England and Wales Court of Appeal (Criminal Division) Decisions

		Neutral Citation Number: [2002] EWCA Crim 1592
		Case No: 2002/00484/W1

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CRIMINAL DIVISION)

		Royal Courts of Justice Strand, London, WC2A 2LL
		27 June 2002

B e f o r e :

LORD JUSTICE KEENE
MR JUSTICE DAVIS
and
THE RECORDER OF CARDIFF
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Regina -v- Frank Pisciotto

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(Transcript of the Handed Down Judgment of
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James Dennison (instructed by Crown Prosecution Service) for the Crown
Walter Bealby (instructed by Chafes, Stockport SX1 1EY) for the Defendant
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Lord Justice Keene :

1. On 23 January 2001 in the Crown Court at Wolverhampton before His Honour Judge Cavell, the appellant pleaded guilty on re-arraignment to three counts of possessing cannabis. On 25 January 2001 before the same court after a trial lasting two days he was convicted of being concerned in supplying cannabis and possessing cannabis with intent to supply. On that same day he was sentenced to a total of eight years imprisonment. This sentence reflected the very substantial amounts of cannabis resin found when his car was stopped.
2. Some ten and a half months later, on 14 December 2001, before the same judge a confiscation order was made under the Drug Trafficking Act 1994 in the sum of £25,051.75 or in default a term of eighteen months imprisonment consecutive to the terms imposed for the substantive offences, the sum to be paid within nine months. His appeal against sentence by leave of the single judge concerns the lawfulness of that confiscation hearing.
3. It is necessary to set out in some detail what happened on the 25 January 2001 when sentence was passed on the appellant. After the verdicts had been returned, the prosecution dealt with the facts in relation to a co-defendant who had pleaded guilty to a number of drugs offences, and prosecution counsel said this at the end of that part of that part of the hearing:

“I think that’s really all I can tell you about the facts of the matter. There will have to be, of course, a trafficking enquiry, financial...”

4. The Judge then commented:

“Well, I am going to have to adjourn that so that the prosecution can serve the appropriate statement under the Act, and the Defence can serve any counter statement.”

5. He indicated that he was assuming that this would take some time. The remainder of the proceedings that day dealt with the sentences of imprisonment which were imposed. The only other reference to a drug trafficking enquiry came right at the end of those proceedings, when the judge said:

“So, the only outstanding matter that will have to come back on a future date is the Drug Trafficking Act matter.”

6. Prosecution counsel agreed. The judge said that that related to both defendants, and again prosecution counsel agreed. Nothing was said by defence counsel on this point. That was the end of the proceedings on that day.
7. Subsequently the case was listed for hearing on the 25 May 2001 for the confiscation order proceedings. That day, the confiscation proceedings had to be further postponed because the appellant had changed his solicitors – we understand that he refused to leave the cell. The proceedings were adjourned to 1^st June 2001 and on that date adjourned further to 13 June 2001 on which date the Judge ordered that the time for making the determination under the Drug Trafficking Act 1994 be extended for 6 months. On 7 September 2001 the matter was re-listed before the judge for a submission on behalf of the appellant that the court had no power to proceed further on the confiscation proceedings. That submission was based on a passage in the judgement of this court in the case of Ross (2001)EWCACrim560, (2001) 2 Crim. App.R.(S)484, where at paragraph 25 it was said:

“No particular form of words is required, but the decision to postpone must be made manifest and, in particular, it must specify the period of the postponement...”

8. The Judge rejected that submission, and in due course as we have already indicated the determination was made on 14 December 2001. In many respects the submission was wholly without merit. The appellant can have been in no doubt that the prosecution would be seeking a Confiscation Order. They had sought and obtained a Restraint Order pursuant to section 26 of the Drug Trafficking Act 1994 from Moses J on 2 August 2000 and their intention to institute confiscation proceedings was confirmed on 25 January 2001, by which date the prosecution’s section 11 statement dated 13 November 2000 had been prepared. The prosecution provided a further s.11 statement dated 23.3.2001. It seems then that but for a change of solicitors by the appellant, the proceedings may well have been determined within the 6 month period.
9. The issue in this appeal is whether there was a power to make a confiscation order under the 1994 Act, given what did and did not happen at the sentencing hearing on 25 Jan 2001.
10. Section 2 of the 1994 Act provides for the making of confiscation orders in cases of drug trafficking offences. It spells out the procedure whereby the court in certain circumstances is to determine whether the defendant has benefited from drug trafficking and, if so, what amount is to be recovered. It is to be noted that section 2(4) provides as follows:

“If the court determines that the defendant has so benefited, the court shall, before sentencing or otherwise dealing with him in respect of the offence or, as the case may be, any of the offences concerned, determine in accordance with section 5 of this Act the amount to be recovered in his case by virtue of this section.”

11. Section 3 of the Act deals with postponed determinations. In so far as material for present purposes, it provides:

“(1) Where the Crown Court is acting under section 2 of this Act but considers that it requires further information before-

a) determining whether the defendant has benefited from drug trafficking, or

b) determining the amount to be recovered in his case by virtue of that section,

it may, for the purpose of enabling that information to be obtained, postpone making the determination for such period as it may specify.

(2) More than one postponement may be made under subsection (1) above in relation to the same case.

(3) Unless it is satisfied that there are exceptional circumstances, the court shall not specify a period under subsection (1) above which:

(a) by itself; or

(b) where there have been one or more previous postponements under subsection (1) above or (4) below, when taken together with the earlier specified period or periods exceeds six months beginning with the date of conviction

(5) A postponement or extension under subsection (1) or (4) above may be made

(a) on application by the defendant the prosecutor; or

(b) by the court of its own motion.

(9) In sentencing, or otherwise dealing with, the defendant in respect of the relevant offence or any of the relevant offences at any time during the specified period, the court shall not-

(a) impose any fine on him; or

(b) make any such order as is mentioned in section 2(5) b(ii) or (iii) of this Act.

(10) Where the court has sentenced the defendant under subsection (7) above during the specified period it may, after the end of that period, vary the sentence by imposing a fine or making any such order as is mentioned in section 2(5) (b) (ii) or (iii) of this Act so long as it does so within a period corresponding to that allowed by section 155(1) or (2) of the Powers of Criminal Courts (Sentencing) Act 2000 (time allowed for varying a sentence) but beginning with the end of the specified period.”

12. It is submitted on behalf of the appellant that the power of postponement was not lawfully exercised in the present case. Therefore the court had no power to make the confiscation order subsequently. Mr Bealby contends that under section 3(1) the Crown Court, if it decides to postpone the determination, must do so for a specified period. That was not done here. No period whatsoever was specified by the Judge on 25 January 2001. Reliance is placed on the decision in Ross and on a more recent decision, that of Davies (2001) EWCA Crim 2902; (2002) 1 WLR 1806; (2002) Crim.L.R.224. Mr Bealby recognises that there is also authority the other way in the form of the decision in the case of Copeland (2002) EWCA Crim.736 but it is submitted that the decisions in Ross and Davies are to be preferred. It is said that in Copeland there was some basis for saying on the facts that a period of between three and six months had been specified.
13. It is emphasised that the 1994 Act is a harsh piece of legislation which makes a number of assumptions against an accused person, with the consequence that such a person is entitled to have such legislation strictly and formally interpreted. Moreover, the Act may impinge upon the financial interests of persons other than the accused, such as a spouse, children or other dependants. For their sake also there should be a restrictive interpretation of the wording of the legislation. Finally Mr Bealby submits that, when there has to be disclosure of assets and expenditure by a convicted person, it is important that there should not be uncertainty as to when the determination is to take place. That would explain why Parliament required a period of postponement to be specified if any postponement is decided upon.
14. On behalf on the Crown, Mr Dennison (who did not appear below) argues that it is clear on the facts of the present case that the judge decided on the 25 January 2001 that there was to be a determination under the Act and that it was being postponed. The only omission was to specify a period. Yet section 3(1) does not state that the postponement is to be for “such period as it shall specify”. It uses the words “such period as it may specify”. This language indicates that the court is not required to specify any period of time, and it can be assumed that the postponement will be within the normal maximum of six months required by section 3 (3).
15. It is pointed out that in the present case there were proper extensions of time, beginning with an extension made within the six months time limit. It is submitted on behalf of the Crown that Copeland was rightly decided and should be followed.
16. It seems to us that it is clear on the authorities that a positive judicial decision to postpone a determination is required by section 3 of the Act: see not only the decision in Ross but also Shevki and Steele (2001) 2 Crim.App.R.(S) 178, para.25. It is accepted in the present case that a decision to postpone the determinations was taken by the judge, given what was said on 25 January 2001. The question remains whether, as a matter of law, it is necessary to specify the period of postponement when exercising the power under section 3 of the Act and, if so, whether there was a failure to do so in the present case.
17. There is undoubtedly some conflict of authority on the interpretation of section 3(1). The court in Ross clearly took the view that a period must be specified, as the passage at paragraph 25 already quoted indicates, although it would seem that that statement was obiter. Similarly, a reference in the case of Kelly (2000) 2 Crim.App.R.(S) 129 at page 137 to like effect would also seem to be obiter. Of more significance is the decision in the case of Davies. There the judge when sentencing the offender set a timetable for the purpose of determinations under the 1994 Act, requiring disclosure of assets and expenditure by the defendant within 28 days and a prosecutor’s statement within 28 days thereafter. Nonetheless, it was held that there had been a breach of section 3 because the court had failed to specify a period for which the determinations were postponed. The Court said at paragraphs 28 to 30 of its judgment:

28. “The second use of the word “may” in section 3(1) means, in this context, “must” (see R v Ross at page 490). The Court in Ross did not give reasons for its opinion that this is the proper construction of section 3(1) and Judge LJ did not deal specifically with it in paragraph 58 of his judgment at page 194 in Steele and Shevki. In our view the mandatory nature of the requirement is established by reading section 3 (1) together with section 3(3). The latter reads:

“Unless it is satisfied that there are exceptional circumstances, the court shall not specify a period under subsection (1) which-”

(a) by itself; or

(b) where there have been one or more previous postponements under subsection (1) above or subsection (4) below, when taken together with the earlier specified period or periods exceeds six months beginning with the date of conviction.”

29. The plain purpose of the section is to place time limits on the determination proceedings. Had Parliament intended merely to set a period within which, subject to exceptional circumstances, the determination must be made, it could, and in our view would, have explicitly so provided. The whole section, particularly subsection (3), is structured upon the assumption that the setting of a period or periods for postponement will take or has taken place. Without the setting of a period under subsection (1), the limitation imposed by subsection (3) does not bite. It follows that either Parliament intended that there should be no limitation when the court chooses not to specify the period, or it intended that the court should specify a period in every case. In our view the latter construction is inevitable.

30. In expressing its decision under section 3 (1), no particular form of words is required, provided that the decision of the court is made before sentence and that the decision of the court is manifest.

The court continued at paragraph 32 to say:

“If no particular form of words is required provided the decision is manifest, then that which is required to be manifest is a decision in compliance with section 3(1), including the period of postponement.”

18. Despite the timetable, a period had not in fact been specified. The court referred at paragraph 37 to the “necessity to specify a period under section 3(1)”
19. A different interpretation of section 3(1) was adopted in the case of Copeland. There the court held that in fact a period of postponement of between three and six months had been made clear by the court below: see paragraph 9. In effect, therefore, the court was prepared to say that on the facts of that case a period had been specified. However, later in the judgment the court indicated that it did not agree with what had been said at paragraph 25 of the judgment in the case of Ross. Having quoted the wording of section 3(1) of the Act, the court commented that the wording was not mandatory:

“If it had been thought desirable then the statute could have been worded in words such as “for such period as the court shall specify”. Those are not the words of the statute.”

