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England and Wales High Court (Queen's Bench Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Queen's Bench Division) Decisions >> Serious Organised Crime Agency v Bosworth & Anor [2010] EWHC 645 (QB) (26 March 2010)
URL: http://www.bailii.org/ew/cases/EWHC/QB/2010/645.html
Cite as: [2010] EWHC 645 (QB)
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QUEEN'S BENCH DIVISION
Strand, London, WC2A 2LL |
||
B e f o r e :
(sitting as a Judge of the High Court)
____________________
| SERIOUS ORGANISED CRIME AGENCY |
Claimant |
|
| - and - |
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| DAVID IAN BOSWORTH DAWN ELLENOR WALKER |
Respondents |
____________________
Michael Melville-Shreeve (instructed by Messrs. Howell Hylton) for the first respondent
The second respondent appeared in person.
Hearing dates: 9, 10 and 11 March 2010
____________________
Crown Copyright ©
- In this action the Serious Organised Crime Agency ("SOCA") sought what was described in the claim form issued under CPR Part 8 against the respondents, Mr. David Bosworth, and his former wife, Miss Dawn Walker, this relief:-
- As the details of the alleged basis of the claim were set out in the claim form this:-
- I shall come to the evidence of Mr. Thompson.
- The property alleged to be "recoverable property" was listed in a schedule to the claim form as follows:-
- The remedy sought by SOCA against Mr. Bosworth and Miss Walker, the making of a "recovery order", was created by Proceeds of Crime Act 2002 ("POCA"). It is therefore necessary to consider the relevant provisions of POCA in order to determine when, and in what circumstances, it is appropriate to make such an order, and in relation to what property.
- By s.266 of POCA it is provided, so far as is presently material, that:-
- Consequently, if the court is satisfied that property is "recoverable", it must, subject to the possible issues whether to do would not be just and equitable, as defined, or in breach of any of the Convention rights, make a recovery order vesting the property in question in the trustee for civil recovery. A recovery order is thus, potentially, draconian in its effect. As a result, it is appropriate to consider with great care what needs to be demonstrated in order to prove that particular property is "recoverable".
- The concept of property which is "recoverable" is dealt with in s.304 and s.305 of POCA:-
- It thus appears that any property obtained "through unlawful conduct" is, and will forever remain, recoverable property, subject to a provision to which I am about to come, and so is any property obtained by use of "the original property", using that expression in the sense defined in s.305 of POCA, through a potentially infinite number of transactions.
- One of the few events which can stop the relentless pursuit of recoverable property is that provided for in s.308(1) of POCA:-
- In the result, the vital question in relation to any particular property in respect of which a recovery order is sought is, is it, or does it represent any manifestation of, "property obtained through unlawful conduct"?
- S.242 of POCA deals with the question of the circumstances in which property is obtained through unlawful conduct:-
- For the purposes of POCA, "property" is defined in s.316(4) as follows:-
- Since, for the purposes of POCA, "property" means all forms of property, and it can be "obtained" by or in return for "unlawful conduct", an important aspect of the question posed above as the vital question is the question, "what conduct is unlawful"?
- The answer to that latter question given by POCA is to be found in s.241(1):-
- Two questions have arisen in decided cases which should be noticed at this point. One is whether it is necessary, in order to justify the making of a recovery order, for it to be demonstrated that particular property was obtained through the commission of a particular crime or series of crimes. The other concerns the evaluation of evidence.
- The first of the two matters which I have identified was considered by the Court of Appeal in Olupitan v. Director of the Assets Recovery Agency [2008] Lloyd's Rep FC 253. The leading judgment in that case was that of Carnwath LJ, with whose conclusion on the point in question the other members of the Court of Appeal concurred. The material parts of the judgment of Carnwath LJ are paragraphs 13 18, inclusive, and paragraph 22, at pages 257 and 258:-
- Those views do, in fact, impact upon the second of the two questions which I have identified, that in relation to evidence.
- By s.241(3) of POCA it is provided that:-
- In In re D [2008] 1 WLR 1499, Lord Carswell, delivering the leading speech in the House of Lords, observed, in paragraphs 27 and 28 on page 1509:-
- The speeches of the members of the House of Lords in that case were handed down after the judgments of the Court of Appeal in Director of the Assets Recovery Agency v. Szepietowski [2008] Lloyd's Rep FC 10. While my attention has, rightly, been drawn to some observations of Moore-Bick LJ in the latter case, in paragraph 112 on page 25, the passage which I have just quoted is, perhaps, a healthy reminder of the balancing exercise which needs to be undertaken by a trial judge in evaluating evidence. What Moore-Bick LJ said was:-
- It is, perhaps, also helpful to have in mind the latter part of that passage, in particular the penultimate sentence.
- The types of cases in which a recovery order might be sought are, no doubt, infinitely various. The most obvious case, plainly, is that in which the party against whom an order is sought has been convicted of a particular crime, and the property sought to be recovered can be shown, directly, to be the proceeds of that crime. However, the further away one gets from such a straightforward example, the less strong the case for a recovery order. Just as a matter of logic, if no particular crime can be shown on the evidence, there is an obvious difficulty in proving that particular property was obtained from unlawful conduct. A recovery order is not in the nature of a confiscation of the assets of a criminal as a penalty because he has been convicted of an offence. It is an order which must be made where the evidence shows that particular property was obtained through unlawful conduct. That means, first, that it must be proved that there has been unlawful conduct. Absent unlawful conduct there is no power under POCA to make a recovery order. Assuming evidence which is accepted that there has been unlawful conduct, there must then be a link between the unlawful conduct and the property in respect of which the recovery order is sought. In relation to each of these issues it is, as it seems to me, necessary to recognise that, on particular facts, the heightened examination of the evidence contemplated by Lord Carswell might be appropriate. To allege, against someone who has not been convicted of any criminal offence, that he or she has nonetheless engaged in unlawful conduct, as defined in POCA, is a serious matter. In effect the allegation is that the person in question has committed crime. Again, if what is sought to be made the subject of a recovery order is effectively the vast bulk of the assets of the person against whom the order is sought, the consequences, in financial and personal terms, if the order sought were made, would be likely to be catastrophic.
- Before departing from the consideration of the legal principles to be applied in this action, it is convenient to notice some observations of Kerr LCJ, sitting in the Court of Appeal of Northern Ireland in The Director of the Assets Recovery Agency v. Lovell [200] NICA 27. Those comments relate to the evasion of income tax and National Insurance contributions. What he said was:-
- The decision in The Director of the Assets Recovery Agency v. Lovell, being a decision of the Court of Appeal of Northern Ireland, is not binding upon me. With the greatest of respect to the Court of Appeal of Northern Ireland, it is difficult to understand the view expressed by Kerr LCJ. He did not mention specifically in his judgment, which was the judgment of the court, any provision of any taxation statute which created any criminal offence, or any common law offence. The closest which he seemed to come to explaining what was in his mind was in paragraph 25 of his judgment, where he referred to the evidence in that case that Mr. Lovell had never made an income tax return and had never paid any sum in respect of income tax or National Insurance contributions. However, failing to make income tax returns of his income would not appear to have had the effect that he obtained anything. Rather it would seem that that failure merely did not set in train a process by which he would have been required to pay whatever income tax and National Insurance contributions was properly due from his lawful (on this hypothesis) earnings. Consequently he retained sums which he would otherwise have had to pay to settle his debts to HM Revenue and Customs. The sums which he might have used to settle his liabilities were his already, not assets which became his because he had not filed a tax return or not paid income tax or National Insurance contributions properly due to HM Revenue and Customs.
- I have already quoted the material terms of the claim form issued in this action. Essentially the reader was bidden to find full particulars of the claim of SOCA in the witness statement of Andrew Thompson dated 28 October 2008. It does not seem to me that it was in fact helpful for SOCA to approach the need to explain the nature of its case in that way. Mr. Thompson described himself, in the witness statement, as a "Financial Investigator and a member of staff of the Serious Organised Crime Agency". Unsurprisingly, the witness statement was not intended as a summary exposition of the nature of the case of SOCA, but as evidence in support of the case. It ran to some 24 pages of main text, to which was annexed a substantial exhibit, AT/5. That exhibit included 468 pages. In my judgment it was not just, or fair, for SOCA to serve a 24 page witness statement and 468 pages of exhibited documentation and to say, in effect, "if you read all of that, you will be able to work out what is the case which you have to meet." This is not simply a criticism of a technical nature, for, as I shall explain, there was a vagueness about what the case of SOCA actually was, and that did make it more difficult than it should have been for Mr. Bosworth and Miss Walker to identify that upon which they should each focus in resisting the case.
- The issue of the claim form in this action under CPR Part 8 was in accordance with the relevant Practice Direction. Had the claim form been issued under CPR Part 7, it would have been necessary for there to have been Particulars of Claim either endorsed on the claim form or served separately. By CPR Part 16.4(1) it is provided, so far as is presently material, that:-
- Such a concise statement in the present case would have been of much assistance to the respondents, in directing their focus on the case which they had to meet, and to the court. While SOCA cannot be criticised for issuing a claim form under CPR Part 8, it would at least have been helpful if it had considered whether it was appropriate in the circumstances of the present case to have sought a direction from the court for the action to proceed as if commenced under CPR Part 7. Had consideration been given to that matter, I think that it is likely that the conclusion would have been that such a direction should have been sought in this case. Certainly when, during the course of the trial, I raised the question whether Particulars of Claim might be helpful, Mr. Stephen Hellman, who appeared on behalf of SOCA, seemed to contemplate that such a statement of case might have been useful.
