this point we shall quote one or two of the many passages to which we were referred in the transcript of Mr. Latham's final speech:

[Arrows] continued trading simply by in effect mortgaging the group's main asset, namely the property portfolio which brought in lots of cash, the double borrowing. Then to use all that cash to pay the interest and to pay the jet flights around the place, and to pay all the ritzy entertaining and to pay for all the staff, and to pay the likes of Tariq [the appellant's brother] a million pounds in cash. I said to Mr. Wilkinson [the appellant's accountancy expert], in the light of the fact that Arrows was a property company, why are all the staff there, the 90 odd staff? What is the television advertising about? What is all the publicity for? Why all the charitable functions? Why were all the bad debts being disposed of as it were under the counter without publicising it to anyone?

In connection with the reference to the appellant's brother Tariq we were shown a number of passages in the cross-examination of the appellant where the suggestion that £1 m. had been illicitly paid to Tariq were pressed, it is said unfairly. The complaint is that there ought either to have been a charge of misappropriation of the money paid to Tariq or at least an assertion in the case statement about it.

Then a complaint is made in the written submissions on the appellant's behalf in the following terms:

.... the closing submissions of leading counsel for the Crown contained the distasteful and unfair implication that the appellant was a jumped up, vulgar, ostentatious hypocrite from an immigrant background who had only achieved success by perpetrating a staggering fraud. This goes beyond the bounds of reasonable comment. There must be limits to the extent to which a court is the appropriate forum for such personal vilification which a reasonable dispassionate observer might regard as mere prejudice.

When, however, we were referred to the passage on which this serious assertion is based, we found that what Mr. Latham actually said was:

Is it personal enrichment beyond one's wildest dreams ... to fly round the world in your personal jet, to commute from the South of France, to be feted by the famous and by royalty, the successful dynamic entrepreneur, the benefactor of good causes, the supporter of charities. It is all on other peoples money and it was all done to prop up the fraud ...

There is, in this admittedly hard-hitting passage, no hint of the most serious of the suggestions contained in the submission. However, even if regard is had to the words used by counsel, it can be said that some quite forceful submissions were being made which presented the appellant in an unflattering way.

In response to this ground of appeal the Crown drew attention to the fact that in opening his case the appellant had, in outraged terms, spent considerable time telling the jury how the authorities had pursued him and his family and made their lives a misery: and in the course of his evidence in chief had again emphasised these criticisms. Given that it was - or became - common ground that the beneficiaries of the ICE companies were the appellant's family, and that the Crown's case was that money supposedly destined for old-style stock finance had been used for purchase of property vested in these ICE companies, investigation of the sort of matters of which complaint is made was to be expected.

A further factor is that, as appears from the brochures and other publicity material which we have seen, the appellant had promoted Arrows in exactly the way that, given what occurred, made cross-examination and comment of the kind of which complaint is made relevant and indeed inevitable.

We have carefully considered the material relied on is support of this ground, and we are satisfied that the Crown did not act in an unfair or oppressive manner in putting the case as they did. It is of course true that particular care must be taken not to be unfair to a litigant in person but he does not enjoy some special immunity which precludes the Crown from making valid comments or pursuing relevant lines of enquiry - and in any case of this sort an investigation of what has become of the money is usually relevant. As to criticisms of the appellant's presentation of his case or cross-examination of witnesses, similar considerations apply. It was the Crown's contention that the appellant, on critical issues, had consistently and deliberately avoided putting to the witness a positive case and they were entitled to make that clear. It is the duty of the Crown not only to be fair to the defendant - whether represented or not - but also to ensure that the points that can legitimately be made in support of a grave case such as this was are made. We are satisfied that they performed this duty properly, and we reject the assertions of unfairness and oppression embodied in this ground.

Ground 14 contains allegations of unfairness based both on the matters already considered and on what are said to be the interventions and interruptions of leading counsel for the Crown "which had the effect of diminishing the honesty, credibility, competence, integrity and esteem of the appellant in the eyes of the jury and which further had an oppressive and demoralising effect on the appellant which inhibited his ability properly to present his case to the jury". It is further contended that counsel's interruptions during submissions to the judge in the absence of the jury had a similar effect. Finally, it is said the judge's own interruptions had a similar effect.

Mr Rhodes, in support of this ground, submitted two files, containing a compendious collection of the interventions he relied upon: Schedule 4, Interventions of Prosecution Counsel, and Schedule 5, Interventions of the judge. Quite properly he did not take the court through each and every intervention which the above schedules demonstrate occurred. Save for one instance where he contended the judge interrupted no less than 30 times in the course of a day, he did not direct the court's attention to any particular interventions and interruptions. He invited the court to read the two schedules, having in mind the consequences which he submitted had occurred and which constituted the unfairness relied upon. The preponderance of counsel's interventions arose in the course of the appellant's cross examination of witnesses. The judge's interventions occurred frequently in cross examination by the appellant but also during the very lengthy evidence in chief of the appellant.

Mr Rhodes accepted that the conclusion whether there had been a fair trial on grounds such as this was essentially a matter of perception and impression for the court. His submissions were consistent with the contentions advanced in this ground, summarized above.

It must be obvious that where a defendant chooses to conduct his own case, he will be subject to interruption from both counsel for the prosecution and the judge in relation to his conduct of the case. Those objections and interruptions will in general be made in the presence of the jury. By electing to conduct his case a defendant cannot acquire immunity from interruption and objection from those sources. A helpful consequence of being represented by counsel is that when aspects of the defence case (for example as it is put in cross-examination) give rise to comment, that comment will be directed at counsel. The defendant is thus screened from being the immediate focus of attention in the jury's eyes. In a case where a defendant acts in person and interventions by counsel or judge are necessary it is to be expected that both will act with restraint and endeavour to limit intervention to the occasions when, in their judgment, it is necessary. Both should be alert to any possible prejudice to the defendant's ability to conduct his case. Plainly no advantage should be sought to be obtained from the defendant's position. The number of interventions, however, cannot of itself be determinative of the question whether a fair trial has taken place, for the number of interventions may themselves have been dictated by the need to secure a fair trial: for example, to ensure the proper presentation of the case, and the exclusion of irrelevant and inappropriate material from the trial. Thus the number of interventions will often reflect the skill with which the defendant in person has been able to conduct his defence. An unskillful presentation of a case demanding frequent intervention cannot of itself give rise to a ground of appeal that the number of interventions has prevented a fair trial. In the judgment of this court the starting point is to consider the ground for objection or reason for the intervention. Other considerations will also apply.

Accepting as this court does that as a matter of principle a trial could be rendered unfair by the interruptions of prosecuting counsel and/or by the judge, we have read the above mentioned schedules having in mind, in particular, the following:

(i) the reason for the intervention or interruption;

(ii) whether the intervention or interruption could fairly be termed gratuitous or unnecessary;

(iii) the extent to which it can be seen that the judge has properly considered the objections made by prosecuting counsel;

(iv) the particular submission that the appellant was so demoralised and affected by the interventions that he was unable to conduct his case properly, which has led us to have close regard to the manner in which the appellant conducted himself when the interruptions took place and to other parts of the general conduct of his own defence.

Examination of Schedule 4 discloses the following broad categories of bases for intervention:

(1) Doubts about the appellant's readiness to start the case;

(2) Clarifying points being put in cross-examination by the appellant;

(3) Objections to the validity of a particular point being taken;

(4) Urgings by the prosecution that the appellant should put his case;

(5) Miscellaneous objections in cross examination, for example, criticisms of a lack of precision in language, the introduction of hearsay material, repetition, inappropriate questions, and other objections to the admissibility of matters being put by way of cross examination.

We are satisfied that a legitimate ground for objection existed on each occasion. In that sense objection was properly taken by prosecuting counsel. He was vigilant and determined in pursuit of his objections. Other counsel might not have taken the same objections. The prosecution was vigorously pursued. In our judgment counsel was entitled to conduct the case as he did. His objections were not invariably upheld. Sometimes the judge permitted the appellant to pursue a line of questioning to which objection was taken. Again, it is apparent that where the judge did not immediately resolve the question, the appellant was quite able to deal with objections himself. He would appear to have acquitted himself adequately. The jury inevitably witnessed criticisms in open court of how the appellant was conducting his case, but they were not personal, they were not gratuitous. We cannot conclude that they were unnecessary or constituted the taking of an unfair advantage. There being a rational basis for the objections we see no reason to conclude that the jury would have appraised the objections in a way which did not give effect to the context in which they had been raised. Thus we are unable to conclude that any unfair consequence of the nature submitted by Mr Rhodes occurred.

Examination of Schedule 5 discloses that the judge intervened on occasions which can be broadly described as follows:

(1) protecting a witness who, by reason of the manner of cross examination was not being allowed to answer;

(2) clarifying the content of a document which was being put to a witness;

(3) generally advising the appellant on how to conduct cross examination;

(4) identifying documents which might be helpful to the appellant which should be put;

(5) controlling witnesses who were not answering questions, or who were asking questions by way of response;

(6) slowing the appellant down to permit answers to be given;

(7) taking up questions which the jury itself posed during the cross examination;

(8) reprimanding a witness for the manner in which he gave his evidence;

(9) advising the appellant to put his questions properly and fully;

(10) attempting to prevent repetition. It is clear to us that the Judge concluded that there had been far too much repetition.

The judge's interruptions were fair in the sense that they were polite and firm. They were not personal. They were precisely the type of interruptions which a judge would conventionally make to counsel conducting a case. There is nothing to suggest that they were gratuitous or unnecessary. Indeed, we have concluded from our reading of the transcripts that the judge had good reason to take steps to see that the trial was properly conducted. The issue of repetition was a matter with which he was, rightly in our judgment, deeply concerned, and good case management required him to take firm steps to prevent repetitious questions. There is nothing in the extracts that we have read to indicate that in responding to the judge the appellant was so oppressed as to be significantly handicapped in the presentation of his case. The transcript discloses that on occasions he had difficulty articulating certain parts of his case. But such events occur even with experienced counsel who, from the pressure of circumstance and maybe pressure from interruption by his opponent or the judge, might temporarily have difficulty in formulating questions correctly.

Having regard to the essentially straightforward character of the appellant's defence to these charges, and having seen the nature of the case which he advanced, we are not persuaded that he was prevented from presenting his case. The judge's summing up contained a summary of the defence case which was a model of clarity and simplicity. We have therefore concluded that this ground of appeal must fail.

The first of Mr. Rhodes's new grounds he has numbered 4C, which relates to the Preddy point and counts 1 and 3, and we are inclined to agree that this is the place where it logically falls to be considered. However, since Mr. Rhodes for good reasons addressed us first on his other main new ground, we propose to consider that first.

