England and Wales Court of Appeal (Criminal Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CRIMINAL DIVISION)
ON APPEAL FROM SHEFFIELD CROWN COURT
His Honour Judge SWANSON
200303335/Z4

		Royal Courts of Justice Strand, London, WC2A 2LL
		5 May 2004

The Hon. Mr Justice Eady:

1. On 6 February 2003 at the Sheffield Crown Court the Appellant pleaded guilty to conspiring to supply a Class B drug (cannabis), on re-arraignment, after the jury had been sworn. He was sentenced to 13 months' imprisonment. On 14 May 2003 His Honour Judge Swanson made a confiscation order under s.6 of the Drug Trafficking Offences Act 1986 in the sum of £12,371.29 with a default sentence of eight months' imprisonment consecutive. The Appellant now appeals against the confiscation order by leave of the single judge.
2. By way of background, it is necessary to record that there were four co-accused. Jesse Richards, Anthony Wood and Walter Hawker all pleaded guilty to the conspiracy on re-arraignment. Richards and Wood were sentenced to six years' imprisonment and Hawker to four years. Samuel Richards was found not guilty by the Jury on the Judge's direction.
3. In view of the way the grounds of appeal have been formulated, it is necessary to set out in broad terms the nature of the conspiracy and the Appellant's role within it. On 12 and 13 September 2002, officers from the National Crime Squad kept observation on the activities of the Appellant and his co-accused. Cannabis was concealed within a lorry containing a consignment of scrap metal. This was driven from Holland to Sheffield, where the consignment was unloaded and put on another lorry. This was driven to another scrap yard by Hawker, who followed a car in which this Appellant and Jesse Richards were travelling. On arrival, the co-accused were seen to unload sacks from the lorry. At that point officers entered the yard and all the co-accused were arrested. The Appellant had driven out of the yard in the car but he was arrested a short while later.
4. Upon examination, the sacks were found to contain 7,666 blocks of cannabis weighing a total of approximately 1,892.66kg. They had a wholesale value of between £1,703,394 and £2,271,192. The corresponding street value ranged between £4,731,650 and £5,677,980. When he was interviewed, this Appellant said that he had been asked by Anthony Wood to accompany Walter Hawker from Holland to the United Kingdom, but he had no idea that the arrangement was anything to do with the drugs seized. It is important to record the precise basis upon which the Appellant pleaded guilty:

i) He flew to Schiphol airport on 11 September 2002, having been asked by Jesse Richards to bring him a quantity of cash. The Appellant accepts that the money was to be applied for the purchase and subsequent importation of cannabis. He was told that his fare would be paid and that he would receive £200 for his trouble. Originally, he understood that this was to be the limit of his involvement.

ii) It had then been agreed that the Appellant would return to the United Kingdom with Walter Hawker in the hire van. He was unaware that the lorry carrying the cannabis was on the same ferry.

iii) It was originally intended that the Appellant would be collected from Anthony Wood's house in Loughton, but on the journey between Dover and Loughton he was asked by Woods to take the van to Sheffield. He agreed, knowing that he was becoming further involved in the enterprise, but without detailed knowledge of the arrangements. There was no discussion regarding any additional payment.

iv) Once in Sheffield, the Appellant acted under the direction of Jesse Richards and Anthony Woods in the knowledge that he was becoming further involved in a criminal enterprise.

v) At the time of his arrest, the Appellant's part in the enterprise was over and he was leaving the premises in his father's car.

vi) The Appellant has had no financial benefit from his involvement in the conspiracy.

5. The Appellant's counsel offered to put the basis of the plea in writing, but it was said by counsel for the Crown that this was not necessary (although it was insisted that a written basis of plea be provided from the other defendants). It was, however, accepted by the Crown that this Appellant prior to the incident in question had no previous involvement in drug trafficking.
6. We turn to the statutory framework under which the order was made. In particular, it is necessary to have in mind the provisions of sections 2 and 4 of the Drug Trafficking Act 1994. This represents, in effect, the consolidated form of the 1986 Act, as amended by the Criminal Justice Act 1993. In so far as relevant, the terms of s.2 are as follows:

"(1) Subject to subsection (7) below, where a defendant appears before the Crown Court to be sentenced in respect of one or more drug trafficking offences (and has not previously been sentenced or otherwise dealt with in respect of his conviction for the offence or, as the case may be, any of the offences concerned), then—(a) if the prosecutor asks the court to proceed under this section, or (b) if the court considers that, even though the prosecutor has not asked it to do so, it is appropriate for it to proceed under this section, it shall act as follows.

(2) The court shall first determine whether the defendant has benefited from drug trafficking.

