QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL
B e f o r e :
| REGINA (SIMON PRICE)
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|THE CROWN COURT AT SNARESBROOK
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CROWN PROSECUTION SERVICE
Mr Michael Newbold (instructed by the Crown Prosecution Service "CPS") for the Interested Party
Hearing dates: 20 November 2019, 26 November 2019 and 3 December 2019
Crown Copyright ©
Mr Justice Freedman:
The procedural history
"There was no dispute as to the figure for the benefit which had been arrived at. The total amount was £2.34 million odd. It was made up by valuing the drugs at 80 per cent purity, at £1.9 million and various other items of expenditure, either through the bank, expenses, gifts and motorcars with some amounts for cash, wine, furniture and a gym. Property, by reason of disputed interests, was left out of account."
Proceeds of crime
"37. Both the wording and purpose of the 2006 Framework Decision are plain enough in this regard. It is obvious – and consistent also with Conventions such as the Strasbourg Convention – that the whole scheme is designed to extend, equally and without differentiation, both to value confiscation and to property confiscation systems. The domestic system here is a value based system – albeit it is perfectly capable of also extending to (and often will in particular cases extend to) specific items of property which are in actuality derived from crime. The point remains that the available amount, under the 2002 Act, can include property which may have no taint of criminality. That is the way the domestic scheme works. The link with criminality is provided by the link with benefit. For benefit is identified by reference to general criminal conduct or to particular criminal conduct: and a confiscation order for the recoverable amount may not exceed the amount of the benefit. Accordingly a value based scheme of this kind is comprehended in and respected by the 2006 Framework Decision. Since, self-evidently, Regulation 11, read with Regulation 3 of the 2014 Regulations, is seeking to give effect to Article 7, read with Article 2, of the 2006 Framework Decision, the 2014 Regulations are to be interpreted accordingly.
38. Moreover, the appellant's argument has difficulties even at a narrower level of interpretation. It is true that Regulation 11(2)(b)(ii) – with the introduced requirement (for whatever reason) of a good arguable case – must relate to property which "is the proceeds of the offence". But proceeds of an offence is then the subject of the interpretative provision – albeit not, by reason of the word "includes", a definition as such - contained in Regulation 3(2)(c). In particular, Regulation 3(2)(c)(ii) is, in our view, apt to extend to "clean" property, as being part of the available amount. The argument on behalf of the appellant would seem to deprive Regulation 3(2)(c)(ii) of purpose and effect and effectively would make it otiose. But there is no reason not to give full and wide effect to Regulation 3(2)(c)(ii). It therefore follows that there is no requirement, for the purpose of seeking a certificate, that the Crown must at that stage engage in an evidential tracing exercise seeking to show that a specified asset derives from criminal conduct. Indeed, given the evident intent of the 2006 Framework Decision to treat both systems of confiscation equally and given the evident intent to make recognition and enforcement relatively straightforward, it is difficult to comprehend why a value based confiscation jurisdiction should, at the stage of certification, then be intended by the 2014 Regulations to be required positively to engage in the potentially complex process of tracing in order to show that a particular asset derives from criminality" (emphasis added).
Judgment as a result of failure to comply with an unless order
The applicable law regarding relief from sanctions
"35…the more serious or significant the breach the less likely it is that relief will be granted unless there is a good reason for it. Where there is a good reason for a serious or significant breach, relief is likely to be granted. Where the breach is not serious or significant, relief is also likely to be granted.
36. But it is always necessary to have regard to all the circumstances of the case. The factors that are relevant will vary from case to case."
32. The case of Denton went on to say that the merits of the case will not generally be explored at the interim stage following failure to observe a peremptory order. However, there is an exception to this where the case can be shown as if on a summary judgment to be bound to succeed or to fail. The language used in this connection was in the case of HRH Prince Abdulaziz Bin Mishal Bin Abdulaziz Al Saud (Appellant) v Apex Global Management Ltd and another  UKSC 64 where Lord Neuberger said that the strength of a party's case is generally irrelevant in case management issues. However, there was a possible exception where a case was strong enough to obtain summary judgment. However, he cautioned that in order to avoid unfairness, the point as to merits must be signalled very clearly in advance.
33. This was applied in the case of R (Hysaj) v Secretary of State for the Home Department  EWCA Civ 1633. This was a case which decided that the merits of the appeal in the context of an application to extend time for bringing the appeal were in most cases not relevant to the exercise of the discretion. However, the Court of Appeal referred to the above-mentioned judgment of Lord Neuberger, saying the following:
"46. If applications for extensions of time are allowed to develop into disputes about the merits of the substantive appeal, they will occupy a great deal of time and lead to the parties' incurring substantial costs. In most cases the merits of the appeal will have little to do with whether it is appropriate to grant an extension of time. Only in those cases where the court can see without much investigation that the grounds of appeal are either very strong or very weak will the merits have a significant part to play when it comes to balancing the various factors that have to be considered at stage three of the process. In most cases the court should decline to embark on an investigation of the merits and firmly discourage argument directed to them. Here too a robust exercise of the jurisdiction in relation to costs is appropriate in order to discourage those who would otherwise seek to impress the court with the strength of their cases.
47. Support for that conclusion can be found in the recent decision of the Supreme Court in HRH Prince Abdulaziz Bin Mishal Bin Abdulaziz Al Saud v Apex Global Management Ltd  UKSC 64, in which the court had to consider the extent to which the merits of a claim or defence were relevant to granting relief from the sanction of striking out in default of compliance with an "unless" order. Lord Neuberger, with whom Lord Sumption, Lord Hughes and Lord Hodge agreed, held that, even in a case of striking out, the merits of the claim or defence were relevant only when they were so strong that there was no real answer to them, in other words, in cases where an application for summary judgment could be expected to succeed."
Application of law to the instant facts
Further submissions of the Claimant