- In his witness statement dated 28 October 2008, at paragraph 3.1, Mr. Thompson set out what he described as "Summary of Claimant's Case":-
- Thus at that stage the unlawful conduct complained of appeared to be handling stolen goods, dealing in contraband tobacco and/or money laundering. I say, "appeared to be" because at paragraph 4.16 of the first witness statement of Mr. Thompson appeared this:-
- It is unclear why that passage was included in the first witness statement of Mr. Thompson. He did not, in terms, suggest that Mr. Bosworth had stolen whichever bottles of champagne were said to have had necks in a condition consistent with the security tags having been forcibly removed. Nor did Mr. Thompson suggest that any of the bottles had actually been stolen and that Mr. Bosworth had handled them, knowing or believing them to have been stolen.
- Equally obscure were the reasons for paragraphs 4.19 and 4.20 of Mr. Thompson's first witness statement, which followed the rubric "Previous allegations of unlawful conduct":-
- No conclusion was sought to be drawn in terms by Mr. Thompson concerning what was said in either of these paragraphs. However, the references to the facts alleged, and the rubric beneath which these paragraphs appeared, at least made it unclear whether it was going to be contended on behalf of SOCA that these allegations had some relevance to the relief sought in this action. Unless that were the case, the only obvious purpose of including the allegations in paragraphs 4.19 and 4.20, neither of which resulted in any prosecution, would seem to be to cast aspersions upon the character of Mr. Bosworth by innuendo.
- In the course of opening the case of SOCA Mr. Hellman expressly eschewed any reliance upon the contents of paragraphs 4.16, 4.19 and 4.20 of the first witness statement of Mr. Thompson. If there had been properly pleaded Particulars of Claim, no one could have been misled into thinking that the matters in these paragraphs were of relevance to the case against Mr. Bosworth and Miss Walker. However, as it was, Mr. Bosworth, in his first witness statement in answer to the first witness statement of Mr. Thompson, felt it necessary to deal with them.
- Mr. Thompson made a second witness statement in answer to the first witness statement in this action of Mr. Bosworth. That statement was dated 11 June 2009. At paragraph 3.56 Mr. Thompson again set out a summary:-
- That summary appeared to suggest that SOCA wanted to pursue an alternative case as to the alleged unlawful conduct, namely evasion of income tax.
- No application was made on behalf of SOCA at the date of the second witness statement of Mr. Thompson, or at any point before trial, for permission to amend the endorsement on the claim form either to include reference to tax evasion as alleged unlawful conduct, whether in addition, or as an alternative, to handling stolen goods or trafficking in contraband tobacco, or to include reference to the second witness statement of Mr. Thompson.
- Mr. Michael Melville-Shreeve, who appeared on behalf of Mr. Bosworth, made plain, at paragraph 5 of his written skeleton argument, that he interpreted the case against Mr. Bosworth as depending, and depending only, on the allegations of fraudulent evasion of tobacco duty and handling stolen goods.
- In his first witness statement Mr. Thompson gave an account of the circumstances which resulted in Mr. Bosworth, as was not in dispute, being tried at Truro Crown Court in April 2008 on charges of handling stolen goods:-
- As I understand it, of the 300 or so items found in the premises of Mr. Bosworth the only ones which were said, at his trial, to have been stolen were the eighteen originating with Cornwall Pearl, the three belonging to Mrs. Dymond, and the nineteen belonging to Mr. Goodings, thus a total of 40 items, or about 13.33% of the total. Mr. Melville-Shreeve suggested that at the trial in the Crown Court rather less than 40 items of allegedly stolen jewellery were positively identified as having been stolen, but there was actually no evidence before me on that point.
- The significance in this action of the trial of Mr. Bosworth on charges of handling stolen goods was obscure for two completely different reasons. The first was that Mr. Bosworth was acquitted on 13 April 2008 of all charges. The second was that the items alleged stolen had been recovered, so it must follow that Mr. Bosworth had not obtained anything as a result of acquiring possession of the stolen goods.
- Mr. Hellman submitted that it was immaterial in this action that Mr. Bosworth had been acquitted at his trial on charges of handling stolen goods. The question, he submitted, was whether I, on the material put before me, was satisfied, on the balance of probabilities, that he had been guilty. Why that mattered, given that it was plain that Mr. Bosworth had obtained nothing as a result of handling the stolen goods alleged, assuming that he had done so, was that I should infer, from handling the stolen goods the subject of the charges, that Mr. Bosworth had handled stolen goods on previous occasions, and that the assets which he had in December 2005 in respect of which a recovery order was sought had been obtained, at least in part, by that previous handling of stolen goods.
- I shall come to consider the evidence relevant to the issue of whether Mr. Bosworth was guilty of the charges of handling stolen goods which he faced in the Crown Court. For the present it is appropriate to continue an examination of the case of SOCA.
- Apart from the issue of handling stolen goods, as I understood it, the primary case of SOCA against Mr. Bosworth was that he had also been guilty of fraudulently evading the payment of duty on tobacco, contrary to Customs and Excise Management Act 1979 s.170. The evidence in support of that allegation was set out in the first witness statement of Mr. Thompson as follows:-
- 100 x 50g bags of Golden Virginia Tobacco in a black bag in the back of the car;
- 200 Benson and Henson cigarettes contained in the same bag as the tobacco above;
- A further 100 x 50g bags of Golden Virginia Tobacco from the rear of the vehicle;
- MOT certificate and insurance documents in the First Respondent's name for the vehicle;
- A number of keys. One of the keys was marked '98'.
- Although Mr. Bosworth was charged with offences of fraudulently evading tobacco duty, in the event those charges were dropped. The prosecution offered no evidence on the relevant charges and it was directed that Mr. Bosworth be acquitted on all counts.
- In the circumstances the same two reasons which I have identified as making it obscure what was the case of SOCA in relation to the allegations of handling stolen jewellery applied equally to the allegations of fraudulently evading tobacco duty. Mr. Hellman gave the same answers in respect of these points when made concerning the allegations of fraudulently evading tobacco duty as he had concerning the allegations of handling stolen jewellery.
- In the end, therefore, the primary case for SOCA was simply that it should be inferred, from the facts underlying the charges of handling stolen jewellery and those underlying the charges of fraudulently evading tobacco duty, first, that he had habitually handled stolen jewellery and evaded tobacco duty on occasions prior to December 2005, and, second, having regard to evidence to which I shall come, that, essentially all of his assets and those of his former wife as at December 2005 had been obtained through unlawful conduct.
- The desired alternative case of SOCA foreshadowed in the second witness statement of Mr. Thompson seemed to amount to little more than this: in the light of the evidence of Mr. Bosworth that he had evaded income tax in the past and that that was the source of the wealth which SOCA contended was unexplained, he had, on his own evidence, obtained that wealth through unlawful conduct.
- I have already commented on the difficulty of analysing not paying one's debts out of available assets as "obtaining" those assets.
- Quite apart from that, really no attempt was made by SOCA to prove positively that Mr. Bosworth had evaded income tax. To the contrary, in his second witness statement, as we shall see, Mr. Thompson sought to cast doubt upon the fact that tax evasion had occurred. It appeared that this desired secondary case was very much a fall-back position. Certainly no effort was made by Mr. Thompson to link any particular asset of Mr. Bosworth or Miss Walker to the evasion of income tax.
- Following some discussion as to the need for an application on behalf of SOCA to amend the endorsement on the claim form in order to pursue any case that the unlawful conduct complained of on the part of Mr. Bosworth was tax evasion, Mr. Hellman made an application for permission to amend to include in the endorsement a reference to a document entitled "Statement of criminal conduct alleged against David Ian Bosworth" ("the Statement"). The Statement was a document produced by Mr. Hellman and was intended to set out concisely the case which SOCA desired to pursue against Mr. Bosworth. The first five paragraphs of the Statement summarised the case based on fraudulent evasion of tobacco duty and handling stolen goods. Paragraphs 6 to 14 inclusive, covering three pages, set out the case which SOCA wished to pursue, as it was put, "Further or alternatively", against Mr. Bosworth in relation to "Cheating the Public Revenue". That part of the Statement included, in paragraph 9, a full-blown attack on a settlement which Mr. Bosworth had reached on 31 January 2002 with the Commissioners of Inland Revenue ("the Commissioners"), the body responsible at the material time for the collection of income tax, to pay £40,000 in respect of undeclared income in the tax years 1993 1994 to 1998 1999, inclusive. That attack was expounded over seven sub-paragraphs covering a page and a half of text. It really amounted to contending that Mr. Bosworth had not been frank with the Commissioners and had induced the Commissioners to enter into the settlement as a result of misrepresentations. At paragraph 13 of the Statement was set out a case, not previously adverted to, that only a proportion of sums which were in fact applied out of untaxed income to the purchase of property was recoverable, and suggesting that, "The court might adopt a "broad brush" approach to calculating the portion of the mixed property which counts as recoverable property say 25% of the value of the item of Property in question or alternatively put the matter back for more precise calculation".
- Mr. Melville-Shreeve objected to the grant of permission to amend. He submitted that, had it been made clear that SOCA wished to challenge the circumstances in which Mr. Bosworth had made the settlement with the Commissioners, something which could not be deduced from the second witness statement of Mr. Thompson, he would have wished to call as a witness Mrs. Dallimore, the Inspector of Taxes with whom the settlement had been negotiated. As the application for permission to amend was only made on the second day of the trial, after the closure of the case of SOCA, an adjournment would be necessary, if permission to amend were granted. Mr. Melville-Shreeve also submitted that the issues sought to be raised by paragraph 13 of the Statement were entirely new and would necessitate considering aspects which had not previously been relevant and which there would be no proper opportunity to consider without an adjournment. He made plain that his client did not want an adjournment, given the length of time matters had already been outstanding.