(3) For the purposes of this Act, a person has benefited from drug trafficking if he has at any time (whether before or after the commencement of this Act) received payment or other reward in connection with drug trafficking carried on by him or another person.

(4) If the court determines that the defendant has so benefited, the court shall … determine in accordance with section 5 of this Act the amount to be recovered in his case by virtue of this section

…

(8) The standard of proof required to determine any question arising under this Act as to—(a) whether a person has benefited from drug trafficking, or (b) the amount to be recovered in his case by virtue of this section, shall be that applicable in civil proceedings."

7. The provisions of s.4 are as follows:

"4(1) For the purposes of this Act—(a) any payments or other rewards received by a person at any time (whether before or after the commencement of this Act) in connection with drug trafficking carried on by him or another person are his proceeds of drug trafficking: and (b) the value of his proceeds of drug trafficking is the aggregate of the values of the payments or other rewards.

(2) Subject to subsections (4) and (5) below, the Crown Court shall, for the purpose—(a) of determining whether the defendant has benefited from drug trafficking, and (b) if he has, of assessing the value of his proceeds of drug trafficking, make the required assumptions.

(3) The required assumptions are—(a) that any property appearing to the court—(i) to have been held by the defendant at any time since his conviction, or (ii) to have been transferred to him at any time since the beginning of the period of six years ending when the proceedings were instituted against him, was received by him, at the earliest time at which he appears to the court to have held it, as a payment or reward in connection with drug trafficking carried on by him; (b) that any expenditure of his since the beginning of that period was met out of payments received by him in connection with drug trafficking carried on by him; and (c) that, for the purpose of valuing any property received or assumed to have been received by him at any time as such a reward, he received the property free of any other interests in it.

(4) The court shall not make any required assumptions in relation to any particular property or expenditure if—(a) that assumption is shown to be incorrect in the defendant's case; or (b) the court is satisfied that there would be a serious risk of injustice in the defendant's case if the assumption were to be made; and where, by virtue of this subsection, the court does not make one or more of the required assumptions, it shall state its reasons" (emphasis supplied).

8. Judge Swanson reminded himself at the hearing below that he was concerned with the civil standard of proof and that he not only could, but should, rely upon the statutory assumptions contained in s.4(3) of the 1994 Act unless, in accordance with s.4(4), any required assumption was shown to be incorrect or the court was satisfied "that there would be a serious risk of injustice in the defendant's case if the assumption were to be made".
9. The learned Judge correctly identified the relevant assumptions for present purposes in accordance with s.4(3) of the Act and held that there was nothing to displace those assumptions in the light of the fact that the Appellant had admitted telling lies and, also, that there was a notable paucity of documentation in respect of his business. It is thus apparent that the learned Judge put to one side in this context the agreed basis of plea and, in particular, the acknowledgement by the Crown that the Appellant had no previous involvement in drug trafficking.
10. In referring to the Appellant's "lying", what the learned Judge had in mind were the lies told by him and his wife in relation to the ownership of a Golf car. He had originally denied that it was his and claimed that it belonged to his father until a late stage in the proceedings when he admitted the contrary. In the transcript of his ruling the Judge addressed the significance of these lies in the following terms:

"The lies told by the Defendant, admitted as lies, and indeed admitted by his wife, about the ownership of the Golf, are of course conclusive of nothing, other than the fact that they lied. However, in a case which depends, as this does, on their credibility it can do the Defendant's case nothing but harm. In short, there is little of the defence evidence that I can, on the balance of probabilities, accept".

11. Our attention was drawn to the consideration given by the House of Lords to the terms of s.4(3) of the 1994 Act, and especially to the requirement that the assumptions should be displaced if "…the court is satisfied that there would be a serious risk of injustice in the defendant's case if the assumption were to be made". In R v. Benjafield [2003] 1 AC 1099 their Lordships were concerned with the issue of compatibility between Article 6 of the European Convention on Human Rights and Fundamental Freedoms and the comparable provisions for confiscation under s.72AA of the Criminal Justice Act 1988. It was recognised by Lord Steyn in paragraph [15] of his judgment in the linked case of Rezvi (at p1152) that those provisions were passed in furtherance of a legitimate aim and that the measures were rationally connected with that aim. It had been submitted before their Lordships that the means adopted were disproportionate to the objective, in so far as a persuasive burden was placed upon the defendant. He expressed agreement with the Court of Appeal: see at [2001] 3 WLR 75, 103. Specifically, Lord Steyn recognised the responsibility placed by Parliament upon the courts not to make a confiscation order where there was a serious risk of injustice. It is clear that the court, whenever it is necessary to decide whether a confiscation order should be made, should stand back and determine whether there is or might be a risk of serious or real injustice and, if there is, or might be, then such an order should not be made.
12. It is also clear from Lord Steyn's observation at [13] in Rezvi (at p.1152) that "…confiscation proceedings are part of the sentencing process following a conviction and do not involve a fresh criminal charge".
13. For the Appellant here, Lord Thomas of Gresford QC has submitted that the learned Judge failed to take account of the obligation imposed by Parliament upon the courts by s.4(4). As Lord Steyn observed in Benjafield at [8] (at p1161):

