England and Wales Court of Appeal (Criminal Division) Decisions

IN THE COURT OF APPEAL
CRIMINAL DIVISION

		Royal Courts of Justice Strand London, WC2A 2LL
		24th February 2009

1. LORD JUSTICE AIKENS: This appeal concerns confiscation proceedings against Mr Dion Howard Griffin under the Drug Trafficking Act 1994 ("the DTA"), which has since been replaced by the Proceeds of Crime Act 2002. These proceedings followed his plea of guilty to a conspiracy to supply a controlled drug of Class A, namely heroin. Mr Griffin pleaded guilty at the Crown Court in Derby on 12th September 2002. He was sentenced by His Honour Judge Stretton on 19th December 2002 to five years nine months' imprisonment.
2. Before sentence the judge had found, pursuant to section 2(3) of the DTA, that Mr Griffin had benefitted from drug trafficking to the extent of £95,000. The judge found, pursuant to section 5(3) of the DTA, that the appellant's realisable assets amounted to less than the value of the proceeds of his drug trafficking, and the judge fixed the realisable assets at £10,100. The judge then determined, pursuant to section 2(4) of the DTA, that the amount to be recovered under that section should be £10,100. He therefore made a confiscation order in the sum of £10,100, with 12 months' imprisonment in default of payment, that term to run consecutively to the substantive sentence of five years and nine months.
3. The judge arrived at the figure of £10,100 because that was the amount of cash that had been seized from the appellant during a police raid at a house in Nottingham when the appellant was arrested in October 2001. We assume from that date that it was some time between October 2001 and September 2002 that Mr Griffin was actually charged with the substantive offence. The money seized had been kept by the police and it was an exhibit in the trial of Mr Griffin's co-defendants. That trial took place after the sentence of Mr Griffin. At the end of the co-defendants' trial, on 18th February 2003, Her Honour Judge Hampton ordered that this cash should be forfeited under section 27 of the Misuse of Drugs Act 1971. When the judge made the order she was unaware of the confiscation order that had been made by Judge Stretton, based upon the finding that the cash that had been seized in the raid was the property of Mr Griffin when it was seized.
4. As a result of the cash becoming forfeit, the realisable property available to Mr Griffin was inadequate to pay the confiscation order that had made by Judge Stretton. Therefore, by agreement between Mr Griffin's advisers and the CPS, a consent order was made by the High Court of Justice at Nottingham. This order was in the form of a certificate of inadequacy. This order was issued by the High Court on 2nd September 2005, pursuant to section 17 of the DTA.
5. It is required under section 17(1) of the DTA that the certificate of inadequacy shall give reasons for it being made. The certificate set out the facts concerning the cash of £10,100 that we have related above.
6. On 30th September 2005 there was a hearing of an application before His Honour Judge Wait at the Crown Court at Derby, at which Mr Beck appeared for Mr Griffin. The application was made pursuant to section 17(3) of the DTA. The aim was to obtain a variation of the confiscation order that had been made by Judge Stretton on 19th December 2002 so that the amount to be recovered under that order would be reduced to nil. We have seen the transcript of that short hearing. The judge made an order that the amount to be recovered under the confiscation order should be reduced to "nil".
7. A formal order to that effect does not appear to have drawn up. The only record of the order is that in the court's record sheet. That reads:

"On the 30 Sep 2005 His Honour Judge Wait ordered that the amount to be recovered under the confiscation order dated 19 Dec 2002 be reduced to nil. Certificate of Inadequacy variation of order to nil."

