England and Wales Court of Appeal (Criminal Division) Decisions

IN THE HIGH COURT OF JUSTICE
COURT OF APPEAL (CRIMINAL DIVISION)
ON APPEAL FROM
HHJ Mensah
T2005/7198

		Royal Courts of Justice Strand, London, WC2A 2LL
		04/03/2011

Lord Justice Gross:

INTRODUCTION

1. On the 24^th March, 2006, in the Crown Court at Luton, before HHJ Mensah, the Appellant changed his plea to guilty of conspiracy to supply a controlled drug of Class A. On the 25^th June, 2007, he was sentenced, by the same Judge, to twelve years imprisonment.
2. A co-accused, Luigi Menga ("Menga"), looms large in this appeal. We mention him at once. Before the Magistrates, he admitted two counts of possessing Class A drugs with intent to supply and two counts of being concerned in supplying Class A drugs. On the 7^th February, 2005, he was sentenced to eight years imprisonment.
3. On the 31^st January, 2008, the Full Court ("the 2008 Full Court decision") refused the Appellant's renewed application for leave to appeal sentence. The 2008 Full Court decision is of relevance to this appeal because of its endorsement of the Judge's sentencing observations as to the relative roles of the Appellant and Menga. It is not open to the Appellant on this appeal to seek to go behind the 2008 Full Court decision, to which we shall return in due course.
4. In the meantime, confiscation proceedings had been brought by the Crown pursuant to the Proceeds of Crime Act 2002 ("POCA"). On the 19^th December, 2007, HHJ Mensah made a confiscation order ("the confiscation order"), providing for the Appellant to pay £500,000 or, in default, to serve a period of 4 years imprisonment. The benefit figure was deemed to be £1,641,160.00 and the available amount £500,000 – comprised of £21,383.83 known assets and the remainder hidden assets.
5. The Appellant now appeals to this Court against the confiscation order, with leave of the Full Court, given on the 26^th May, 2010 ("the 2010 Full Court decision").
6. The grounds of appeal may be summarised as follows:

i) The trial Judge erred in law in acceding to the Crown's application to adduce in evidence in the confiscation proceedings out of court statements of Menga and remarks made in mitigation by counsel for and on behalf of Menga (compendiously, "the Menga evidence"), by way of the hearsay provisions contained in s.114(1)(d) of the Criminal Justice Act 2003 ("the CJA 2003"). In a nutshell, the Appellant contends that the hearsay provisions of the CJA 2003 were inapplicable, so that the Menga evidence was wrongly allowed into evidence; the Crown's application ought to have been considered in the light of the Civil Evidence Act 1995 ("the CEA 1995"). ("Ground (I)")

ii) On the footing that the Menga evidence ought not to have been adduced, there was no other evidence of hidden assets and the Appellant's benefit figure ought to have been computed more in accordance with his evidence; the realisable figure ought to have been the agreed figure for the known realisable assets. ("Ground (II)").

7. The Crown resists this appeal. As to Ground (I), the Crown contends that the hearsay provisions of the CJA 2003 are applicable. Further and in any event, the Menga evidence was properly admissible, whether the provisions of the CJA 2003 or the CEA 1995 govern the matter. Ground (II) therefore does not arise. If, however, Ground (II) does fall to be considered, then with or without the Menga evidence there was ample material for the Judge to fix the confiscation order in the amount she did.

