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 WC2
		13th July 2006

Thursday, 13th July 2006

1. MR JUSTICE AIKENS: This is a claim by Frederick George Deamer for judicial review of a decision of District Judge Morgan made on 4th April 2006 in the Southampton Magistrates' Court. The claimant had applied to the District Judge to stay proceedings for the enforcement of a confiscation order which had been made by HHJ Darlow in the Southampton Crown Court on 1st March 1999 under the terms of the legislation then in force, the Drug Trafficking Act 1994. The claimant had applied for a stay to the District Judge on the ground that the application for the enforcement of the confiscation order, which had been made by the Revenue and Customs Prosecution Office ("RCPO") in February 2006, was an abuse of process and a violation of the claimant's rights under Article 6(1) of the European Convention for the Protection of Human Rights and Fundamental Freedoms. The District Judge concluded that there was no abuse of process and no breach of the Article 6(1) rights, so that the application for a stay of the enforcement proceedings should be dismissed. The District Judge thereafter issued a warrant to commit Mr Deamer. The claimant seeks an order that this warrant be quashed, as well as a stay of any such proceedings.
2. This matter has a long history. I will attempt to give only the briefest account.
3. The claimant was born on 7th May 1939. He is therefore now 67. On 4th April 1997 he was arrested and remanded in custody. Subsequently, the claimant was tried for conspiracy to import cannabis. The prosecution's case was based upon the fact that two tons of cannabis resin had been found in the ballast tanks of the claimant's sketch, "Lucky Lady", which was detained at Bayonne, in southwest France. After a trial at which Mr Deamer gave evidence, he was convicted.
4. There was a second trial of two counts of conspiracy to supply cannabis resin. Mr Deamer did not give evidence at that trial. He was convicted.
5. HHJ Darlow was the trial judge in each case. He sentenced Mr Deamer to 12 years' imprisonment for the importation offence and six years' imprisonment, concurrent one between the other, for each of the supply offences. The total sentence was 18 years' imprisonment. The sentence's were passed on 28th September 1998.
6. The Crown instituted confiscation proceedings against Mr Deamer under the Drug Trafficking Act 1994. The there was a confiscation hearing before HHJ Darlow on 1st March 1999. The prosecution had served a "prosecutor's statement" under section 11(3) of the 1994 Act. The Judge was invited by both counsel for the prosecution and defence to make a preliminary ruling and finding of fact on whether or not Mr Deamer had any "hidden" assets. The defence case was that there were no hidden assets and that those which did exist had already been seized by the prosecution. Having heard evidence, the Judge concluded that the prosecution had demonstrated (to the necessary standard of proof) that additional assets did exist beyond those that the Crown knew about.
7. Once the Judge had reached that conclusion, counsel for the defence invited the Judge to make a determination of the figure by which Mr Deamer had benefitted in drug dealing. Counsel were able to agree this figure as being £5,448,200. The Judge made a confiscation order under section 2 of the 1994 Act that Mr Deamer should pay that sum. The Judge ordered that this sum should be paid within nine months, ie, by 29th January 2000. He also ordered, that in default of payment, Mr Deamer would go to prison for a period of six years.
8. On 29th January 2000, when time to pay under the confiscation order expired, none of the sum of £5,448,200 had been paid.
9. On 18th February 2000 a Receiver was appointed in order to get in any assets that Mr Deamer might have, in order to pay the sum due under the confiscation order. We were told by Mr Mitchell QC (for Mr Deamer) that the Receiver was appointed on the instance of those advising Mr Deamer, at least in part. However, the Receiver realised very little assets. The total sum realised was only £5,456.06 by the time that the Receiver was discharged on 24th May 2001.
10. Meanwhile, the claimant's appeal against conviction and sentence had been dismissed on 3rd April 2000.
