England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
THE ADMINISTRATIVE COURT

		Royal Courts of Justice Strand London WC2A 2LL
		18 November 2005

1. MR JUSTICE MCCOMBE: I have before me an application for judicial review brought with the leave of the single judge against a decision of the Criminal Injuries Compensation Appeal Panel made on 2 December 2004 following a hearing on 1 December 2004. This was a case in which the claimant for compensation, Mr Raja Arshad Mahmood, was the victim of an offence of kidnapping and assault on 9 December 1998. I was told by his counsel Mr Carr, who appeared before me today, that the circumstances of the offences were these. There was a serious family dispute between Mr Mahmood and his wife's family, which resulted in Mr Mahmood being kidnapped by his in-laws and assaulted by them and by his wife, suffering significant physical injury and some psychiatric injury from which he has made an incomplete recovery. There was a trial of the defendants implicated in the offences. Mr Mahmood gave evidence. The result was that his wife received a sentence of ten years' imprisonment; and I understand that other defendants received penalties of a similar order.
2. Mr Mahmood at the time was 30 years old and in employment. He is not now in employment and I understand has not been in any significant employment since these events, save so far as were disclosed in his application to the authority and to the Panel in relation to his self-employed activity as a plumber.
3. Mr Mahmood made application for compensation on 24 September 1999. Initially the application was rejected on the grounds that Mrs Mahmood, the defendant in the criminal proceedings, might benefit from the award. That was successfully appealed following Mrs Mahmood's conviction. A full award was then made subject to funding assessment being adjourned to await medical evidence. At that stage the matter was to go before an Appeal Panel on 1 December 2004.
4. As already indicated, at the time of the offences against him Mr Mahmood was a man of good character. However, on 27 July 2004 Mr Mahmood pleaded guilty to certain offences involving benefit fraud and was sentenced to a two-year conditional discharge. The total loss in respect of the offences to which he pleaded guilty was in the region of £3,800. The figure was put in Mr Carr's written argument as £3,568. It was envisaged that that money would be recouped from Mr Mahmood in due course.
5. When the matter came before the Panel leading to the decision upon review, therefore, Mr Mahmood was no longer a man of good character, and that is a matter of materiality under the Criminal Injuries Compensation Scheme. I was taken to the statute giving rise to the making of the scheme. The present scheme is that issued by the Secretary of State on 12 December 1995 coming into effect (as I am told) on 1 April 1996.
6. The relevant material for present purposes is in paragraph 13, where it is provided that a claims officer may withhold or reduce an award where he considers that:

"(e) the applicant's character as shown by his criminal convictions (excluding convictions spent under the Rehabilitation of Offenders Act 1974) or by evidence available to the claims officer makes it inappropriate that a full award or any award at all be made."

I was also taken by Mr Johnson, who appears for the Panel, to paragraph 64 of the Scheme, which provides:

"The standard of proof to be applied by the Panel in all matters before it will be the balance of probabilities. It will be for the appellant to make out his case including, where appropriate: ...

(b) satisfying the adjudicator or adjudicators responsible for determining his appeal that an award should not be reconsidered, withheld or reduced under any provision of this Scheme."

Thus it was incumbent upon the claimant to satisfy the Panel that there should be no reduction, by reason of the matters that I have mentioned from paragraph 13(e) of the Scheme.

7. Before the Panel, it appeared that, apart from the question of the benefit fraud, there had been uncovered during the investigation of the matter a mortgage application form filled in by or on behalf of the claimant. The evidence was and is unclear as to what happened to that form, but the result was that the Panel heard evidence about how it came to be filled in and it appeared that, taken at its face value, the claimant was applying for a mortgage on the basis of earnings of £20,000 a year.
8. That matter, coupled with the convictions for the offences to which Mr Mahmood pleaded guilty, gave rise to the Panel's decision to refuse any compensation to the claimant in respect of the crimes of which he had been a victim, save that they did not order any refund of a payment of some £3,000 by way of interim payment that had been made at an early stage of the proceedings.
9. On 14 February 2005 the Panel gave brief reasons for reaching the conclusion it did. In the operative part the Panel said this:

"We regard benefit fraud as a very serious offence particularly when the applicant asks the public to compensate him from the public purse.

We were told there would be no claim for loss of earnings.

His convictions are recent and having regard to his false declaration and the nature of these convictions under Paragraph 13(e) of the Scheme we consider it inappropriate to make any award out of public funds under the Scheme .

No refund ordered of the £3,000 interim payment."

Earlier on in the reasons the Panel also mentioned what they referred to as "a false application" for a mortgage in which Mr Mahmood stated he was earning £20,000 a year as a self-employed plumber.