- I accepted the submissions of Mr. Melville-Shreeve and refused permission to SOCA to amend the endorsement on the claim form. The case which Mr. Bosworth and Miss Walker had to meet was thus that which could be discerned from the first witness statement of Mr. Thompson, which did not include any suggestion that Mr. Bosworth had been engaged in unlawful conduct in the form of tax evasion.
- No suggestion was made as against Miss Walker that she personally had been engaged in any unlawful conduct at all. She was a party to this action simply because it was contended on behalf of SOCA that the source of the funds in the account ("the Portman Account") numbered 5321068-8 in the name of Miss Walker held with Portman Building Society was unlawful conduct on the part of Mr. Bosworth, and that such was also the source of the funds out of which the property in Spain held in the joint names of Mr. Bosworth and Miss Walker, Edificio Nautilius, essc B, 5th Planta, Puerta 20B, 03710 Calpe, Alicante ("the Spanish Property"), had been acquired. It was accepted that the immediate source of funds in the La Caixa bank account numbered 2000040997 in the name of Miss Walker ("the La Caixa Account") was income from the letting of the Spanish Property, but the balance in that account was claimed as recoverable property as being income derived from the application of funds alleged to be obtained by unlawful conduct to purchase the Spanish Property.
- Miss Walker herself alleged that she had an equitable interest in the property at 4, Penkernick Close, Newlyn ("the Newlyn Property") as constructive trustee. That contention was disputed on behalf of SOCA.
- It was difficult to avoid the conclusion that the essential basis for the claims made in this action was simply that Mr. Bosworth had been caught in possession of assets for the lawful acquisition of which he could not satisfy SOCA. In my judgment, the effect of the material provisions of POCA is not that a person has to satisfy SOCA, or anyone else, that a particular asset had been acquired out of funds obtained lawfully. The true position is that, if SOCA alleges that particular property is recoverable property, it has to prove, on a balance of probabilities, that that property was obtained by unlawful conduct. In the course of considering the evidence in a particular case, the ability, or not, of a person against whom SOCA is seeking a recovery order to show what was the source of the funds out of which the property was acquired, and that that source was not unlawful conduct, is likely to be relevant. But as Sullivan J pointed out in R (Director of Assets Recovery Agency) v. Green, and the Court of Appeal approved in Olupitan v. Director of the Assets Recovery Agency, "A claim for civil recovery cannot be sustained solely on the basis that a respondent has no identifiable lawful income to warrant his lifestyle", or, I would add, solely on the basis that a respondent has not demonstrated that the funds used for the acquisition of particular property were acquired lawfully. In each case, it is necessary to consider the evidence put before the court. Consequently, in the present case it is necessary to consider the evidence which was adduced before me and to indicate the conclusions which I have reached in the light of that evidence.
- The only evidence adduced on behalf of SOCA was that of Mr. Thompson in the two witness statements which I have mentioned and the documents exhibited thereto. Mr. Thompson was not put forward as an expert witness, and no attempt was made to comply with the requirements of CPR Part 35 appropriate to be met if he was to be put forward as an expert.
- Mr. Thompson did not profess personal knowledge of any of the matters alleged to justify the conclusions that Mr. Bosworth had been guilty of the charges of handling stolen goods of which he had in fact been acquitted, or that he had been guilty of the charges of fraudulently evading tobacco duty which had been dropped.
- What Mr. Thompson did do in his witness statement was summarise his understanding, based on what he had been told by unidentified others, of what were the facts which were considered to have justified the prosecutions. He also commented upon the financial circumstances and property transactions of Mr. Bosworth and his former wife from time to time and expressed his conclusions from his understanding of the relevant facts. That might have been appropriate for someone who was called as an expert, but it was not appropriate for a witness in respect of whom no application to adduce expert evidence had been made. Mr. Thompson also expressed, in his witness statements, his views as to whether the evidence of Mr. Bosworth, and others, was credible and should be accepted. That was manifestly inappropriate as arrogating to himself the function of the court in relation to the assessment of the evidence led before the court.
- All, in the end, I think that one could derive from the evidence of Mr. Thompson which was material to any issue in this action was his summary of the evidence which led to the prosecution of Mr. Bosworth and the contemporaneous documents which were exhibited to those statements.
- It was, I think, appropriate for me to consider, so far as I could, the evidence relating to the charges of handling stolen goods of which Mr. Bosworth was acquitted. The evidence for SOCA was that the items which I have mentioned which were in fact stolen had been found in the house of Mr. Bosworth when that house was searched. It was not in dispute before me that the items had been found where they were alleged to have been found, and that they were in fact stolen. Mr. Bosworth's account in his first witness statement, dated 28 May 2009, was that he had been in business as a dealer in second-hand goods from premises at 47, Market Jew Street, Penzance ("the Business Premises"), under the name "Fair Deals" since about 2000. As part of his business he bought and sold gold jewellery. He went on:-
- Mr. Bosworth's case at his criminal trial, and his case before me, was that he had purchased the jewellery which had in fact been stolen innocently, not knowing them to be stolen, or having any particular reason to suspect that they had been stolen. His acquittal meant at very least that the jury at his trial did not feel able to rule out the possibility that what he said was true. While it seems that at his trial there was evidence from other traders supporting at least the possibility that what he said was true, the most important evidence on the point must have been his own. Consequently the verdict of the jury must have meant at least that they did not feel they could disbelieve him.
- In my judgment the submission of Mr. Hellman that the acquittal of Mr. Bosworth at his trial on the charges of handling stolen goods should simply be disregarded is not acceptable. It would be a bold judge who took the view that he or she was uniquely able to decide who was telling the truth and who not. Judges have to do their best to determine that issue frequently, but no one is infallible. Common sense dictates that it must be relevant, in assessing whether to accept the evidence of a witness, that others who have heard him give the same account of the same events at least decided that they could not be sure that what he was saying was not true, and may have decided positively that he was telling the truth.
- It is correct, as Mr. Hellman submitted, that in this action the question was not whether I was satisfied so as to feel sure that Mr. Bosworth was guilty of the charges of handling stolen goods, but whether I concluded on a balance of probabilities that he was guilty. The nature of the allegations against Mr. Bosworth in relation to the handling of stolen goods meant that, he being of good character, that heightened examination of the evidence of which Lord Carswell spoke was appropriate in reaching a conclusion on the balance of probabilities.
- Mr. Bosworth was called to give evidence, and he was cross-examined by Mr. Hellman. Mr. Bosworth struck me as not very intelligent and liable to become confused. However, he accepted in cross-examination that he had misled his accountant as to the profits generated by his businesses from time to time and had sought to mislead the Commissioners as to his earnings. In addition, he had completed a statement of his income and assets as at 31 January 2001 required by the Commissioners inaccurately by understating, significantly, his assets. These elements of dishonesty Mr. Hellman relied upon heavily in urging me to find that Mr. Bosworth had indeed been guilty of handling stolen jewellery and of fraudulently evading tobacco duty. It is obviously possible that an individual might be incapable of acting honestly in any sort of transaction, so that he or she always acted dishonestly. However, it is, perhaps, more likely that those inclined at all to act dishonestly are selective in their dishonesty. It may also be the case that some kinds of dishonesty, of which a paradigm could be evasion of tax, are regarded in some quarters as less socially unacceptable than others. Consequently, it does not seem to me that it would be appropriate for me to conclude simply from the facts, of which I am satisfied, that Mr. Bosworth, as he admitted in a rather general way, evaded his income tax liabilities, or at least sought to do so until detected, and that he completed the statement of income and assets required by the Commissioners inaccurately, that he in fact handled stolen jewellery, knowing or believing it to have been stolen.
- It was suggested to Mr. Bosworth in cross-examination only in the most formalistic way that he had in fact handled stolen goods, knowing or believing them to have been stolen. That suggestion he roundly rejected.
- It was a curious feature of this action, on the case for SOCA, that Mr. Bosworth had not sought himself to turn to account the stolen jewellery in his possession by selling it to anyone else. The evidence suggested that some, at least, of the stolen jewellery might have been in the possession of Mr. Bosworth for years at the date of recovery by the police. One might have thought that someone who was seeking to fund his lifestyle, or at least a significant part of it, by handling stolen jewellery would have sought to sell on that which he had received. However, there was no evidence of that in the present case in relation to Mr. Bosworth.
- In all of the circumstances I did not feel able to conclude, on the material put before me, that Mr. Bosworth had in fact been guilty of the charges of handling stolen goods of which he had been acquitted by the jury.
- Mr. Thompson accepted in cross-examination that, apart from the evidence which I have summarised, there was no evidence of which he was aware which suggested that Mr. Bosworth had ever handled stolen goods, knowing or believing them to have been stolen.
- If Mr. Bosworth was a serial handler of stolen goods, maintaining his lifestyle by that activity, or at least seeking to make a significant contribution to that lifestyle by that activity, such that all of his assets in December 2005 had been acquired from handling stolen goods, perhaps in conjunction with fraudulently evading tobacco duty, it is surprising that he had not come to the notice of the police in the 43 years of his existence up to the date of his arrest.
- Consequently, I was not satisfied that SOCA had discharged the burden upon it of satisfying me that Mr. Bosworth had ever committed an offence of handling stolen goods, knowing or believing them to have been stolen.