THE HISTORY

8. (1) The facts: The Crown's case was that the Appellant was at the top of a conspiracy to supply Class A drugs between 1^st April, 2003 and 18^th May, 2005. He employed the co-defendants as runners and drivers (whom he provided with cars) to assist in the delivery of drugs around the Bedford area. A number of different addresses were used, including 17 Hoover Place, where the Appellant employed Menga to bag the drugs, prepare deals and distribute them in accordance with the Appellant's lists and ledgers.
9. On the 17^th November, 2004, police officers forced entry into 17 Hoover Place and arrested Menga. A large amount of material used in the preparation of drugs was recovered, as well as 1.13kg of heroin, 52 grams of crack cocaine and 10.5 grams of cocaine. The Appellant was arrested at about the same time; for present purposes, the details surrounding that arrest do not matter.
10. In interview, Menga admitted that he was a dedicated "bagger", working on a daily basis bagging drugs. He said – and this comprised most of "the Menga evidence" to which reference has already been made – that he had dealt with 22.5 kilos of heroin and 4.5 kilos of crack cocaine in the nine months preceding his arrest.
11. The Appellant declined to answer any questions and, on that occasion, he was released at the end of his interviews.
12. After Menga was arrested and imprisoned, the Appellant remained in contact with him and provided financial support to his partner and children.
13. The arrest of Menga and the loss of 17 Hoover Place resulted in the operation no longer using a dedicated bagging address; but the business still flourished and many others were used to run the telephone lines and the drugs. Street dealers were paid on an almost wage slip basis. Payment was made in relation to the amount of drugs sold and petrol expenses were covered.
14. In 2005, the Appellant began to hide drugs at the rear of the Bedford Football Club ground and he was frequently observed there, retrieving drugs from a stash; his "cover" (so to speak) was a lawful connection with the club which he also had. On 17^th May, 2005, police officers executed a search warrant at the football club and found a large amount of crack cocaine and heroin hidden inside a glove on the grounds. It was the Crown's case that the Appellant stocked and re-stocked the drugs. The Appellant was arrested at his home address and officers found £10,000 in cash, some wrapped in blocks of £100, with one note wrapped around the rest.
15. As to the hierarchy within the conspiracy, the Crown's case was that the Appellant was at the top. Menga was at the rung below him, as were some other co-defendants; inevitably there were further co-defendants at a level below that.
16. (2) Sentencing remarks – HHJ Mensah: Passing sentence, HHJ Mensah observed that the Appellant had operated at a very substantial level as a Class A dealer. He directed operations and was head of the conspiracy. The Judge referred to text messages, telephone calls and various police observations. He had used runners, rented properties and a system of mobile telephones to take orders and deliver goods. The force of these conclusions was not weakened by the fact that, as the Judge accepted, there must have been someone above the Appellant who supplied him.
17. Despite Menga's arrest and imprisonment, the Appellant had continued his activities, albeit in a more cautious manner. Although a precise figure for the money involved was not available, the conspiracy involved a large amount of drugs over a long period of time. The extent of supply was substantial. This was a highly organised operation; without the Appellant, it would not have got off the ground. The Appellant had directed the operation to ensure that it was efficient and successful.
18. The Appellant's offending was aggravated by the fact that he had become involved in this operation following his release from a previous sentence of imprisonment for possession with intent to supply. Aggravating features also included the Appellant's high degree of involvement, the large amount of drugs, the two types of drugs, the value of the dealing and the manner in which the Appellant operated after Menga's arrest. Various mitigating factors were taken into account, including, in particular, the Appellant's early plea of guilty. The Judge passed the sentence of imprisonment already referred to.
19. (3) The 2008 Full Court decision: The Full Court fully upheld the Judge's factual observations when sentencing. Giving the judgment of the Full Court, Sir Christopher Holland noted the prosecution case that, after Menga's arrest, the throughput of drugs, if anything, increased. The single Judge, refusing the Appellant's application for leave to appeal, had commented (amongst other things) on the "major role" played by the Appellant in this conspiracy, together with the "clear and full reasons" given by HHJ Mensah for differentiating between the Appellant's sentence and the sentences passed on his co-defendants. As Sir Christopher Holland put it, the Full Court found itself "quite unable to disagree" with the single Judge. The renewed application for leave to appeal against sentence was accordingly refused.
20. (4) The confiscation proceedings and the ruling on the admissibility of the Menga evidence: As already foreshadowed, the Crown proceeded with the confiscation proceedings, pursuant to the provisions of POCA, seeking a confiscation order against the Appellant.
21. Based on what Menga had said during the investigation, especially as to the quantity of drugs involved, the Crown wished to rely upon his evidence as part of its case in the confiscation proceedings. After a display of some reluctance to attend the hearing on 18^th December, 2007, a production order was issued for Menga's attendance at court. Thereafter, he was further reluctant to come up to court from the cells. It was agreed that a warrant should be issued for his attendance but, before it was drawn up, he did come up into court.
22. Menga then indicated that he had nothing to say. He had been charged and sentenced alone and did not want to give evidence in the confiscation proceedings. With regard to his interviews and comments during the investigation, these related only to him and had nothing to do with the Appellant or any other person. Menga's attitude can be assessed from the following passages taken from his remarks on the 18^th December, 2007:

" No comment. I've got nothing to say. I don't know why I've been brought here. I was charged on me own, yeah, I wasn't charged with nobody else. I'm doing my sentence on my own, that's it. I've got nothing to say. I didn't want to come here in the beginning…..

What I said in my statement was nothing to do with Vinnie Clipston, it was about me, I've give my statement about myself, that was it…..

….I don't want to get involved….

….I'm doing time, I'm going, that's it. I don't want to know."

23. The Crown then sought to adduce the Menga evidence pursuant to s.114(1)(d) of the CJA 2003. The Crown underlined that as Menga had provided details of his own criminality, what he said was likely to be reliable and, in any event, it accorded with other evidence in the case. Moreover, his statement in interview had been "confirmed in mitigation by counsel on behalf of Menga in the face of the court" on the occasion on which he was sentenced.
24. Counsel then representing the Appellant opposed the Menga evidence being adduced by way of the hearsay provisions of the CJA 2003. No point was taken that the CJA 2003 was inapplicable or that some other legal regime governed the admissibility of hearsay evidence in confiscation proceedings. Instead, the thrust of the defence case was that the reliability of Menga was very much in question; it would be wrong to rely upon his interview without the benefit of testing it by cross-examination. On the Crown's own figures, his account was highly suspect and therefore, having regard to s.114(2), it was not admissible. In addition, as there would be great difficulty in challenging Menga's statements in interview, it would be unjust to allow that evidence to be adduced and it was not in the interests of justice to do so.
25. Insofar as material, s.114 of the CJA 2003 provides as follows:

" (1) In criminal proceedings a statement not made in oral evidence in the proceedings is admissible as evidence of any matter stated if, but only if –

(d) the court is satisfied that it is in the interests of justice for it to be admissible.

(2) In deciding whether a statement not made in oral evidence should be admitted under subsection (1)(d), the court must have regard to the following factors (and to any others it considers relevant) –

(a) how much probative value the statement has (assuming it to be true) in relation to a matter in issue in the proceedings….

