England and Wales Court of Appeal (Criminal Division) Decisions

IN THE COURT OF APPEAL
CRIMINAL DIVISION

		Royal Courts of Justice Strand London, WC2A 2LL
		Thursday, 27 July 2017

LORD JUSTICE DAVIS:

Introduction

1. This appeal, for which we have today granted leave, raises the issue of the correct approach to be adopted by the Crown Court in considering making a compliance order which includes a foreign travel restriction under section 13A of the Proceeds of Crime Act 2002 (as amended). It is said that this is the first occasion on which a travel restriction order made under that section has come before this court.
2. Section 13A was introduced into the Proceeds of Crime Act 2002 with effect from 1st June 2015, by virtue of the provisions of section 7 of the Serious Crime Act 2015. Section 13A provides as follows:

"13A Orders for securing compliance with confiscation order

(1) This section applies where the court makes a confiscation order.

(2) The court may make such order as it believes is appropriate for the purpose of ensuring that the confiscation order is effective (a 'compliance order').

(3) The court must consider whether to make a compliance order—

(a) on the making of the confiscation order, and

(b) if it does not make a compliance order then, at any later time

(while the confiscation order is still in effect) on the application of the prosecutor.

(4) In considering whether to make a compliance order, the court must, in particular, consider whether any restriction or prohibition on the

defendant's travel outside the United Kingdom ought to be imposed for the purpose mentioned in subsection (2).

(5) The court may discharge or vary a compliance order on an application made by—

(a) the prosecutor;

(b) any person affected by the order."

3. Such an order, in terms we will come on to set out, was made in confiscation proceedings against the appellant by His Honour Judge Timothy Smith, sitting in the Northampton Crown Court, on 9th November 2016.

Background facts

4. The background facts leading up to the making of that order are these.
5. On 15th August 2015, in the Crown Court at Northampton, after a trial before His Honour Judge Fowler and a jury, the appellant was convicted, along with others, of conspiracy fraudulently to evade duty, prohibition or restriction on the importation of controlled drugs. On 16th September 2014 he was sentenced to a term of five-and-a-half years' imprisonment.
6. Thereafter, on 9th November 2016 His Honour Judge Smith made a confiscation order in the agreed sum of £92,920, the benefit figure being £246,240. That sum was to be paid within 3 months and a 15 month term of imprisonment in default was set.
7. The appellant had between 1st March and 19th April 2012 conspired with others to import cannabis from Greece. On 12th April 2012 two consignments were intercepted at a warehouse at East Midlands Airport. The first consignment was destined for a business address of one of the co-conspirators, a man named Gosling. The second assignment was destined for the business address of another co-accused, a man named Ward. Each consignment contained nine blocks of cannabis. A total of 36 kilograms of cannabis was involved.
8. A test delivery was subsequently made by an undercover officer at Gosling's business address, which led to the investigation into other premises and other individuals. Cannabis found at the appellant's own business premises originated from the same distribution network. It was established that four consignments had already been successfully delivered. It was in due course accepted that some 108 kilograms of cannabis, with a street value of over £300,000, had been imported into the United Kingdom.
9. It was assessed that the appellant and his co-accused, Ward, had leading roles in the conspiracy. The appellant himself had international connections and through his businesses had experience in international shipping. Both he and Ward had been involved in buying cannabis on a commercial scale and used their businesses as cover for the conspiracy. To avoid detection they had used a number of addresses including "clean" addresses in fictitious names. There was a considerable amount of text traffic between the conspirators and evidence of onward movement of the cannabis.
10. On 16th September 2013 the appellant was interviewed by the police. He said that he had worked out of Greece but denied having any relevant account with the warehouse. He believed that the co-accused, Ward, was trying to blame him for the offence and he sought to explain away the various text messages. When interviewed again, on 28th November 2013, he reiterated his denial in involvement in setting up the cannabis importations.
11. It appears, from what we were told, that there was no discussion at sentence before His Honour Judge Fowler about the making of any travel restriction order under the provisions of section 33 of the Criminal Justice and Police Act 2001. At all events, consequent upon conviction and sentence confiscation proceedings were pursued against the accused. The confiscation proceedings against the appellant and the co-accused, Ward, seem to have proceeded together. In due course the matter came on for hearing before Judge Smith, who had not himself been the trial judge.