- So far as the offences alleged against Mr. Bosworth of fraudulently evading tobacco duty were concerned, on the material summarised in the first witness statement of Mr. Thompson in paragraphs 4.1 to 4.8 inclusive, one could well understand the decision to prosecute Mr. Bosworth. What was quite impossible to understand, without some explanation, was the decision to offer no evidence in relation to those charges, so that acquittals were directed. Mr. Melville-Shreeve asked Mr. Thompson in cross-examination whether he was aware that that decision had been made following a Public Interest Immunity hearing in the Crown Court. That did seem to be the position. However, Mr. Hellman objected to Mr. Thompson telling me in open court what ruling had been made by the judge on that hearing, and the result was that, so far as the evidence led in this trial was concerned, the decision to abandon the prosecution of Mr. Bosworth on charges of fraudulently evading tobacco duty was wholly unexplained. Mr. Hellman submitted that it was immaterial to the case of SOCA what had in fact been the reasons for the decision to abandon the prosecution of Mr. Bosworth on charges of fraudulently evading tobacco duty. He contended that I should ignore the decision not to pursue the prosecution, and reach a decision on the other material put before me. Again, it did not seem to me that that course was acceptable. It would be quite wrong for me to ignore the knowledge that, for whatever reason, SOCA choosing not to tell me what the reason or reasons in fact were, the decision had been made not to pursue the prosecution. That decision made it obvious that the prosecuting authorities knew something, or formed an opinion, which I had not been told, but which, in their view, meant that the prosecution should not continue. Something caused the prosecuting authorities to take the view that, notwithstanding that the evidence which was put before me in relation to the charges of fraudulently evading tobacco duty as summarised in paragraphs 4.1 to 4.8 inclusive of the first witness statement of Mr. Thompson indicated that there was a case fit to go before a jury, actually the prospects of obtaining a conviction were slight or non-existent.
- Mr. Bosworth denied that he had sought to evade tobacco duty. In his first witness statement he made these comments on the allegations in paragraphs 4.1 to 4.10 inclusive of the first witness statement of Mr. Thompson:-
- Mr. Bosworth's defence thus was that he had no knowledge of the tobacco found in his car or of the tobacco found in either of the garages. He maintained that Mr. Chalker had contended that the tobacco found in the car belonged to Mr. Chalker. It was not in dispute that Mr. Chalker had said that, albeit some 11 months after the tobacco was seized. Nonetheless, by making that assertion Mr. Chalker had exposed himself to the possibility of being prosecuted for fraudulent evasion of tobacco duty.
- Later in his first witness statement Mr. Bosworth said:-
- Mr. Bosworth was not cross-examined on the contents of paragraph 2.93 of his first witness statement.
- A witness statement dated 22 December 2005 made by Mr. Jack was included in the documents put before the court as attachments to the first witness statement of Mr. Thompson. In his witness statement Mr. Jack said that he did not keep any items in either of the two garages he sub-let to Mr. Bosworth. He also said that he did not hold a key to garage 98, but he did hold a spare key to garage 125.
- Mr. Jack was not called to give evidence at this trial. Mr. Hellman relied upon the witness statement of Mr. Jack, as he was entitled to, pursuant to the provisions of Civil Evidence Act 1995.
- Mr. Melville-Shreeve submitted that, Mr. Jack not having been called to give oral evidence, the weight to be attached to his witness statement was limited, not least because Mr. Bosworth had been called to give evidence on his account, contradicting Mr. Jack on the matter of Mr. Jack having a key to garage 98, and he had been cross-examined.
- Mr. Hellman sought to counter that point by submitting that advantage might have been taken on behalf of Mr. Bosworth of the provision in CPR Part 33.4(1) that:-
- That was not, as it seemed to me, an answer to Mr. Melville-Shreeve's point. It was for SOCA to decide which witnesses it wished to call to give live evidence and which not. It must have been obvious to SOCA that, if it sought to rely on evidence in a witness statement which was disputed, it would be open to Mr. Bosworth to make the point that was made on his behalf. SOCA could have prevented that point being available to Mr. Bosworth by calling Mr. Jack. It chose not to. Mr. Bosworth was under no obligation himself to call Mr. Jack. As a matter of tactics it was entirely sensible for him not to seek to take advantage of the provisions of CPR Part 33.4(1), but instead to be in a position to make the submission which Mr. Melville-Shreeve made about the weight to be attached to the evidence of Mr. Jack.
- In the result the evidence against Mr. Bosworth in relation to fraudulent evasion of tobacco duty was circumstantial. As it seemed to me, that notwithstanding, it was a case which was fit to go before a jury, if the only relevant facts were those summarised in paragraphs 4.1 to 4.8 inclusive of the first witness statement of Mr. Thompson. However, the case was potentially fatally weakened by the claim of Mr. Chalker that the tobacco found in Mr. Bosworth's car in fact belonged to Mr. Chalker. Mr. Chalker's evidence supported the assertion of Mr. Bosworth that he, Mr. Bosworth, knew nothing about the tobacco in the car. It also introduced the possibility that the tobacco found in the garages was also that of Mr. Chalker. Mr. Chalker was not called to give evidence in this trial by either SOCA or Mr. Bosworth, so I had no opportunity of seeing him or forming any view about him. The suggestion advanced on behalf of SOCA was that Mr. Chalker was giving false evidence in claiming ownership of the tobacco found in the car to support his employer, Mr. Bosworth. That was not impossible, but nor was it particularly likely, given the risk of prosecution to which Mr. Chalker exposed himself by his claim to ownership.
- The result was that the involvement of Mr. Chalker introduced a complicating factor in a case which otherwise seemed to depend simply on whether a jury accepted the explanation offered by Mr. Bosworth. Whether it was this complication, or some other matter or matters which were not put before me, which resulted in the prosecution of Mr. Bosworth being dropped I do not know. Perhaps the decision had something to do with Mr. Jack, given the unchallenged evidence in paragraph 2.93 of the first witness statement of Mr. Bosworth.
- I have already indicated my assessment of Mr. Bosworth. I have not overlooked that at paragraph 2.19 of his first witness statement he said:-
- In the circumstances, expressing the view, unnecessarily, that he was not concerned by people selling cheap tobacco, might seem to indicate that Mr. Bosworth was the sort of person who would have no compunction in adopting that course himself. However, actually, as it seemed to me, the point was one for Mr. Bosworth, and his expressed sympathy for those selling contraband tobacco redounded to his credit. He could easily have kept his view to himself, and thereby avoided any suggestion that his opinion made it more, rather than less, likely that he had himself sought fraudulently to evade the duty on tobacco.
- In the result I was not persuaded that Mr. Bosworth had been guilty of fraudulently evading tobacco duty in relation to the tobacco found in December 2005 in his car or in the garages which he sub-let from Mr. Jack.
- Mr. Thompson accepted in cross-examination that there was no evidence that Mr. Bosworth had been fraudulently evading tobacco duty other than that summarised in paragraphs 4.1 to 4.8 inclusive of Mr. Thompson's first witness statement.
- If Mr. Bosworth were an habitual smuggler of tobacco or an habitual seller of contraband tobacco, to the extent that it was from that source that he maintained his lifestyle, or it made a substantial contribution to his lifestyle, again the point can be made that it is surprising that he had not been detected in that activity in the previous 43 years of his life. It is not easy to see why anyone would wish to seek to evade payment of duty on tobacco unless his personal requirements were very great, or he intended to sell such tobacco for profit. One imagines that selling tobacco in respect of which duty has been fraudulently evaded is difficult to achieve in secret. Unless there is a retail market in which non-consumers purchase with a view to resale to consumers, it would seem that sale of tobacco on which duty has been evaded depends upon finding persons wishing to consume the tobacco. Absent those with large personal requirements, it would appear to be necessary to find a considerable number of customers for the operation to be worthwhile. The larger the number of customers required, the more difficult to conduct the operation of selling clandestinely, and thus the greater chance of being caught. Yet, despite this, there was no evidence that Mr. Bosworth had ever been caught, or even suspected of, fraudulently evading tobacco duty on any other occasion.
- Consequently, I was not satisfied that SOCA had discharged the burden on it of proving that Mr. Bosworth had been guilty of fraudulently evading tobacco duty on any occasion.
- In the light of my decision during the trial not to permit SOCA to amend the endorsement on the claim form to include a reference to tax evasion, it is unnecessary to consider the evidence in relation to it. That is, perhaps, just as well. On the material contained in the second witness statement of Mr. Thompson SOCA in fact had no coherent case on tax evasion. SOCA's basic position was that, as Mr. Thompson put it at paragraph 2.11:-
- The high point of the case on tax evasion seemed to be what Mr. Thompson said at paragraph 3.55 of his second witness statement:-
- The real point made on behalf of SOCA at that stage thus seemed to be, not that it wished to pursue the present action alternatively on the ground that identified assets of Mr. Bosworth or Miss Walker were obtained using funds which ought to have been applied to discharging tax liabilities, but rather that the explanation given by Mr. Bosworth, insofar as he said that he had used funds in respect of which income tax had not been paid, was no answer to the primary grounds of claim. Certainly no attempt was made to assert that a particular asset was obtained using funds which ought to have been applied to discharging tax liabilities. That, I think, was in itself a fatal problem. What is required to justify making a recovery order under s.266 of POCA is not that it is demonstrated that someone has engaged in conduct which was unlawful under English law and had property, but that that person had particular identified property as a result of engaging in the unlawful conduct. SOCA did not even begin to address that requirement in relation to a case based on admitted tax evasion.