8. Mr Beck accepts that the word "nil" was not used with any particular purpose in mind. It was certainly not used for the purposes of any of the arguments that he presents so concisely and cogently today.
9. Mr Griffin was released from prison on 10th March 2006. Since his release from prison he has acquired further assets. There is no dispute that the amount of his realisable assets, for the purpose of the DTA, now stand at £33,897.
10. A question then arose, however: was the CPS entitled to seek a variation of the original confiscation order made on 19th December 2002, as varied by Judge Wait on 30th September 2005, so as to fix a new amount for the purposes of confiscation? At first it was said that the realisable assets of Mr Griffin was £27,997. Then there was an additional £5,900, so making the total £33,897. The CPS's case was that it was entitled, under section 16(2) of the DTA, to apply to the High Court for a certificate to the effect that the amount that might be realised for the purposes of making a further confiscation order was greater than the amount taken into account in making the original confiscation order, as varied. The argument ran that the High Court could give a certificate to that effect with reasons. Then the CPS could apply to the Crown Court, pursuant to section 16(4) of the DTA, for an order that increased the amount to be recovered under the confiscation order to £33,897, with a commensurate increase in the term of imprisonment to be served in default of payment of the sum set out in the new order.
11. Two certificates were given by judges of the High Court. One, dated 19th November 2007, was given by Collins J in respect of the sum of £27,997. The second, dated 16th April 2008, was given by Ouseley J. That certified that the amount that might be realised in the case of Mr Griffin, called "the defendant" in the certificate, was greater than the amount taken into account by the Crown Court at Derby on 19th December 2002 when the confiscation order was made and on 30th September 2005, when the amount to be recovered was reduced following a certificate of inadequacy because the defendant's assets had increased. Details of the two sums of £27,997 and £5,900 were given.
12. The two certificates were granted by consent. Mr Beck reserved his argument on whether any new confiscation order could be made to a hearing at the Crown Court. That is the only place where a revised confiscation order can be made under section 16(4) of the DTA.
13. Following the grant of the certificates, the CPS then applied to the Crown Court at Derby under section 16(4) of the DTA, for an order that the amount to be recovered under the confiscation order should be increased from nil (as ordered on 30th September 2005) to £33,897. The application was opposed by Mr Beck on behalf of Mr Griffin. Judge Lea heard argument on Friday 25th April 2008 and reserved his decision. He gave that in writing on 30th April 2008.
14. Two arguments were raised by Mr Beck in opposition to the proposed order. The first was that, as a matter of statutory construction of the DTA, once the confiscation order had been amended so that a "nil" amount was to be recovered, there was no power to increase it again under section 16 of the DTA. The second argument was that any order thus made would be after the lapse of a "reasonable time" for bringing and completing criminal proceedings and so it offended the "reasonable time" provision in Article 6(1) of the ECHR. This, therefore, made the new order of the court increasing the amount of the confiscation unlawful under the Human Rights Act 1998.
15. His Honour Judge Lea rejected both arguments. He made a confiscation order in the sum of £33,897. He ordered that Mr Griffin had six months from 30th April 2007 to pay that sum and he fixed the period of 15 months' imprisonment in default of payment.

The statutory provisions

16. In order to consider the two arguments, which we will call the "statutory construction" argument and the "Article 6" argument respectively, it is necessary to set out various sections of the DTA 1994. As we have already noted, the sections of the DTA with which this case is concerned have now been replaced by similar provisions in the Proceeds of Crime Act 2002. We must concentrate on the DTA. The relevant sections of that Act are, for the purposes of this case, sections 2(1)-(5), section 5, sections 16 and 17 and section 41(3) to (6). They provide as follows:

"2. Confiscation orders

(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 any 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, 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.

(5) The court shall then, in respect of the offence or offences concerned —

(a) order the defendant to pay that amount;

(b) take account of the order before —

(i) imposing any fine on him;

(ii) making any order involving any payment by him; or

(iii) making any order under section 27 of the Misuse of Drugs Act 1971 (forfeiture orders) or section 43 of the Powers[1973 c. 62.] of Criminal Courts Act 1973 (deprivation orders); and

(c) subject to paragraph (b) above, leave the order out of account in determining the appropriate sentence or other manner of dealing with him...

5 Amount to be recovered under confiscation order

(1) Subject to subsection (3) below, the amount to be recovered in the defendant's case under the confiscation order shall be the amount the Crown Court assesses to be the value of the defendant's proceeds of drug trafficking.

