England and Wales Court of Appeal (Criminal Division) Decisions

IN THE COURT OF APPEAL
CRIMINAL DIVISION

		Royal Courts of Justice Strand London, WC2A 2LL
		12 January 2010

1. LORD JUSTICE MAURICE KAY: David Clarke J will give our judgment.
2. MR JUSTICE DAVID CLARKE: On 24 July 2009, the appellant was convicted on three counts of what had become a 17-count indictment for offences contrary to the Trade Marks Act 1994. On 27 July, he was fined £2,000 on each of those three counts, together with the statutory victim surcharge, and was ordered to pay the prosecution costs amounting to £22,045. That was the full amount of the costs sought by the prosecuting authority, which was Swansea City Council. This appeal, brought with leave of the Single Judge, is against the order for costs only.
3. The prosecution arose from the seizure of items from a street seller in Swansea who was selling counterfeit Swansea City Football Club merchandise on 20 March 2006. The seller refused to name his supplier, but on further enquiries it was established that the merchandise had originated from this appellant, who was the proprietor of a business called Eclipse Flags carrying on business in Essex.
4. On 28 April 2006, a search warrant was executed at those business premises. A large quantity of goods was found ready for dispatch at the factory door. Items were seized, including computer and printing equipment, and various goods were identified which officers believed bore false marks, that is to say marks identical to, or likely to be mistaken for, registered trademarks. The appellant was not present at the time of the search, but was arrested on his return to the premises.
5. The three counts on which the jury convicted him were counts 1 and 2, which relate to a T shirt and flag seized from the street vendor in Swansea, and count 7, which concerned a Chelsea football T shirt, which was one of the numerous items seized at his premises.
6. All the remaining counts, on which he was acquitted, concerned items similarly seized, all which were alleged to be counterfeit goods in the sense that they bore marks which the Crown alleged to be identical to, or likely to be mistaken for, registered trade marks. They were not all football related items. They included items bearing the logos of various pop groups, and the like. The jury acquitted the appellant on eight of those counts. The remainder were withdrawn by the judge, apparently because of absence of proof of the registration of the trade marks.
7. No complaint is made about the level of fines, which was carefully considered by the judge. The complaint is made that although counsel had submitted that he should reflect in his costs order the fact that the appellant had only been convicted on three of the counts, he was nevertheless ordered to pay the full amount of the costs.
8. The court's power to award costs arises from section 17(1) of the Prosecution of Offences Act 1985, and it is to make such order as the court considers just and reasonable. The submission here is that to impose this very large order for costs, which so far exceeded the amount of the fines imposed, was to impose a substantial additional penalty on the appellant, which was wrong in principle.
9. It has been argued in writing that a more detailed breakdown of the costs should have been provided by the Crown, but, in the absence of any point taken in the court below to that effect, we do not consider that any proper criticism can be made. The information provided was not detailed, but it was quite sufficient for the court to proceed in the absence of any complaint on this score.
10. It is further submitted with more force that the Crown's case had shifted as the proceedings unfolded. The indictment underwent a number of changes. There was the addition and deletion of various counts until the indictment reached its final form with 17 counts, of which the appellant was convicted of only three.
11. Reliance is placed on the decision of this court in

R v B & Q Plc [2005] EWCA Crim 2297, a Health and Safety Act prosecution arising from a fatal accident to a customer at retail premises. There was a substantial contested trial in that case. The appellants were convicted of some of the counts on the indictment, but not all. Those on which they were convicted included the important one arising from the death of the customer. The company were fined a total of £550,000 and ordered to pay the costs of £250,000. This court in a lengthy judgment dismissed the appeals against conviction and fines, but did reduce the order for costs.

12. There was a significant issue there which did not arise here, which was the defendants had sought, but had been refused, a defendant's cost order in respect of those counts on which they were acquitted. No appeal against that could be pursued.
13. It was an unusual case in the sense that the trial had twice been aborted for reasons that were in no way the defendant's fault, but in which they had incurred substantial costs in respect of which they were also seeking relief. This court did make a deduction for the fact that the appellants were acquitted on some of the counts.
14. In our judgment it was wrong in principle for the judge to make an order for the totality of the costs against the defendant when he was only convicted on three of the counts. The fact that the amount of the costs was disproportionate to the amount of the fines is not, in our judgment, the crucial factor. There may well be cases in which in the totality of the sentencing process the court is justified in weighting the penalty on to the costs more than on to the fine.
15. The point here which carries weight with us is the appellant's acquittal on so many of the counts on the indictment. It does not follow that a mathematical approach should be taken. Mr Roughton does not pursue his submission, based on pure mathematics, that the order for costs should have been three seventeenths of the total costs claimed. This was a man who was conducting a substantial commercial enterprise, which, on the finding of the court, involved the commission of criminal offences. The judge remarked in his sentencing observations that what the defendant was really doing for commercial purposes was to test the regulations, as found by the jury, to beyond the limits of the criminal law. The prosecution and the trial were clearly in the public interest. This was not a case of a sledgehammer being used to crack a nut.
16. We consider that it is right for this court to take an overall view. It accords with the general approach commonly taken in civil proceedings where issues are decided differently in respect of the opposing parties. We have concluded that fairness and proportionality here would be achieved by reducing the order for costs to £10,000 in place of that made by the learned judge. The appeal is allowed to that extent.
17. LORD JUSTICE MAURICE KAY: Thank you, Mr Roughton.
18. MR ROUGHTON: My Lords and My Lady, the order that the judge made was on 27 July 2009. All I simply seek is the substitution of the £10,000 with the time to pay remaining being 12 months from 27 July 2009, so that it is payable by the next 26 July 2010. I would ask for that order.
19. LORD JUSTICE MAURICE KAY: Yes. I am much obliged. Thank you very much, indeed. Mr Roughton, are you publicly funded?
20. MR ROUGHTON: I am publicly funded, my Lord.