- In the circumstances the claims in this action failed on the simple ground that it had not been proved that Mr. Bosworth engaged in any criminal activity at all. It was not, therefore, necessary to consider in any detail the source from which any of the assets in respect of which a recovery order was sought which was not a sum in a bank account had been funded, or the source of funds in the Portman Account or the La Caixa Account. I simply observe that the fact that Mr. Bosworth plainly was wrong in the initial accounts which he gave of the source of funds with which particular properties were bought, as he accepted, takes one only so far on the question what inferences should be drawn. In an appropriate case, no doubt, the inability of a respondent to provide a convincing account of the source of funds from which he acquired an asset may justify drawing the inference that the real source was unlawful conduct. However, it does not follow that such inference must be appropriate in all cases. In an imperfect world the possibilities of confusion, mistake and forgetfulness need to be taken into account, and the passage of time since the events in question, and the presence or absence of relevant documents, are also likely to be highly material.
- In paragraph 17 of his written closing submissions Mr. Hellman conveniently summarised the matters relied upon by SOCA as unsatisfactory accounts given by Mr. Bosworth, and contradictions:-
- He said the £17,000 deposit for 22 Fore Street was from the sale of 70 Fore Street, then changed his story when Mr. Thompson pointed out that the deposit was paid before 70 Fore Street was sold.
- He said the £35,000 deposit for 4 Penkernick Close came from the sale of 22 Fore Street, then changed his story when Mr. Thompson pointed out that the deposit was paid before 22 Fore Street was sold.
- He said the final £11,000 payment for 4 Penkernick Close came from his business bank account at HSBC, then changed his story when Mr. Thompson pointed out that there were no withdrawals from his own or his mother's bank account at the relevant time.
- He said that the £17,000 deposit for 47 Market Jew Street was from money that was left over from the Discount Furnishing business, then changed his story when Mr. Thompson pointed out that £12,250 came from a cheque from John Hamilton/O'Neill.
- As to Edificio Nautilus:
- He said that he paid Euros 69,000 cash for the property, and that the money was undeclared proceeds from the Discount Warehouse and Fair Deals Trading.
- Then he said the money was a loan from his mother;
- Then he changed his story when Mr. Thompson pointed out that the apartment in fact cost Euros 106,500 of which Euros 14,000 was by way of bankers draft. He says he cannot recall whether all this money was paid in cash or whether part of it was paid by bankers draft and, if so, who that bankers draft was from.
- He said that the £7,500 deposit for First Floor Flat, 47 Market Jew Street was from stock that he had sold at the Discount Furniture Warehouse in the closing down sale, then changed his story when Mr. Thompson pointed out that the deposit was largely funded by a payment of £8,000 into his bank account from Mr. Blewett."
- The points made by Mr. Hellman were fair up to a point. Broadly the picture was that Mr. Bosworth volunteered an account, in fact in his witness statement made for the purposes of the criminal proceedings, of various transactions in property over the years, leading up to the acquisition of his present assets. Mr. Thompson in his first witness statement in this action pointed out errors in what Mr. Bosworth had said, and Mr. Bosworth in his first witness statement in this action accepted the errors pointed out by Mr. Thompson. In instances in which Mr. Thompson did not suggest, from his investigations, what the actual source of the material funds was, Mr. Bosworth offered an explanation alternative to that which he had originally advanced. However, where Mr. Thompson did suggest the real source of funds, as in the cases of the deposit paid in respect of the acquisition of the Business Premises and the deposit paid in relation to the purchase of the first floor flat at 47, Market Jew Street ("the Flat"), Mr. Bosworth agreed with the suggestions made.
- However, it was, as it seemed to me, in these latter two instances that the case for SOCA that all of the properties in respect of which a recovery order was sought in this action were obtained by unlawful conduct, and that Mr. Bosworth was simply saying whatever came into his head in order to explain the source of funds applied to the various properties, really appeared to fall apart. On the face of Mr. Thompson's investigations into the deposits for the Business Premises and the Flat each of the deposits was provided, substantially, by a documented loan from a third party. If those loans were taken as what they seemed at first sight to be, it followed that the money paid for the deposits was lawfully obtained, or at any rate not obtained as a result of unlawful conduct on the part of Mr. Bosworth. However, the case for SOCA was that these loans were not what they seemed. In some way which I am afraid I never really understood these loans were said to be some sort of faηade to conceal what was really a use by Mr. Bosworth of ill-gotten gains. But how was this supposed to work? Was it suggested that Mr. Bosworth repaid the loans in advance, as it were, putting the lenders in funds ostensibly to lend money to him? If so, what was the point of it, when Mr. Bosworth did not, in the first instance, place any reliance upon these loans, but only agreed, when Mr. Thompson pointed them out, that they had in fact been made? If the whole thing was some sort of charade one would have expected Mr. Bosworth to be the first to allege that the loans were the source of the deposits. Moreover, if the loans were not genuine, but created to shield the true source of the funds, it could have been anticipated that Mr. Bosworth would have had some written evidence in support of the alleged loans, like an IOU or some other acknowledgment of debt. In fact the evidence which led Mr. Thompson to his conclusions was simply deposits in bank accounts.
- Mr. Bosworth's answer to the suggestion that he was making up his evidence about the source of funds out of which he had purchased particular assets was that he had simply been confused in giving his original account, because the events in question were some time before the date at which he gave the account and the transactions were not sufficiently well documented to enable him to remind himself of the true position. That what Mr. Bosworth contended might well be so was suggested by the fact that the errors in his account of the sources of the deposit for 22, Fore Street, the deposit for the Newlyn Property and the final payment for the Newlyn Property were so easily demonstrated. However, the most blatant example of confusion seemed to be in these passages in Mr. Bosworth's witness statement in the criminal proceedings, in which he contradicted himself as to the source of funds for the purchase of the Spanish Property within two consecutive paragraphs on one page. I have highlighted the contradictions so as to demonstrate how close together on the page they appear:-
- In that short passage not only did Mr. Bosworth contradict himself as to the source of the funds out of which the Spanish Property was purchased, he also contradicted himself as to the price. In paragraph 1.49 he said that the total price was 69,000, but in paragraph 1.50 he said that that was the amount of the balance after an initial deposit had been paid. It was established by enquiry of Mr. Van Parijs, who was indeed the sales agent in Spain, that actually the total purchase price was 106,500, the equivalent at the time of about £76,000, and that it was paid as to 92,500 in cash and as to the balance by a banker's draft issued by Barclays Bank plc. At least Mr. Bosworth got the name of the Spanish agent correct. It seems to have been because Mr. Bosworth recorded the name of Mr. Van Parijs correctly that it was possible for a police officer to contact him and to establish the correct position as to the purchase of the Spanish Property.
- At paragraph 6 of his written closing submissions Mr. Hellman urged that:-
- It seemed to me that it was in fact very useful to stand back and to consider the circumstances of Mr. Bosworth in the round. In December 2005 he was 43 years of age. He had left school at the age of 15. Thereafter he seems always to have had employment of some kind, including, between 1984 and 1990, service in 42 Commando, Royal Marines, from which he was honourably discharged. At the age of 21 he purchased his first house, jointly with his mother. Thereafter he had always owned some kind of property. In December 2005 he owned, freehold, the Newlyn Property, an ordinary family bungalow in a small fishing town in Cornwall. He also owned what it seems was a long leasehold interest of some kind in the Business Premises. I conclude that it was a long lease, and not a freehold interest, from the fact that the Flat, at the same address, had a separate registration at HM Land Registry. The interest of Mr. Bosworth in the Flat must inevitably also have been a long leasehold interest. Photographs of the Business Premises, including the Flat, were put in evidence. The Business Premises seemed to be rather rundown and located, from the look of it, in a tertiary trading area. The Flat appeared to have been constructed, along with the Business Premises, probably in the 1950s or 1960s. From the exterior the Flat did not appear luxurious. The evidence was that the Spanish Property comprised a one-bedroom flat. Absent any other information, it did not seem to me that anyone would be particularly surprised that a small businessman living in Cornwall aged in his forties would have a property portfolio such as Mr. Bosworth had. The car which he drove, in which the tobacco was found, was about 10 years old in December 2005. There was nothing about Mr. Bosworth's apparent assets or his lifestyle which appeared to me to justify any suspicion of engaging in unlawful conduct. The most exotic thing which could be said of him was that he kept a parrot as a pet.
- In his first witness statement Mr. Thompson put the value of the alleged recoverable property at a total of £576,822.45. However, a table at paragraph 3.2 of the witness statement showed that of that total, £321,500 and 13,500 represented the difference between the acquisition cost of the various real properties in which Mr. Bosworth had an interest, and the estimated value of each, according to Mr. Thompson's assessment.
- Each of the Business Premises and the Flat had been purchased, Mr. Thompson established, with the aid of a mortgage advance from HSBC Bank plc ("HSBC"). The advance on the Business Premises was £33,000. That on the Flat was £22,000. Borrowing money from a bank on the security of a charge over real property certainly used to be a perfectly normal way of funding a purchase. It is, I think, significant that Mr. Bosworth borrowed money from a reputable bank a fortiori a lawful source to fund each purchase and that the sums borrowed were relatively modest. The amount of cash seized by the police from Mr. Bosworth was in excess of the loan on the security of the Business Premises, so if Mr. Bosworth was generating on a regular basis significant sums from unlawful conduct one might have expected him to have purchased the Business Premises and the Flat for cash, but not so. As I have already noted, the balance of the purchase price of each property was, on the face of things, provided substantially by loans from friends of Mr. Bosworth.
- The Newlyn Property was not purchased with the benefit of a loan from a bank, but it was purchased as an empty plot, and the bungalow constructed on the plot was built by Mr. Bosworth's brother. The alleged total cost, £69,000 or £70,000, Mr. Bosworth said was raised as to £46,000 from the net proceeds of sale of properties which he owned previously, and as to £24,000 as loans from two friends. One of these friends, Mr. Stephen Gilbert, was called to give evidence on behalf of Mr. Bosworth. He told me that he had lent Mr. Bosworth £10,000 because Mr. Bosworth asked for such a loan. It was not suggested to him in cross-examination that there had been no loan, or that the supposed loan was actually some mechanism for concealing funds obtained by Mr. Bosworth by unlawful conduct. I accept the evidence of Mr. Gilbert that he made to Mr. Bosworth the loan of £10,000 of which he spoke, in order to assist in the development of the plot by the construction of a bungalow.
