England and Wales Court of Appeal (Criminal Division) Decisions

IN THE COURT OF APPEAL
CRIMINAL DIVISION

		Royal Courts of Justice Strand London, WC2 Wednesday, 21st July 2004

1. LORD JUSTICE LONGMORE: This case must have tried the patience of His Honour Judge Copley very considerably and this Court would like to pay tribute to the way in which he handled the trial.
2. This appellant, Jeffrey Port, was tried at Harrow Crown Court before His Honour Judge Copley and a jury and was, on 3rd March 2000, convicted of an offence of being concerned in the management of a company while being an undischarged bankrupt contrary to section 11 of the Company Directors Disqualification Act 1986. The appellant represented himself throughout the trial which lasted about two months. On 6th March he was sentenced to 21 months' imprisonment and a consecutive term of three months' imprisonment for contempt of court. That sentence has now been served. The appellant was also ordered to pay £175,000 towards the prosecution costs.
3. He appeals against that last order by leave of the single judge, given as long ago as 5th October 2000. It has proved very difficult to bring this appeal on, part of the trouble being that, although the appellant was represented by counsel when it came to sentence, that counsel has now retired from the Bar. Mr Guest has now replaced him for the purposes of this appeal.
4. The appellant was adjudged bankrupt in May 1987 by the High Court. The period covered by the indictment was June 1993 to August 1995. The appellant appears to have been made bankrupt a third time during the currency of the May 1987 bankruptcy in May of 1999 and at that stage it was claimed by the Inland Revenue that he owed the Revenue £1.46 million.
5. The judge, in the course of his sentencing remarks, said this, and, of course, we are only concerned with the order for costs:

"in relation to the costs, these have been brought about entirely as a result of your own conduct, initially, and your conduct in dealing with this case and the way in which you have dealt with it. Increasing the costs many times by your stubborn refusal to deal with the matter properly and to be represented by experienced counsel.

I am more than satisfied that the tale you have told of a mysterious benefactor is not worthy of belief and stretches credulity to the extreme."

Counsel then representing the appellant offered to impart the name of the mysterious benefactor, which was then said to be Stockton Wholesale Limited, Stockton upon Tees.

6. The judge continued:

"I have heard what you have said about that but, notwithstanding that, I am more than satisfied that the position in relation to these Liechtenstein Companies is that you have a very much greater connection than you care to admit. It is plain that you have had in cash, out of the company some, very nearly £600,000: £583,789 during the course of that company's trading. That has gone somewhere.

It may very well be in one of those Liechtenstein companies or somewhere else. Your own evidence was that that was your pension fund. I am quite satisfied that you have access to monies and can get more than sufficient to pay these costs. If it has to be from the company in Stockton on Tees, so be it. Where you get it from is a matter for you."

7. As a matter of history it is important to say that counsel, who at very short notice was representing the appellant at sentence, did make an application to the court to adjourn the sentencing proceedings so that he could obtain proper instructions. That application was refused and, of course, counsel was at a very considerable disadvantage when he found that the judge and counsel for the Crown were discussing the sum of nearly £600,000 which had been referred to in evidence. It was a sum which was in a schedule prepared by the prosecution for the purposes of the trial, headed "schedule of monies received by Jeffrey Port", and was referred to in evidence on 11th, 12th and 18th January respectively. What counsel then representing the appellant was unable to do in the absence of an adjournment was to mount any very substantial argument about the appellant's means, the judge concluding that he had heard quite enough in the course of the evidence.
8. It is axiomatic that if a court is minded to make an order for compensation, or confiscation, or an order for contribution to the prosecution costs, that the court must have regard to the appellant's means. What Mr Guest submits on this appeal is that the judge did not in this case have proper regard for the appellant's means, because, as appears from the extract which we have quoted from the transcript at the time of sentence, the judge was comparing the sum of £600,000, that he considered the appellant had salted away in Liechtenstein, with the figure that he had in mind for contribution to prosecution costs in the sum of £175,000.
9. Mr Guest submits that is not the right exercise. If a judge is to make an enquiry into means of an undischarged bankrupt, submits Mr Guest, he must have regard to the sums which the bankrupt owes to his creditors. Any money that the bankrupt actually has, or any property that the bankrupt actually has, has to be delivered to the trustee in bankruptcy. So if, for example, the appellant here did acquire £175,000, which would, on the face of it, be sufficient to discharge the court order, in fact it could not be used for that purpose, because an order of the court made after the bankruptcy could only be satisfied out of sums left over after the trustee in bankruptcy is able to satisfy the bankrupt's creditors. So, submits Mr Guest, the judge ought to have, as best he could, (1) assessed the amount which the appellant owed his creditors, which would include the sum of £1.46 million owed to the Revenue, no doubt with interest on top so far as relevant, and (2) made some assessment of the amount of money that, on the balance of probabilities, the appellant had available to him; only if there was, in the judge's view, likely to be money over and above that amount would it be proper to make an order for prosecution costs.
10. He refers us to the old case of Michel (1984) 6 Cr App R(S) 379, where, at page 389, this Court, using the old language of the Criminal Bankruptcy Order pursuant to the Powers of Criminal Courts Act 1973, observed that "very seldom" would it be right to make a criminal bankruptcy order and a fine at the same time, because any monies which the defendant had available to him would belong to the trustee in bankruptcy. Of course, the Court used the word "seldom" rather than "never", and if it is the case that a court thinks that a defendant has money available to him which would be sufficient to discharge his creditors and to pay money for prosecution costs, or confiscation as the case might be, then it might be proper to make such an order.
11. Mr Mandel accepts that the judge did not go through this exercise. He submits that it was unnecessary for the judge to go through that exercise, because the bankrupt appellant will be discharged automatically from his bankruptcy in 2009 and then the order of the court would bite. The reason why the appellant will not be discharged until 2009 is that the bankruptcy in this case is a second or subsequent bankruptcy, not a first bankruptcy, and the time of discharge from such bankruptcies only elapses after ten years.
12. We do not think it satisfactory or right that a court should make an order which it only intends to be enforced in ten years' time, at least without considering the circumstances in which an appellant is likely to be placed in ten years' time. We accept the submissions of Mr Guest that it is not appropriate for a judge to make an order, whether for the prosecution costs or otherwise, in favour of the Crown against a bankrupt without taking into account, and expressly taking into account, the fact that the defendant is an undischarged bankrupt and does owe money to his creditors. If this point had been brought to the attention of the judge it is impossible to know what order he would have made, and in the circumstances, with a certain measure of reluctance, this Court is constrained to quash the order for prosecution costs. No other matter arises.
13. We are most grateful to counsel for the assistance we have received.