(2) If the court is satisfied as to any matter relevant for determining the amount that might be realised at the time the confiscation order is made (whether by reason of the acceptance of an allegation made in a statement given under section 11 of this Act or made in the giving of information under section 12 of this Act, or otherwise) the court may issue a certificate giving the court's opinion as to the matters concerned, and shall do so if satisfied as mentioned in subsection (3) below.

(3) If the court is satisfied that the amount that might be realised at the time the confiscation order is made is less than the amount the court assesses to be the value of his proceeds of drug trafficking, the amount to be recovered in the defendant's case under the confiscation order shall be —

(a) the amount appearing to the court to be the amount that might be so realised; or

(b) a nominal amount, where it appears to the court (on the information available to it at the time) that the amount that might be so realised is nil...

16. Increase in realisable property

(1) This section applies where, by virtue of section 5(3) of this Act, the amount which a person is ordered to pay by a confiscation order is less than the amount assessed to be the value of his proceeds of drug trafficking.

(2) If, on an application made in accordance with subsection (3) below, the High Court is satisfied that the amount that might be realised in the case of the person in question is greater than the amount taken into account in making the confiscation order (whether it was greater than was thought when the order was made or has subsequently increased) the court shall issue a certificate to that effect, giving the court's reasons.

(3) An application under subsection (2) above may be made either by the prosecutor or by a receiver appointed in relation to the realisable property of the person in question under section 26 or 29 of this Act or in pursuance of a charging order.

(4) Where a certificate has been issued under subsection (2) above 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; and

(b) increase the term of imprisonment or detention fixed in respect of the confiscation order under subsection (2) of section 31 of the Powers[1973 c. 62.] of Criminal Courts Act 1973 (as it has effect by virtue of section 9 of this Act) if the effect of the substitution is to increase the maximum period applicable in relation to the order under subsection (3A) of that section.

17. Inadequacy of realisable property

(1) If, on an application made in respect of a confiscation order by —

(a) the defendant, or

(b) a receiver appointed under section 26 or 29 of this Act or in pursuance of a charging order,

the High Court is satisfied that the realisable property is inadequate for the payment of any amount remaining to be recovered under the confiscation order, the court shall issue a certificate to that effect, giving the court's reasons.

(2) For the purposes of subsection (1) above —

(a) in the case of realisable property held by a person who has been adjudged bankrupt or whose estate has been sequestrated the court shall take into account the extent to which any property held by him may be distributed among creditors; and

(b) the court may disregard any inadequacy in the realisable property which appears to the court to be attributable wholly or partly to anything done by the defendant for the purpose of preserving any property held by a person to whom the defendant had directly or indirectly made a gift caught by this Act from any risk of realisation under this Act.

(3) Where a certificate has been issued under subsection (1) above, the person who applied for it may apply to the Crown Court for the amount to be recovered under the confiscation order to be reduced.

(4) The Crown Court shall, on an application under subsection (3) above —

(a) substitute for the amount to be recovered under the order such lesser amount as the court thinks just in all the circumstances of the case; and

(b) substitute for the term of imprisonment or of detention fixed under subsection (2) of section 31 of the Powers[1973 c. 62.] of Criminal Courts Act 1973 in respect of the amount to be recovered under the order a shorter term determined in accordance with that section (as it has effect by virtue of section 9 of this Act) in respect of the lesser amount.

(5) Rules of court may make provision —

(a) for the giving of notice of any application under this section; and

(b) for any person appearing to the court to be likely to be affected by any exercise of its powers under this section to be given an opportunity to make representations to the court...

41. Interpretation of Part I

...

(3) Proceedings for a drug trafficking offence are concluded —

(a) when the defendant is acquitted on all counts;

(b) if he is convicted on one or more counts, but the court decides not to make a confiscation order against him, when it makes that decision; or

(c) if a confiscation order is made against him in those proceedings, when the order is satisfied.