(b) what other evidence has been, or can be, given on the matter or evidence mentioned in paragraph (a);

(c) how important the matter or evidence mentioned in paragraph (a) is in the context of the case as a whole;

(d) the circumstances in which the statement was made;

(e) how reliable the maker of the statement appears to be;

(f) how reliable the evidence of the making of the statement appears to be;

(g) whether oral evidence of the matter stated can be given and, if not, why it cannot;

(h) the amount of difficulty involved in challenging the statement;

(i) the extent to which that difficulty would be likely to prejudice the party facing it."

26. In a careful ruling on the same day, HHJ Mensah held ("the evidential ruling") that the Mensa evidence would be admitted. Having had particular regard to the provisions of s.114(2), the Judge was satisfied that it was in the interests of justice to do so. The Judge said this:

" This is clearly…evidence…with much probative value. There is evidence which may support [or] confirm it, which can be given. I have noted the circumstances in which the statement was made and the reliability of the maker of the statement…. [Menga] …was at all times represented by solicitors and/or counsel.

With regard to questions about difficulty in challenging the statement or the reliability of the maker of the statement, I bear in mind in particular that this is a case in which I sit without a jury……

I see no unfairness in admitting this evidence. The defendant is …represented and able to challenge the statement to a certain extent. He can give evidence himself if he chooses to do so and submissions can be made on his behalf and I will attach such weight to the evidence as I think proper in the circumstances. "

27. Following the ruling, the Crown called the financial investigating officer to give evidence and the defence called the Appellant. The Appellant's evidence was to the effect that he was involved in more limited trading than suggested in the Menga evidence.
28. (5) The ruling on confiscation: On the next day, the 19^th December, 2007, the Judge gave her ruling on confiscation ("the confiscation ruling").
29. Having regard to the provisions of ss.6 and following of POCA, the confiscation ruling proceeded as follows. First, the Judge found that the Appellant had a "criminal lifestyle", both by reason of the fact that he had pleaded guilty to an offence within Schedule 2 of POCA and because of the evidence as to the lifestyle he enjoyed.
30. Secondly, the Judge had to determine whether the Appellant had benefited from his criminal conduct. Here, in accordance with s.10 of POCA, the Judge was required to make various assumptions, unless shown to be incorrect or there would be a serious risk of injustice if the assumption in question was made. In the event, the Judge concluded that the assumptions should be made and that the Appellant had benefited from his criminal conduct.
31. Coming, thirdly, to the value of the benefit obtained, the Judge made various findings and assumptions, in addition to the s.10 assumptions. Here, the Judge took into account the Menga evidence, the evidence given by the Appellant at the confiscation hearing and the Judge's own detailed knowledge of the case. She remained satisfied that the Appellant was the director of the drug dealing operations and had been at the head of the conspiracy, maintaining and supporting the activities of those beneath him in the hierarchy.
32. With regard to the Menga evidence, the Judge exercised "particular caution", given Menga's refusal to give evidence and the remarks he had made the day before (outlined above). She paid regard to the fact that Menga had stated that his comments related to his own participation in the conspiracy, not to the participation of the Appellant or any others. The Judge continued as follows:

" However, it seems to me that he would say that now as he nears the completion of his sentence and as, from his prison letter which was available to me in the first and second trial, he appeared very grateful to Mr. Clipston for looking after his partner and children and, in his words, 'taking a load of worry [off] his …shoulders'……

At the time at which he made his comments…, he and Mr. Clipston were friends. On Mr. Clipston's account before me yesterday, he was helping out …[Menga]…who had got himself into debt. If he …[Menga]…were taking the punishment and Mr. Clipston paying the transferred debt, there would be no incentive for Mr. Menga to make things look worse for Mr. Clipston. His letter from prison would not have been written to someone who he had dumped unfairly and untruthfully into this conspiracy. It certainly would not have been in Mr. Menga's interests to exaggerate his own or …[the Appellant's]…involvement in the criminal activity.

For all those reasons I therefore accept Mr. Menga's account over Mr. Clipston's.

In addition, Mr. Menga's account is supported by documentary evidence from the ledger books, the large number of phone calls, comings and goings of various people involved in the operation. Mr. Clipston, on the other hand, at this stage of the inquiry has every incentive to minimise his own role and level of dealing. "

Moreover, the Appellant's claim of limited involvement was inconsistent with the evidence presented and it was not credible that if, as he asserted, the operation was making so little money, "he would risk continuinig with such [an] unprofitable business at the risk of being caught…".