- Mr. Bosworth told me that he had had an extension built to the bungalow after it had first been completed. The extension was built by a friend and funded, in substance, by a loan of £20,000 from HSBC. There did not appear to be any real dispute that Mr. Bosworth had borrowed from HSBC in order to fund the greater part of the cost of the extension. Again it seems to me to be significant that Mr. Bosworth approached an impeccable source for a relatively modest loan.
- Overall the evidence indicated that the amounts which had been put into the purchase of real property in which Mr. Bosworth had an interest which had not been borrowed from HSBC amounted to about £169,500 (£69,000 for the Newlyn Property, £17,000 for the Business Premises, £7,500 for the Flat and about £76,000 for the Spanish Property). Of that total, Mr. Bosworth contended that a total of £43,750 had been provided by loans from friends (£10,000 from Mr. Gilbert, £14,000 from Mark Blewett for the Newlyn Property and £7,500 from him for the Flat, and £12,250 from John Hamilton, or O'Neil). Even if there was doubt about the loan of £14,000 from Mark Blewett, the other loans being the subject of oral (Mr. Gilbert) or documentary evidence, one is not talking about very large amounts being put into property purchases.
- Looking at the asset position of Mr. Bosworth in terms of value, therefore, something of the order of 57.5% (depending upon the precise rate of exchange taken as between £ and ) of the worth of the alleged recoverable property as assessed by Mr. Thompson was attributable to the increase in property prices after original acquisition. The balance, even leaving aside the evidence as to loans, was not so large, in the context of a man in the apparent circumstances of Mr. Bosworth to suggest that it, or any part of it, must have been obtained by unlawful conduct.
- Miss Walker volunteered to give evidence on her own behalf at the trial, and she was cross-examined. I found her an entirely convincing witness and I accept her evidence without hesitation. I therefore find that the principal source of the monies in the Portman Account originally was as she said, as to £12,000 cash which she personally had accumulated over the years prior to depositing £16,000 in that account on 10th August 1999, and as to the balance money which she took from Mr. Bosworth, but repaid between 20 August 1999 and 23 September 1999. I also find that the £5,000 deposited in the Portman Account on 9 November 2005 had come from another account which Miss Walker had closed. The actual sum in the Portman Account as at 1 January 2006, £6,252.96, reflected the withdrawals after those two sums had been deposited. As Miss Walker tellingly put it in cross-examination when it was suggested to her by Mr. Hellman that the source of the money in the Portman Account had been Mr. Bosworth, "Why would he give money to me?".
- It is not necessary for me to reach any conclusion as to whether Miss Walker has any beneficial interest in the Newlyn Property. If there is a dispute about it between Miss Walker and Mr. Bosworth, it can be resolved in the divorce proceedings between them.
- In the result this action fails and is dismissed.
His Honour Judge Richard Seymour Q.C. :
Introduction
"a Recovery Order pursuant to section 266 of the Proceeds of Crime Act 2002 in respect of recoverable property held directly or indirectly by the Respondent. The recoverable property in respect of which this application relates is set out in the schedule hereto."
"The full details of this claim are set out in the witness statement of Andrew Thompson dated October 28th 2008 filed in support of this claim."
"1. The property situated at 4 Penkernick Close, Newlyn, Cornwall TR18 5RA and registered at HM Land Registry in the name of Mr D Bosworth with the title number CL169610;
2. The property situated at 47 Market Jew Street, Penzance TR18 2HY and registered at HM Land Registry in the name of Mr D Bosworth with the title number CL85561;
3. The property situated at 1st Floor Flat, 47 Market Jew Street, Penzance, TR18 2HY and registered at HM Land Registry in the name of Mr D Bosworth with the title number CL191613;
4. The property known as Edificio Nautilus, essc B, 5th Planta, Puerta 20B, 03710 Calpe, Alicante, Spain, registered in Spain in the name of Mr David Ian Bosworth and Miss Dawn Ellenor Walker;
5. Monies held in Portman account number 5321068-8 in the name of Miss D E Walker;
6. Monies held in La Caixa bank account number 2000040997 in the name of Dawn Ellenor Walker;
7. The funds held by Devon and Cornwall Constabulary in the interest bearing account 00987565 20-30-47 which relate to the cash seized in the sums of £13,743.49 and £19,000 respectively from the First Respondent at the premises at 4 Penkernick Close, Newlyn, Cornwall TR18 5RA and any interest accrued thereon."
The law
"(1) If in proceedings under this Chapter the court is satisfied that any property is recoverable, the court must make a recovery order.
(2) The recovery order must vest the recoverable property in the trustee for civil recovery.
(3) But the court may not make in a recovery order
(a) any provision in respect of any recoverable property if each of the conditions in subsection (4) or (as the case may be [which it does not in the present case, because subsection (5) applies to Scotland]) (5) is met and it would not be just and equitable to do to, or
(b) any provision which is incompatible with any of the Convention rights (within the meaning of the Human Rights Act 1998 (c.42)).
(4) In relation to a court in England and Wales or Northern Ireland, the conditions referred to in subsection (3)(a) are that
(a) the respondent obtained the recoverable property in good faith,
(b) he took steps after obtaining the property which he would not have taken if he had not obtained it or he took steps before obtaining the property which he would not have taken if he had not believed he was going to obtain it,
(c) when he took the steps, he had no notice that the property was recoverable,
(d) if a recovery order were made in respect of the property, it would, by reason of the steps, be detrimental to him. "
"304 (1). Property obtained through unlawful conduct is recoverable property.
(2) But if property obtained through unlawful conduct has been disposed of (since it was so obtained), it is recoverable property only if it is held by a person into whose hands it may be followed.
(3) Recoverable property obtained through unlawful conduct may be followed into the hands of a person obtaining it on a disposal by
(a) the person who through the conduct obtained the property, or
(b) a person into whose hands it may (by virtue of this section) be followed.
305 (1) Where property obtained through unlawful conduct ("the original property") is or has been recoverable, property which represents the original property is also recoverable property.
(2) If a person enters into a transaction by which
(a) he disposes of recoverable property, whether the original property or property which (by virtue of this Chapter) represents the original property, and
(b) he obtains other property in place of it,
the other property represents the original property.
(3) If a person disposes of recoverable property which represents the original property, the property may be followed into the hands of the person who obtains it (and it continues to represent the original property)."
"If
(a) a person disposes of recoverable property, and
(b) the person who obtains it on the disposal does so in good faith, for value and without notice that it was recoverable property,
the property may not be followed into that person's hands and, accordingly, it ceases to be recoverable."
"(1) A person obtains property through unlawful conduct (whether his own conduct or another's) if he obtains property by or in return for the conduct.
(2) In deciding whether any property was obtained through unlawful conduct -
(a) it is immaterial whether or not any money, goods or services were provided in order to put the person in question in a position to carry out the conduct,
(b) it is not necessary to show that the conduct was of a particular kind if it is shown that the property was obtained through conduct of one of a number of kinds, each of which would have been unlawful conduct."
""Property is all property wherever situated and includes
(a) money,
(b) all forms of property, real or personal, heritable or moveable,
(c) things in action and other intangible or incorporeal property."
"Conduct occurring in any part of the United Kingdom is unlawful if it is unlawful under the criminal law of that part."
"13. There have been few cases on this part of the Act. There is a helpful discussion of their background by Sullivan J in R. (Director of Assets Recovery Agency) v. Green [2005] EWHC 3168 (Admin) "Green"). Sullivan J was asked to decide as a preliminary issue:
Whether a claim for civil recovery can be determined on the basis of conduct in relation to property without the identification of any particular unlawful conduct, this first question to include whether the claimant can sustain a case for civil recovery in circumstances where a respondent has no identifiable lawful income to warrant the lifestyle and purchases of that respondent (para 20, emphasis added).
14. Although he did not accept the full width of the Director's submission, he accepted that it was not necessary to allege a specific criminal offence. His answer came in the form of two declarations:
1. In civil proceedings for recovery under Part 5 of the Act the Director need not allege the commission of a specific criminal offence but must set out the matters that are alleged to constitute the particular kind or kinds of unlawful conduct by or in return for which the property was obtained.
2. A claim for civil recovery cannot be sustained solely on the basis that a respondent has no identifiable lawful income to warrant his lifestyle (para 21).
15. The Director did not appeal against that formulation, and does not seek to question it in this appeal.
16. In my view this is the correct approach, and I would respectfully adopt Sullivan J's analysis and conclusions. However, I would emphasise the word "solely" in the second declaration. Lack of lawful income to support the respondent's lifestyle may be a very relevant factor in painting the overall picture.
17. The same approach was in effect adopted by this court in Director of the Assets Recovery Agency v. Szepietowski [2008] Lloyd's Rep FC 10. This was an appeal by the Director against a finding by the court below that he did not have "a good arguable case", justifying an interim recovery order (under section 246). The court allowed the appeal. In the leading judgment, Waller LJ said:
In this case, in considering whether a good arguable case has been established, it will be necessary to examine first whether it is arguable on the evidence that unlawful conduct of the kind asserted by the ARA has taken place, ie mortgage fraud. Next needs to be considered whether it is arguable that the property sought to be frozen represents property originally obtained through such unlawful conduct, but not necessarily through specific examples of that conduct; and finally, if there is some evidence that property was obtained through unlawful conduct, consideration needs to be given to any untruthful explanation or a lack of explanation where opportunity has been given to provide it. An untruthful explanation or a failure to offer an explanation may add strength to the arguability of the case (para 28, emphasis added).
