England and Wales Court of Appeal (Criminal Division) Decisions

IN THE COURT OF APPEAL
CRIMINAL DIVISION

		Royal Courts of Justice Strand London, WC2
		5th April 2006

MR JUSTICE PENRY-DAVEY:

1. On 25th January 1999 in the Crown Court at Luton the appellant was convicted of various drug trafficking offences in relation to Class B drugs and an offence of possession in relation to a Class A drug. He was sentenced to a total of 30 months' imprisonment. That sentence was varied on appeal to a total of 18 months' imprisonment. The amount of benefit certified by the Crown Court at the confiscation hearing on 26th February 1999 was £45,000, but the amount that might be realised was assessed as £7,839 and a confiscation order made in that sum.
2. On 29th July 1999, on the hearing of the appeal against sentence, the confiscation order was varied to the sum of £1,470, payable within 28 days, with 6 months' imprisonment in default consecutive to any term of imprisonment then being served. The benefit figure of £45,000 remained unaltered.
3. The appellant paid the order in full and was released from prison on 29th July. On 12th September 2002 the appellant purchased the house in which he had lived for many years in Stevenage. He had occupied the house for years as a council tenant and had acquired it under the Right to Buy legislation. Its value at that time was between £80,000 and £100,000, but under the legislation he paid the local authority £46,000 for the property. It was and remains subject to a mortgage.
4. The appellant's ownership of the property became known to the police. On 21st January 2004 the prosecution issued an application in the High Court for a certificate that the amount that might be realised was greater by £43,530 and the amount taken into account by this Court when imposing the confiscation order against the appellant on 29th July. The market value of the property was by then in the bracket of £130,000 to £135,000 and as of 15th September 2003 the amount of the mortgage not paid was £40,000. The equity in the property was therefore in excess of £43,500.
5. On 24th May 2004 that application became before Bennett J. The appellant did not oppose the application for the grant of the certificate of increase but reserved his position in respect of the Crown Court application. Bennett J issued a certificate pursuant to section 16(2) of the Drug Trafficking Act 1994. That provision requires the High Court to issue a certificate where the Court is satisfied that the amount that might be realised is greater than the amount taken into account in making the confiscation order.
6. Exactly a year later the prosecution applied to the Crown Court for an increase in the amount to be recovered under the confiscation order under section 16(4). That provides relevantly as follows: where a certificate has been issued under subsection (2) above, (that is a certificate of increase) the prosecutor may apply to the Crown Court for an increase in the amount to be recovered under the confiscation order and on that application the court may (a) substitute for that amount such amount not exceeding the amount assessed as the value referred to in subsection (1) above as appears to the court to be appropriate having regard to the amount now shown to be realisable. Subsection (4)(b) goes on to provide for the appropriate increase in the term of imprisonment in default.
7. On 24th May 2005, in the Crown Court at Luton, His Honour Judge Atkins ordered that the amount of the confiscation order against the appellant should be increased to £43,530, with 12 months' imprisonment in default. The appellant appeals against that order with the leave of the Single Judge. It is clear that the wording of section 16 gives the judge a discretion. The appellant submits through Mr Ashley-Norman for whose able and concise submissions the Court is grateful, that the judge had insufficient regard to a number of factors, including that the appellant would be obliged to sell his home of many years, to the passage of time since the imposition of the original confiscation order, to the relative modesty of the claim and to the significance of the house in the discharge of the appellant's responsibility towards his children. Equally, it is submitted that the judge paid undue regard to the fact that there would be some remaining equity after discharge of the order, to the fact that none of the appellant's 15 children was living permanently at the property, and it was finally submitted the judge had wrongly dismissed as irrelevant to the exercise of his discretion, the adverse financial consequences suffered by the appellant as the result of the original proceedings, additional and unnecessary time spent in custody by the appellant following his original sentence, and other ways in which he had suffered adversely in consequence of the order. He summarises those contentions with the submission that essentially this legislation, if interpreted in the way that it is suggested the judge dealt with it in this case and exercised his discretion, is a significant disincentive to good conduct, to somebody who seeks in the wake of a term of imprisonment with a history of drug dealing to break the mould and to develop and change, because of the threat that anything that he achieves may be taken away from him.
8. The submissions are resisted by Mr Hellman on behalf of the respondent who submits first that the judge did not err in the exercise of his discretion, in that he gave the various aspects that he identified such weight as he saw fit and in any event, submits Mr Hellman, the judge reached the right result and even if we were to come to the conclusion that there was a wrong exercise of discretion, that this Court should, in exercising its discretion, arrive at the same conclusion as the judge, particularly having regard to the policy of the statute to strip those who deal in drugs of any possible profit from so doing by depriving them their realisable assets whether or not they are the proceeds of drug trafficking, up to the amount to which they have benefited from drug trafficking.
9. In R v Tivnan [1999] 1 Cr App R(S) at 92, this Court referred to the Draconian nature of the provisions relating to confiscation in the 1994 Act. At page 96 the Vice-President, giving the judgment of the Court, said this:

"It is intended to strip those who deal in drugs of any possible profit from so doing, by depriving them of their realisable assets, whether or not these are the proceeds of drug trafficking up to the amount to which they have benefited from drug dealing."