33. The Judge reiterated her view that the Appellant was the "main mover" in the operation. She was satisfied that the level of dealing was at least "…as great before Menga as during the Menga period, and greater thereafter…", as evidenced by the level of dealing, by telephone calls and by the activity observed. Ultimately, the Judge accepted that the calculation of benefit should be based on Menga's account, which was more credible than the Appellant's. On this footing, the Judge arrived at the benefit figure, already recounted, of £1,641,160.00.
34. As to the available amount (POCA, ss. 7 and 9), the Judge took into account the Appellant's own evidence, his response to the prosecution's s.16 statement of information and the prosecution investigation. The investigation had revealed that "free property" available amounted to £21,383.83. The Crown, however, sought a confiscation order in the sum of £1.6 million on the basis there must be "hidden assets", taking into account the level of dealing. For her part, the Judge was satisfied that the Appellant had benefited to a great extent and had made a large amount of profit. She was satisfied that he did have hidden assets available. She concluded that these amounted to at least £1 million but, having regard to running costs and overheads, she reduced the available amount to the figure of £500,000 (including the £21,383.83 of known assets). Accordingly, the Judge made the confiscation order in the amount of £500,000.
35. (6) The 2010 Full Court decision: As appears from its ruling, the Full Court gave the Appellant leave to appeal the confiscation order, essentially because of concern about hearsay evidence and the question of whether the civil approach, perhaps narrowed given the provision for imprisonment in default, was the proper approach to adopt.
36. In the course of the 2010 hearing before the Full Court, Hooper LJ remarked that HHJ Mensah may have been generous to the Appellant in respect of hidden assets. Before us, there was some debate as to this Court's powers if we were to come to such a conclusion. In the event, the matter was put to rest by the Crown's helpful clarification that it would not seek an increase in the confiscation order, even should this Court be of that view.

THE RIVAL CASES

37. For the Appellant, Mr. Finch's submissions proceeded as follows. The admissibility of the Menga evidence ought not to have been considered under the CJA 2003; reliance was placed on R v Silcock and Levin [2004] EWCA Crim 408; [2004] 2 Cr App R (S) 61. Instead, guidance should have been obtained from the CEA 1995. Questions for the Court as to the Menga evidence went to (1) admissibility; (2) fairness, in terms of s.78 of the Police and Criminal Evidence Act 1984 ("PACE"); (3) weight. There were also concerns as to Menga's role and whether an "accommodation" had been reached between the Crown and Menga; why had both the amount of Menga's benefit and the available amount been assessed at (only) £2,185.00? It had been wrong and unfair to admit in evidence the remarks of counsel in mitigation at the Menga sentencing hearing before a different Judge. What remained was the Menga interview; but that was not evidence against anyone other than Menga himself. The Court had fallen into error, attributing to the Appellant the dealing of Menga. If Menga's evidence was disregarded, the value of the Appellant's benefits should have been assessed at some £0.4 million – thus significantly reducing the gap between his known assets and the value of his benefit from criminal conduct. On this footing, the figure for hidden assets and, hence, the confiscation order, ought to have been reduced substantially.
38. For the Crown, Mr. Trimmer QC submitted that these were essentially criminal or criminal style proceedings; the best safeguards governing the admissibility of hearsay evidence were those contained in the CJA 2003. Silcock (supra), decided under a predecessor statute, did not require the Court to decide otherwise. The decision of this Court in R v Chal [2007] EWCA Crim 2647, pointed to the application of the CJA 2003. There had been no "deal" with Menga; the Crown had not been able to assert hidden assets with regard to him. The Appellant's period of involvement in the conspiracy had of course been considerably longer than Menga's. As to counsel's remarks in mitigation, these had been spoken in Menga's presence and were recorded on the transcript of the relevant hearing; they were properly admissible in evidence. So too with regard to Menga's statement/s in interview. The Crown had intended to call him but as he would not give evidence, those statements could be adduced as hearsay evidence. In any event, even if the Menga evidence was excluded, the appeal should be dismissed as the confiscation order was justified on the evidence which remained.

GROUND I

39. (1) The nature of confiscation proceedings under POCA: Confiscation proceedings are governed by Part 2 of POCA, ss. 6 and following. So far as relevant, the scheme is as follows.
40. As provided by s.6(1), the Crown Court must proceed if two conditions are satisfied – the first condition is that the defendant must have committed a criminal offence: s.6(2). Under s.6(4), the court must decide whether the defendant has a criminal lifestyle; if so, it must decide whether he has benefited from his general criminal conduct; if not, it must decide whether he has benefited from his particular criminal conduct. By virtue of s.6(5), if the court decides that the defendant has benefited from the relevant criminal conduct, it must decide the recoverable amount and make a confiscation order requiring him to pay that amount. S.6(7) provides that the court:

" ….must decide any question arising under subsection (4) or (5) on a balance of probabilities"

41. If the court has decided (under s.6) that the defendant has a criminal lifestyle, then, pursuant to s.10, various assumptions are to be made for the purpose of deciding whether he has benefited from his general criminal conduct and, if so, deciding his benefit from that conduct. Provision is made by s.10(6) for assumptions not to be made, if the assumption in question is shown to be incorrect or there would be a serious risk of injustice if the assumption were made.
42. S.7 addresses the "recoverable amount" – that is, an amount equal to the defendant's benefit from the conduct concerned. However, as provided by s.7(2), "if the defendant shows" that the available amount is less than that benefit, then the recoverable amount is to be the available amount or a nominal amount, if the available amount is nil.
43. S.16 makes provision for a statement of "information" from the prosecutor and s.17 for the defendant's response. Ss. 17(2) and (3) provide for the circumstances in which such information may be accepted or, in the absence of proper challenge by the defendant, treated as conclusive S.17(4) provides that, for the purposes of that section:

"….an allegation may be accepted or particulars may be given in a manner ordered by the court."