18. Concurring, Moore-Bick LJ said that the judge had wrongly confined himself to looking at the consequences of the various mortgage frauds of which the Director had positive evidence, while failing to take account of "the broader picture" (para 112).
22. This question [specific criminal offences?] is answered by the authorities to which I have referred. I agree with Sullivan J (in Green), that the Director need not allege the commission of any specific criminal offence, provided there are set out matters alleged to constitute "the particular kind or kinds of unlawful conduct" by or in return for which the property was obtained. This approach in my view follows from the wording of the Act. Use of the term "unlawful conduct", rather than reference to a criminal offence or offences, is a clear indication that the power is not so restricted. The Green approach was in effect endorsed by this court in Szepietowski."
"The court or sheriff must decide on a balance of probabilities whether it is proved
(a) that any matters alleged to constitute unlawful conduct have occurred, or
(b) that any person intended to use cash in unlawful conduct."
"27. Richards LJ expressed the proposition neatly in R(N) v. Mental Health Review Tribunal (Northern Region) [2006] QB 468, para 62 where he said:
"Although there is a single civil standard of proof on the balance of probabilities, it is flexible in its application. In particular, the more serious the allegation or the more serious the consequences if the allegation is proved, the stronger must be the evidence before a court will find the allegation proved on the balance of probabilities. Thus the flexibility of the standard lies not in any adjustment to the degree of probability required for an allegation to be proved (such that a more serious allegation has to be proved to a higher degree of probability), but in the strength or quality of the evidence that will in practice be required for an allegation to be proved on the balance of probabilities."
In my opinion this paragraph effectively states in concise terms the proper state of the law on this topic. I would add one small qualification, which may be no more than an explanation of what Richards LJ meant about the seriousness of the consequences. That factor is relevant to the likelihood or unlikelihood of the allegation being unfounded, as I explain below.
28. It is recognised by these statements that a possible source of confusion is the failure to bear in mind with sufficient clarity the fact that in some contexts a court or tribunal has to look at the facts more critically or more anxiously than in others before it can be satisfied to the requisite standard. The standard itself is, however, finite and unvarying. Situations which make such heightened examination necessary may be the inherent unlikelihood of the occurrence taking place (Lord Hoffmann's example of the animal seen in Regent's Park), the seriousness of the allegation to be proved or, in some cases, the consequences which could follow from acceptance of proof of the relevant fact. The seriousness of the allegation requires no elaboration: a tribunal of fact will look closely into the facts grounding an allegation of fraud before accepting that it has been established. The seriousness of consequences is another facet of the same proposition: if it is alleged that a bank manager has committed a minor peculation, that could entail very serious consequences for his career, so making it the less likely that he would risk doing such a thing. These are all matters of ordinary experience, requiring the application of good sense on the part of those who have to decide such cases. They do not require a different standard of proof or a specially cogent standard of evidence, merely appropriately careful consideration by the tribunal before it is satisfied of the matter which has to be established."
"In my view the judge was wrong to regard the Director's case as merely speculative. He appears to have taken that view because he confined himself to looking at the consequences of the various mortgage frauds, of which the Director had positive evidence in the shape of the receiver's report, and the rental income derived from the properties purchased by the respondents by means of those frauds, while failing to take account of the broader picture. In addition to the evidence that strongly suggested that Mr. and Mrs. Szepietowski had been involved in several mortgage frauds, there was the evidence that their legitimate income fell far short of what was required to pay for the property, that in addition they were enjoying an extravagant lifestyle, that Mr. Szepietowski had lied to his accountant about the source of at least part of the funds and that neither of them had explained satisfactorily where the money needed to finance the purchase had come from. All Mr. Szepietowski had said about that was that it had been obtained from the sale of a previous (unidentified) property. In my view the evidence, taken as a whole, is sufficient to support a strong inference that the funds used to buy 6 Holland Road had been obtained by unlawful conduct of some kind, probably, though not necessarily, one or more of the mortgage frauds committed by Mr. and Mrs. Szepietowski. That was sufficient in my view to give rise to a good arguable case that the funds used to finance the purchase had been obtained by unlawful conduct. Whether it would be sufficient for the Director to plead her case in those terms and whether the evidence currently before the court will be sufficient on its own to establish her case at trial are not matters which arise on the present application. I am satisfied, therefore, that the evidence is sufficient to establish a good arguable case that 6 Holland Road is recoverable property within the meaning of section 30191) of the Act."
"31. That evidence established clearly that the appellant did not have a business that could remotely have supported his expenditure. On his own admission, he had never paid tax or national insurance. It was suggested that such moneys as he obtained from his failure to pay tax or such property as he purchased by use of those moneys should not form part of the recoverable property. We do not accept that submission. True it is that he may be subject to recovery action by the authorities in respect of tax and national insurance, but his failure to pay these legally due payments constituted criminal conduct and the money that he thereby obtained and such property as he bought with that money come clearly within the rubric of recoverable property.
41. The appellant did not challenge the finding that he had been guilty of tax evasion. I have already referred in paragraph [31] above to Mr. O'Donoghue's argument that the legislation was not designed to bring within the embrace of 'property obtained through unlawful conduct' property that had been funded by moneys that ought to have been paid in discharge of tax and national insurance liabilities. He suggested that if the tax and national insurance liability of the appellant could be dealt with by the imposition of penalties and recovery action by the Inland Revenue and national insurance authorities, it should not be the subject of a recovery order under POCA. We cannot accept that argument. In the first place, there is no evidence that such a recovery process is either in prospect or even feasible. Secondly, it cannot be correct that property acquired by plainly unlawful conduct should fall outside the ambit of POCA simply because some other means of recovering the money (as opposed to the property obtained through its use) existed. If Mr. O'Donoghue's argument were correct, it would mean that property which had been obtained by money withheld from the tax and national insurance authorities and which had increased markedly in value before the crime was detected could remain immune from the recovery process under POCA by the payment of the outstanding liabilities and any penalties deemed appropriate. That would defeat the clear intention of the legislation, in my opinion."
The nature of the case of SOCA
"Particulars of claim must include
(a) a concise statement of the facts upon which the claimant relies;"
"In December 2005 large quantities of contraband tobacco were found by the police in a car owned by the First Respondent. Further large quantities of tobacco were subsequently found in garages leased by him. A search of his home address uncovered stolen jewellery and approximately £23,500 in cash. The First and Second Respondent have acquired a sizeable portfolio of assets, including an apartment in Spain and commercial and residential properties in the UK. The family home and apartment in Spain were purchased outright without recourse to a mortgage. The First Respondent's known legitimate income is insufficient however to afford the assets acquired and maintain the lifestyle enjoyed by himself, his now ex-wife and his three dependant children. Furthermore, the First Respondent has received substantial payments from third parties which contributed towards the purchase of some of real properties. Those third parties have either said they cannot now recall why they made these payments, or have provided explanations for the transactions which lack credibility. It is therefore the Claimant's case that the First Respondent has engaged in unlawful conduct, namely handling stolen goods, dealing in contraband tobacco and/or money laundering."
"During the same search of the First Respondent's home a large quantity of expensive alcohol was recovered, including Dom Perignon and Taittinger champagne [At/5 at pages 144 to 146]. The First Respondent claimed that he had purchased the alcohol from Tescos. The manager of Tescos supermarket at Bramwell Lane, Penzance, Mr. Philips, examined the bottles and was able to say that some of the items were sold by Tescos, estimating the value of those goods at £592. However, he also examined the necks of the bottles and found that a number were damaged in a way which was consistent with the security tags having been forcibly removed. The bottles would not have been damaged in that way had the cashier removed the tags upon sale [AT/5 at pages 169 to 171 refers]. It can therefore be inferred that some of the alcohol was stolen property."
"4.19 In August 2002 a number of stolen vouchers were presented at a shop called New Look in Penzance by the Second Respondent. She stated that she had got them from her husband the First Respondent. He attended Penzance Police Station as a voluntary attendee and stated that he bought the vouchers from a man in a pub who he did not know or would recognise again. The First Respondent stated that he did not believe the items to be stolen as due to his work he often buys items in this way.
4.20 On 30th September 2003 an allegation was made that a Mitsubishi Shogun registration number P140 PWW had been stolen from the Humberside area. The vehicle was in the possession of Mr. Athwal who resided in Devon. He stated that he bought the vehicle from the First Respondent having seen the car for sale in Autotrader. On 8th October 2003 DC Crawford arrested the First Respondent for obtaining property by deception. He was taken to Cambourne police station and interviewed. The First Respondent stated that the vehicle was bought in good faith and sold by Mr. Athwal. There was insufficient evidence to disprove this and the matter was not pursued."
"A lot of the detail, especially in relation to earlier properties and businesses, is not only inaccurate, it is irrelevant, for example, in respect of earlier property sales they simply cannot have funded any of the current portfolio. This means that we are left with the rather vague notion that the money has come from his various businesses over the years and the profits he has made from avoiding tax. I believe I have shown that, on the rare occasion any documents do exist for the businesses, then the evidence that Mr. Bosworth's suggestion his income is derived from "vast hoards of cash" from these businesses is not capable of belief. Furthermore given paragraph 3.55 above [a reference to the judgment of the Court of Appeal of Northern Ireland in The Director of the Assets Recovery Agency v. Lovell to which I shall return] it would appear that any income derived from legitimate business but deliberately not declared to the Inland Revenue falls within the parameters of recoverable property. Where Mr. Bosworth claims that his money has come from loans from third parties, they either have previous convictions for acquisitive crimes, have had consignments of tobacco/alcohol destroyed or use false names. No paperwork can be provided as evidence for the loans and there is an argument as to the amounts outstanding. Given the circumstances and individuals involved I believe the loans are merely a front for Mr. Bosworth to launder his unlawful conduct."