11. On 23rd January 2002 the sum of £350,182.85, which comprised the value of assets that had been received by HM Revenue and Customs at the time that Mr Deamer was arrested in 1997, was paid in part satisfaction of the confiscation order. It is said that this sum, plus the amount that was realised by the Receiver, ought in any event to be taken into account when calculating the default time of imprisonment for failure to pay the sum due under the confiscation order.
12. In 2001 there was correspondence between the solicitors acting for Mr Deamer and HM Customs and Excise on the question of an application by Mr Deamer for a Certificate of Inadequacy, that is to say for a certificate that he had inadequate means to pay the confiscation order. It seems that Mr Deamer's solicitors thought that HM Customs and Excise would draft a proposed Certificate of Inadequacy. However, in a letter dated 12th July 2001, HM Customs and Excise Solicitor's Office made it plain that because HHJ Darlow had made a finding that Mr Deamer had "hidden assets", therefore HM Customs and Excise could not and would not consent to the grant of a Certificate of Inadequacy. The letter indicated that in the case where there had been a conclusion by the Judge the the offender had "hidden assets", then an application for a Certificate of Inadequacy was, effectively, a challenge to the finding by the Judge. Therefore the proper forum for that challenge was the Court of Appeal, although any appeal would by then be much out of time.
13. Between July 2002 and February 2006, there was correspondence between solicitors acting for Mr Deamer and HM Customs and Excise Solicitor's Office and the successor of that office, which is now called the Revenue and Customs Prosecution Office ("RCPO"). This correspondence was produced by the RCPO at the hearing before the District Judge, although it would seem (from the first witness statement of Kevin Lowry -Mullins on behalf of the claimant) that the claimant and his advisers were not provided with a copy of the bundle of the correspondence prior to the hearing.
14. The correspondence demonstrates that in 2002 the claimant was still considering applying for a Certificate of Inadequacy, with the intention of using such certificate to discharge or vary the Confiscation Order by instituting proceedings in the High Court. On 19th September 2003, HM Customs and Excise wrote to the claimant's solicitors, asking whether or not that was still their intention. The letter asked that Mr Deamer's solicitors indicate, within 14 days, their proposals for paying the outstanding sum under the Confiscation Order. The letter said that in the absence of satisfactory proposals, HM Customs and Excise would have no alternative but to apply to the appropriate court to enforce the Confiscation Order.
15. On 22nd September 2003, Mr Deamer's solicitors responded that it was still their intention to seek a Certificate of Inadequacy. Subsequently, Moses J granted a legal representation order in respect of any application for such a certificate.
16. On 20th October 2003 there was, apparently, a telephone conversation between Mr Colin Cunio, a lawyer at HM Customs and Excise Solicitor's Office, and Mr Lowry -Mullins, in which the latter apparently stated that the claimant had "additional assets in the United States". Mr Lowry -Mullins also told Mr Cunio that attempts were being made to contact a representative of the US Customs and Excise and also Mr Deamer's American lawyer. Mr Cunio asked Mr Lowry -Mullins to provide a schedule of assets that had been seized by the US authorities as well as a schedule of any further assets held in the US at present by Mr Deamer or at any time since his arrest.
17. During the remainder of 2003 and throughout 2004 there was periodic correspondence between Mr Deamer's solicitors and HM Customs and Excise Solicitor's Office. The latter kept asking for news of any further information with regard to Mr Deamer's assets in the US. Mr Deamer's solicitors stated that they had received no information from either the US authorities or lawyers in the United States.
18. On 17th December 2004, Mr Lowry -Mullins wrote an e -mail to Mr Ogunfemi of HM Customs and Excise Solicitor's Office, indicating that they had received a communication from the US authorities. But he said he would "inform you once my inquiries are completed in relation to the above matter." On 21st February 2005, Mr Ogunfemi responded to Mr Lowry -Mullins, pointing out that over a year had passed since Mr Deamer's solicitors had sought this information and that an application for a Certificate of Inadequacy had not yet been filed. That letter continued:

"We understand your client will become eligible for parole in the early part of 2006. Please note that if there is no appreciable progress in this matter very soon, we shall invite the Magistrates' Court to convene an enforcement hearing at which the default sentence, which may be up to six years' imprisonment, may be imposed on your said client."

19. Mr Lowry -Mullins responded on 23rd February 2005, indicating that he had received some information from the United States of America and "we are following up a potential lead which we are finding somewhat difficult. This has only recently come to light and would assist Mr Deamer in his confiscation Certificate of Inadequacy proceedings." The letter indicated that everything possible was being done to obtain the information from the US authorities.
20. There was further correspondence in the spring and summer of 2005, but that did not advance the position. Then on 9th February 2006, the RCPO wrote to Mr Lowry -Mullins and stated that as no information had apparently been forthcoming from the US, the matter would be listed for an enforcement hearing at Southampton Magistrates' Court on 3rd April 2006. The letter stated that, in the absence of full payment of the outstanding amount, including interest, which made a total of nearly £7,400,000, the RCPO would be asking the court to invoke the claimant's default term of imprisonment.
21. Mr Deamer's solicitors responded to this letter on 15th February 2006. That letter stated:

"There has been protracted correspondence in this matter in which we repeatedly stated that we were pursuing evidence from the United States of America. We have obtained evidence from the USA and that is ongoing. You should be aware that Mr Deamer is not in a position to pay any of the outstanding amount and that is why we are applying for a Certificate of Inadequacy. However, before we can do this, we must be in possession of all relevant documentation, some of which was in the possession of the prosecution but was never disclosed to us. It is for that reason we need to pursue every avenue open in the US in order for an Equality of Arms at any subsequent High Court hearing."

22. Subsequently, Mr Deamer's solicitors obtained a representation order so that Mr Deamer could take advice from Queen's Counsel on the question of whether or not an application for a Certificate of Inadequacy should be made to the High Court. On 28th March 2006, Mr Deamer's solicitors wrote to the Southampton Magistrates' Court, asking that the proposed enforcement proceedings be adjourned. In the event, as I have already stated, the hearing took place on 4th April 2006 and Mr Deamer applied for the stay of the enforcement proceedings with the result that I have already indicated.
23. On 4th April 2006, the claimant was due for release on parole. I understand that the claimant remains in custody.
24. In her decision, the District Judge stated that the authorities made it clear that "mere passage of time is not enough. There must be some delay that is unjustifiable and unreasonable." As a proposition of law, I understand this is challenged by Mr Mitchell on behalf of the claimant. On the facts, the District Judge concluded that the period from 29th January 2000, when payment became due, until 24th May 2001, when the Receiver was discharged, should be, for the purposes of the application for a stay, disregarded. That was on the basis that it was proper for a Receiver to have been appointed and that the time allowed for a Receiver to get in assets was reasonable.
25. The District Judge then considered the period between 24th May 2001 and 22nd February 2006 when the RCPO requested enforcement proceedings in the Magistrates' Court. The District Judge referred to the correspondence between Mr Deamer's solicitors and the RCPO and its predecessor. She concluded that the correspondence did not suggest that the Customs and Excise had been "indolent". She noted that the Customs and Excise regularly sought information and made it clear on more than one occasion (in particular the 19th September 2003 and 21st February 2005) "that it was their continuing intention to seek enforcement of [the confiscation] order." Her decision continues:

"Although there is no specific request on behalf of Mr Deamer not to enforce, the tenor of the responses gives a clear prospect of progress in the recovery of assets that might meet the order."

26. The District Judge then found as follows:

"The Customs and Excise may have been naive in accepting the assurances given - especially as Mr Deamer's solicitors did not at any time respond to their requests for further details - but they cannot be said to have let this case become dormant. There was also held out the prospect of funds to discharge this order and I do not find - on the information available to this court - that waiting to try and realise these funds was unreasonable or unjustifiable."

27. The District Judge also found that there was nothing "cynical" or "sinister" in the decision of the RCPO to seek an enforcement order prior to Mr Deamer's release on parole.
28. The District Judge therefore concluded that she was not satisfied that the passage of time between 24th May 2001 and 22nd February 2006 constituted a delay that was "caused by the unreasonable, unjustifiable or unexplained behaviour of Customs and Excise that would amount to a breach of Mr Deamer's Article 6 right to a hearing in a reasonable time."
29. Mr Mitchell QC, on behalf of the claimant, submits that the regime of confiscation orders under the Drug Trafficking Act, including any orders that a person will be imprisoned in default of paying a confiscation order, constitutes a "coercive principle" as opposed to a "punishment principle". He notes that a confiscation order always stipulates within which time the sum ordered to be paid must be paid. In his submission, an enforcing authority has a duty to bring enforcement proceeding,s, as part of the "coercive principle", as soon as possible after the date for the payment of the confiscation order has passed. Further, he submits that enforcement proceedings, and a hearing to determine them, must be brought within a reasonable time, so as to comply with Article 6(1) of the ECHR. He submits it is the duty of the RCPO, as a public authority, to ensure that it does not act in a way which is incompatible with that Convention right.
30. Mr Mitchell also submits that in a case where the court imposes a substantial prison term (eg, 18 years) for the substantive offence, yet fixes a time for payment under a confiscation order that is much shorter than the prison term, (eg, nine months) then it is plainly contemplated by the court making the confiscation order that enforcement proceedings should be brought independently of the time of the substantive prison term and should be brought well before the expiry of any custody proportion of that prison sentence.
31. Mr Mitchell referred us in particular to three cases. The first is R (on the application of Lloyd) v Bow Street Magistrates' Court [2004] 1 Criminal Appeal Reports 11; secondly, R v Goring [2004] EWCA Crim 969, and thirdly, Crowther v United Kingdom ECHR 1st February 2005.
32. The decision in the Lloyd case establishes that Article 6(1) of the ECHR is applicable in the context of an application by a prosecuting authority to institute enforcement proceedings to commit a defendant to prison in default of a payment of a sum due under a confiscation order. At paragraph 14 of the judgment of Dyson LJ, he states that it is now clearly established that Article 6(1) applies to all stages of criminal proceedings including any confiscation proceedings culminating in the making of a confiscation order. Having considered a number of authorities, Dyson LJ concluded, at paragraph 24 of his judgment, that:

"A defendant enjoys the full benefit of all the rights conferred by Article 6(1) in all aspects of confiscation proceedings (including their enforcement by means of a summons for the issue of a warrant to commit in the Magistrates' Court."

33. At paragraph 25, Dyson LJ said that the defendant also enjoyed the benefit of the requirements that these proceedings for enforcement must be brought within a reasonable time. He states:

"It is potentially very unfair on a defendant that he should be liable to be committed to prison for non -payment of sums due under a confiscation order many years after the time for payment has expired, and long after he has been released from custody and resumed work and family life."

34. I interpose to note that in that case it was the fact that the defendant had long since left prison and been a free man.
35. In the following two paragraphs of his judgment, Dyson LJ acknowledged that the threshold for proving a breach of the reasonable time requirement is a high one and that in determining what is a reasonable time, all the circumstances of the case must be taken into account. Dyson LJ noted two particular factors to be taken into account:
36. (i) whether efforts had been made to extract the money by other methods, eg, by the appointment of Receivers;
37. (ii) whether the defendant had been evasive and avoided the diligent attempts to extract the money from him.
38. Dyson LJ concluded his judgment at paragraph 35 and 36, by saying:

"We agree entirely with [counsel for the prosecution's] submissions that the public interest requires that criminals be stripped of the proceeds of their criminal activities. That public interest is best served if those authorities whose task it is to force confiscation orders (a) take prompt steps to secure payment by 'civil procedures' and (if those fail) (b) take prompt steps to activate any terms of imprisonment in default. The longer authorities delay, the less likely it is that the offender will still have assets to meet the confiscation order (as that case illustrates).

36. If the authorities whose task it is to enforce confiscation orders are so slow in communicating with one another or in activating enforcement mechanisms that they become in breach of Article 6(1), then the appropriate remedy may well be (as in this case) that the weapon of imprisonment in default is lost. The sooner this is appreciated by all agencies of the Criminal Justice system the better."