What we shall for convenience call the extra ground - that not based on Preddy - was, as finally formulated, in these terms:

Ground 4D: Obtaining Services by deception

4D.1. The learned judge erred in law and/or misdirected the jury in that he

(a) Failed to withdraw counts 2 and 4 from the consideration of the jury on the ground that there was no evidence that

(i) The Revolving Credit Agreement (count 2); or

(ii) The Credit Facility (count 4)

was in each case a "service" and/or conferred a benefit on Arrows Ltd. which had or would have been paid for within the meaning of section 1 of the Theft Act 1978.

(b) [not pursued]

(c) Erred in law in that he failed to withdraw counts 2 and 4 from the consideration of the jury on the ground that there was no case to answer by reason that Arrows had paid in full for such services as they had received under the Revolving Credit Agreement and the Syndicated Loan Facility.

(d) Misdirected the jury and/or erred in law in that he directed the jury that

"The offence may be committed even where it is intended that the services should be paid for or indeed where payment is made".

For the reasons which we are about to give we have concluded that there is no substance in this ground and, since we also considered that it raised no point which is both relevant and reasonably arguable we refused leave for this amendment. We set out our reasons below.

It is convenient to deal with sub-paragraphs (c) and (d) first. Section 1 of the 1978 Act, headed "Obtaining services by deception", provides:

1 (1) A person who by any deception dishonestly obtains services from another shall be guilty of an offence.

(2) It is an obtaining of services where the other is induced to confer a benefit by doing some act, or causing or permitting some act to be done, on the understanding that the benefit has been or will be paid for.

Mr. Rhodes submits that this section is ambiguous, because it is not clear whether it makes it an offence only where the defendant is shown dishonestly to have deceived the provider of services as to the prospect of payment, or whether it is enough that in respect of a service for which payment is to be made, the provider was dishonestly deceived into providing the service, In a sentence, must the operative deception relate to the prospect of payment for the service or may it be as to other matters.

On the basis that his submission as to the existence of this ambiguity was correct, Mr. Rhodes sought, in reliance on Pepper v Hart [1993] AC 593, to take us to the record in Hansard of the debates leading to the enactment of the section, and he also relied on what he called the legislative history of the section. As to Pepper v Hart , he recognized the limitations indicated by Lord Oliver at page 620 A-B and D-E but submitted that the present was indeed a case

....where the expression of the legislative intention is genuinely ambiguous or obscure or where a literal or prima facie construction leads to a manifest absurdity ...." (per Lord Oliver at 620D)

Counsel relied in particular on the word "obscure". He accepted that unless he could make good his assertion of ambiguity or obscurity we were not entitled to refer to Parliamentary material.

We see no ambiguity or obscurity in the section. In our view Mr. Rhodes's argument founders on the word "any" in subsection (1), the presence of which (as he was we think almost constrained to accept) cannot be explained on the basis of his suggested restrictive meaning. So far from being open to the possible construction that an offence is committed only where the deception relates to the prospect of payment, the language of the section is in our view entirely inconsistent with such an interpretation. What it says is that dishonestly to obtain services by any deception of another is an offence in those cases where the services (a benefit conferred by the doing of some act or the causing or permitting of it to be done) are given on the understanding that the benefit has been or will be paid for. There is simply no scope for Mr. Rhodes's suggested alternative construction nor is there any ambiguity or obscurity - let alone manifest absurdity, which Mr. Rhodes did not assert -about the literal construction which we have identified. We accordingly refused to look at any Parliamentary material.

As to legislative history, Mr. Rhodes relied on the fact that the 1978 Act was passed "to replace section 16 (2) (a) of the Theft Act 1968 with other provision against fraudulent conduct; and for connected purposes". As this submission was developed it seemed to us that it was, if apt at all, germane to the issue of how the suggested ambiguity should be resolved rather than whether there was an ambiguity. Certainly we derive no assistance from it on the latter point.

We are satisfied that there is no basis for the argument on which sub-paragraphs (c) and (d) of the draft amended grounds are based and we reject them as unarguable.

We now turn to consider sub-paragraph (a). Inherent in this ground are two contentions; first that the provision of the two facilities was not the provision of services within the meaning that had been attributed to that word in section 1 by this court in R v Halai [1983] Cr. LR 624; and second that Halai is still to be regarded as good law notwithstanding recent decisions of this court that it should not be so regarded. Mr. Rhodes accepted that, in order to succeed, he must make good both of these contentions. We shall address first the question whether, assuming that Halai embodies some principle and still binds this court, it would conflict with that principle to hold that the provision of the two facilities by the banks concerned amounted to the provision of services within s.1 of the 1978 Act.

In Halai a division of this court had occasion to consider whether the allegations in counts 2, 3 and 4 of the indictment fell within section 1 of the Theft Act 1978, cited above.

The case arose from the conduct of a 20 year old man who had but a few weeks before the events in question become an insurance consultant. He had unjustifiably high expectations of his likely future earnings. He opened a bank account with Williams & Glynn's Bank having very limited funds, and went to see a solicitor, who happened to be an agent for a building society, with a view to purchasing a house. In an attempt to obtain an advance by way of mortgage for the purchase of a house, he made misrepresentations about the length of time he had been employed

and his likely future earnings. He also presented for payment into the building society account which was to be opened, a cheque for £500 drawn on William and Glynn's Bank, when he knew that there were no funds to meet the cheque.

A few days later he attended and delivered another cheque which he knew would not be met, drawn in the sum of £250. He also induced by deception the employee of the building society to pay out £100 in cash by claiming that the initial sum of £500 had been paid not by way of cheque, but by cash.

These very simple facts gave rise to an indictment which the court considered unduly complicated. Count 2 of the indictment alleged that the appellant had obtained a service, namely the opening of a savings account with the Portsmouth Building Society, with an initial credit balance therein of £500. Count 3 of the indictment alleged that he had dishonestly attempted to obtain a service, namely a mortgage advance by deception by falsely representing that he was an insurance consultant and had been so employed for 18 months. Count 4 alleged that he had dishonestly obtained a service, namely the increase of £250 to the apparent credit balance by payment of the invalid cheque referred to above. At the time he obtained the £100 in cash the entry was made in his passbook that £250 had been paid. The convictions on counts 2, 3 and 4 were quashed. On count 2 the court held:

Where a customer pays £500 into a bank, by no stretch of the use of ordinary English can anyone suggest that the bank is conferring a benefit on the customer; and so too, if the £500 is lodged in a building society account by no stretch of the imagination can anyone say that the building society is conferring a benefit on the customer.

Further, the court held in answer to the submission that the benefit was the entry in the passbook, that:

No payment whatever was made for that, or expected for it.

It was for those reasons that the count was quashed.

As to count 4, the court held:

No service was rendered by Mrs. Cooper, (the building society employee) by making an entry in the passbook.

As to count 3

...... a mortgage advance cannot be described as a service. A mortgage advance is the lending of money for property and can properly be charged under s.15 of the 1968 Act.

In summary, therefore, the court held:

(1) that when a cheque is paid into a bank account by a customer the bank confers no benefit on the customer;

(2) no benefit is conferred when an entry is made in a passbook recording a payment in;

(3) a mortgage advance cannot be described as a service.

It is the third holding which has received much recent judicial consideration. (see R v Graham, Transcript 25 October 1996, R v Cooke, Transcript 24 January 1997, R v Cumming-John transcript 28 February 1997, and R v Hilton Transcript 7 March 1997) The Lord Chief Justice, Lord Bingham, observed in Graham that "the practical utility of this section has been greatly limited by the decision" in Halai. The broad language employed went beyond the facts surrounding the particular mortgage advance in question and has been treated as applying to all mortgage advances. Having regard to the extent of the difficulty the words have occasioned it may be pertinent to recall an observation of Viscount Haldane, Lord Chancellor, in G & C Kreglinger v The New Patagonian Meat and Cold Storage Company , 1914 AC 25 at page 40:

To follow previous authorities, so far as they lay down principles, is essential if the law is to be preserved from becoming unsettled and vague. In this respect previous decisions of a court of co-ordinate jurisdiction are more binding in a system of jurisprudence such as ours than in systems where the paramount authority is that of a code. When a previous case has not laid down any principle, but has merely decided that a particular set of facts illustrates an existing rule, there are few more fertile sources of fallacy than to search in it for what is simply resemblances in circumstances, and to erect a previous decision into a governing precedent merely on this account. To look for anything except the principle established or recognized by previous decisions is really to weaken and not to strengthen the importance of precedent. The consideration of cases which turn on particular facts may often be useful for edification, but it can rarely yield authoritative guidance.

Although as we have said, the holding in relation to a mortgage advance is couched in broad language, it cannot be taken that it was intended to lay down that no mortgage advance, no matter what terms might attach to the mortgage and no matter in what circumstances the advance had been made, could amount to a service within the meaning of s.1 of the Theft Act 1978. In our judgment, at its highest, the court was holding that a mortgage advance to a private individual by a building society in respect of a private residence and on the terms and conditions normally attendant upon such a building society mortgage, did not amount to a service within the meaning of the Act. The court was plainly concentrating its attention upon the money which would have been obtained as a result of the deception, and must be taken to have concluded that the consequences derived from such a transaction, namely the use and occupation of a property and, in normal circumstances, the holding of a significant investment, did not constitute a benefit. It is in this regard that the decision is surprising and it is noteworthy that a division of this court in R v Widdowson 82 Cr. App. R 314 was able to identify the conferring of a benefit sufficient to constitute a service in a hire purchase situation.

In support of his argument as to the status and effect of Halai Mr. Rhodes relied on an observation by Lord Goff in Preddy at page 269:

There is considerable force in this criticism and certainly, if accepted, it would close a manifest gap in our criminal law. I feel bound to comment, however, that, although a wide definition of "services" appears to have been intended (see Professor Smith's The Law of Theft, 7th Ed page 112), nevertheless if sub-section 2 were to be construed in the literal manner which is understandably urged upon us in the literature on the subject, it would follow that the ambit of section 1 of the Act of 1978 would be remarkably wide. It would stretch far beyond what is ordinarily included in the notion of services as generally understood. In particular, although we have become used to the expression "financial services" as describing a range of services available from those involved in that service industry, it is not altogether natural to think of the simple making of a loan upon interest as itself constituting a service.

A little later, Lord Goff observed:

While Halai stands, its effect is that [prosecuting authorities] can hardly charge defendants, alleged to have committed mortgage frauds, with the offence of obtaining services by deception ...