(4) An application under section 13, 14 or 19 of this Act is concluded —

(a) if the court decides not to make a confiscation order against the defendant, when it makes that decision; or

(b) if a confiscation order is made against him as a result of that application, when the order is satisfied.

(5) An application under section 15 or 16 of this Act is concluded —

(a) if the court decides not to vary the confiscation order in question, when it makes that decision; or

(b) if the court varies the confiscation order as a result of the application, when the order is satisfied.

(6) A confiscation order is satisfied when no amount is due under it."

The statutory construction argument

17. Any construction of the DTA must be against the background of the intention of the Act. It is clear from the decision of the House in Lords in Soneji [2005] UKHL 49, which in fact concerned the Criminal Justice Act 1988, a predecessor to the DTA, that the primary purpose behind the statutory provision for confiscation orders is the recovery of any financial benefit that the offender might have obtained from his criminal conduct. That this remains the intention behind such statutes is clear from the later decision of the Court of Appeal Civil Division In the matter of the Drug Trafficking Act 1994, In the matter of Saggar [2005] EWCA Civ 174. In that case, at paragraph 44, Rix LJ referred to the public interest as set out in the Vienna Convention on Proceeds of Crime, upon which part of the 1994 Act, and in particular section 16, is based.
18. In this case it is also important to recall the sequence of events. First, there was a confiscation order for £10,100. Then there was the order of 30th September 2005 reducing the amount in the confiscation order to nil. Then there was the order of Judge Lea on 30th April 2007 increasing the confiscation order amount to £33,897.
19. There can be no complaint about the confiscation order made by Judge Stretton on 19th December 2002. It complied with the requirements of section 5(3)(a) of the DTA because the judge was satisfied that the amount that might be realised at the time of his confiscation order was less than the amount the court had assessed as being the value of the proceeds of Mr Griffin's judge trafficking.
20. It is accepted by Mr Beck that the order of 30th September 2005 was made under section 17 of the DTA. The CPS had obtained a certificate of inadequacy on 2nd September 2005 and then obtained the order from Judge Wait. It should be noted that section 17(4) of the DTA states that if an application is made under section 17(3) "for the amount to be recovered under the confiscation order to be reduced", then the court has the power to substitute "such lesser amount as the court thinks just in all the circumstances of the case".
21. The argument of Mr Beck is that "amount" is not the same as "nil". He submits that it is relevant that in section 5(3) of the DTA there is a contrast between the use of the words "nominal amount" in the first part of paragraph (b) of 5(3) and the use of the word "nil" at the end, thus contrasting an order for a "nominal amount" with the fact that the amount that might be realised is "nil". By parity of reasoning, Mr Beck submits, it must be assumed that the use of the words "such lesser amount" in section 17(4)(a) is relevant. Therefore, if the word "nil" is used in the order obtained, then that means that section 16 cannot thereafter be invoked, because that can only be invoked when some "amount" is to be recovered, however small.
22. In our view, the wording of section 17 is plainly wide enough to enable the court to make an order that "the amount" to be recovered under the confiscation order can be a "nil amount", if that is just in all the circumstances of the case. We accept that this wording is in contrast to section 5(3)(b). But that is dealing with the form of the confiscation order when it is first made and it appears that the amount of money that might be realised is "nil". Section 5(3)(b) states that the confiscation order shall stipulate "a nominal amount". But there is no similar wording contrasting the sum to be recovered and the realisable amount in section 17(4)(a). Under the latter provision the court is given the power to substitute any lesser amount, including an amount of "nil", which expression we use advisedly.