39. I need not refer in any detail to the Goring case or the Crowther case because the principles are established sufficiently in the Lloyd case. Mr Mitchell submits that the District Judge erred in law in not applying the principles set out in the Lloyd case, or not doing so correctly.
40. Secondly, he submits that the District Judge erred in law by thinking it relevant that there was no prejudice to Mr Deamer, because even if the enforcement proceedings had been begun some time before, it would have made no difference as Mr Deamer would still have been in default and had to serve his imprisonment in default sentence.
41. Thirdly, Mr Mitchell submits that the District Judge erred in her interpretation of the correspondence. He submits that the District Judge's finding that the solicitors for Mr Deamer were always holding out a prospect of funds to discharge the confiscation order is manifestly wrong if one examines the correspondence carefully. Therefore, he submits, the conclusion that the RCPO was acting reasonably and justifiably in waiting to try and realise funds from the USA was not justified and was unreasonable.
42. Fourthly, he submits that the fact that the claimant did not apply for a Certificate of Inadequacy is irrelevant to the question of whether or not the RCPO discharged its obligation to bring enforcement proceedings within a reasonable time within Article 6(1). He submits that the RCPO should have followed what is now the National Guide of Best Practice and should have taken Mr Deamer back to the Magistrates' Court for enforcement proceedings much quicker.
43. Lastly, he submits that the District Judge was wrong and unreasonable in her conclusion that there was no "cynical" or "sinister" motive in the application by the RCPO for enforcement proceedings on the eve of the claimant's release on parole.
44. Generally, Mr Mitchell submits that in the context of the 1994 Act, the prosecuting authority is not acting with reasonable expedition unless,first, it can be shown that the prosecuting authority has made reasonable attempts to find assets to pay the confiscation order due and, secondly, having done so, it has concluded that there are none and then promptly starts enforcement proceedings. He says neither was done in this case.
45. Mr Perry for the Crown submits, first, that it is clear from the correspondence that the enforcement authority was seeking information on a regular basis in a case where there had been a finding that the claimant had available to him some £5.5 million in assets, although no -one knew where it was. Secondly, he submits that the District Judge was entitled to conclude from the correspondence that there were assets outside the jurisdiction in the US and Spain on which the solicitors for Mr Deamer were seeking further information. Thirdly, he submits that the enforcing authority said that it wished to be informed of this. Fourthly, he points out that the enforcing authority made it plain that it would take proceedings to enforce if nothing was forthcoming. He submits that in the context of the enforcement this could not be said to be unreasonable activity on the part of the RCPO. He submits it was reasonable for them to await the outcome of these inquiries on behalf of the claimant in this case and that the enforcement authority did sufficiently chase and made it clear when nothing was coming of those investigations that it would carry out the default proceedings.
46. The question of whether a person in Mr Deamer's position has been denied the benefit of his rights under Article 6(1), i.e. that relevant proceedings should be taken and concluded in a reasonable time, must depend upon all the circumstances of the case. The court considering the matter, such as the District Judge in this case, is duty bound to consider all the facts and to come to a conclusion on whether the delay was so long as to be unreasonable and so contrary to Article 6(1).
47. In this case, in my view, the District Judge cannot be criticised for her conclusion that the period up to the end of the appointment for the Receiver is unexceptional. As to the period when Mr Deamer's solicitors were apparently seeking evidence for the application of a Certificate of Inadequacy, it seems to me that they were trying to get information to back such an application. At the same time, the RCPO were hoping that this information would provide material to show that Mr Deamer indeed had assets to pay the confiscation order. I agree with the District Judge's tentative view that the RCPO might have been naive in this regard. But I have reached the firm conclusion that it cannot be said that the District Judge's finding on the facts was in any way unreasonable. The solicitors for Mr Deamer did indicate that investigations were still going on in the USA, even if they had produced no results.
48. In my view, it cannot be said that the District Judge's conclusion on the reasonableness of the RCPO's activity and their stance in relation to these investigations as either irrational or perverse or unreasonable.
49. Mr Mitchell made a more general submission that the order for a warrant to commit was generally unfair in all the circumstances of case. He emphasised the particular position that this claimant was in. In particular, he emphasised that there was, or must have been, in Mr Deamer's mind a reasonable expectation that, as he come up to his parole date, there would not be any action to enforce.
50. In my view, that is not a correct reading of the correspondence. It was made absolutely plain by the RCPO that if the funds were not forthcoming they would take enforcement proceedings. That was made clear in 2003 and again in 2005. Therefore, I come to the conclusion that the District Judge cannot be criticised in any way for her refusal to grant a stay and nor for her decision to grant a warrant for commitment. I would therefore dismiss this claim.
51. LORD JUSTICE MAY: I agree that the application for judicial review fails for the reasons which Aikens J has given. I agree that the District Judge's decision was, to put it at its lowest, a tenable one on the facts in the light of authority which, importantly, includes R (on the application of Lloyd) v Bow Street Magistrates' Court [2004] 1 Criminal Appeal Reports 11, and which the District Judge, in substance, applied.
52. I would only additionally record that Mr Mitchell QC touched on a number of other conceivable routes by which Mr Deamer's position might be judicially alleviated. Some of these would appear to require an application very far out of time to the Court of Appeal, Criminal Division; others an application to the Magistrates' Court. I would record, I hope helpfully, that insofar as Mr Mitchell may this morning have adumbrated an application to amend the grounds in the present proceedings, we indicated that we would not accede to that application made, as it would have been, at the very time of the hearing.
53. Mr Mitchell, Mr Perry, the application fails. Thank you very much.