"The 1994 Act pursues an important objective in the public interest and the legislative measures are rationally connected with the furtherance of this objective. The procedure devised by Parliament is a fair and proportionate response to the need to protect the public interest. The critical point is that under the 1994 Act, as under the 1988 Act, the judge must be astute to avoid injustice. If there is or might be a serious or real risk of injustice, he must not make a confiscation order".

14. Lord Thomas argues that, if the Judge had stood back and made an assessment as required, he would have been bound to take into account the fact that the Crown had accepted that this Appellant had no previous involvement with drug trafficking. In this context it is important to note that, at the outset of his ruling on 14 May 2003, he appears to have recognised the significance of the Crown's concession:

"Also, prior to the sentence of imprisonment, I was told that the Crown accepted the basis of his plea which was substantially concerned with the length of the prison sentence imposed but was relevant to these proceedings in two regards. Firstly, the indication was given by the Crown that he had no previous involvement with drug trafficking and, secondly, that the Crown had no information from any other source that that was untrue. I'll refer to this later".

Unfortunately, despite this assurance, the learned Judge never did return to the subject. Accordingly, it is simply not possible to identify any strand of reasoning on the basis of which the Judge thought it appropriate to ignore, for confiscation purposes, the Crown's concession and to rely simply upon the statutory assumptions.

15. The Crown sought to overcome these formidable difficulties, on appeal, by arguing that the Appellant's grounds rested upon a fundamental misconception. It was argued that the statutory regime is such that "…a defendant may properly be sentenced on the basis that he has not previously been involved in drug trafficking, yet have a confiscation order made against him relating to previous drug trafficking". It was said to be "…perfectly proper, indeed inevitable in certain cases, that the judge may conclude that the defendant is a first time drug dealer when sentencing him for the offence of which he is convicted, yet make a substantial confiscation order against him on the basis of prior drug dealing".
16. It has already been pointed out that the House of Lords approached the process of making a confiscation order as part of the sentencing process (see above at [12]). It would always be open to a defendant to prove on the balance of probabilities that he had no previous involvement in drug trafficking, but why should he where the Crown has explicitly conceded this to be the position?
17. No doubt one could envisage circumstances where the Crown has discovered prior to the conclusion of a confiscation hearing that such a concession has been wrongly made. Further information may have come to light which demonstrates this to have been the case. In such circumstances, the appropriate course would be for the Crown to notify the defendant that the concession has been withdrawn and that, accordingly, he will have the choice of proving on the balance of probabilities that he was, after all, a first-time offender, or of inviting the court to be satisfied that there would be a serious risk of injustice, for some other reason, if the statutory assumptions were to be applied. What is plainly unacceptable is for the concession to be made for part of the sentencing process, without qualification, but for reliance to be placed, tacitly, on the assumptions when it comes to the confiscation hearing.
18. It is clear from the House of Lords' decision in Benjafield that the obligation upon the court under s.4(4)(b) to "stand back" and make its own independent assessment is of fundamental importance, since this is what renders the reverse burden of proof compatible with the requirements of Article 6 of the European Convention. The Crown has submitted before this court that it cannot be unjust to make the assumptions because "…the court's power to make a confiscation order in these sort of circumstances is the very power Parliament intended to confer". Such an argument diminishes, however, the importance of the requirement to stand back and make an independent assessment. Once the Crown has made a concession, such as in this case, unless and until it is withdrawn, there would be an apparent injustice in the court's ignoring it for the purposes of a confiscation hearing. At least, when the court stands back to consider the risk of injustice, a fully reasoned explanation would be required as to why the statutory assumptions should nevertheless apply. Here the Judge omitted to give any such explanation, and the court is not in a position to evaluate his reasoning.
19. It was submitted by the Crown before this court that there was "…no reason to think that the Judge did not apply his mind to the justice of the case in the round". There is, however, in the view of this court every reason to come to that conclusion because the Crown's concession was simply not addressed.
20. As we indicated at the conclusion of the hearing, the appeal will be allowed and the confiscation order accordingly quashed.