44. As it seems to us, there is nothing in these sections of POCA which, on a natural reading, suggests that confiscation proceedings are other than criminal in nature. Their starting point, as noted, is the prior conviction of the defendant of a criminal offence. The scheme, backed by a sentence of imprisonment in default, undoubtedly has draconian features, reflecting the legislature's determination to part criminals from the proceeds of crime. For this reason, no doubt, certain matters (as outlined above) may be determined in favour of the Crown but in accordance with the civil standard of proof or, flexibly, in a manner ordered by the court (s.17(4)). See: Dickens (1990) 12 Cr App R (S) 191, esp. at p.194; R v Benjafield [2002] UKHL 2; [2003] 1 AC 1099, esp. at [9] – [18]. Again, insofar as there is a "reverse" burden on the defendant (e.g., to prove that the available amount is less than the benefit), then, as elsewhere in the criminal law, the standard of proof is a balance of probabilities.
45. In our judgment, the appropriate analysis of confiscation proceedings under POCA is that (as in the predecessor legislation) they are an extension of the sentencing hearing and, therefore, criminal in nature: Silcock (supra), at [47]; see too, McIntosh v Lord Advocate [2001] UKPC D1; [2003] 1 AC 1078, esp., at [14]. As they do not involve the determination of a criminal charge but are to be regarded as part of the sentencing procedure following conviction, it has long been accepted that Art. 6(2), ECHR is inapplicable: Phillips v UK (2001) 11 BHRC 280; R v Briggs-Price [2009] UKHL 19; [2009] 1 AC 1026, esp. at [26] – [30]. It does not in any way follow from the inapplicability of Art. 6(2) that these are any the less in the nature of criminal proceedings. Very recently, a clear distinction was helpfully drawn between confiscation proceedings under Part 2 of POCA and proceedings for the recovery of assets under Part 5 of POCA. In Serious Organised Crime Agency v Gale [2010] EWCA Civ 759; [2010] 1 WLR 2881, Carnwath LJ said this (at [44]):

" ….Part 5 of the 2002 Act is quite different in purpose and effect from the provisions [in another case]…which correspond to the confiscation provisions of Part 2. In such cases the confiscation proceedings are treated by the European Court of Human Rights as linked to the prior criminal proceedings, but analogous to the process of sentencing rather than establishing a criminal charge, and therefore not normally subject to article 6(2)…… By contrast Part 5 of the 2002 Act is not necessarily linked to criminal proceedings of any kind………. "

46. (2) Confiscation proceedings – the relevant regime governing the admissibility of hearsay evidence: If right so far, then confiscation proceedings under POCA are criminal in nature. It remains, however, to consider the basis upon which hearsay evidence is admissible in such proceedings.
47. (i) The CEA 1995: We at once rule out the CEA 1995, for reasons which can be briefly stated.
48. First, practical considerations suggest that the CEA 1995 regime should not be "imported" into confiscation proceedings unless driven to it by statute or authority. Confiscation proceedings are routinely conducted in Crown Courts by practitioners (and Judges) with greater experience of the criminal law provisions governing hearsay evidence, than the CEA 1995. Moreover, unsurprisingly, this regime is not tailored to the needs (including appropriate safeguards) of proceedings which are criminal in nature.
49. Secondly, no authority requires the adoption of the CEA 1995 provisions as to hearsay evidence in confiscation proceedings. We shall return to Silcock (supra) presently but, on any view, it is not authority for the proposition that the CEA 1995 is applicable here.
50. Thirdly, POCA itself contains no express provision calling for the application of the CEA 1995 to confiscation proceedings under Part 2. For completeness, s.46 of POCA inferentially tells against it. This section, likewise within Part 2 of POCA, deals with restraint orders. It makes specific provision for hearsay evidence and for the applicability of the CEA 1995, as follows:

" (1) Evidence must not be excluded in restraint proceedings on the ground that it is hearsay….

(2) Sections 2 to 4 of the Civil Evidence Act 1995….apply in relation to restraint proceedings as those sections apply in relation to civil proceedings."

The suggestion must be that without such specific provision, the CEA 1995 would not have applied – otherwise it is difficult to explain the need for this section. But no similar provision is made for confiscation orders. Moreover, restraint proceedings are different from confiscation proceedings; in particular, unlike a confiscation order, a restraint order is not premised on the person who is to be restrained having been convicted (or even charged or suspected) of any offence.

51. (ii) The CJA 2003: We turn next to the CJA 2003. It is at once to be acknowledged that if it is right (as we think it is) to view confiscation proceedings as criminal in nature, then, at first blush, it would be natural to look to adopt the hearsay regime in the CJA 2003. On reflection, however, there are formidable difficulties in treating this regime as directly applicable to confiscation proceedings.
52. First and plainly, the hearsay regime contained in the CJA 2003 cannot apply to confiscation proceedings commenced before this regime came into force on the 4^th April, 2005. It is not apparent what mechanism there is for applying it directly to confiscation proceedings commenced thereafter.
53. Secondly, it is necessary to have regard to the terms of the CJA 2003. So, s. 114 (set out above) applies to "criminal proceedings"; for that matter, s.116 likewise applies to "criminal proceedings". The definition of "criminal proceedings" is to be found in s.134(1) the CJA 2003:

" 'criminal proceedings' means criminal proceedings in relation to which the strict rules of evidence apply;"