The confiscation proceedings

12. At the hearing on 9th November 2016, in the case of each of the co-accused, Ward, and the appellant the benefit figure was agreed to be £264,240. In the case of the appellant, so far as the available amount was concerned, his realisable assets were agreed to be in the amount of £92,920. We were told that that figure, to a considerable extent, rested on an assessment of the likely estimated profit from the cannabis importations.
13. The schedule of realisable assets annexed to the confiscation order of 9th November 2016 represented £4,000 as being the value attributed to a jet ski owned by the appellant and apparently located in Spain. The remaining amount of £88,920 was in terms, on the schedule to the order, stated to represent "concealed assets", the location of which was on the schedule described as "not known". In the event, as we have said, the judge gave 3 months for payment of the amount due under the confiscation order with a 15 month default term of imprisonment being set.
14. There was then discussion before the judge about the making of a compliance order. As mandated by the terms of section 13A, the judge was required to consider making such an order. In the result, having heard argument, he decided to do so in terms of imposing a traffic restriction with regard to the appellant. The judge decided that it was not appropriate to make such an order with regard to the co-accused, Ward. The judge decided that such an order as against the appellant would assist in ensuring that the confiscation order would be effective. The judge considered that that was the "proper balance", weighing the appellant's "treaty rights", as the judge described them, and the appellant's right to visit his family abroad as against the need to ensure compliance with the confiscation order itself.
15. It is to be noted in this respect that the appellant had put in detailed section 18 statements, setting out, amongst other things, his personal background. He is an Irish citizen. He had, for a considerable number of years, lived in Spain, there engaging, as he said, in a cash business sourcing liquidated stock and then selling that stock on, making an income, he estimated, of around £60,000 to £70,000 a year. He had established two companies in Spain for this purpose. His estranged wife still lived in Spain. He has three adult non-dependent daughters, two of whom live in Spain and one of whom lives mainly in England. He formerly, with his wife, had also owned a villa in Turkey which had been sold. He had travelled extensively over the years, as he said on business, including visits to Russia, Greece and other countries.
16. The appellant returned from Spain to live in the United Kingdom in 2011. He has lived there since that time, in rented accommodation before being sent to prison. In the United Kingdom he has engaged, according to him, in the like business of buying and selling liquidated stock, latterly through a company set up by him called "Ghost Industries". According to his section 18 statements he estimates his income from such activities as in the region of £80,000 to £90,000 per annum. He has not, however, seen fit to submit any Tax Returns to the United Kingdom authorities since 2011.
17. In his section 18 statements he disclosed no assets of any kind save for three identified bank accounts and the jet ski. He said that he owned no real property, owned no shares, had no pensions and had no assets worth over £500 save possibly for the stock of Ghost Industries, which in any event, he said, had been "taken over" by his estranged wife.
18. The judge having made the confiscation order he made a compliance order in the form of imposing a travel restriction. The latter order reads as follows:

"The following order is made in order to secure compliance with the confiscation order made against this defendant.

The defendant, John Pritchard

(i) is prohibited from leaving the United Kingdom,

(ii) must surrender all passports and international travel documents.

(iii) must not apply for any passport or international travel document."

The approach to section 13A

19. We turn then to the approach required in dealing with prospective orders to be made under section 13A. It was a fundamental part of the submissions of Ms De Redman, appearing on behalf of the appellant before us, as she had below, that a travel restriction imposed under section 13A could not be made unless there was a need for it. She further submitted that such an order as was made by the judge in this case was disproportionate and in the result, she submitted, no compliance order in the form of containing a travel restriction should have been imposed at all.
20. It is to be noted that section 13A is so worded that it is not a jurisdictional condition precedent for the exercise of the powers under that section that the court considers it necessary to make such an order to ensure that the confiscation order is effective. On the contrary, the making of an order is geared to such an order as the court "believes is appropriate" for ensuring that the confiscation order is effective. The word "appropriate", as used in this section is, in our judgment, emphatically not a synonym for the word "necessary". In criminal legislation Parliament sometimes chooses explicitly to make necessity part of the exercise by the court of the relevant jurisdiction: for example, by reference to the protection of the public in imposing a sexual harm prevention order, under section 103A of the Sexual Offences Act 2003. But that is not the language adopted in section 13A of this Act. The language here used is indeed more akin to that of section 41(7) of the Proceeds of Crime Act 2002, relating to restraint orders: as the Explanatory Notes to section 7 of the 2015 Act themselves point out. Consequently, we unhesitatingly reject any suggestion that necessity is the yardstick for the exercise of the powers conferred by section 13A.
21. Ms De Redman, however, has submitted that there is a lack of clarity in the legislation as to the meaning of the word "appropriate" and a lack of authority in relation to section 13A, outlining the considerations relevant to deciding whether or not the making of a compliance order is appropriate.
22. However, she helpfully referred, in this context, to the provisions of section 33 of the Criminal Justice and Police Act 2001. Section 33 of that Act requires the court to consider, on sentencing a drug trafficker who is the subject of at least a 4 year custodial sentence, whether it would be "appropriate" for the sentence to include a travel restriction order.
23. Ms De Redman's argument then moved on to consideration of certain authorities relating to the operation of section 33: in particular in the form of R v Mee [2004] EWCA Crim 629; [2004] 2 Cr App R(S) 81 and R v Gee [2009] EWCA Crim 1843. In particular she focused on what was said at paragraphs 11 and 12 of the judgment of the court in the former case, that is to say the case of Mee:

"11. It is unrealistic, if not impossible, to set out the broad range of facts which are likely to arise in individual cases. Suffice it to say, that the starting point should be a careful consideration of the circumstances of the offence and of the offender with a view to making a realistic assessment of the risk which arises from the facts of the case.

12. Assuming that a risk has been identified, and a need for an order arises, the principles of proportionality and fairness require a balanced approach to the length of the restriction to be imposed. A restriction on a person's freedom to travel is, as has been pointed out in the skeleton argument presented for this appellant, a restriction on a significant aspect of modern life. It is not to be taken away from a person for a number of years unless there are grounds for doing so. It cannot be for less than two years. It could in many cases affect his right to live and work abroad, to visit his family and so forth. That is a matter to which the court will wish to have regard. But having said that, we must emphasise that the weight to be given to such factors, when they are present to be taken into account, is to a significant degree, affected by section 35, which provides for the revocation and suspension of a travel restriction order. In our judgment the legislature must have contemplated that an order of this sort could affect an individual so as to prejudice his future employment and his personal life. Such prejudice must be regarded as being the contemplated and necessary consequence of the imposition of an order for which the statute provides a specific regime of relief."

24. Ms De Redman particularly latched onto the reference in paragraph 12 of the judgment in Mee to the "need" for such an order. But that reference, in that context, cannot be used to distort the actual meaning of section 13A of the 2002 Act: which is unequivocally geared to what is "appropriate". Moreover, the underpinning purpose of section 13A of the 2002 Act is different from that of section 33 of the 2001 Act. The latter is focused on seeking to prevent re-offending, the former is focused on ensuring that a confiscation order is effective.
25. In the judgment of this court the word "appropriate", as used in section 13A, does not require any gloss. What, however, can be accepted is that it is inherent in section 13A that the making of a compliance order must be justified. Such an order therefore can only be made if there is proper reason for so doing. How the making of an order of this kind is to be justified will then depend, when the court in question is assessing what is appropriate, on the facts and circumstances of the individual case.
26. Nevertheless, it can confidently be asserted that for this purpose considerations of proportionality must be involved in the decision-making process. They must be involved just because such considerations are themselves inherent in the legislative use of the word "appropriate" in section 13A, when set in the context of compliance orders in general and travel restrictions under subsection (4) in particular. A travel restriction for example, involves a restriction on freedom of movement, an important right in itself. Moreover, there will be cases where a travel restriction may involve prospective interference with the enjoyment of private or family life or the enjoyment of property. Thus, in considering whether or not to make an order imposing a travel restriction, under section 13A(4), the court has to strike a balance between the need to ensure that the confiscation order in question is effective and the risk of that confiscation order being rendered ineffective if no travel restriction is made, on the one hand, and the impact upon the individual defendant if a travel restriction is made, on the other hand.
27. This court does not think it likely to be helpful to give any further generalised guidance to Crown Court judges, or to seek to enumerate, if that were possible, the factors likely to be relevant in assessing whether or not it is appropriate to make a compliance order containing a travel restriction under section 13A. This is just because, as we have said, each case must be fact and circumstance specific. But what must always be borne in mind for the purpose of considering making an order under section 13A is that the "appropriateness" of making such an order has to be founded upon the purpose of making the confiscation order in question effective.
28. We think, nevertheless, that the present case may provide a useful illustration of how the section is to be applied in this context. In our view, the judge plainly, by his ruling, had properly engaged in the necessary balancing exercise. His conclusion, even if the reasoning was relatively terse, that it was appropriate to impose a travel restriction in this case is, in our judgment, unassailable.
29. Ms De Redman submitted that there was no risk of the appellant leaving the country so as to make the confiscation order ineffective. She emphasised that heretofore he had been a man with no previous convictions. He had not, whilst on bail pending trial, sought to abscond. He has since proved himself to be a model and trusted prisoner. Furthermore, she observed that he has family connections in Spain; he is an Irish citizen, with no doubt social and family connections there too; and he may, for example, need to look for employment or business occupation, as he has in the past, in the international field. Overall, she said, to impose a travel restriction would not be proportionate and thus it would not have been an appropriate order to make.
