England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION

		Royal Courts of Justice Strand, London, WC2A 2LL
		15 October 2013

MRS JUSTICE ANDREWS:

1. This is an appeal by the Lord Chancellor pursuant to Article 31 of the Criminal Service Funding Order 2007 ("the Funding Order") against the decision of Costs Judge Campbell (SCCO Ref 298/2012) dated 16 April 2013.
2. The decision was made on an appeal by the respondent, Mr Gulan Ahmed, a barrister, against a decision by the Legal Services Commission to pay him a fee under the Advocates' Graduated Fee Scheme on the basis of a Class B offence rather than on the basis of a Class K offence. Mr Ahmed's appeal was successful.
3. Mr Ahmed had been the defence trial advocate representing one Mario Liserre, who was charged on an indictment with conspiracy to contravene section 170 of the Customs & Excise Management Act 1979. The particulars of the offence allege that the defendant had conspired with others "fraudulently to evade the prohibition of a controlled drug of Class A, namely cocaine, imposed by section 3(1) of the Misuse of Drugs 1971, in contravention of section 170 of the Customs & Excise Management Act 1979".
4. Section 170 of the Customs & Excise Management Act 1979 is entitled "Penalty for Fraudulent Evasion of Duty, etc". It has two subsections. The relevant provisions are subsections (1)(b) and (2), which provide inter alia as follows:

"(1) If any person...

(b) is in any way knowingly concerned in carrying, removing, depositing, harbouring, keeping or concealing, or in any manner dealing with [goods of which any prohibition or restriction is for the time being in force under or by virtue of any enactment] and does so ..... to evade any such prohibition or restriction with respect to the goods, he shall be guilty of an offence under this section.

(2) Without prejudice to any other provision of the Customs & Excise Act 1979, if any person is in relation to any goods in any way knowingly concerned in any fraudulent evasion...

(b) of any prohibition or restriction for the time being in force with respect to the goods under or by virtue of any enactment he shall be guilty of an offence under this section."

5. It is immediately apparent that section 170(2) is extremely wide-ranging. In R v Neil [1977] Cr App Rep. 283, Griffiths LJ stated that its language is "so embracing and casts the net so wide that one is left to wonder what purpose is served by subsection (2) for it is difficult to think of any behaviour aimed at defrauding the Customs & Excise that would be caught by subsection (1). However, subsection (2) has consistently appeared in a similar form in a succession of Customs & Excise Acts as the final and sweeping provision... We are satisfied that it was inserted by the draftsman with the intention of casting his net as widely as words enabled him." One might be forgiven for thinking that this was a clear indication that subsection (2) is a general safety net, and that the substantive offence should normally fall to be charged under subsection (1). However, in practice the reverse is true: it is the norm for an indictment relating to the offence of importation of Class A drugs to charge the defendant with committing an offence under subsection (2).
6. It is possibly the fact that Mr Liserre was charged with conspiracy that led the Crown to make reference to section 170 generically, and not to indicate in the indictment whether the conspiracy was to commit an offence falling under subsection (1), subsection (2) or, possibly, under both.
7. It is quite clear from the language of section 170 that I have quoted that the activity of importing Class A drugs could equally appositely be charged as an offence under subsection (1) or subsection (2). If a defendant is knowingly concerned in fraudulent – which in this context means dishonest – evasion of a prohibition or restriction for the time being in force with respect to the goods under or by virtue of any enactment because he is involved in the unlawful importation of a Class A drug, he will inevitably also have been "dealing in any manner with goods of which any prohibition or restrictions for the time being [are] in force under or by virtue of any enactment" for the purposes of section 170(1)(b). In other words, if the substantive allegation is one of importation of Class A drugs and the defendant is found guilty, he would be guilty of an offence under subsection (1)(b) and guilty of an offence under subsection (2).
8. Part 6 of the Funding Order sets out classes of offences categorised from Class A, homicide and related grade offences, and Class B, offences involving serious violence or damage and serious drugs offences, right through to Class K, other offences of dishonesty, high value. Within the list of offences appearing under Class B are the following specified offences: fraudulent evasion of controls on Class A and B drugs, Custom & Excise Management Act 1979 section 170(2)(b) and (c). It is worth noting that Class B also includes the offence of illegal importation of Class A and B drugs, contrary to the Customs & Excise Management Act section 50. There is no specific mention of section 170(1) in Class B.
9. Classes F, G and K are entitled generically "Other Offences of Dishonesty". There is a list of offences which are stated to be always in Class F. These include fraudulent evasion, counterfeit notes or coins, Customs & Excise Management Act 1979, section 170(2)(b) and (c). The Order then goes on to specify certain offences which are in Class G if the value involved exceeds £30,000, Class K if the value exceeds £100,000, and in Class F otherwise. Among the offences listed under this category are:

fraudulent evasion of duty: Customs & Excise Management Act 1979 section 170(1)(b);

handling stolen goods: section 22 of the Theft Act 1968;

evasion of liability by deception: section 2 of the Theft Act 1978;

theft itself :section 1 of the Theft Act;

illegal importation not elsewhere specified: Customs & Excise Management Act 1979 section 50;

forgery under the Forgery & Counterfeiting Act 1981 section 1, and

fraudulent evasion not elsewhere specified: Customs & Excise Management Act 1979, section 170(2)(b) and (c).

10. Therefore, certain offences charged under section 170(2)(b) will fall within Class G, K or F depending on the value involved; almost certainly the value of the duty being evaded. These three Classes also embrace fraudulent evasion not otherwise specified under section 170(2)(b). Importantly, they also include what is described as "fraudulent evasion of duty: Customs & Excise Management Act 1979, section 170(1)(b)". By contrast with section 170(2), this is the only specific reference to section 170(1) in any of the lists in the various Classes in Part 6.
11. Part 1 of Schedule 1 to the Funding Order provides in section 3(1)(b) that conspiracy to commit an indictable offence falls within the same class as the substantive offence to which it relates.
12. Section 3(1)(e) provides that "where an entry in the table of offences specifies an offence as being contrary to a statutory provision, then subject to an express limitation in that entry that entry will include every offence contrary to that statutory provision whether or not the words of description in that entry are appropriate to cover all such offences." (my emphasis).

13. I have already referred to the fact that section 170(2)(b) is referred to in various places in Schedule 6 and different types of activity charged as offences contrary to that wide-ranging section may fall under different Classes. In a case where the offence charged under section 170(2)(b) is the fraudulent evasion of controls on Class A and B drugs, then that offence plainly falls under Class B and the value of the drugs is irrelevant. If the offence charged under section 170(2)(b) is a fraudulent evasion of duty, or a fraudulent evasion not elsewhere specified, then it falls under F, G or K depending on the value of the amount in question. If it is fraudulent evasion, counterfeit currency, it only falls under Class F and the amount of the counterfeit notes or coins is irrelevant. Thus, so far as section 170(2) is concerned, section 3(i)(e) does not operate to bring all offences under that sub-section under the same Class, because each entry in the list is expressly limited by reference to the nature of the specific criminal activity in question.