54. Accordingly, the full rigour of the hearsay regime of the CJA 2003 can only apply – at least directly - to confiscation proceedings if they are criminal proceedings in relation to which "the strict rules of evidence apply". Two separate lines of reasoning, however, suggest that confiscation proceedings, even though criminal, are not proceedings to which "the strict rules of evidence apply". The first relates to confiscation proceedings themselves; the second to the sentencing process more generally. (For completeness, we respectfully acknowledge the value of the analysis of Toulson LJ in Chal (supra), at [19] – [34] but the differences between proceedings under the Criminal Procedure (Insanity) Act 1964 and confiscation proceedings under Part 2 of POCA are such as to rule out any helpful analogy.)
55. As to confiscation proceedings, statute provides that they proceed on statements of "information", not "evidence": see, POCA, ss. 16-18. This choice of language is significant, as explained in the different context of Imprisonment for Public Protection: see Considine [2008] 1 Cr App (S) 41, at [26] – [27]. In the present context, the difference is no less significant - notwithstanding the statutory provision made in s.17 for an allegation in the statement of information to be treated as conclusive - and is founded on practical good sense. For instance, the prosecutor's statement of "information" is not restricted to "evidence"; not every item within it must be strictly proved in accordance with rules of evidence of any description. Were it otherwise, the system would be at risk of grinding to a halt. See too, the observation of the Court in Dickens (supra), at p.193, distinguishing between the prosecution's statements and the lack of need for evidence in support.
56. Turning to the sentencing process more generally, its starting point is, of course, the offender's guilty plea or conviction after a trial. The demanding evidential requirements for the proof of guilt are not generally transposed to such post-conviction proceedings. So, although there are a variety of safeguards in the sentencing process – for example, respecting the jury's verdict, only sentencing the offender for crimes of which he has been convicted or which he has admitted (but see below) – the strict rules of evidence will not invariably be applied in the sentencing process. By no means everything in the prosecutor's opening will need to be strictly proved and, undoubtedly, the same flexibility applies to the defendant's mitigation.
57. The decision in Patrick Smith (1988) 10 Cr App R (S) 271 furnishes helpful guidance. There, the appellant had pleaded guilty; his co-defendants had been convicted after a trial. The question arose as to whether the sentencer was entitled to take account, as against the appellant, of matters which emerged at the trial of his co-defendants. This Court held that he was. Lord Lane CJ said this (at p.276):

" In deciding what the factual situation was he [i.e., the Judge] is not bound by the rules of admissibility which would be applicable to the trial of the issue of guilt or innocence. He can take into account the contents of witness statements or depositions; he can take into account evidence he may have heard in the trial of the co-defendants. He must, however, (and this is perhaps to state the obvious) bear in mind the danger that self-serving statements are likely to be untrue, that such statements have as a rule not been subjected to cross-examination and that the particular defendant whom he is sentencing may not have had the opportunity to put forward his version of events. The last danger can be avoided by giving the defendant the opportunity to give evidence if he wishes. As in the Newton situation, the aim is to provide the Judge with the fullest information possible, while at the same time ensuring that the particular defendant has every opportunity to present his side of the picture. "

58. (iii) Silcock in context: The decision in Silcock (supra) can now be revisited in context. The issue in Silcock of relevance to this discussion, concerned the admissibility of hearsay evidence in confiscation proceedings, evidence which it was argued was inadmissible under the ordinary rules of criminal evidence. The legislation in question was a predecessor of POCA; the hearsay provisions of the CJA 2003 were not yet in force. This Court, pointing to the "sea change" in the conduct of confiscation proceedings, through the use of information, presumptions, assumptions and the civil standard of proof, ruled that the evidence was admissible: see, [41] – [47] and [60]. In so ruling, the Court said this (at [47]):

" For this reason…[counsel for the Crown]…submits, and again we agree, that the judge was right to rule that the ordinary rules of criminal evidence did not apply and that the confiscation hearing was an extension of the sentencing hearing, and was more in the nature of civil proceedings, though we prefer a description that the confiscation hearing is an extension of the sentencing hearing, and therefore criminal in nature, but that by virtue of the 1993 Act the civil procedure is correctly adopted and applied. "

59. The sense of the Court's ruling is plain. There had been a "sea change" in the procedure, as we have ourselves outlined, to give effect to the legislative purpose underlying confiscation orders. The proceedings were criminal in nature albeit aspects of civil procedure (e.g., the standard of proof) were applied. Had the "ordinary rules of criminal evidence" applied, there would have been difficulty (to put it no higher) in treating the material in dispute as admissible in evidence. There would thus have been an unfortunate tension between the aims of the legislation and the then prevailing rules of evidence in criminal proceedings. Pulling the threads together, at [60], the Court said the following (by reference to the enactments preceding POCA and with which we are not concerned in any detail):

" ….it is apparent from the foregoing that since the coming into force, in February 1995, of the 1993 amendments to the 1988 Act, there has been a seachange in the conduct of confiscation proceedings, which are now to be viewed, as Parliament intended through the prism of those amendments identified by Mr. Smith. First, the burden of proof is now the civil burden. Second, the court may make far-reaching assumptions. Third, the court may require the defendant to provide information and may draw inferences from his failure to do so. Fourth, the court may rely both on evidence at trial and on any relevant information, properly obtained both before trial and thereafter, in order to determine a defendant's benefit and the amount to be recovered. These are, and are intended to be far-reaching provisions, with the aim of separating criminals from the proceeds of their crimes. The determining judge must, of course, examine both the evidence and the information obtained judicially and with great care as to its weight. But we are in no doubt that the sentencing judge here was proceeding well within the letter and the spirit of these provisions in proceeding as he did. He was fully entitled to consider all of the material provided to him, drawing from it such inferences and making such assumptions as were proper. Moreover, it was for him thereafter to attach such weight to the material as seemed proper. "