Mr. Rhodes submits that although we are not concerned with a mortgage fraud, by analogy the revolving credit facilities obtained by Arrows and referred to in the counts in the indictment should be treated as though governed by the ratio in Halai. Alternatively, he submits, they are covered by Lord Goff's observation that:

.... it is not altogether natural to think of the simple making of a loan upon interest as itself constituting a service.

Having regard to: (1) Lord Haldane's reminder of the danger of erecting a previous decision reached on particular facts into a governing precedent; and (2) the strong criticism which has been levelled at the decision in Halai, and the recent statements in other divisions of this court that that case should not be followed, we would, if bound by it, consider it appropriate to give effect to it only on the basis of the strictest and narrowest permissible interpretations of its ratio. It should at best be treated only as authority for what so interpreted, it actually decides.

Count 2 alleged that the appellant obtained services from NMB, namely a £30 m. revolving credit facility. Count 4 covered a similar facility for £11 m. from GIRO. In our judgment there are a number of facts which distinguish such a facility from a mortgage advance and from a simple "loan on interest". The following are not intended to be exhaustive:

1. When a facility is granted no loan is made until draw-down occurs.

2. The facilities granted to Arrows provided the core finance for the operation of its short-term capital financing business. The NMB facility was expressly stated to be for the purpose of providing Arrows with "working capital requirement".

3. The facility enabled Arrows to draw-down as and when it required finance and to repay it as and when it chose to do so within the limits of the facilities granted.

4. It provided Arrows with financial strength and capability to the extent of the facility beyond the assets of the company but without the need, save to the extent of any draw-down, for the assets to be offset by a loan.

5. It enabled Arrows to operate its business without entering into medium and long-term debt.

6. It gave the company great financial strength and flexibility where hitherto it had been required to seek finance from NMB and other banks against the presentation of bills of exchange from the clients of Arrows.

7. Arrows were obliged to pay a commitment fee on signing of the facility and a further commitment fee in the event that utilisation of the facility was less than a specified percentage. In addition, upon draw-down interest was payable on the borrowings.

8. The facility carried the benefit of security for Arrows in that it was a committed facility, enabling Arrows to draw-down and rely upon it for a period of up to two years.

9. So far as the facility for £11 m. obtained from GIRO is concerned, although the charges were not the same, there was no material difference between it and the terms and characteristics to which we have referred in respect of the NMB facility.

10. The facility was not available as "the lending of money for property". Indeed, the very opposite was the case, for it is the appellant's use of money for that purpose which has been found to be fraudulent. The case did not involve a private individual and a building society. The circumstances of Arrows financing its commercial affairs bear no resemblance to Mr. Halai's dealings with the building society.

11. The facility agreement, extending as it does to a substantial number of clauses, cannot be described as a simple loan upon interest.

For the above reasons we are entirely satisfied that there is no arguable case that the facilities referred to in counts 2 and 4 of the indictment can be said to fall within any governing ratio laid down by the case of Halai.

In the light of this conclusion it is unnecessary to consider in any detail the second contention (relating to the present status of Halai) and we do not propose to prolong this already long judgment by doing so. We state simply that Mr. Rhodes's submission was that the decisions in this court in the cases of Graham & others, Cooke, Cumming-John and Hilton that Halai was no longer to be regarded as good law were all made per incuriam and should not be followed. His contention, in support of which he referred us to a number of authorities, was that it was only open to this court to depart from a previous decision of the court if that decision had been given per incuriam, overruled by the House of Lords or reversed by Statute; or, exceptionally, where justice to the defendant, who has been wrongly convicted on the strength of an erroneous decision, required it. Since none of those reasons existed, this court, which in the above cases appears not to have been referred to those authorities, was itself acting per incuriam.

In deference to Mr. Rhodes's careful argument we should record that the line of authority to which he referred us included R v Spencer & others [1985] 1 QB 771, where he particularly relied on a passage in the judgment of May LJ at 778 F to 779 F. He also took us to the summary of the law on this topic in the current edition of Archbold at 7-33 to 7-35 (and to all the other authorities there mentioned, and others besides).

We add only this. In Graham & others the Lord Chief Justice giving the judgment of the court, said of Halai:

For years now the decision of this court in Halai has lain like a sunken wreck, impeding navigation but difficult, laborious and expensive to remove. It amounts, on this point, to mere assertion, unsupported by reasoning. Lord Lane CJ in R v Teong Sun Chuah [1991] Crim. LR 463 considered the decision to bear all the hallmarks of being decided per incuriam. There is no reason to restrict the meaning of "services" in section 1 of the 1978 Act, "services" being wide enough to embrace professional services (as the court accepted elsewhere in its judgment in Halai), and commercial services and financial services, the essential conditions being that a service must confer a benefit and be rendered on the understanding that it has been or will paid for. The time has in our judgment come when the ruling in Halai quoted above should no longer be regarded as good authority, and it should no longer be followed. So to hold does not in our view remove the need for remedial legislation, to which we refer below; but it may in the short term provide a basis for indicting those responsible for at least some fraudulent transactions.

As we have already said, that approach has been followed in a number of other cases in this court. We cannot conceive (particularly in the light of Lord Bingham's words at the beginning of the passage cited above) that he did not have the principles of stare decisis well in mind, and we should not have acceded to the invitation to treat Graham and the subsequent decisions as having been per incuriam.

Accordingly, had the outcome of this proposed extra ground of appeal depended upon whether Halai was still binding, we should have decided the matter on the basis that it was not.

Ground 4C reads:

The learned judge erred in law and/or misdirected the jury in that he

(a) failed to withdraw counts 1 and 3 from the consideration of the jury on the ground that there was no evidence that the appellant obtained for Arrows Ltd. any property belonging to another; and/or

(b) misdirected the jury in connection with counts 1 and 3 that the credits to the bank account of Arrows were the property of NMB.

As we have said already, Mr. Latham conceded this point, accepting that in the light of Preddy charges under s. 15 (1) of the 1968 Act were, on the facts of this case, inappropriate. In our judgment, given the way in which the transfers of the money was effected in each case, he was clearly right to make this concession. His submissions under this head have accordingly been confined to inviting us to substitute verdicts of theft, contrary to s.1 of the 1968 Act; or of obtaining services by deception, contrary to s.1 of the 1978 Act; or procuring the execution of a valuable security by deception, contrary to s.20 of the 1968 Act. We should, however, say something about the facts on which Mr. Latham makes his concession, because they are relevant to the question whether verdicts should be substituted. This can most conveniently be done by reference to the documents pertaining to count 1.

By a letter of 3rd August 1990 to Mr. Endersby the appellant for Arrows requested NMB to make available a further £3,000,000, pursuant to the facility, on 6th August. On that date the appellant wrote again, in accordance with the agreement enclosing a promissory note by Arrows for £3 m. with a maturity date of 1st November 1990, and asking NMB to endorse the note and giving instructions as to the destination of the funds to be paid. On the same day NMB sent written confirmation of a SWIFT transfer of £3 m. to the designated Arrows account. This document contained, in summary form, details of the entire transaction, including the maturity date of the loan and the interest payable. In particular it stated:

"We will remit [the £3 m.] to your account with Societe Generale ... through Midland Bank International division London".

The transaction was carried out as detailed in these documents. Save for the difference in dates and amount the same procedure was followed in relation to the draw down of the

£1 m. the subject of count 3.

It will be readily apparent why Mr. Latham conceded that, in the light of Preddy, and the subsequent decision of this court in Graham & others , the convictions on these two counts could not stand.

Mr. Latham's first suggested alternative was theft contrary to s.1 of the Theft Act 1968. He conceded that he was unable to point to any case in which such a substitution had been made. However, relying in particular on R v Kohn 69 Cr. App. R 395 (a case the authority of which was expressly affirmed in an addendum to the judgment in Graham and others ) and the unreported decision of this court in Hilton (7th March 1997) Mr. Latham argued that such a substitution would be permissible and appropriate. There had been, he submitted, a deliberate destruction of a chose in action belonging to NMB when its balance in the Midland Bank was debited. That event was, it is true, the immediate result of the instructions given by NMB (and was therefore consensual) but that was no bar because the consent had been procured by deception. In this connection he placed reliance on D.P.P. v Gomez [1993] AC 442.

The argument on this point was lengthy and wide-ranging, and we have not mentioned all the submissions made. We are, however, satisfied that theft is not an available alternative on the facts of this case, if only because

(i) As Mr. Latham conceded there was no evidence as to the state of NMB's account at the Midland Bank. For all we know (or the jury knew, which is more to the point) the payment ordered would have resulted in an unsanctioned overdrawing. Mr. Latham submitted that the jury could, despite the absence of any evidence, have inferred that the account was either sufficiently in credit or within authorized overdraft limits, and therefore fell within the first or second of Lord Lane's categories in Kohn, but we do not agree. There simply was no evidence from which such an inference could be drawn.

(ii) We are not satisfied that a misrepresentation which persuades the account holder to direct payment out of his account is an assumption of the rights of the account holder as owner such as to amount to an appropriation of his rights within s.3 (1) of the 1968 Act.

(iii) In all the circumstances we are not satisfied either that the terms of the indictment were such that the jury could have found the appellant guilty of theft of a chose in action or that they must have been satisfied of facts which proved the appellant guilty of theft - the two requirements that the prosecution must establish before this court can substitute a conviction for an alternative offence (see per Lord Bingham CJ in Graham & others ).

The next suggested substitute conviction advanced by Mr. Latham was obtaining services by deception contrary to s.1 of the 1978 Act, the same offence as that charged in counts 2 and 4. He relied on the fact that in two of the unreported cases to which we have earlier referred - Cooke and Cumming-John - this court had made such substitution: and he argued that on the facts it was plain that the terms of the allegations in counts 1 and 3 of the indictment impliedly included an allegation of such an offence (s.6 (3) of the Criminal Law Act 1967) and that the jury could on the indictment have found the appellant guilty of such an offence and must have been satisfied of facts which proved him guilty of such an offence (s.3 of the Criminal Appeal Act 1968). The way in which, at the end of his argument, he formulated the charge which the indictment impliedly included was that, whereas count 2 covered the obtaining by deception of the service involved in making available a facility, the suggested alternative to counts 1 and 3 covered the obtaining by deception of the service involved in the utilization of the facility, by taking advantage of the right to draw down funds.

Mr. Rhodes, in response to these submissions, did not contend that the main part of Mr. Latham's argument was incorrect; he confined his submissions to the following points:

(1) He relied on his earlier arguments based on Halai and contended that in the circumstances the facts did not in law support a charge that services were obtained.

(2) He invited us, as a matter of discretion, to refuse to permit substitution, because as he submitted there were available to the court plenty of other counts which reflected the overall criminality of the appellant and in all the circumstances it would not be appropriate or fair to substitute two more.