13. However, as I have already said, there is no specific reference to an offence under section 170(1)(b) anywhere in the lists other than the specific reference in Classes F, G and K. In the absence of any "express limitation" in that entry, section 3(i)(e) would operate so as to include in that reference any offence that is charged under section 170(1)(b), and the value involved would dictate which of those Classes was applicable.
14. Mr David Bedenham, who appears for the appellant in this case, submitted that whilst the indictment did not specifically refer to either subsections (1) or (2) of section 170, the Costs Judge should have found that section 170(2) was applicable. He submitted that it was Parliament's intention that Class B was intended to encompass any matter charged under section 170 that in substance amounted to evasion of controls on Class A and B drugs. That submission would have had a lot more force if the list under Class B had simply said "fraudulent evasion of controls on Class A and B drugs, Customs & Excise Management Act 1979 section 170" and stopped there, but it does not. Moreover, since the prosecution chose not to specify a subsection of section 170 to which the conspiracy related, it would have been impermissible for the Costs Judge to second-guess their intentions or to construe the indictment as bearing a limitation that was not apparent on its face. It is perfectly legitimate to construe this particular indictment as including conspiracy to commit an offence under section 170(1)(b).
15. Mr Bedenham further submitted that the regime for payment of fees is all about ensuring that all offences are specifically categorised, so that no particular offence will fall under more than one category, with a view to advocates receiving the same payment in like for like cases. He submitted that it cannot be right that one ends up with a situation where the manner in which an offence is indicted would lead to a choice on the part of the trial advocate as to which of a number of different Classes the offence falls under for the purposes of remuneration. I do not accept that submission.
16. It is quite clear that if a defendant is charged with two different offences and those two offences appear in different Classes, the trial advocate can choose which of the offences he is applying for payment in relation to, so that he can choose the one that will obviously pay him better if there is a difference in the level of remuneration. But it appears that this is the first, and possibly the only case so far in which the situation has arisen where there is a potential, at least, of the offence which was charged falling into more than one category. Mr Bedenham submitted that if one looks at the purpose of Parliament, that is a situation that simply should not be allowed to arise. His primary submission is that one can simply look at the substance of what was being charged, and he points to the specific words of the particulars of the offence that were stated in the indictment; those words being, in his submission, very closely connected with the language of subsection (2). Indeed they are. They refer to "fraudulently evading the prohibition of a controlled drug of Class A, namely cocaine". However, the particulars go on to say "in contravention of section 170". They do not say, as they could have done, "in contravention of section 170(2)" and as I have already observed, the act of fraudulently evading the prohibition of a controlled drug of Class A, namely cocaine, will inevitably fall within subsection (1)(b) as well as subsection (2).
17. So the question is what happens under the Graduated Fees Scheme if the charge could be interpreted equally well as applying to an offence under subsection (1)(b) as to an offence under subsection (2)? Mr Bedenham submitted that the taxing authority had a choice and that it was not a matter for the advocate to elect as to which subsection he categorised the offence under when it was plainly Parliament's intention that all offences of this nature should fall under Class B. In support of that submission, he submitted that if one scrutinises the lists under Classes F, G and K the specific offences under section 170 listed in those Classes are all to do with the fraudulent evasion of duty or similar, whereas, by contrast, if one looks at Class B, which is where certain drugs importation offences under section 170 and other statutory provisions are expressly listed, the value of the drugs has nothing to do with the level of remuneration or with the class into which the particular matter falls.
18. That is undoubtedly so, but it seems to me that that submission entirely ignores the impact of section 3(1)(e). Section 3(1)(e), as I have already stated, provides that where any entry in the table of offences specifies an offence as being contrary to a statutory provision, then subject to any express limitation in that entry the entry will include every offence contrary to that statutory provision whether or not the words of description in that entry are appropriate to cover all such offences. The only entry in the table of offences relating to an offence contrary to section 170(1)(b) is under Classes F, G and K, described as "fraudulent evasion of duty". Unless those words in some way expressly limit the offence, then all other offences indicted under section 170(1)(b) would also fall in that category.
19. Mr Bedenham submitted that the words "fraudulent evasion of duty" are words of limitation, but in my judgment they are merely words of description. They are setting out the generic form of offence under section 170(1), consistently with the title to that section, which is "fraudulent evasion of duty etc." There is no specific limitation in the language to make it clear that it is only certain types of offence under section 170(1)(b) that fall within that Class, and nothing in any other list to indicate where other offences charged under section 170(1)(b) would be categorised if Mr Bedenham's approach were right (unlike the different types of offence that can be charged under section 170(2)). Certainly there is nothing to point to a drugs offence charged under section 170(1)(b) falling within Class B. Accordingly, on the face of it, offences that are charged under section 170(1)(b) including but not limited to fraudulent evasion of duty, are in Class G if the value involved exceeds £30,000, Class K if the value exceeds £100,000 and Class F otherwise.
20. In this particular case the value exceeded £100,000 and therefore if the offence charged on the face of the indictment could be interpreted as falling under section 170(1)(b), as in my judgment it could, it would fall within Class K as well as potentially falling within subsection (2) and Class B. In those circumstances, the choice lies with the advocate and not the taxing authority. Once an advocate has chosen which of two equally viable classes the offence that his lay client has been charged with falls into, and has put in a claim which on the face of it is a valid claim under that Class, it is not open to the taxing authority to say that he should have made a claim under a different class - even though it may consider that a claim under that other Class might be more apposite or more in accordance with Parliament's intention. The paying authority can only interfere if the claim that was made was clearly made under the wrong Class, and in this case the claim made by Mr Ahmed was valid because it was made under one of the two equally apposite Classes that this indictment covered.
21. For those reasons this appeal is dismissed. I would only go so far as to say this. If it is indeed the intention of Parliament that all offences of evasion of controls on Class A and B drugs should fall under Class B, it should be relatively straightforward to remedy the drafting of the Funding Order so as to ensure that this problem does not arise again in the future.