60. As it seems to us, Silcock reflects both the sea change in the conduct of confiscation proceedings specifically – a sea change continued under POCA – and the readiness of the sentencing process more generally to take account of material which may not strictly be admissible under the ordinary rules of criminal evidence. On our reading of the judgment (and it is an authority very much in point), nothing said in Silcock compels or suggests the adoption of the CEA 1995 hearsay regime in confiscation proceedings. However, the reasoning in Silcock, understood in context, points against treating confiscation proceedings as proceedings in which "the strict rules of evidence apply". If that be right, then the CJA 2003 hearsay regime cannot be directly or strictly applicable to confiscation proceedings. Given the trend towards the court taking an increasingly strict approach to the admissibility of hearsay under s.114(1)(d) in the trial context, this conclusion has the considerable attraction of avoiding the introduction of unnecessary technical rigidity at the sentencing stage. For example, were it otherwise then provisions as to the service of notices (s.132 of the CJA 2003, read with Part 34 of the Criminal Procedure Rules) would apply to confiscation proceedings – perhaps unexpectedly and certainly unfortunately.
61. (iv) Conclusion and solution: For the reasons already foreshadowed, our conclusion as to the admissibility of hearsay evidence in confiscation proceedings is as follows:

i) The CEA 1995 hearsay regime has no application to confiscation proceedings.

ii) The CJA 2003 hearsay regime, while potentially more suitable, can likewise not apply – at least strictly and directly.

iii) Our conclusion plainly does not entail that hearsay evidence is inadmissible in confiscation proceedings. Any such outcome would be absurd, having regard to the realities both of confiscation proceedings in particular and the sentencing process more generally.

iv) Instead, our conclusion does entail that hearsay evidence is admissible in confiscation proceedings – but in accordance with the approach to be outlined below, rather than via the CEA 1995 or, at least directly, by way of the CJA 2003.

62. For completeness and as a matter of courtesy, we acknowledge at this point that our conclusion involves rejecting the submissions of both parties as to the route by which hearsay evidence is or may be admissible in confiscation proceedings. Ordinarily, we might well have invited further argument from counsel but we have decided against doing so, essentially because - as will appear – the result is wholly unaffected by the precise reasoning involved.
63. What then is a Judge to do when faced with the proposed introduction of hearsay evidence in the course of confiscation proceedings under Part 2 of POCA? What control mechanism is available? Plainly, it cannot be that anything goes.
64. In our judgment, the solution is indicated by decisions such as Patrick Smith, Silcock and Considine (at [34] – [36]). The post-conviction stage has been reached. The jury is not involved. The particular context is that of confiscation proceedings. The procedure must be both flexible and fair. We cannot sensibly be unduly prescriptive but we venture the following broad considerations:

i) In many instances, there will or should be no realistic issue as to the admissibility of the evidence, not least given the focus of POCA on "information".

ii) There will, however, be occasions where a hearsay statement is of importance and seriously in dispute so that admissibility is, quite properly, a live issue. If so, as it seems to us, the CJA 2003 regime, applied by analogy, will furnish the most appropriate framework for adjudicating on such issues. The vital need is for the Judge in such a situation to understand the potential for unfairness and to "borrow", as appropriate, from the available guidance in s.114(2) (together with the matters contained in s.116) of the CJA However, when applying this regime – and especially the "interests of justice" test in s.114(1)(d) – it will be of the first importance to keep the post-conviction context in mind. There may well be room for more flexibility than in the trial context.

iii) In many more cases, the real issue will be the weight rather than the admissibility of the evidence or information in question. If so, the "checklist" contained in s.114(2) (and the matters set out in s.116) of the CJA 2003, suitably adapted to address weight rather than admissibility, will here too provide a valuable (if not exhaustive) framework of reference. In any event and in every case, a Judge must of course proceed judicially, having regard to the limitations of the evidence or information under consideration (including, by way of examples, the reliability of the maker, the circumstances in which it came to be made, the reason why oral evidence cannot be given and the absence of cross-examination). Furthermore, care must invariably be taken to ensure that the defendant has a proper opportunity to be heard.

iv) Here, as elsewhere in the sentencing process, the Judge will need to exercise judgment. In the present context, such judgment must be exercised consistently with both the legislative intent underpinning POCA and (it goes without saying) the need for fairness to all concerned.