20. It is to be observed that the constitution of this court in Copeland does not appear to have been referred by counsel to the earlier decision of Davies. There is no mention of it in the judgment and, given its obvious relevance, one would have expected the court to have dealt with it if it had been cited. It would appear therefore that the decision in Copeland was taken in ignorance of the decision in Davies.
21. Nonetheless, this court has to make up its mind which of these authorities is to be preferred. It seems to us that the reasoning in Davies is highly persuasive and to be preferred to that in Copeland. The other provisions of section 3 make it clear that a period has to be specified, for without that having been done, provisions such as subsection (3), (9) and (10) do not make sense. In particular, it is of the greatest importance that the normal six months time limit on the length of postponement of the determination only arises by way of subsection (3) of this section. Yet the wording of subsection (3) indicates that such a time limit only arises if a period has been specified, since the wording is that “the court shall not specify a period under subsection (1) above which....exceeds six months beginning with the date of conviction.” If a court could simply postpone a determination without specifying any period of postponement, subsection (3) would not be breached and the time limit of six months could therefore readily be circumvented. A court could simply postpone without reference to any period and could then conduct a determination hearing after six months had expired. This in our view was clearly not what was intended by Parliament. It therefore demonstrates the importance of a period being specified whenever there is a postponement under section 3(1).
22. Like the court in Davies, we do not regard the second use of the word “may” in section 3(1) as indicating that the court has a choice as to whether or not it specifies a period. It is more likely that that word is used there to indicate that the court has a discretion as to the length of the period to be set, subject to the normal six months maximum. It does not relieve the court of its obligation to specify the period of postponement whenever section 3 is used.
23. We accept the submissions of Mr Bealby that the penal nature of the Act when dealing with confiscation orders justifies a strict interpretation of the language of section 3 and also indicates why it was that Parliament considered such a specification of the period of postponement to be necessary. It is likely that the legislature did not wish to leave the offender in such a case in ignorance of the period of time for which he would have this financial threat hanging over him. While it would normally not exceed six months, he would be entitled to know what particular period was in fact envisaged.
24. Applying that interpretation of the Act to the present case, this court cannot see that the judge complied with the statutory requirements of section 3. The judge did not even set a timetable for the disclosure of information and the serving of statements. The question of the length of the postponement was left entirely at large at the end of the hearing of 25 January 2001. That failure to specify means that, as a matter of law, the power to postpone the determinations under section 3 of the Act was not properly exercised. It follows that there was no jurisdiction in the Crown Court to make the determinations which it did in December 2001.
25. Judges dealing with drug trafficking cases should be alert to the need to comply carefully with the terms of section 3(1) when postponing a determination. This case is yet another instance of a failure to do so. We emphasise that no particular form of wording is needed so long as the judge at the time of passing sentence (1) makes clear that he has exercised his discretion to postpone and (2) makes clear the period for which the determination is postponed. If at that stage a judge sets out a time-table for service of prosecution and defence statements and also specifies a hearing date for the determination (or even a band of dates within which the determination hearing is to take place, provided that the band of dates falls within the 6 month period beginning with the date of conviction) that doubtless would suffice: although we think that it would even then be greatly preferable for the judge first to have specified the precise period he has selected. What is not acceptable, however, is for the judge either to fail to specify any period at all (as happened here); or for the judge to give directions in such a way that it cannot clearly be discerned what period, if any, has been specified (as happened in Davies). If the sentencing judge fails to specify a period, or if he expresses himself ambiguously, it is the duty of prosecuting counsel to remind the judge of the statutory requirements. Indeed that is also the duty of defence counsel: it is not appropriate that silence should be maintained, leaving a defendant uncertain as to the length of the period in which the determination may occur, with the uncertain prospects and delay occasioned by a possible subsequent appeal on what (on one view) would be a technicality. Similar considerations may apply where a Court is proposing to exercise its powers under section 72A of the Criminal Justice Act 1988.
26. Nonetheless, we conclude that the determinations in the present case were unlawful. It must follow that the confiscation order dated 14 December 2001 must be quashed and this appeal against sentence is allowed to that extent.
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MR DENNISON: My Lord, this is a judgment which plainly is of general public importance. My Lord, it may very well be that we shall be seeking leave to appeal this matter, to take this matter further. As I understand it that can be done in writing within the next 14 days.PRIVATE 

LORD JUSTICE KEENE: Yes, if you want us to certify then certainly you will need to spell it out in writing what question you want their Lordships to consider.

MR DENNISON: Yes. We shall serve that upon the court if we may within the time.