23. It is not necessary, in our view, to comment on whether the words "a nominal amount" in section 5(3)(b) are broad enough to include an order for a "nil" payment. On the face of it we accept that there is a difference between "a nominal amount" and "nil", and both expressions are used in the same paragraph of section 5(3).
24. The question that then arises is whether a confiscation order that has been reduced to "nil" pursuant to section 17(4) can then be increased again under the powers granted to the Crown Court by section 16 of the DTA. In our view, the statutory wording creates no difficulties, at least on the facts of this case. Section 16(1) states that the section applies where, by virtue of section 5(3) of the Act, the amount which a person is ordered to pay by a confiscation order is less than the amount assessed to be the value of his proceeds of drug trafficking. In the present case such an order was made by Judge Stretton on 19th December 2002.
25. There is no provision in either section 16 or 17 to indicate that it is relevant that the amount to be confiscated was subsequently reduced still further under section 17 to nil. Section 16 is in general terms and permits an application to the High Court for a certificate that the amount that might be realised in the case of the person in question is greater than the amount taken into account in making the original confiscation. There is nothing in section 16 which precludes an application for such certificate if there has already been an application under section 17. Given the purpose of the Act, it would be illogical, in our view, to imply some restriction on section 16 such that it could not be invoked to ask for a certificate if there had previously been an application under section 17 to reduce the realisable amount and so the amount to be confiscated. It is consistent with the aim of the Act, as stated by Rose LJ in Tivnan [1999] 1 Cr App R (S) 92 at 97, that drug dealers be deprived of their assets until they have disgorged an amount equivalent to all the benefits which have accrued to them from drug dealing. Hence, in Saggar [2005] EWCA Civ 174 (to which we have referred), Rix LJ, giving the judgment of the court, noted that section 16 gives the state the right to reopen the issues of the amount that might be realised: see paragraph 38. It can make an application under section 16 after an existing confiscation order has been satisfied: see paragraph 37. Hence, as has been noted in several cases, section 16, unlike other sections such as section 13(10), section 14(7) and section 15(15), has no time limit on its operation.
26. We note what Rix LJ stated in his judgment in Saggar at paragraph 42, that under section 16(2), if the High Court is satisfied that the amount that might be realised is greater than the amount taken into account in making the confiscation order, the court shall issue the certificate to that effect. However, when such a certificate has been issued by the High Court and the prosecutor applies under section 16(4) for an increase in the amount to be recovered under the confiscation order, the Crown Court has a discretion on whether to substitute that amount as the amount shown to be realisable.
27. However, subject to the Article 6 argument, no issues arise in relation to the exercise of a discretion to make an order under section 16(4).
28. Therefore, we have concluded that there is nothing in the wording of section 5(3) or sections 16 and 17 of the DTA that deprives the Crown Court from the power of making an order increasing the amount to be recovered under a confiscation order, even though previously the High Court had certified that the realisable amount is "nil" under section 17 and the Crown Court had made such an order to that effect with regard to a confiscation order. This is nothing that prevents the Crown Court from making a subsequent order under section 16 after the issue of the second certificate saying that the realisable amount is now greater than nil.
29. The statutory construction argument is therefore rejected.

