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 May 2011

1. MR JUSTICE SWEENEY: This is an appeal by leave of the Full Court, differently constituted, against an agreed confiscation order in the sum of £88,000 which was made under the provisions of the Criminal Justice Act 1988 by His Honour Judge Robbins in the Southwark Crown Court on 26 January 2007.
2. The background facts, in short, are these. Between 29 September 1999 and 29 April 2004 the appellant and his wife and co-defendant, Adesola Adelana, hijacked the identities of 37 innocent individuals and used those identities to make claims for Working Family Tax Credits amounting in all to £357,500. Two of the identities were linked to the appellant through his employment at the Provident Row Housing Association, and his wife obtained nine names from the Young Women's Christian Association where her sister worked, but without her sister's knowledge. A third defendant, Olowe, abused her position working for the Department of Work and Pensions by obtaining 11 names through her employment at that department, and by allowing her premises to be used as a mail address for claims.
3. In the subsequent proceedings for conspiracy to defraud in the Southwark Crown Court all three defendants were represented by a firm of solicitors called Stephen Fidler & Co.
4. On 3 August 2006 all three pleaded guilty on re-arraignment. On 23 October 2006 His Honour Judge Robbins sentenced the appellant to four years' imprisonment and recommended that he be deported. On the same occasion his wife was also sentenced to four years' imprisonment and a sentence of two years and six months' imprisonment was imposed on Olowe.
5. In the confiscation proceedings which followed an eventual realisable asset figure in the order of £94,000 was argued for by the prosecution. The onus was, however, on the appellant to persuade the court that his realisable assets were less than his benefit, which was in a vastly larger sum. In a formal response to the prosecutor's statement the appellant indicated that: (1) he had the sole ownership of his home at 37 Larmans Road, Enfield; (2) he had re-mortgaged the property in May 2006 in order to release some £20,000 of the equity; (3) the full amount had been deposited in his Halifax account and had then been used to pay various creditors and a Barclays loan account; (4) despite a number of requests, the Halifax and Barclays had failed to provide information by way of bank statements; (5) the Lexus car that he had sold in August 2006 to a private buyer had been sold for £2,500, being in poor condition; (6) he had no hidden assets.
6. On 25 January 2007 the appellant was produced at the Southwark Crown Court in order that Mr Tristan Harwood, a barrister then employed by Stephen Fidler & Co, could have a conference with him in relation to confiscation issues.
7. When the confiscation proceedings in relation to all three defendants were called on before His Honour Judge Robbins the following day, 26 January 2007, the appellant was again represented by Mr Harwood. The appellant's wife, in her absence, having not been produced from custody, was represented by Mr Stephen Fidler, the principal of the firm himself. During the course of a short argument, a transcript of which is before the court, the judge was considering whether or not to adjourn the proceedings in the light of the non-production of the appellant's wife from prison. Not only was she not present during the argument, neither was the appellant at that stage.
8. The learned judge was concerned as to whether the non-production amounted to exceptional circumstances justifying an adjournment beyond the statutory time limit and ventilated that with counsel. Mr Harwood indicated that he would not object to such an adjournment because he was going to be seeking an adjournment in any event in order to obtain the bank statements to which the appellant had referred in the formal response to which we have already made reference. It is clear from the transcript that Mr Fidler objected, albeit in the absence of his client, to that adjournment, as did the prosecution. The conflict of interest to which Mr Fidler's objection gave rise is obvious, but does not seem to have occurred, at least on the face of it, to those who were involved in the case at the time. At all events, it is clear from the transcript that the learned judge made no decision as to any application to adjourn, rather, noting the absence of the appellant, he curtailed discussion on the topic altogether until both the appellant and the appellant's wife were in court, which by that stage was hoped to be later that afternoon.
9. When the case was called on again that afternoon the transcript shows that an agreement had been reached between the prosecution and all three defendants as to the amount of their respective benefit and realisable asset figures. In the appellant's case the benefit amount that was agreed was in the sum of £166,547.50 and the realisable asset figure that was agreed was in the sum of £88,000, which thus included a hitherto disputed total sum of a little over £22,000. The appellant signed a consent order. In addition to the order made against the appellant in the agreed sum that we have just indicated, confiscation orders were also made against the appellant's wife in the sum of £75,000 and against Olowe in the sum of £17,000. The appellant was ordered to pay the £88,000 within nine months, with a consecutive term of 23 months' imprisonment in default.
10. On 7 April 2008 the Full Court, again differently constituted, refused the appellant's renewed application for leave to appeal against sentence.
11. In the autumn of 2009, over two years and seven months out of time, the appellant sought permission to appeal against the confiscation order upon the basis that he should have had a full confiscation hearing and thus given evidence about the disputed £22,000, but had been prevented from doing so by his legal representatives, who had told him that the agreement as to the amount of his realisable assets could be re-negotiated in the future. The appellant made a witness statement setting out his concerns on 28 September 2009. He asserted that he had been bullied and intimidated. Thereafter, at the court's invitation, the appellant waived privilege. In consequence, on 1st December 2009 Mr Harwood sent a letter to the Registrar in which he stated that: (1) he did not advise that the confiscation agreement that the appellant signed was re-negotiable; (2) at no point was the appellant bullied or intimidated; (3) the appellant was advised that he could give evidence at the confiscation hearing if he so wished, but had declined to do so.