10. In fuller reasons provided after these proceedings had been commenced the Panel said this, at paragraph 10:

"We found the witness [Mr Mahmood] to be unconvincing. We did not accept his account as to how the figure of £20,000 earnings came to be on the mortgage application. He accepted that he had received payment as a self employed plumber. He was unable to say how much. Our impression was that no proper records were kept. We were told by his representative that there was no claim for loss of earnings arising out of this assault."

Then in the final paragraphs which contain the crux of the reasoning the Panel said this:

"(12) We accept that we do have discretion under paragraph 13(e). In exercising this discretion, however, we considered the evidence of the applicant. The nature of his convictions and the figure set out in the mortgage application of £20,000 which we were told was not correct and in our view was included to assist the application to obtain his mortgage. We did not accept his evidence that he did not know about this figure. If it was true, then the application was not fraudulent, but the fraud against the local authority must have occurred when the applicant was in receipt of a substantial income. If it was not true then it was a clear fraud and the applicant should have disclosed he was on benefit or on a far less income.

(13) The compensation under the Scheme is paid for out of public funds. In addition to costing that fund money; when he appeared in court. [Punctuation as in the original] The Panel take a serious view of Benefit frauds, as they reduce the public funds or the Local authorities' finances. On the evidence this was not an isolated case, but was spread over a period of three and a half years. We were not shown any Inland Revenue returns. We did consider if it would be appropriate to make a reduced award, but in view of the nature of the convictions, the length of time of the fraud and the false declaration for the mortgage, we did not consider that it was appropriate to make an award of compensation. We therefore, for the reasons given make no award."

11. Mr Carr submits that the complete denial of an award to Mr Mahmood was irrational, particularly having regard to the guidelines promulgated by the Criminal Injuries compensation authority as to the type of reductions that may be made in the light of particular offences and penalties that are imposed on an application for compensation. In the relevant guide in paragraph 8(15) the reasons for a reduction of compensation or denial of compensation was set out and the scale of penalty points that will be applied in the normal case by the Authority is given.
12. Sentences imposed by the courts on applicants ranging from imprisonment down to absolute discharge attracts, in accordance with the authority's scale, a range of penalty points from 10 at the highest, where the applicant has been in prison for more than 30 months, down to 0 in the case of some absolute discharges. It is common ground that in the present case the conditional discharge would have attracted two penalty points, and the indication is that in the usual case a 2-penalty point total would be likely to result in a 0 per cent reduction. Mr Carr's submission is that the jump for the reasons specified by the Board from the authority's guideline of a nil deduction to 100 per cent deduction is irrational and unjustified, particularly having regard to his second and subsidiary ground, namely, that in its reasons the Panel has given no grounds for stating why such a leap is made. It is accepted on all hands, however, that in the normal course of things the Panel is not bound by the guidelines and is not bound to explain its adherence to, or departure from, the guidelines, save that Mr Carr submits that in a case where such a stark leap is made some explanation is called for.
13. Mr Johnson submits that the Panel has the widest possible discretion in matters of this sort which has been emphasised time and time again by the Court of Appeal. I need refer, I think, to only one decision which is cited on all occasions in those matters, the decision of the Court of Appeal in R v Criminal Injuries Compensation Board, ex parte Thompstone [1984] 1 WLR 1234 where the Master of the Rolls (at page 1239) said this:

"It seems to me to be clear that paragraph 6(c) [in the appropriate paragraph] contemplates that circumstances can arise in which it would be 'inappropriate' that the public purse should be used to compensate a victim - when it could not reasonably be expected to be used for that purpose. It then restricts the considerations which can be taken into account in judging of inappropriateness to two broad categories which are disjunctive. The first is 'the conduct of the applicant before, during or after the events giving rise to the claim,' and in such a case the conduct would usually have some ascertainable bearing on the occurrence of the injury or its aftermath, although I do not want to be taken as deciding that it must do so. The public servant who before or after the event embezzles public funds might well not be thought to be an appropriate recipient of public bounty, although that would depend upon the circumstances and be a matter to be considered by the board. The second is "the character and way of life" of the applicant, where it is much less likely that this will have any ascertainable bearing on the occurrence of the injury, but again may be such that the applicant would not be thought to be an appropriate recipient of public bounty.

In each case, although different categories of circumstances can be taken into account, the issue is the same. Is the applicant an appropriate recipient of an ex gratia compensatory payment made at the public expense? As with all discretionary decisions, there will be cases where the answer is clear one way or the other and cases which are on the borderline and in which different people might reach different decisions. The Crown has left the decision to the board and the court can and should only intervene if the board has misconstrued its mandate or its decision is plainly wrong."

In short, the task for me is to decide whether in the present case the Panel has misconstrued its mandate or its decision is plainly wrong.