As to the first of these submissions, it will be clear from what we have said earlier that we take the view that, even if Halai is still to be regarded as correctly decided, it is to be treated as a case very much on its own facts. In our judgment there are very significant differences between the mere "lending of money for property" in an ordinary mortgage transaction and the arrangements involved in a continuing facility with its reciprocal obligations. We are quite satisfied that, here again, any principle embodied in Halai would not compel us to hold on the facts of the present case that, when the bank complied with a requirement by Arrows to draw down funds pursuant to the facility, the bank was not providing a service. Plainly, it was doing so.

Even had we not been satisfied of this we should, for reasons given earlier, have felt compelled to treat Halai as no longer binding.

As to discretion, we have carefully considered Mr. Rhodes's submissions, in the course of which he made it clear that, notwithstanding his argument as to overall criminality, he would be submitting that the quashing (without substitution) of counts 1 and 3 should make a significant difference to the overall sentence. It seems to us that,given that the jury were, as their verdicts demonstrate, satisfied that the appellant dishonestly deceived NMB into granting the facility and permitting it to be operated, there is nothing inappropriate or unfair in making the substitution for which the Crown contend. We indicated at the conclusion of the argument that we proposed to do so, and we do.

It is accordingly unnecessary to consider Mr. Latham's arguments in support of the third possible substituted offence - procuring the execution of a valuable security by deception contrary to s. 20 of the 1968 Act. We say no more than that this involved reliance on the cancellation of the promissory note provided as security for the loans and that, as he developed his submissions, we readily understood why Mr. Latham characterized this option as the one he favoured least. We should not have permitted it.

Mr. Rhodes's subsidiary new grounds only arose if one or both of his main new grounds succeeded - in the case of the first ground to the extent of successfully resisting the substitution of a conviction for an alternative offence - and in the event he did not advance them.

We turn now to the grounds which embody criticisms of the summing up. We begin by setting out a quite lengthy passage from the summing up to which the first group of grounds that we shall consider relates - for ease of reference we have numbered the paragraphs.The quotation starts with a passage which occurs shortly after the judge had introduced the elements of Counts 1 and 3, explained that they were sample counts and explained what obtaining property meant. He continued:

1. A person is to be regarded as having an intention permanently to deprive another of property if, even though he does not mean the other to lose the property permanently, he intends to treat the property as his own, to dispose of regardless of the other's rights. Thus, if money is loaned for a particular purpose, an intention to use it in a way which was not intended by the lender and for an entirely different objective may amount to an intention permanently to deprive, whether or not the borrower has the hope or expectation of repaying the sum advanced. The intention must be present at the time when the property was obtained.

The judge then dealt with intention and deception and continued:

2. Although a representation may be true in one sense, that is not necessarily a defence. Clearly, if the person making the representation may have honestly intended that the true sense should be understood, he would be not guilty of the offence. But if he intended that the representation would be understood in the untrue sense and it was in fact understood in that untrue sense, then that is a deliberate deception.

3. The particular representations in counts 1 and 3 cover two broad topics: trade finance and insurance. You are not concerned in this case with legal arguments as to what these terms might encompass or might mean. You are considering them as representations made about the business of Arrows. In considering whether an individual representation was false, you should ask what NMB understood by the use of the expression "trade finance", for example, and what Mr. Naviede knew and intended that they should understand. Similarly in relation to insurance, the representation which the prosecution seek to prove at number 3 is that each individual transaction with a customer of Arrows was insured. Is this what NMB understood and what Mr. Naviede knew they would understand to be the insurance position as a result of a representation that he made?

4. The deception must operate on the mind of the person deceived, in this case the representatives of the banks -- and taking the transactions as a whole -- must be the cause of the property being obtained.

5. Plainly this has to be approached employing common sense. There may be many reasons why banks loan money, not least the wish to make a profit. Equally, lending may be the result of a sequence of events and decisions set in train by the initial representations. The deception does not need to be the only reason for the advance but it must have been relied upon so as to be the effective cause of the obtaining. If the representation was unimportant to the person to whom it was made and played no part in the obtaining of the money, then clearly it would not have been the effective cause.

6. You must be sure that Mr. Naviede acted dishonestly. In deciding whether the prosecution have proved dishonesty, you approach the matter in stages. Firstly, consider whether on the evidence before you you are sure that Mr. Naviede acted dishonestly by the standards of ordinary and decent people. If but only if you consider that he did so act, then go on to consider whether you are sure that he must have realised that what he was doing was by those standards dishonest.

7. I should add in this regard, members of the jury, that, although it may seem difficult to envisage a deliberate deception which was not also dishonest, the question of dishonestly is a separate matter to which you must apply your minds. You will, just by way of illustration, remember for example the evidence that Mr. Naviede was secretive in his business affairs. There has been a good deal of evidence about that. It is conceivable that the true nature of a business might be concealed by a deliberate deception for the honest purpose of protecting trade secrets or confidentiality. I merely give that to you as an example, members of the jury, about how deception and dishonesty are separate matters to be considered. However, since I have chosen this as an example, I should remind you that it is Mr. Naviede's case that he did not deliberately deceive anyone whether for this or any other reason.

8. Although an intention to repay sums obtained or to perform contractual obligations at some stage may be evidence of honesty, it is not of itself a defence to this charge.

9. I would like you now to go to the script that has just been handed to you, as I conclude my directions on counts 1 - 3. Do you have the first page, counts 1 and 3?

10. Bearing in mind the directions I have given you as to all of the elements of the offence and my observations (if you agree with them) as to what is in issue, it may be helpful for you to approach your consideration of these counts by taking each representation in turn and asking whether the prosecution have made you feel sure of the following:

(a) that Mr. Naviede made the representation;

(b) that the representation was false when made;

(c) that at the time when the representation was made Mr. Naviede knew it to be false and intended to deceive NMB;

(d) that the credit to the account of Arrows was obtained as a result, that is to say that the representation was the effective cause of the credit;

(e) that Mr. Naviede intended permanently to deprive NMB of the sums advanced;

(f) that Mr. Naviede acted dishonestly.

The reference in paragraphs 9 and 10 to a script is a reference to written directions which the judge had prepared, the content of which can be gathered from what he said.

When, on the second day of their retirement, the jury asked the judge if he would clarify sections (c) and (e) of his written directions, he discussed with counsel and the appellant how he should answer and in the event adopted suggestions by Mr. Latham that in repeating his earlier directions he should add a few words in paragraphs 1 and 3. Accordingly, when he repeated paragraph 1 he extended the penultimate sentence by adding the words "and even if at some later stage an equivalent value is returned". In paragraph 3 he also inserted some words and for clarity we repeat the entirety of that paragraph with the added words underlined.

The particular representations in counts 1 and 3 cover two broad topics: trade finance and insurance. You are not concerned in this case with legal arguments as to what these terms encompass or might mean. You are considering them as representations made about the business of Arrows. In considering whether an individual representation was false you should ask what NMB understood by the use of the expression "trade finance". May they have understood it to encompass property financing or, alternatively, are you sure that they understood it to mean traditional stock financing ,for example, and what Mr. Naviede knew and intended they should understand. Similarly, in relation to insurance, the representation which the prosecution seek to prove at number 3 is that each individual transaction with and customer of Arrows was insured. Is this what NMB understood, and what Mr. Naviede knew they would understand, to be the insurance position as a result of the representation that he made?

Grounds 4A and 4B assert that the judge erred when he directed the jury as he did in paragraphs 2 and 3. These directions were, Mr. Rhodes submitted, simply wrong in law. It was the appellant's case that the property financing business was within the description of trade finance and there was some evidence to support this construction, as well as what Mr. Rhodes called a concession by Mr. Latham for the Crown in his closing submissions to that effect. He argued that the judge was not only disregarding these matters by his directions in the first sentence of paragraph 2, he was also confusing two distinct elements of the offence - whether the representation was false and whether it was made with the intention of deceiving the bank. The judge should have directed the jury that a representation was either true or false; and that if they were not satisfied that it was false that was an end of the matter and the defendant must be acquitted. Only if they were sure it was false need they consider the other quite separate elements of the charge. The subjective understanding of the defendant or the complainant was irrelevant at this initial stage.

In this connection we were referred to R v Dellar [1952] 36 Cr. App.R 184, a case in which the charge depended on proof that the defendant did not, as he had represented he did, own a vehicle which he had disposed of. The Crown's case rested on the proposition that the vehicle was subject to a hire purchase agreement to the defendant who therefore did not own it. However, the court concluded that the documents were a sham and that he did in fact have title; and it was held that notwithstanding his own belief to the contrary, he was entitled to be acquitted.

The case of Dellar is, in our view, not material in the present context. There it turned out as a matter of law that the defendant was the owner of the car, even though he believed that he was not. Plainly, therefore, he could not be guilty of obtaining by deception - there had been no deception. The present case was quite different, for the reasons given by Mr. Latham - namely that the issue for the jury was what, in the context of the business of Arrows and the exchanges between the appellant and the banks, the words trade finance were intended by him and understood by them to mean. Trade finance is not a term of art and we accept Mr. Latham's submission that it was well understood by everyone at the trial, including the jury, that they could only convict if they were sure that by that term the appellant meant the banks to understand and they did in fact understand that he required money for the purposes of providing finance to traders by means of purchase and resale of stock.

We reject Mr. Rhodes' contention that, in the circumstances the indictment was defective and the judge should have required it to be amended or alternatively withdrawn these counts from the jury.

We should mention in this context that we were referred by Mr. Latham to and derived assistance from the recent decision of this court in R v Page and others [1996] Crim. L.R. 821, a case in which it was contended for the appellant that it was for the judge to direct the jury as to the legal effect of undertakings given by a solicitor. In rejecting that contention Kennedy LJ. giving the judgment of the court referred to R v Adams [1993] CLR 525 and to Sir John Smith's comment in a footnote:

"A distinction must be made according to whether the issue is as to:

(i) the legal effect of the document or

(ii) the meaning of the document as (a) understood or intended by the person making it and (b) understood by the person reading it.

Where the issue is as to the legal effect of the document, it is submitted that it is a matter for the judge. Where the issue is as to the meaning intended or understood by the parties it is a matter for the jury".