12. In March 2010 the appellant's application was refused by the single judge. By the time his renewed application came before the Full Court on 1 September 2010 the appellant had served both the sentence of four years' imprisonment and, having paid nothing towards the confiscation order, the consecutive default term of 23 months' imprisonment as well. The court recognised that usually it would be unwilling to grant such a long extension of time and that it would also be unusual to go behind an advocate's assertion that nothing inappropriate had happened. However, the court identified the following features that caused it concern: (1) the points that the appellant made about the £22,000 were made to his advocate at the time of the confiscation hearing; (2) the application to adjourn in order to acquire the bank statements was appropriate, as demonstrated by the fact that bank statements that had since been produced appeared to bear out, at least in part, what the appellant had been saying all along; (3) Mr Fidler, who was instructing Mr Harwood, had objected to the adjournment, which gave rise to unease that it may thereafter have been difficult for Mr Harwood to take a strong independent view and to continue to pursue his application for an adjournment, which he did not in fact do.
13. In the result, and whilst recognising on the one hand that the only potential benefit of success to the appellant would be a reduction in his licence period and, on the other hand, that it might well be that at the hearing of the appeal it would be demonstrated that there was nothing in the case, the court extended time and gave leave. In addition, the court ordered Mr Harwood to make a detailed statement and ordered Mr Fidler to make a statement dealing with his relationship with Mr Harwood.
14. Mr Harwood duly made a statement on 1 October 2010. He stated, amongst other things, that (1) he no longer had any notes in connection with this case, but the Advice provided to the appellant by fresh counsel and the grounds of appeal had been most helpful in refreshing his memory; (2) the appellant was entirely unable to substantiate how he had disposed of the funds that resulted from the re-mortgage and had accepted that it was unlikely that there was any pattern of withdrawals from his account which would support his case that he had used part of the balance to pay the mortgage and part to pay off debts; (3) in those circumstances he advised the appellant that, unless he could provide evidence that he had used the funds or part of them to pay the mortgage, the court would be likely to conclude that he had re-mortgaged in order to hide the asset, to which the appellant had responded that he could provide no evidence except his own word; (4) the appellant was also entirely unable to substantiate how he had disposed of the funds from the sale of the Lexus car, but protested that the prosecution's valuation of £4,000 via Parkers Used Car Guide was too high without himself saying what the sale price actually was; (5) therefore his advice to the appellant was that the court would be likely to conclude that the sale proceeds were a hidden asset; (6) the appellant was not misled in any way, rather, given that he could not substantiate his claims he was advised that he could either have a contested hearing as to the disputed amounts or he could agree the sums of benefit and realisable assets as part of a confiscation order; (7) the appellant then agreed to the confiscation order; (8) there was no advice about the possibility of renegotiation or variation.
15. Mr Fidler, for his part, made a very short undated statement indicating that the relationship between Mr Harwood and his firm was that Mr Harwood was at the time a barrister employed by the firm. In a further statement, dated 28 February 2011, Mr Fidler indicated that he had searched his firm's files for any note of the conversation between Mr Harwood and the appellant at the confiscation hearing on 26 January 2007, but had been unable to locate one. He suggested that any note on the file would have been forwarded to the appellant's later solicitors, Messrs Daniel Berman & Co, who had settled the original grounds of appeal. However, subsequently that firm indicated that it had held no such note.
16. Yesterday, 23 May 2011, Mr Fidler provided the court with copies of the consent orders signed by the appellant and his wife on 26 January 2007 and of a letter sent to the appellant on 13 February 2007, confirming the essential details of the confiscation order. Mr Fidler also provided some other materials. It was against that background that the matter was called on for hearing before us today.
17. Mr Ganesan, representing the appellant in his absence (as he has now been deported to Nigeria), then indicated that yet further material had been produced by Mr Fidler this morning. It appears that that material was found in the possession of a third firm of solicitors. The material includes an attendance note as to what was said during the course of the conference at court on 25 January 2007 and also as to the events the following day. Insofar as those events are concerned, we note that on page 9 of the bundle which has been provided to us the attendance note records that Mr Harwood told the appellant that a submission had been made to adjourn and "HH rules there are no exceptional circs to adjourn to another date". On page 12 of the bundle the attendance note records that the appellant asked for a transcript in relation to that ruling.
18. Against the background of the last minute revelation of these documents, counsel sought an adjournment in which to consider them. Both counsel have now considered them. In the result it is now agreed that in the light of the content of the documents the inference that is to be drawn is that the appellant was informed, in error, before he decided to agree to a confiscation order that, in his absence, the learned judge had already ruled that no further adjournment to obtain bank statements was possible (when, in fact, the learned judge had not so ruled), and that the appellant was told therefore that he had a simple choice between, on the one hand, giving evidence at a confiscation hearing that day absent any documentation and with the inherent risks that a very substantial realisable asset figure would result, or he could consent to an order in the sum of £88,000, which was the figure that the prosecution had indicated that it was prepared to agree. Given that agreement between the parties as to the inference, it seems to us that it is unnecessary for either Mr Harwood or Mr Fidler to give evidence, although both of them are in attendance to do so. Rather, it is appropriate for us to consider the merits of this appeal against the background of the now agreement between the parties.
19. Mr Ganesan submits in his skeleton argument that the leading authority insofar as appeals in relation to agreed confiscation orders are concerned is the case of Hirani [2008] EWCA Crim 1463. In that case the appellant had originally asserted that he had no realisable assets, but had then agreed to a figure of £110,000 when the prosecution were suggesting a figure of £160,000. He asserted that that was because of advice that he had received that he could thereafter discharge any liability by obtaining a certificate of inadequacy under the provisions of section 83 of the Criminal Justice Act 1988. At paragraphs 35 and 36 of the judgment the court said this:

"35. In other jurisdictions, those who have entered into consent orders may set them aside on very narrow grounds. We do not exclude the possibility in the arena of confiscation orders that such circumstances might conceivably arise. But we do not consider that they arise where the essence of the complaint is that, in seeking to secure the best deal available, erroneous advice was given to one of those who was party to the agreement, save in the most exceptional circumstances. We would not wish to identify exhaustively what those circumstances might be but, in our judgment, there would need to be a well-founded submission that the whole process was unfair. We do not consider that the circumstances of this case come close to that.

36. We see no warrant for reading over generally the approach that has developed in appeals against conviction based upon erroneous advice into confiscation proceedings. There is a fundamental difference between sentence and conviction. On an appeal against conviction, where it is suggested that erroneous legal advice resulted in a guilty plea, the court may allow the appeal and then a trial will take place. The defendant will be either acquitted or convicted and, if convicted, he will be given an appropriate sentence. On a successful appeal against sentence, the matter is not sent back to the court with the issue, as it were, at large. This court can vary a sentence but it cannot increase it. So if Mr Ashley-Norman were correct, an appellant in Mr Hirani's position could appeal to this court, having agreed the confiscation order on a false basis, and seek to set it aside, but in doing so he would deny the prosecution the possibility of contending for a higher figure. In other words, the prosecution would in effect be bound by the agreement from which the appellant, on this hypothesis, had been released. That would, in our judgment, be an undesirable -- not to say extremely odd -- result."

Those paragraphs were specifically approved in the subsequent case of Kirman [2010] EWCA Crim 614 by a constitution presided over by the Lord Chief Justice.

20. We cannot emphasise too strongly that where an agreement is reached as to the amount of a confiscation order, that agreement will be binding on the defendant unless there are the sort of exceptional circumstances referred to in Hirani. The question for us, against the background of the now agreement between the parties, is as to whether this is such a case.
21. As we have touched on already, the agreement is to the effect that the appellant was, or at the very least might have been, misled as to what had occurred before the learned judge in his absence in the morning of 26 January 2007. The misleading was thus agreed to be of a potentially fundamental nature. Instead of being told that the possibility of an adjournment was still available, the appellant was being told that the possibility of an adjournment had already been excluded by ruling. Secondly, on examination of the bank statements and other material that have now come to light it is clear that there was force all along in some of the appellant's concerns, in particular that the mortgage that he had taken out was in the sum of £20,000, not the sum of £24,000 for which the prosecution were then contending. Although, as Mr Brown on behalf of the respondent points out, the agreed £88,000 figure itself involved a generous deduction of £6,000 from the £94,000 originally argued for by the prosecution in order to reflect the making of mortgage payments, it seems to us that this is nevertheless one of those wholly exceptional cases where it is appropriate, given the agreement between the parties as to what happened on 26 January 2007, for the court to intervene.
22. The parties have indicated that, if the court were minded to intervene, a new agreed realisable asset figure has been reached, namely £82,297.53. That, it seems to us is an entirely sensible figure in that it gives credit in relation to concrete figures now revealed by the bank statements in relation to the size of the mortgage and in relation to the payment of Council Tax, but makes no allowance, perfectly sensibly, for the disputed figures in relation to the Lexus car and other matters. In those unusual circumstances it therefore seems to us that it is right to allow this appeal to the extent of quashing the current order in the sum of £88,000 and substituting for it an order in the sum of £82,297,503. To that extent this appeal is allowed.