30. As will be gathered, we cannot agree. An obvious highly material initial point is this. This is a defendant who, as reflected in the confiscation order itself, has concealed assets in unknown locations; indeed those concealed assets represent the vast bulk of the available amount. He has international connections particularly, but not only, with Spain; and the drugs conspiracy itself had involved a significant international element. His business dealings on his own account, whether overseas or in the United Kingdom, have mostly, it seems, been conducted on a cash basis and in recent years he has submitted no Tax Returns. Clearly it can be inferred that discharging his financial obligations towards the State is not a matter of any priority for him.
31. It plainly can be assessed that is a real risk that he would leave the country so as to frustrate the effective operation of the confiscation order. One means indeed of achieving the effective operation of a confiscation order would be the potential impact of the imposition of the default term: which should not readily be allowed to be circumvented by enabling a defendant such as this to leave the country.
32. As to the actual effect of the travel restriction on him he has no dependent young children or other dependent family overseas whom he has need to visit. To the extent that he has adult daughters in Spain, they are not dependent on him and in any event they can visit him in the United Kingdom if they so wish. Contact, moreover, can be maintained through Skype or other modern means of communication.
33. As for further employment, on which Ms De Redman dwelt, it seems that in recent years the appellant has been able to and has engaged in business in the United Kingdom. Moreover, if, for example, any firm legitimate job opportunity from abroad were to come up, he could always apply, under section 13A(5), for a variation of the order. That subsection, in fact, as we see it, is an important part of the workings of this entire section. Thus, while of course the imposition of this travel restriction will potentially have a real impact upon the appellant the balancing exercise undertaken by the judge, in our view, eminently justified his overall conclusion.
34. We do, however, have one significant reservation as to the order made by the judge. That order was indefinite in point of time. It is true, as we have said, that section 13A(5) confers the right to apply to vary or discharge. But that provision cannot of itself, in our view, justify the making of an indefinite order containing a travel restriction of this kind. It is also true, as Mr Harris on behalf of the Crown observed, that a defendant himself has the means of getting rid of a travel restriction contained in the compliance order such as this: that is, by satisfying the amount due under the confiscation order in question in full. But that too cannot, in our judgment, of itself justify the making of an indefinite travel restriction. For example, one only has to consider what continued justification there might be for an indefinite travel restriction where the particular defendant has not satisfied the confiscation order but has served the default term.
35. We certainly do not say that there will never be a case where an indefinite travel restriction can be appropriate by reference to section 13A. However, such a travel restriction should be regarded as the exception rather than the rule. A Crown Court, if contemplating making an indefinite travel restriction order under section 13A, should think long and hard before doing so and, if such an order is to be made at all, it should be spelled out expressly on the face of the compliance order that it is indefinite.
36. Where, as is likely to be normal, a travel restriction made under section 13A will be finite in point of time, it will be for individual evaluation by the Crown Court judge, in the circumstances of each case, as to how long the period of the travel restriction should appropriately be. Those circumstances will include, amongst other considerations, the length of time, if any, remaining to be served under the initial custodial sentence and also will include the making of an assessment of what is likely to be a reasonable period of time to ensure enforcement and to ensure the effectiveness of the confiscation order. In all such orders, where made, it would be good practice expressly to write in that the travel restriction will in any event expire on satisfaction in full of the amount due under the confiscation order in question and to refer also to the liberty to apply to vary or discharge under section 13A(5). In this context, we might also add that subsection (5) also empowers the prosecutor itself, amongst other things, to apply, where the circumstances justify, to vary the initial length of any travel restriction set by the compliance order by seeking to extend it. Both counsel before us rightly agreed that was so.
37. In the present case, in our judgment, an indefinite travel restriction order was not justified and was not appropriate. We will therefore vary the order made by the judge so as to add this further paragraph which we consider appropriate in this case:

"4. This order is to last for a period expiring either on satisfaction in full of the amount due under the confiscation order or at the expiry of a term of 3 years from the date of this order, whichever is the earlier (but without prejudice to the right to apply in the interim to vary or discharge under section 13A(5) of the Proceeds of Crime Act 2002)."

38. To that limited extent this appeal is allowed.