Kennedy LJ. continued:

"That precisely encapsulates the position as we understand it. In the present case the issue in relation to each alleged solicitor's undertaking was as to the meaning of the document as understood by the person reading it - either Page or Holden. It was therefore a matter for the jury"

It should not be thought that, in arriving at the conclusion stated above, we have failed to have regard to Mr. Rhodes' arguments that in any criminal trial the indictment is a crucially important document and that it is incumbent on the Crown properly to plead the ingredients of the offence. We accept that the indictment must make clear to the defendant what it is that is alleged against him. In essence the complaint here is of the failure to refer to stock finance or to make it clear by additional words that the allegation was that the term trade finance was used in the sense of stock fiance. But in the context of this case that complaint is, we are satisfied, technical and ummeritorious. It is easy to understand why the words trade finance were used, because that is the way "trade finance" is described, in effect defined, in the all-important documents on which the Crown relied - see in particular the Information Memorandum. As we have said, we have no doubt that, both by reason of the way the whole trial had been conducted and in the light of what the judge said in his summing up, the jury well understood that the misrepresentation alleged involved that the appellant was telling the banks that the business of Arrows was still old style stock finance and that it was for that purpose that he required the money.

As to the contention that the judge was, in paragraph 2,. confusing the question whether the deception was false with the question whether it was operative, we accept that he was dealing with both concepts. It does not, however, follow that this was confusion or that the jury were confused. Here again our view is that this is in the context of this case a technical rather than a substantive criticism.

Immediately before he gave the direction in paragraph 2 the judge had told the jury that the deception must be deliberate and false when it was made, explaining that deliberate in the context meant that the representation was made in the knowledge that it was false and with the intention that the person to whom it was made should believe it to be true. In paragraph 3 he told the jury that they were considering the representations "as representations made about the business of Arrows". We are satisfied that the jury would have understood paragraphs 2 and 3 as meaning that, in deciding whether the representations were true or false, they were concerned not with some possible meaning that they might, as a matter of strict construction, bear, but with what they were intended and understood by the parties to mean at the time and in the context in which they were made. The jury must have understood perfectly well that if they thought that the appellant may have intended the words to encompass property finance or the banks may have understood them in that sense then the appellant was entitled to be acquitted. We therefore reject Mr. Rhodes's submission that paragraph 3 contains serious misdirections and, with paragraph 2, may have led the jury to understand that they could convict the appellant even if the Crown had not proved that the representations alleged were false. We also reject his argument that the jury may have failed to understand that it was incumbent on the Crown to prove as a distinct element of the charge that the deception had caused the loss: that this was necessary was we consider abundantly clear from the judge's directions taken as a whole, including his written directions.

Mr. Rhodes also advanced under this head some arguments in connection with the aspect of insurance but it is more convenient to deal with those in a different context.

Ground 5A asserts that the judge erred in that he gave no adequate directions as to the separate elements of deliberate deception and dishonesty required to be proved in the counts of obtaining by deception, or as to the matters the jury could properly take into account in determining those elements. It is contended that the correct direction given in paragraph 7 was wholly vitiated by the allegedly incorrect directions in paragraphs 2 and 3. Given the view we have expressed about the latter paragraphs, we need say no more than that we reject this contention.

Ground 5B raises a discrete point in relation to paragraph 8, contending that the judge was there guilty of a serious misdirection in that he did not go far enough, since he should have reminded the jury that intention to repay might go to the issue of dishonesty, which was at the core of the case; and that he should in this context have emphasised that absent proof of dishonesty the defendant did have a defence.

It is said that this misdirection was compounded by the judge's direction in paragraph 1, repeated with additional words in answer to the jury's question - those additional words introducing the incorrect and confusing notion that an intention permanently to deprive is synonymous with an absence of intention to repay. It was said that intention permanently to deprive the banks of the sums advanced was not in issue and that the only issue to which intention to repay went was dishonesty. Accordingly, it was argued, those directions were confusing to the jury - all the more so because of the introduction of the concept, irrelevant on the facts of this case, of unauthorized later appropriation.

It was in our judgment necessary for the judge to direct the jury on intention permanently to deprive: we accept Mr. Latham's recollection that this element of the offences was in issue. However, we accept that in the passages relied on by the appellant there was an element of confusion.

The question, however, is whether the central thrust of this ground - that the judge misdirected the jury in saying what he did in paragraph 8 by not making clear that intention to repay was relevant to the important issue of dishonesty - is made good. We have no doubt that it is not. The first part of the sentence specifically refers to its relevance to the issue of dishonesty, and it was not necessary for the judge to say more.

Ground 5C seeks to impugn the judge's directions on dishonesty. He had given a standard direction in accordance with Ghosh 75 Cr. App. R 185 of which no criticism is made. The complaint is that such a standard direction was in the circumstances wholly inadequate - there should have been a direction tailor-made to guide the jury by explaining to them how the evidence and the issues in the case which they had to decide related to the honesty or dishonesty of the appellant. Thus, it is argued, among the questions which the jury ought to have been directed specifically to consider were whether the appellant believed or might have believed that he had made sufficient disclosure to the banks; that the insurance policies covered Arrows' property business; and that that business could properly be described as trade finance.

Further it is said that there was a serious omission in that the judge failed to direct the jury that the formation of a dishonest intent in relation to the banks after the obtaining of the property did not suffice to prove dishonesty at the time of the obtaining.

Finally complaint is made in relation to the judge's failure to direct the jury to ignore a suggestion, already mentioned in a different context, that the appellant had been salting money away for himself or his family. The submission is that the jury should have been directed to ignore that suggestion, and that the failure so to direct them was a material misdirection because the allegation may have been a factor in their deliberations on the issue of dishonesty.

We cannot accept these criticisms. The extent to which a judge who has given what is conceded to be a correct direction in law as to dishonesty may choose to reinforce that direction in relation to specific issues is very much a matter for his judgment, and we find no valid reason for criticising what the judge did in this case. He had, as passages we have already cited show, made clear to the jury that an honest intention on the part of the appellant as to how his representations should be understood would entitle him to be acquitted. Both his written and his oral directions made clear that the prosecution must establish dishonesty and that central to the defendant's case was his assertion that he had acted honestly throughout. The jury were properly directed as to the material time for proof of the charges, including the element of dishonesty. As to the introduction of the suggestion that money had been salted away, we have already considered this when dealing with Ground 13 and we do not accept that it was incumbent on the judge to give the suggested direction on dishonesty in relation to it.

The vital question is whether the jury - who after hearing this case for months were obviously very familiar with the issues - were made sufficiently aware of the fact that the question of the appellant's honesty was central, and that it was for the Crown to satisfy them so that they were sure that he had been dishonest. We have no doubt that they were, and we do not think that the judge's directions on this issue were deficient.

By Ground 6 it is alleged that there was a misdirection by reason of the judge's failure to tell the jury that the appellant was under no duty to disclose material facts to the banks when he made representations as to the scope of Arrows' business. It is further contended that he should have directed them that there was a material difference between insurance contracts and agreements between a bank and its customer in that the latter are not subject to duties of utmost good faith.

There is in our judgment no substance in this ground. It is based primarily on the contention - disputed by the prosecution - that Mr. Endersby of NMB had repeatedly confused the two types of contract and appeared to believe that he was entitled to complete disclosure. However, the passage in his evidence to which we were referred does not support the contention that he was equating agreements between banks and their customers with contracts of the utmost good faith - and we do not believe the jury can have thought that there was any such obligation. Counsel for the Crown had in his opening explained that an insurance contract involved a duty of full disclosure and the judge in summing up, when dealing with the evidence of Mr. Morris the insurance broker, had rehearsed his evidence that "utmost good faith" is a general concept in all forms of insurance. We see no reason to think that the jury may have been under a misapprehension that such a duty applied to other contracts.

It has to be remembered, moreover, that the Crown's case, based as it largely was on the contents of the Information Memorandum, involved a positive misrepresentation to the effect that Arrows' business was and remained one 98% which related to old style stock finance.

Ground 7 relates to the way the judge dealt with similar fact evidence, and requires a little explanation.

The Crown had adduced evidence of witnesses from three banks which did not figure in any of the counts in the indictment. It is clear that, at least by the end of the case, the relevance of this evidence was that it went to refute the appellant's case that it was Mr. Endersby who had been responsible for inserting in the Information Memorandum all those details on which the Crown placed so much reliance. The Crown pointed to the evidence of the witnesses from these other banks, whose accuracy but not whose honesty was challenged by Mr. Naviede, that he had told them very much the same as Mr. Endersby said Mr. Naviede had told him. This was, accordingly, most telling evidence. It went to support Mr. Endersby's and refute the appellant's evidence as to where the damaging information came from. What it did not go to prove, however, was that what the appellant had allegedly said, whether to Mr. Endersby or other bankers, was untrue.

The judge gave the jury this direction:

In the case of each of the banks that I have referred to, the prosecution say that Mr. Naviede was falsely and deceitfully representing that the main part of his business was trade finance, the old business, backed by insurance. It is alleged that the false and deceitful representations caused each bank to grant facilities, and that Mr. Naviede was behaving dishonestly.

In deciding whether for instance you are sure that an individual offence is made out against NMB, you may take into account the evidence of any of the other banks I have referred to -- that is Giro, Dresdner, RZB and OLB -- if you find that there is an underlying unity shown in their evidence as to make coincidence an affront to common sense. Putting it another way, if you find that there is a plain unity of intention shown on the defendant's part dishonestly to obtain from the banks by deception, then you may take into account the evidence of the other banks when considering if you are sure on an NMB account.

Before you may use the evidence of the other banks in that way, you must feel sure that the evidence of the bank in question was independent of the others, and this has two aspects: firstly, you must feel sure that there has been no collaboration between them in the account that they give, collaboration meaning putting their heads together to tell a false story; secondly, you must feel sure that there has been no contamination of their evidence. Contamination in this context means being influenced by hearing of other allegations or being influenced by some third party such as an investigating officer to make unreliable or untruthful statements.

If the evidence of any or all of the other banks I have referred to does not pass the tests of independence that I have described, then it should be totally ignored when considering each NMB count.

Initially Mr. Rhodes submitted that the judge should have directed the jury to ignore the evidence of the other banks entirely as it did not go to any live issue in the case: but we think on consideration he accepted that it did go to the very important issue we have identified. His real contention is that the judge did not explain to the jury how the evidence was relevant, but instead gave them what was intended to be a standard similar fact direction.

We accept the validity of the criticism that this direction was in the circumstances inappropriate in that it did not bring home to the jury the real relevance of the evidence referred to. (However, we reject a second contention - that the judge did not adequately warn the jury about collaboration and contamination, since he plainly did so). The question is whether this misdirection makes the appellant's conviction unsafe - a matter to which we shall return when we have considered all the grounds of appeal.

Ground 8 concerns the judge's directions on the subject of insurance. Complaint is made that the judge erred in directing the jury as he did in paragraph 3, in effect telling the jury to concentrate upon whether the prosecution had proved the alleged representation by the appellant that each individual transaction with a customer of Arrows was insured.

As the judge said in paragraph 3: "Is this what NMB understood and what Mr. Naviede knew they would understand to be the insurance position as a result of a representation that he made?"