The Article 6 argument

30. The confiscation proceedings are all a part of the sentencing process. They are covered by the "reasonable time" requirements of Article 6(1) of the ECHR. That is re-stated by Rix LJ in his judgment in the Saggar case at paragraph 34. It is common ground in this appeal that, for the purposes of Article 6(1), time starts to run from the point at which Mr Griffin was charged.
31. In the Saggar case Rix LJ held that on the true construction of the DTA, in particular section 41(3), confiscation proceedings leading to a confiscation order being made and applications under section 16 and also sections 13, 14 and 15, are separate proceedings, although they may overlap when a confiscation order is made and has not yet been satisfied at a time when a subsequent application is made. Rix LJ specifically held that where a confiscation order has been made and satisfied, the "proceedings for a drug trafficking offence" will have been concluded under section 41(3)(c) and (6) of the DTA, even though there is still power to re-open the confiscation order under section 16: see paragraph 37 of his judgment.
32. Rix LJ went on to hold, in paragraph 38 of his judgment, that:

"... where the state grants to itself the right to reopen the issue of confiscation, a fortiori to reopen the issues of the amount of benefit or the amount that might be realised where a confiscation order has been made, then the reasonable time requirement extends throughout the period in question".

33. Mr Beck takes up the argument on that point. His submission is very simple. He says section 16 has no time limit. Time starts to run from the moment that Mr Griffin was charged. Does it follow, he asks rhetorically, that an appellant is potentially liable to wait for 30 or more years after charge before he can know that the confiscation proceedings will finally have finished? If that is the position, then that means that the proceedings will not have taken place within a reasonable time within Article 6(1).
34. In support of his submission he referred us to the European Court of Human Rights decision in the case of Bullen and Soneji v The United Kingdom [2009] ECHR 28, at paragraphs 58 and 59 and also paragraphs 70 and 71. He had already referred us to the judgment of Rix LJ at paragraph 44 in Saggar, where the learned Lord Justice points out to what he describes as two but not necessarily conflicting, public interests:

"... the public interest in making drug traffickers disgorge the full proceeds of their crimes, as expressed in the Vienna Convention, domestic statute and Tivnan on the one hand, and the public interest expressed in Article 6(1) on the other hand".

35. We accept that the whole period from the moment that the appellant was charged has to be taken into account when considering the issue of "reasonable time" in relation to confiscation proceedings under the DTA. However, that is not the end of the matter. The first point to note is that the appellant, in common with all defendants against whom a confiscation order has been made, will know from the moment that a declaration is made under section 5 what the amount is that the Crown Court judge has assessed as being the value of the defendant's proceeds of drug trafficking: see section 5(1). He will also know that there is an amount that has been stated to be the realisable assets, under section 5(3). Secondly, such a defendant will know that he is at risk of being brought back before the court if there are changes to his circumstances in order that he can be made to disgorge any assets that he has up to the declared value of the proceeds of his drug trafficking. Thirdly, as Rix LJ identified in paragraph 40 of his judgment in Saggar, the critical question that has to be asked is: has the state at any stage "sat on its hands" after significant and clear evidence about the defendant's means or realisable property comes to its attention. Putting it the other way, as Rix LJ does at paragraph 41 of Saggar, has the state "moved without unreasonable delay" in reopening the issue of the defendant's means to disgorge his proceeds of crime? If the state has delayed unreasonably then, as Rix LJ says at paragraph 40 of his judgment, the state "should not be able to avoid criticism of unreasonable and unfair delay merely by the expedient of an argument that everything which preceded its new application is irrelevant for the purposes of the new proceedings". That is because the original order still stands as the basis for the new assessment of the realisable property.
36. There is one further aspect of the analysis that needs to be emphasised. It is that the Crown Court has a discretion under section 16(4) as to whether or not it will comply with the prosecutor's application for an increase in the amount to be recovered under the confiscation order if an application under section 16(4) is made. In short, there is procedural protection, in Article 6(1) terms, for a defendant by virtue of the discretion that is given to the Crown Court by that provision.
37. Now, once this analysis is made we think it must follow that the argument based on Article 6(1) must fail on the facts of this case. Mr Beck has not asserted that there was any unreasonable delay on the part of the CPS, the police or the court in making the various applications for certificates, or in making the application for an order under section 16(4) of the DTA in respect of the realisable sum of £33,897. Mr Beck has concentrated on the length of time since charge and emphasised that Mr Griffin has now served his sentence. But, in our view, that is not to the point. As Judge Lea correctly pointed out at paragraph 6 of his ruling, the defendant is at risk of a section 16 application so long as there are realisable assets and any existing confiscation has not been sufficient to discharge the sum that was assessed in the first place (in December 2002) as being the benefit of Mr Griffin's drug trafficking. There are the protections that we have mentioned in section 16(4).
38. In those circumstances we have come to the conclusion that the argument based on Article 6(1) of the ECHR must fail on the facts. Accordingly, the order made by Judge Lea was proper and cannot be attacked.
39. We dismiss this appeal.