65. Lest it be objected that the proposed solution is open-ended or too uncertain, such questions of judgment are by no means novel in confiscation proceedings. They arose in Silcock, prior to the introduction of POCA. The decision in Sangha [2009] 2 Cr App R (S) 17, serves to show that especially where the criminal lifestyle provisions of POCA are engaged, then the sentencing Judge will not be limited to information concerning the offence or offences of which the defendant has been convicted; in such situations, the principle in Canavan [1998] 1 WLR 604 will be displaced or modified. While there is undoubtedly the need in confiscation proceedings for very considerable flexibility, conversely, there will be areas where strictness is appropriate; Briggs-Price (supra) illustrates how in some situations the relevant standard of proof will be the criminal standard – even in the confiscation context. None of this is unduly complex provided the issues are kept properly in focus. Above all a fair outcome to all parties does not require a statutory straitjacket, more suitable for the trial, governing the admissibility of hearsay at the stage of confiscation proceedings.
66. (3) Conclusion as to the evidential ruling: In the light of the conclusion to which we have just come, the substance of the evidential ruling can be taken shortly. In summary, however approached, no proper criticism can be made of HHJ Mensah's decision to admit the Menga evidence.
67. In our judgment, this was an occasion when the admissibility of the Menga evidence did give rise to a serious issue. For our part, consistent with our earlier conclusion, the CJA 2003 regime applied by analogy. It is noteworthy that in ruling on admissibility, the Judge had regard to the reliability of the Menga evidence, the opportunity there would be for the Appellant to give evidence and the fact that (for these purposes) she was sitting as a Judge without a jury. Her ruling cannot be faulted. Indeed, on this footing - as the Judge dealt with the matter on the basis that the CJA 2003 was directly or strictly applicable – at most it could be said that she erred on the side of caution. Manifestly that is something from which the Appellant can derive no comfort.
68. Assuming, however, that the question of admissibility did require the Crown to satisfy – strictly - the requirements of the CJA 2003 regime, then the answer is the same:

i) As already outlined, the Judge made a careful ruling, properly having regard to the provisions of s.114(2) of the CJA 2003.

ii) Mr. Finch's submission that there was some "deal" or "accommodation" with Menga is wholly speculative and devoid of evidential foundation. That the Crown could not or did not do "better" against Mr. Menga is one thing; that there was some deal with Menga would be quite another. In any event, Mr. Trimmer for the Crown firmly denied that there was any such deal and there is no (certainly no proper) evidential basis for going behind that denial.

iii) The Judge was amply entitled to rule that Menga's statements in interview as to the scale of dealing were admissible in evidence. First, having regard to the unchallengeable conclusions as to the relative roles of the Appellant and Menga in the conspiracy, these statements comprised relevant and probative evidence as to the scale of the conspiracy and, hence, the Appellant's benefit. Secondly, the objection that Menga's statements in interview were only evidence against himself, is misconceived. Menga's interview, could only be evidence against himself; but oral evidence subsequently given in Court could be evidence against the Appellant as well. Here the Crown sought to adduce Menga's evidence orally but he refused to cooperate, thus its introduction by way of hearsay. But the hearsay evidence, no less than any oral evidence, is evidence capable of telling against the Appellant. Thirdly, because this evidence was introduced by way of hearsay, it was necessary (or at least appropriate) for the Judge to proceed with caution; this she plainly did. Fourthly, it is in any event difficult to see why this evidence could not simply have been introduced by way of s.119 of the CJA 2003 (dealing with inconsistent statements), had suitable questions been put to Menga on his brief appearance in Court.

iv) Counsel's remarks in mitigation on behalf of Menga on the occasion he was sentenced, were no more than confirmatory of the statements made by Menga himself in interview. In the circumstances, it is unnecessary to express any view on the standing of counsel's submissions in mitigation (admittedly in Menga's presence) had they stood alone. Even assuming (while not deciding) that there was some objection to the introduction of these remarks in evidence, they added nothing to Menga's own statements in interview – which, as we have ruled, were properly admissible.

69. Essentially for the same reasons, so not requiring repetition, there is no or no proper basis for any complaint that the Judge ought to have excluded the Menga evidence under s.78 of PACE.
70. No sensible criticism can be made of the weight given by HHJ Mensah to the Menga evidence, once it was admitted. Again, it is readily apparent that the Judge proceeded with (as she put it) "particular caution". Further, she had regard to all the evidence (including that given by the Appellant) and her own detailed knowledge of the case.
71. For completeness, we add only this. If contrary to all our views thus far, it was necessary to address the admissibility of the Menga evidence under the CEA 1995, then it would make no difference whatever to the outcome. While no notice of the Menga evidence was served under s.2 of that Act, Mr. Finch, rightly, takes no point on that; plainly, it gave rise to no prejudice. That apart, nothing in the safeguards in relation to hearsay evidence contained in ss. 2 – 4 of the CEA 1995 (which need not be set out here) begins to suggest, even in the context of confiscation proceedings, that the Judge ought to have come to some different conclusion, either as to admissibility or weight.
72. Accordingly, Ground (I) must be dismissed – a conclusion which is sufficient to dispose of the appeal.

GROUND (II)

73. It follows that, strictly, Ground (II) does not arise. We do no more than express our provisional inclination: even without the Menga evidence, the considerable body of other evidence in the case, as to the conspiracy and the Appellant's role in it, would have sufficed for the Judge to reach the same conclusion. It is to be recollected that, if anything, the Judge's conclusion on the available amount was generous to the Appellant – having regard to the benefit figure and the fact that he had hidden assets. Therefore, even assuming the exclusion of the Menga evidence, our provisional view is that there was what might be termed an ample margin, justifying the confiscation order in the amount of £500,000.

OVERALL CONCLUSION

74. For the reasons given, this appeal must be dismissed.