Mr. Rhodes submitted that it was a question of law for the judge as to whether the ICE transactions were capable of being insurable risks under the insurance policy. That question went both to the issue of the falsity of representation 3 in Counts 1 - 4 and the appellant's dishonesty, in particular, whether he could honestly have believed that the ICE transactions were insured against loss. It was submitted that the judge should have directed the jury that, as a matter of law, the ICE transactions were capable of being insurable risks under the insurance policy because:

a) the ICE transactions were capable, as a matter of law, of being described as "trade finance",

and/or

b) the insurance policies, as a matter of law, did not exclude cover in the respect of the ICE transactions at least from 1st October 1990 having regard to the references in Endorsement F effective from that date to "a Corporate Finance Facility" and to Arrows being permitted to advance in excess of the permitted limit of £200,000 "provided the net amount of exposure after deduction of value of security held does not exceed £200,000".

In Mr. Rhodes' submission, if the judge had taken that course, the jury would have been enabled fairly to assess the appellant's alleged honest belief that the ICE transactions were insured against loss.

Over some thirty-three pages of the summing up, the judge first summarised the evidence of the prosecution witness, Mr. Morris, the broker who arranged the insurance and referred the jury to the terms of various insurance policies. He then summarised the appellant's evidence and the essential elements of the appellant's case in respect of insurance.

It is necessary to refer to the Arrows Insurance Company Limited policies for the years 1988 - 1989, 1989 - 1990 and 1990 - 1991. The position from 1982 had been that Mr. Morris, an insurance broker at Sedgwick Group PLC, arranged trade or credit insurance on behalf of Arrows with a view to Arrows being indemnified against losses incurred through the insolvency of clients who had defaulted on their obligations to pay under the relevant Bill of Exchange. That insurance was arranged at first through Trade Indemnity PLC. In 1985, Arrows Insurance Company Limited (AIC) was established in the Isle of Man as a captive insurance company to cover the first aggregate annual loss of £400,000, with Trade Indemnity PLC issuing a policy of

re-insurance to cover any potential additional liability over and above the £400,000 cover provided by AIC. AIC was only ever authorised to issue policies to Arrows as the insured party. The AIC credit insurance policies for 1988 - 1989 and 1989 - 1990 are in identical terms save that Endorsement F, to which we shall refer, was added on 2nd November, 1989. In summary, the effect of those two policies was to provide insurance cover in respect of each stock finance transaction up to 100% of the amount lent by Arrows with a £10,000 excess, in the event of the insolvency of the client, subject to recoveries and salvage. Those two policies plainly related to stock finance, the insured debt being defined as relating specifically to the invoice value of goods, that is, the stock purchased and resold by Arrows. There are numerous references throughout the policies to "goods" or the "invoice value of goods", the trade of Arrows being described in the policies as that of "Trade Financiers". The permitted limit of any indebtedness by a client of Arrows (called "THE INSURED BUYER") was expressed to be £150,000 subject to any higher limit being specifically agreed in writing by AIC. The permitted limit was expressed to be "for the purposes of THE DEFINITION OF INSURED DEBT", insured debt being defined by reference to the "the invoice value of goods (or the face value of the original Bill where a Bill of Exchange is drawn or accepted by THE BUYER in respect of the invoice value of goods)". The policy for 1989 - 1990 introduced for the first time Endorsement F in the following terms:

"Subject to the provisions of Section 5(b) of the Schedule to this Policy, the insured can advance a facility to THE INSURED BUYER in excess of £150,000 without the need to obtain a permitted limit from the Company provided the net amount of exposure after deduction of value of security held does not exceed £150,000".

The "Section 5(b)" there referred to relates to the permitted limit of £150,000 of any indebtedness by the Insured Buyer (Arrows' client), Section 5(b) commencing with the words "For the purposes of THE DEFINITION OF INSURED DEBT". Having regard to the definition of Insured Debt being firmly tied to the invoice value of goods, it is plain that Endorsement F also related to stock finance concerning the sale and repurchase of goods.

Thus, the AIC policies up to 31st March 1990 reflected what was understood to be the nature of Arrows' business, namely, short term lending in respect of goods up to a limit of, at that time, £150,000 to any one client, each transaction being credit insured, up to 100% of the amount lent subject to an excess of £10,000.

The AIC policy for 1990 - 1991 introduced a number of changes. As with the two earlier policies, the period within which the policy operated was specified in Section 4 of the Schedule by reference to the "period for delivery of goods". The period for delivery of goods was expressed to be for a year running from 1st April - 31st March. For the 1990 - 1991 policy, the period ran from 1st April 1990 - 31st March 1991. In the 1990 - 1991 policy, Endorsement F preserved the original Endorsement F referring to "deduction of value of security held" and further redefined "INSURED DEBT" as follows:

"An INSURED DEBT is defined as being so much of any indebtedness arising out of the trade specified in Section 2 of the Schedule ["Trade Financiers"] and owing by an INSURED BUYER to the INSURED as does not exceed the limit permitted under Section 5 of the Schedule [£200,000] and is in respect of goods sold and delivered to and/or Bills of Exchange drawn or accepted by INSURED BUYERS domiciled in [certain] countries ....... within the period specified in Section 4 of the Schedule pursuant to a Contract of Sale or a Corporate Finance Facility providing for repayment of a debt upon the terms specified [normally 120 day Bill of Exchange]".

Paragraph 2 of Endorsement F provided that the definition of INSURED BUYER "shall be deemed to include any client of ARROWS LIMITED with whom a Corporate Finance Facility has been effected".

In place of the heading of Section 4 of the Schedule "period for delivery of goods" the following words were substituted: "period for delivery of goods and/or commencement of a Corporate Finance Facility".

As we have said, it was the prosecution's case that far from informing the Banks or AIC that the business of Arrows had ceased to be that of stock finance and had moved into commercial property investment, the appellant positively represented that the business of Arrows remained the same, namely, that of short term lending in respect of goods. Mr. Morris said in evidence that Endorsement F as to "value of security held" was introduced to enable Arrows to lend more than the permitted limit of £200,000 to any one customer without reference to the insurance company where Arrows held security in respect of the debt in excess of the permitted limit. He also said that the change in the definition of insured debt to include "a Contract of Sale or a Corporate Finance Facility" was introduced to deal with a possible problem about raising invoices for VAT and did not affect "the on-going business of stock finance". It was the appellant's case that the ICE transactions which commenced from about early 1990 fell within the term "trade finance" and were covered by the insurance policy as being Corporate Finance Facilities which, although each ICE transaction normally involved lending by Arrows of sums in excess of £1,000,000, fell within the permitted limit of £200,000. That, so the appellant maintained, was because he personally had given indemnities to each of the ICE Companies to cover any shortfall or loss on the ICE transactions. In a word, the appellant's case was that his personal indemnities amounted to "security held" within Endorsement F, although such indemnities were held not by Arrows, the lender, but by the ICE Companies, the borrowers.

All those issues were properly left to the jury. What the judge did not do was to direct the jury, as a matter of law, as to the true meaning of the AIC policy, namely, whether it did or did not cover each ICE transaction. Mr. Latham submitted that it was not necessary for the judge to do so. It was plain that the course of dealing between the Banks and Arrows, together with the representations made by the appellant about the nature of Arrows' business meant that the terms "trade finance" and "stock finance" were effectively interchangeable. It was further plain that the appellant had led the Banks to believe that the stock finance business would continue to be insured, transaction by transaction as before. What the insurance policy, properly construed, actually covered was irrelevant because there was no true issue as to its meaning. The fact was, as Mr. Latham submitted and as the evidence showed, that, whereas stock finance transactions were insured to the extent of 100% of the amount lent subject to a £10,000 excess, the ICE transactions were insured, if at all, to no more than a maximum of 8% of the amount lent.

It is clear that the judge's decision not to direct the jury as to the true meaning of the policy was quite deliberate. It seems to us that for him to have done so would have been to risk confusing the jury. There was the further risk that the appellant might contend that any ruling had resulted in his defence being withdrawn from the jury. In our judgment, the judge's decision was a correct one. We say that for two reasons.

First, as we see it, the judge would have been bound to rule that the policy, having regard to the course of dealing between the parties, only covered short term stock finance transactions and not the ICE transactions relating, as they did, to long term commercial property investment. We have reached that conclusion as a result of a careful consideration of the terms of the policies between 1988 and 1991. We regard it as unarguable that the changes introduced in the 1990 - 1991 policy could have had the effect of extending the ambit of the insurance cover from short term stock finance transactions to long term commercial property investment. The business of Arrows, so far as the insurance company knew, continued to be short term lending for the purpose of stock finance. Although the appellant's barely credible case was that the insurance company was, or should have been, aware of the change in Arrows' business, it would not have advanced the appellant's case or have assisted the jury's understanding of it for the judge to have rehearsed with the jury the rival interpretations to be placed upon the insurance policy which depended solely upon whether the jury accepted the evidence called on behalf of the prosecution or that of the appellant. Further and we regard this as critical, the judge would have been bound to rule, as we see it, that the appellant's personal indemnities given to the ICE Companies as borrowers and enforceable only by them, did not amount to "security held" within Endorsement F which could only have referred to security held by Arrows,the lender. It is to be noted that in about half the ICE transactions, some thirty or so, there were no indemnities in existence until June or July, 1991 so that, at the time those transactions were entered into, Endorsement F (as to "security held") could not, on any view, have applied. So in the case of each of those transactions, the permitted limit of £200,000 was, without doubt, very considerably exceeded. Thus, by adopting the approach he did, the judge in his summing up was unduly favourable to the appellant. Instead of being faced by rulings that the ICE transactions fell outside the insurance policy and that his personal indemnities could not amount to "security held" (resulting in the ICE transactions being very considerably in excess of the permitted limit of £200,000), the appellant had the advantage that his alleged belief that the ICE transactions fell within the policy was assessed by the jury, untrammelled by rulings of law unfavourable to him.

Secondly, the representations by the appellant plainly amounted to a representation that each transaction would relate to short term lending stock finance covered by insurance, as it had been over the years of dealing with the Banks. Put another way, the case against the appellant was that he had falsely represented that Arrows' transactions would be covered by equivalent insurance to that which had obtained in respect of stock finance transactions.