14. There appear to be at the outset an attraction in looking at the offence to which the victim, Mr Mahmood, had been subject (which was an extremely serious offence attracting serious penalties with serious consequences to the applicant) and (in contrast) to look at his own stray from the paths of righteousness in his own convictions and whatever one may derive from the unsatisfactory mortgage application form. Mr Johnson helpfully guided me to authorities suggesting that one must exercise caution in taking that approach, because it is not simply a question of balancing one matter against the other; although Mr Carr submits - and I think he is right in this - that the authorities indicate that it is one matter which needs to be taken into account and can be taken into account by the Panel considering cases of this type.
15. I remind myself before reaching my decision that I must decide whether this is a matter in which the Board has reached a decision that was plainly wrong. I must look at all the factors. It is clear that this applicant for compensation had been found guilty of benefit fraud. It was not in the scale of things an extensive benefit fraud: if it continued for three-and-a-half years, as has been suggested, it was possibly, on counsel's rough calculation, an amount of about to £20 a week. One cannot be clear of the position because the applicant pleaded guilty to only some of the offences which might suggest the period was rather less than the Panel was inclined to think.
16. Secondly, there was the mortgage application. It is not at all clear from the findings of the Panel what they were finding was the use to which that application form had been put, ie whether there had been a substantive application or whether a mortgage form had simply been found ready for use. The evidence is not explained and that is a matter that I am entitled to take into account in assessing the decision that has been taken. Then there was the fact that the application was found to be an unconvincing witness as to his explanation of the mortgage form. Bearing all those matters in mind, I found it entirely surprising on an initial reading of the papers that it could be considered the appropriate course to deprive the claimant entirely of compensation. The learned single judge, Sullivan J, who considered this matter on the papers, considered that it was arguable that this was one of those rare cases where the Panel's response to a claimant's criminal conviction was "over the top", to use the learned judge's expression.
17. At the end of the day, I have had to bear in mind slightly more than the claimant's criminal conviction, namely, the possibility of a mortgage fraud or preparation for a mortgage fraud and the unsatisfactory nature of the claimant's evidence before the Panel. However, I remain at the end of the day still of the view that the response to the claimant's record and character was indeed clearly "over the top" in this case. I cannot conceive of a situation where the facts set out in the Board's determination could justify a complete denial of compensation for an offence as serious as this one, even in the light of the offences to which this claimant pleaded guilty, and having regard, also, to the mortgage application that he either made or was about to make.
18. For those reasons, I find that this decision was irrational. I am supported in that because the reasons for departing from the guidelines have not, in this rather unusual case, been given. I do not find that whatever was made of the mortgage application could, on what was known to the Panel, have led to a conclusion such as they made in this case. With respect to the Panel it was, in my view, clearly, as Sullivan J thought it might be, "over the top". For that reason I propose to quash the decision.
19. Mr Carr urges me to say what would have been a reasonable reduction. It seems to me that Mr Johnson is, however, right that I cannot fetter any new Panel that considers this matter, who may have other evidence and who may have a rather more satisfactory evidence or explanation to give in their own reasons concerning the mortgage application matter which I have found rather unsatisfactory in this Panel's reasoning. So I decline to say what reduction would be appropriate and I am afraid that the matter must simply be remitted to the Panel for reconsideration.
20. MR CARR: My Lord, I am obliged. I ask for my costs, subject to normal detailed public-funding assessment.
21. MR JOHNSON: My Lord, I do not resist costs. My Lord, I do seek permission to appeal. My Lord would have seen from the authorities that this court and the Court of Appeal have regularly upheld the breadth of the Appeal Panel's discretion. That in itself, taken together with the relative scarcity of authorities under the new Scheme, in my submission makes the case fit for consideration by the Court of Appeal.
22. MR JUSTICE MCCOMBE: Do you want to add any observations?
23. MR CARR: My Lord, the only observation is the obvious one, in my submission this one -- the points made were legitimate -- cries out as a mistake and there is nothing to benefit in going further because it is the exercise of your assessment, in my submission quite right premises that it is plainly wrong.
24. MR JUSTICE MCCOMBE: Yes. I am not going to give permission to appeal. I have regard also to the general overriding objective in this regard. The case has been well argued by both counsel. I reached a clear conclusion. That does not mean that that clear conclusion is necessarily correct; judges are often overturned on appeal. However, this is a case that has gone on for a very substantial number of years. It is clearly a most unusual case and I regard it as a matter of some considerable regret that the resolution of this matter has taken so long even to this date, particularly at first on the wholly unfounded basis that Mrs Mahmood might have had the benefit of a compensation award, which had the effect of delaying this matter for some considerable period. The whole history of the matter suggests to me that it is something resolved sooner rather than later. For that reason also I think that if the Panel really does wish to go to the Court of Appeal it should excite the preliminary interest of a Lord Justice before doing so rather than me giving them carte blanche to extend the process further.