He goes on to deal with the first three stages of the process, and continues at page 97 to set out the terms of section 16. He adds:

"It is to be noted, first, that the section contains no words of limitation as to time. Secondly, it is expressed throughout in the present tense, by reference to the time of application for the further certificate and increased confiscation order. Thirdly, the marginal note refers to increase in realisable property. Fourthly, there is in the section no reference to the reason, (whether culpable concealment, subsequent acquisition, or otherwise), why, 'the amount that might be realised ... is greater than amount taken into account in making the confiscation order."

10. Furthermore section 95 of the 1994 Act is in these terms:

"Where the defendant serves a term of imprisonment or detention in default amount of paying any amount due under a confiscation order, his serving that term does not prevent the confiscation order from continuing to have affect so far as any other method of enforcement is concerned.

In our judgment it is apparent, therefore, that when enacting section 16, Parliament contemplated a continuing state of affairs as envisaged by section 9(5).

Indeed, as it seems to us, section 16(4)(b) dovetails with the provisions of section 9(5) ... The plain words of the statute, in our judgment, provide for the making of an application for a further certificate and for an increase in the amount to be recovered under the confiscation at any time after the original confiscation was made. By this means drug dealers can be deprived of their assets until they have disgorged an amount equivalent to all the benefit which has accrued to them from drug dealing."

11. In addition to the matters relied on before the sentencing judge, we have considered additional material in the form of a statement from the appellant dealing with the change in his personal circumstances since his release from prison in respect of an unconnected matter in June 2005. That relates to events whilst in prison and in particular in relation to his wife and some of his children and the importance to him of the house. He also suggests that he is realistically not able to work, having been signed off as long-term sick and suffering from a multiple degenerative disc condition. He sets out the value of the house, now, at approximately £140,000 and the extent of his debts, particularly credit card debts which are substantial. We have also read a letter, dated 14th February 2006, from the National Probation Service dealing with the circumstances of the appellant's release on licence from his recent prison sentence and containing a positive assessment of the appellant. We have considered all the matters that are put forward on the appellant's behalf.
12. Mr Ashley-Norman seeks to identify particular elements which he submits are of relevant to a court exercising its undoubted discretion under this section. He identifies, in brief, though he sets them out at some greater length, the conduct of the appellant at trial, the abandonment of a previous life of crime, the assets being acquired legitimately, although it has to be said that the Act expressly envisages the removal, the confiscation of assets so acquired, the appellant's conduct after these events, the passage of time and issues of exceptional hardship that may be suffered.
13. This Court can see that in many cases considerations such as those may be relevant to a judge considering the exercise of his discretion under this section, but we decline the invitation to set out matters which in principle could or could not be relevant to the exercise of that discretion, for the very straightforward reason that the discretion which, of course, has to be exercised judicially is in the terms of the Act, unconfined. There may be all sorts of circumstances to which a judge can properly have regard, or other matters which he rejects as being of little or no significance. Everything will depend on the circumstances of the case.
14. So far as this case is concerned, even if it were the position that this Court would have had regard to matters which the judge declined to consider as relevant, we have not come to the conclusion that the exercise of his discretion was wrong in coming to the conclusion that he reached for the reasons that he set out. Indeed, considering all the matters put forward and having regard, as did the judge, to the purpose of the legislation, as clearly identified in the wording of section 16, this Court would have come to the same conclusion. Whilst recognising that the decision may have adverse effects on the appellant and cause no little difficulty and inconvenience for him, there is nothing in our judgment which leads to the conclusion in this case that it would not be appropriate to increase the amount of the confiscation order in the amount set out. Accordingly this appeal is dismissed.
15. MR ASHLEY-NORMAN: In granting leave the Single Judge was kind enough to issue a representation order for counsel. I have been sitting with Mr Masters, my instructing solicitor, to the extent of 3 hours preparation for attendance. I wonder whether your Lordships would be kind enough to extend the representation order to include the modest solicitors costs incurred by Mr Masters.
16. THE VICE PRESIDENT: Well, without approving whatever that figure is said to be -- no, no this Court is not getting embroiled in that. We will grant a representation order for a solicitor in the limited terms for which you seek it.
17. MR HELLMAN: I do not make any application for costs but however I see in the Registrar's note it says "the Court is respectfully reminded that at the conclusion of the case the Court consider whether it is reasonable to make a recovery of defence costs order." I make no submission on that my Lord.
18. THE VICE PRESIDENT: Our silence indicates that we are not going to make such and order.
19. MR ASHLEY-NORMAN: Forgive me, there is one other matter it is this. His Honour Judge Atkins gave this defendant a year to discharge the order, which expires of course on 24th May of this year. I wonder if the Court would be so kind as to extend the time limit because he obviously has to make arrangements.
20. THE VICE PRESIDENT: How long are you seeking?
21. MR ASHLEY-NORMAN: Six months from now. I have no direct instructions on the state of the Stevenage property market. It is going to be the determining factor over how long it takes him to realise the funds.
22. THE VICE PRESIDENT: Yes, we shall grant 6 months.
23. MR ASHLEY-NORMAN: I am very much obliged.