Looking at the case in that way, the true meaning of the policy was not in issue. If the appellant had continued with stock finance transactions, such transactions would have been covered by insurance as before, that is, to the extent of 100% of the amount lent less a £10,000 excess. Because the appellant chose secretly to embark upon the ICE transactions (each normally in excess of £1,000,000) while pretending to be still engaged in stock finance, the fact was that the policy, even if it covered such transactions, did so to the extent of only 8% of the amount lent. Neither that fact (which resulted from the very large amounts lent by Arrows to the ICE Companies) nor the existence of the appellant's personal indemnities was ever explained either to the banks or to the insurance company, as the appellant accepted in cross-examination. It seems to us that, in all those circumstances, the judge's approach was a correct one. It would not have assisted the jury to have to grapple with directions of law as to the true interpretation of the insurance policy when the real issues were (1) as to whether the ICE transactions were covered by equivalent insurance to that which had covered the stock finance transactions (which they plainly were not) and (2) as to whether the appellant could have believed that the ICE transactions were so covered.

The issues as to insurance were fully and clearly before the jury. The only defence with any kind of viability related to the appellant's alleged belief that the ICE transactions were covered by insurance. That went to the appellant's honesty. That defence was left to the jury in terms that were at least favourable to the appellant. We very much doubt that the jury would have ventured beyond representations 1 and 2 so plain was it that the ICE transactions had nothing to do with trade finance in the sense that that term was understood and intended by the appellant to be understood by all concerned. Even if they did, we cannot see that the judge's approach to the subject of insurance was incorrect or that it resulted in other than advantage to the appellant.

Accordingly, we reject Ground 8.

Ground 8A requires no separate consideration, since it is in effect an abbreviated reiteration of certain other grounds.

Ground 9 contends that the judge failed adequately to direct the jury as to the need to give separate consideration to each count. He ought, it is said, to have directed them that even if they found the appellant guilty on any of counts 1 - 4 it did not follow that he was guilty of any of the remaining counts. The judge did more than once direct the jury to give separate consideration to each count, and it seems to us that this ground is really comprised in Ground 10 which is in these terms:

The learned judge erred in law and/or misdirected the jury in that he invited the jury to take into account any finding of guilt on the obtaining by deception counts when considering the remaining counts in the indictment. In particular the learned judge wrongly repeated this misdirection in connection with count 8 (fraudulent trading).

The relevant passages in the summing up are to be found at pages 2 and 24 of the first day's transcript, where the judge said:

You give separate consideration to each of the charges, each of the counts that appears on the indictment, because separate verdicts are required for each count. Which order you look at matters in, which of the counts you take first, is entirely a matter for you. The prosecution have said that it would be sensible to look at the counts alleging deception on the banks first. The defendant in his final address began with solvency, an issue on count 8.

If for instance you decide to deal with the counts alleging deception on the banks first, and if you were to find the defendant guilty on one or more of those counts, then plainly that is the factual background upon which you consider the remaining counts. Likewise, if you were to take that course and if you had acquitted the defendant of those counts, then that would be the factual background upon which you would consider the remaining counts. But I repeat: you give separate consideration to each count.

Then, at page 24 he said:

Although I shall give you a separate direction as to the potential relationship between certain of the deception counts, in relation to this count of fraudulent trading I direct you as follows. If you are sure that Mr. Naviede is guilty of one or more of the counts of deception and you are sure that Arrows was insolvent, then you would be entitled to take into account for the purposes of your consideration of fraudulent trading any lies told to or deceptions practiced upon the creditor bank or banks in reaching a conclusion about Mr. Naviede's knowledge of solvency and the company's true financial position, and also on the question of whether Mr. Naviede intended to defraud the bank or banks.

The submission made by Mr. Rhodes concentrates on the judge's use of the word "guilty": he does not suggest that it would have been wrong for the judge to tell the jury that if they were satisfied the appellant had lied to and deceived the banks during the relevant period those were facts to be taken into consideration in their consideration of such matters as whether the intent to defraud creditors had been established and whether there was a question mark in the appellant's mind as to the solvency of Arrows: i.e. that would be a relevant part of the background, but did not necessarily import guilt.

Putting it in the way the judge did - "if you were to find the defendant guilty" - carried the risk that the jury might take the illegitimate step of thinking that a finding of guilt on the earlier counts equated with guilt on the later counts. Hence the need for an express direction that guilt on one did not equate with guilt on the others.

Mr. Latham's response, which we accept, is to contend that, against the background of clear directions as to the necessity for separate consideration, the suggested risk did not arise. If the jury made findings of guilt on any of Counts 1 - 4 before considering the remaining counts (and the judge left it to them to decide in what order to approach the counts) they were perfectly entitled to bear in mind the factual conclusions underlying such a finding when considering the other counts. The lending banks said to have been deceived were also the creditors of the company referred to in Count 8. The judge's words, so far from equating a finding of guilt on 1 - 4 with guilt on the others, made clear that the relevance of that was the underlying facts. Moreover the judge went on to direct the jury that an acquittal on counts 1 - 4 was also something they could take into account by way of factual background.

There was, it seems to us, nothing wrong with these directions, and no danger of the jury misunderstanding the point the judge was properly making.

Ground 11 is a complaint that the judge misdirected the jury on an important matter which went to the appellant's credibility, and therefore his honesty - namely a claim for professional privilege. This too needs a little explanation.

At a time when the new joint auditors, BDO Binder Hamlyn, were voicing misgivings about Arrows' accounts the appellant obtained a report from Coopers & Lybrand. Notwithstanding

(i) that in proceedings in the Chancery Division Hoffman J. had ruled that this report was not privileged and (ii) that the liquidator had, as he was entitled to do, provided the Crown with a copy of it, the appellant with the support of Mr. Rhodes (who was advising him before as well as during the trial) intimated a claim for privilege. The prosecution, we accept, must have taken a decision not to contest that claim. However, in the course of cross-examination Mr. Latham, mindful of the fact that the appellant had waived privilege in relation to certain documents when it suited him, pressed him as to whether he would disclose this report; and, when he refused, put to him that he was "scared stiff". This, we should record, was in our view, an inappropriate assertion to put to the witness, given that the claim for privilege was not challenged.

Much later, and in a different context, Mr. Latham asked of Mr. Levy, the appellant's solicitor, some questions about the report - in circumstances in which we are satisfied, contrary to Mr. Rhodes' submissions, it was legitimate to do so.

The judge, when in summing up he came to deal with the matter of professional privilege, said:

Just before I turn to the facts, the law allows in certain circumstances privilege to be claimed for good reason. So no adverse inference should be drawn from the fact that the defendant has claimed privilege in relation to a document in this case.

The complaint is that the judge should have gone on to direct the jury that the comments that had been made were improper and unfair; and that "for good reason" was an ambiguous phrase which did nothing to correct the unfair impression, created by the question that the appellant was unjustifiably seeking to withhold from the jury a document which would seriously damage his case, or to correct the damage thereby done to his credit in the jury's eyes.

We strongly suspect that the judge directed the jury as he did because he was mindful of the fact that the damaging questions had been asked of the appellant about a month before. In such circumstances he may well have thought - and we would agree - that a brief direction such as he gave was in the appellant's best interests. We do not, at all events, accept that what the judge said can be described as a misdirection.

Ground 12 asserts that the judge's failure to give a Lucas (1981) 73 Cr. App. R 159 direction in relation to lies was a misdirection.

Mr. Rhodes first submission was that, because it was suggested by the Crown that in many respects Mr. Endersby's evidence was to be preferred to the appellant's, this made it appropriate for the judge to give such a direction. We reject this contention - it is certainly not the law that, wherever there is a conflict between the prosecution witnesses and the defendant's evidence as to the very issues in the case such a direction must be given.

Guidance as to the circumstances in which a Lucas direction should be given is to be found in R v Goodway (1994) 98 Cr. App. R 11 and R v Burge & Pegg (1996) 1 Cr. App. R 163. In the latter case Kennedy LJ. giving the judgment of this court said this:

As there seems to be at the moment a tendency in one appeal after another to assert that there has been no direction, or an inadequate direction, as to lies, it may be helpful if we conclude by summarising the circumstances in which, in our judgment, a Lucas direction is usually required. there are four such circumstances but they may overlap:

1. Where the defence relies on an alibi.

2. Where the judge considers it desirable or necessary to suggest that the jury should look for support or corroboration of one piece of evidence from other evidence in the case, and amongst that other evidence draws attention to lies told, or allegedly told, by the defendant.

3. Where the prosecution seek to show that something said, either in or out of the court, in relation to a separate and distinct issue was a lie, and to rely on that lie as evidence of guilt in relation to the charge which is sought to be proved.

4. Where although the prosecution have not adopted the approach to which we have just referred, the judge reasonably envisages that there is a real danger that the jury may do so.

If a Lucas direction is given where there is no need for such a direction (as in the normal case where there is a straight conflict of evidence), it will add complexity and do more harm than good.

Mr. Latham's recollection is that there was a brief discussion before the judge as to whether a Lucas direction was appropriate in this case. Whether or not he is right about that, it is to be inferred that the judge considered that it was not appropriate. We see no reason to think that he was wrong to take that view, in a case where the prosecution had not sought to show that something said by the appellant in relation to a separate and distinct issue was a lie or to rely on that lie as evidence of guilt and where there was as it seems to us no real danger that the jury might adopt that approach.

By Ground 12 A the appellant contends that the judge should have given a Prater [1960] 2 QB 464 direction as to the need for caution in relation to the evidence of witnesses who might have some purpose of their own to serve. The suggestion is that the bank witnesses were persons who might have a purpose of their own to serve, because their conduct might have been negligent, and the acquittal of the appellant might destroy their professional careers or at least show them to have been incompetent.

Prater was a case concerning the evidence of a co-accused, and therefore very different from the present. We were also referred to R v Beck 74 Cr. App. R 221 where these words are to be found at 228:

While we in no way wish to detract from the obligation on a judge to advise a jury to proceed with caution where there is material to suggest that a witness's evidence may be tainted by an improper motive, and the strength of that advice must vary according to the facts of the case, we cannot accept that there is any obligation to give the accomplice warning with all that entails, when it is common ground that there is no basis for suggesting that the witness is a participant or in any way involved in the crime the subject matter of the trial.

It is in our view significant that it was not suggested that any of the bank witnesses other than Mr. Endersby was lying, nor was there any suggestion of collaboration. It seems to us that, if the judge was obliged to give such a direction in this case, he would be so obliged in almost every case in which prosecution witness's evidence was seriously challenged. There was, we consider, no requirement in the circumstances of this case to give such a warning.

We have now dealt with all the grounds of appeal argued on behalf of the appellant. It will be remembered that we have, with the exception of the Preddy point in relation to counts 1 and 3 (Ground 4C) and the point on Ground 7 relating to the judge's direction on similar fact evidence, rejected each individual ground. In respect of Ground 7 we have accepted the criticism that the judge's direction was not such as to bring home to the jury the real relevance of the evidence referred to. However, we see no reason to think that this omission or the direction which the judge did give, which we have cited, were such as to make the appellant's conviction unsafe. They form a very small part of the tapestry which the jury had to consider.

We recall that the burden of the submissions Mr. Rhodes made on many of the individual grounds was that he invited us to take that ground into account not so much for its individual merit but in conjunction with other grounds, and to have regard to their cumulative effect. Notwithstanding our rejection of all the other individual Grounds we have given effect to the spirit of Mr. Rhodes's invitation in that after considering and reaching our conclusions upon the grounds of appeal individually, we have endeavoured to stand back and look at the case overall, and have considered whether in all the circumstances there is any reason to think that the appellant's conviction on any of the seven counts is unsafe. We have in that connection particularly borne in mind that throughout the long trial he was not represented by counsel in court - though he had throughout access to legal advice - and that he was therefore at an inevitable disadvantage. We have also taken into account the evidence as to his physical and mental capacity and the undoubted fact that during the trial he suffered a serious physical illness necessitating a lengthy adjournment. Finally, we have brought into the reckoning all that we have learned of the case and its conduct from the extensive documentation and the detailed arguments presented to us on both sides. Having done this we are unhesitatingly of the view that there is no valid basis for contending that the appellant's convictions are unsafe. The fact is that the prosecution's case was overwhelming and that there was no sensible answer to it. We are quite satisfied that the appellant, whose own considered choice it was to represent himself, was properly and fairly dealt with and received a fair trial. Save as already indicated, the conviction appeal fails.

We turn finally to sentence. The single judge referred the appellant's application for leave to appeal to the court, and we grant leave.

The total sentence of 9 years was made up in the manner already briefly described: but in order to deal properly with Mr. Rhodes's arguments we shall set matters out in more detail in the following table:

Count Offence Sentence Maximum available

1. Obtaining property

by deception

(s.15(1) 1968 Act) 7 10

(Now Obtaining

services by deception (5)

(s.1 1978 Act))

2. Obtaining services by

deception (s.1 1978 Act) 4 5

3. As 1 7 10

(5)

4. As 2 4 5

5. Publishing a false

statement (s.19

1968 Act) 5 7

7. As 5 5 7

8. Fraudulent

trading (s.458

Companies Act 1985) 5 7

It will be remembered that the sentences on counts 1 - 7 were concurrent (total 7) and that on count 8 was consecutive.

When he sentenced the appellant the learned judge said this:

I do bear in mind the fact that you are 41 and a man of hitherto good character, but these offences are very serious. There is no doubt that the evidence has shown that you were Arrows and that upon the jury's verdict you repeatedly obtained loans from banks by making false representations that your business remained the old business of stock finance and that the business was insured. It is clear that you were behaving in a thoroughly dishonest way, committing these offences as the indictment sets out.

In July 1991 Arrows crashed to the tune of £100 million and evidence has been called from four banks who suffered losses in the crash approaching £50 million, and you obtained loans from each of those banks on the false basis that I have just described.

You used the money to deal in the commercial property market, setting up a web of companies closely related to you, to disguise that activity. You published false accounts that you circulated to the banks in order to advance the fraud, the object being to deceive the banks into thinking that the old business of stock finance business was the business of Arrows.

For a substantial period before the crash you continued to carry on the business of Arrows knowing that it was insolvent and you carried it on intentionally and dishonestly to the prejudice of the rights of the banks, knowing you had no right to do so.

As I said to the jury in the course of the summing-up, there is no doubt that banks play an important role in our complex society, and the evidence shows that you defrauded them here on a grand scale.

I have had plenty of opportunity to observe you during this six-month trial, and I have come to the conclusion that you are a highly intelligent man and you were very crafty in the way that you carried out these offences. It is clear to me that substantial sentences are the only ones that are appropriate.

The judge then indicated the sentences on each count, saying in relation to count 8 that he made the sentence consecutive "because this represents a wholly different aspect of the prosecution's case and in my view increases the gravity of the matter. The sentence is only 2 years because I have borne in mind the totality principle and I have looked at the overall sentence". It is apparent, therefore, that the judge had very much in mind what is in cases such as this the most important consideration - namely what was an appropriate sentence, in total, to reflect the overall gravity and criminality of the defendant's conduct in respect of the matters for which he had been convicted. Of course he also, in the individual sentences, plainly had regard in each case to the statutory maximum: but we have no doubt that his main concern was the one we have identified - to arrive at a correct overall sentence.

In support of his argument that a total of nine years was manifestly excessive Mr. Rhodes, at the previous hearing, made a number of points. First he submitted that in all the circumstances the judge was wrong to make the sentence of two years on Count 8 (fraudulent trading) consecutive. Then he emphasised the personal mitigation on which the appellant could rely - the fact that initially the business had been an honest and successful one; his charitable works; his ill-health, which has continued after his conviction; and the fact that his personal and business life was in ruins. Finally Mr. Rhodes invited us to consider the total sentence of nine years in this case against the ten years imposed on the defendant Clowes in the Barlow Clowes case. That, he submitted, was a much worse case because, while the sums involved were broadly comparable the victims, unlike those in the present case, were particularly vulnerable. He also made a point on the effect of the changes since Clowes was sentenced in the rules as to release.

There was in our view no substance in the first point as to the consecutive sentence on count 8: and the judge we were sure had all the relevant personal mitigation in mind. We were however influenced by the comparison with the Barlow Clowes case and it was essentially for that reason that we were minded, as we told counsel then, to reduce the overall sentence by two years.

Mr. Rhodes submits that, in the light of the substitution of convictions on count 1 and 2 of offences bearing a maximum sentence of 5 as opposed to 10 years, logic and fairness require a further reduction. He also asks us to take account of the lengthy delays, before as well as after the last hearing, and the anxiety that the appellant must have been experiencing, and invites us to extend mercy and reduce the sentence further.

We have given very careful consideration to these submissions. At first sight that based on the available maximum sentences does indeed appear logical. However, we are we consider entitled to bear in mind that the conduct on which the substituted conviction is based is precisely the same and is undoubtedly as the judge rightly considered very serious. It is not readily apparent, therefore, why the substitution of convictions which require, because of the lower maximum available, a reduction on two counts should necessarily lead to a reduction in overall sentence.

There is, however, a further matter which we have taken into consideration. It is apparent from the passage we have cited from the judge's sentencing remarks that, when assessing overall gravity, he took account of both the evidence bearing on the counts in the indictment and of that relating to losses sustained by other banks with which Arrows and the appellant had dealings. Of course, to an extent the charge of fraudulent trading in count 8 meant that the losses of those other banks were covered by a charge in the indictment but the judge did say:

....and you obtained loans from each of those banks on the false basis that I have just described.

It can therefore be not unreasonably suggested that the judge, when assessing gravity, was putting into the scales criminal conduct which he attributed to the appellant which was subject neither to an adverse verdict not to an admission by the appellant. We do not criticise the judge for doing so because at the time he sentenced it was widely supposed that this was permissible and it was common practice. However in 1996 came the decision of this court in R v Raymond Clark [1996] 2 Cr. App. R (S) 351 where it was held that where an offender is convicted on a count put forward as a specimen count the sentencer must not sentence him on the basis that he is guilty of further offences of a similar nature unless the offender admits that this is so.

When we said what we did in July last year we were not alive to this point. It could well be argued that, even so, no good ground exists for any further reduction in the sentence, because looked at overall 7 years is a perfectly proper sentence for the offences of which the appellant now stands convicted. However, it does represent a second new factor and it just suffices to persuade us that some further adjustment to the sentence is called for - if only to ensure that the appellant is not left with a justifiable sense of grievance.

What we propose to do, therefore, is to reduce the total sentence to 6 years and that will be achieved by substituting for the sentences on counts 5 and 7 terms of 4 years and substituting on counts 1 and 3 similar terms. That means that on all save count 8 there will be concurrent sentences of 4 years and on count 8 a consecutive sentence of 2 years.

Summary of Conclusions

The appeal against conviction will be allowed only to the extent that the convictions under section 15 of the 1968 Act on counts 1 and 3 will be quashed and there will be substituted convictions under section 1 of the 1978 Act. The appeal against sentence will be allowed to the extent that the sentences of 7 years on counts 1 and 3 and 5 years on counts 5 and 7 will be quashed and there will be substituted sentences of 4 years on each of those counts, concurrent with each other and with the 4 year sentences on counts 2 and 4. The sentence of 2 years on count 8 will remain consecutive, so the total sentence will be reduced from 9 years to 6.

MR RHODES: May it please your Lordships. May I, first of all, express my gratitude for giving me the extra time.

LORD JUSTICE HUTCHISON: It has had the consequence of enabling you to complete a skeleton argument and draft grounds. We are grateful to you for providing those so quickly.

MR RHODES: Before I turn briefly to the proposed question, may I mention one matter which I would invite your Lordship to deal with in the approved judgment? On page 31, second paragraph, there is a typographical error in the second line. Mr Kenyon was not a defence witness; he was the solicitor advising Mr Naviede and he came to court to explain why the defence witness, a Mr Wilkinson, I think it was, was not present.

LORD JUSTICE HUTCHISON: It is obviously an error on our part.

MR RHODES: If my Lords just remove the words "Mr Kenyon" and the commas on either side, that solves the problem.

LORD JUSTICE HUTCHISON: I will do that, and the shorthand writer, who has a copy, will no doubt make a note.

MR RHODES: My Lords, we have drafted questions and in our skeleton provided our submissions as to why we submit it would be appropriate for my Lords to certify. We have also dealt with my Lords' powers, and they are set out in Archbold. In those circumstances I do not intend to address my Lords any further unless there is----

LORD JUSTICE HUTCHISON: So far as your desire to raise a challenge based on the Halai case, that was not the basis of our decision.

MR RHODES: Well, that is so, but----

LORD JUSTICE HUTCHISON: It was not part of our decision.

MR RHODES: But, my Lords did say that my Lords did not consider Halai to be binding.

LORD JUSTICE HUTCHISON: We felt it was not binding. You cannot go to the House of Lords on an expression of opinion which has not been part of the decision.

MR RHODES: Is my Lord talking about the third question in that connection?

LORD JUSTICE HUTCHISON: Yes.

MR RHODES: My Lords, I have nothing further to submit.

LORD JUSTICE HUTCHISON: We will retire to consider the matter.

(The Court adjourned for a short time )

LORD JUSTICE HUTCHISON: We have carefully considered your suggested questions and the skeleton arguments in support of them, for which we are most grateful, but we do not consider there is here any question which either requires or justifies our certifying and we are not going to do so. Is there any other matter? May we express our gratitude to both sides for all the help we have had in this rather long hearing.

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