"4.12 A search was also conducted at the First Respondent's home address 4 Penkernick Close, Newlyn. Nearly 300 items of jewellery were found, mainly in the bedroom used by the First Respondent. The Second Respondent sleeps in a separate bedroom. In addition £9,445 in cash was found [AT/5 at pages 135 to 146 refers].
4.13 A number of items of jewellery have subsequently been identified as being stolen property. Some of the items of jewellery still had price tags on them which did not relate to First Respondent's business. The jewellery was stolen during twenty-one separate burglaries carried out between 1997 and December 2005 just before the execution of the first search warrant on the First Respondent's home address. In total jewellery to the auction value of £9,213.00 [AT/5 at pages 147 to 160] was recovered, of which a proportion was formally identified by the losers as stolen property. The retail value of the jewellery is thought to be much higher.
4.14 As mentioned above, some of the items seized from the First Respondent's bedroom still had price tags on from a company called 'Cornwall Pearl' based at that time in Newquay. That company was burgled in December 2003 and jewellery to a value of £21,793.49 was stolen. Eighteen items recovered from the First Respondent's bedroom, total value £3,716.83, were subsequently identified as stock stolen during the Cornwall Pearl burglary, see pages 161 to 164 of AT/5. This represents too high a proportion of the stolen stock to be dismissed as coincidence.
4.15 A number of items recovered would have been easily identifiable as stolen property. For example, a gentleman's gold wrist watch with no strap was identified by Mrs. S. Dymond as having been stolen from her home address in September 2004, see pages 165 to 166 of AT/5. The watch originally bore the inscription "A. Jones 12 Peverill Road" on the rear, but that marking had been scratched off, probably to make it harder to trace the item back to its lawful owner. This item was one of three identified by Mrs. Dymond that had been stolen from her home address and were recovered from the First Respondent. Another example is four Crawshaw candle smoke brooches identified as belonging to a Mr. Goodings. These items still had the price labels attached. The First Respondent was found in possession of nineteen items of property stolen from Mr. Goodings, see pages 167 to 168 of AT/5."
"4.1 On 21st December 2005 a Misuse of Drugs act warrant was executed by the DCC [Devon and Cornwall Constabulary] on a second-hand goods shop called 'Lovejoys', of Mount Street, Penzance. Lovejoys is run by a man named Mark Fisher, who formerly operated another second-hand goods business with the First Respondent. The First Respondent arrived at the Lovejoys premises whilst the search was in progress. He searched and found in possession of £445 in cash and a key for a motor vehicle.
4.2 The key belonged to a Mitsubishi Shogun M93 CTR, parked nearby. The vehicle was registered to the First Respondent at his business address "Fair Deals". The following items were found within the vehicle:
4.3 The key marked '98' was found to open a lock-up garage in the Penzance area. The garage was searched and officers found a further 1,500 x 50g pouches of Golden Virginia Tobacco.
4.4 Penwith Housing Association owns the garage and let it to a Mr. Raymond Jack ("Jack"). Jack was interviewed on 22nd December 2005 and provided a statement to the police [AT/5 pages 1 to 3 refers]. Jack states that he rents the garage from the Penwith Housing Association and sublets it out along with another garage (number 125) to a man he has known for 10 years as 'Bozzy'. He goes on to describe what he knows about 'Bozzy', the First Respondents nickname. Jack is clearly describing the First Respondent, as he is able to describe the location of the First Respondent's second-hand shop in Market Jew Street and the fact that 'Bozzy' lives with a lady called 'Dawn', the Second Respondent. Jack states that at that time he had been sub-letting garage 125 for about 2 years and garage 98 for the last 4 weeks. He states that when he let the garages to the First Respondent they were empty. The First Respondent pays £30 for one garage and £34 for the other usually in cash. Although Jack's statement doesn't make this point explicit, this seems to be a weekly rent.
4.5 On 22nd December 2005 garage 125 was also searched. 200 Benson & Hedges cigarettes and 220 pouches of Cutters Choice tobacco were discovered at the premises and seized by the police.
4.6 A statement was taken from representatives of the tobacco product manufacturers in relation to the tobacco seized. Exhibit AT/5 at pages 4 to 5 refers. They confirm that the products in question were produced for sale in the Belgian market and cannot be legally traded in the UK domestic market as they do not bear the statutory UK health warnings or UK 'Duty Paid' fiscal mark.
4.7 The First Respondent was interviewed on a number of occasions. He gave no comment answers to all questions put to him, but did give prepared statements about the tobacco [page AT/5] and the stolen jewellery [page 7 of AT/5]. In those statements he simply asserts that he was not aware the tobacco was in his vehicle, that it is not his and that he did not put the items in his car. In relation to the tobacco found in the garage he stated that it was not his and that he did not own the garage. In relation to the jewellery, he merely stated that he had collected it through his businesses and shops over the last 10-15 years and was not aware that it was stolen property.
4.8 In response to the PFO the First Respondent provided a witness statement dated 22nd May 2008. In that statement the First Respondent again denies that the tobacco belonged to him and asserts that the vehicle had recently been in the possession and use of an employee who had placed the tobacco inside the car without his knowledge.
4.9 On November 13th 2006, some 11 months after the tobacco was seized, a man named Phillip Chalker ("Chalker") contacted the police and claimed that the tobacco in the vehicle was his [AT/5 page 8 refers].
4.10 Chalker is an employee of the First Respondent, having worked at Fair Deals as a manager for two years by the time of the tobacco seizures in 2005 [AT/5 at pages 9 to 10 refers].He also has a number of convictions for dishonesty offences [AT/5 pages 52 to 60 refers]. Chalker was in fact interviewed under caution at the time the tobacco was seized and at that time denied any association with the tobacco [AT/5 pages 9 to 51 refers]. It was found in the First Respondent's own vehicle that the tobacco was seized from, the keys to which were found in his own possession when searched by the police. It was also the First Respondent and not Chalker who leased the garages, and the keys to one of which were found in the First Respondent's possession not Chalker's. It should also be noted that the First Respondent ceased renting the garages shortly after the police searches [AT/5 at pages 61 to 133]. In the circumstances it seems incredible that anyone other than the First Respondent could have been the owner of the contraband tobacco."
The evidence relevant to alleged unlawful conduct
"It should have been pointed out by Mr. Thompson that after an extensive investigation only a small number of items amongst the nearly 300 were found to have been stolen items. A full explanation was given to the Jury for my possession of them and this was accepted. It is not unusual for dealers in my profession to innocently come into possession of stolen items. Other traders giving evidence on behalf of the Prosecution and Defence were happy to confirm that it was not unusual. It was very well known by other traders that I advertised openly for jewellery items and other traders sent people directly to me to offer their goods for sale if they themselves did not deal in particular items of jewellery. Evidence was given by other traders that it was not unusual for items of jewellery to carry price tags or code tags as these were sometimes put into auction as bankrupted or unwanted stock. Neither is it unusual to find scratches or damage to items."
"4.3 Agreed. I have a key to this garage 98 as does Philip Chalker, my shop manager and also Raymond Jack from whom I rent the garage. The keys are kept in my Shogun Motor vehicle. The keys are kept there to enable me to have access should I need to go there to assist Philip Chalker to move washing machines or heavy items and also for convenience should either vehicle be used by either of us to visit the garages. There was a key kept in the firm's van as well as in my vehicle. Raymond Jack is the main tenant of the garages and he also has a key and access to it. He also stored some of his own household items in garage 125.
..
4.10 The tobacco found both in the vehicle and in the garages did not belong to me. Philip Chalker admitted that it was his. Mr. Thompson says that it should be noted that I ceased renting the garages shortly after the purchases. This is wrong. I have never stopped renting them, I still rent them to this day and I use them for what I have always used them for and that is storage of furniture and other goods for sale in my shop. Philip Chalker also had personal keys to both garages."
"2.90 I rented the premises from a Raymond Jack. I agree that I have a key to the garages along with Philip Chalker and Raymond Jack and that the keys are kept in my Shogun motor vehicle. The keys are kept there to enable me to have access should I need to go there to assist Philip Chalker to move washing machines or other heavy items and also for convenience should either vehicle be used by either of us to visit the garages. There was a key kept in the firm's van as well as in my vehicle. Raymond Jack is the main tenant of the garages and he also has a key and access to it.
2.91 I had no knowledge that tobacco or cigarettes were being stored in either of the garages.
2.93 It is to my knowledge and well known in the Penzance area that Raymond Jack himself trades in and sells contraband tobacco and cigarettes. He is the former licensee of the London Inn in Penzance and was dismissed from that position because of him trading in those goods. It is also to my knowledge that Jack is still dealing in Penzance in contraband tobacco and that the Police must have some form of information or intelligence on his activities. It is well known that he generally goes around public houses in Penzance and Newlyn and sells particularly to fishermen. He carries the goods around in an ordinary plastic shopping bag. He is assisted by his wife Bernie who herself carries contraband tobacco around for him in her handbag."
"Where a party
(a) proposes to rely on hearsay evidence; and
(b) does not propose to call the person who made the original statement to give oral evidence,
the court may, on the application of any other party, permit that party to call the maker of the statement to be cross-examined on the contents of the statement."
"So far as Contraband tobacco is concerned I have no issue of people selling cheap tobacco. It has never been part of my business nor would it make sense. People buying used three piece suites would not expect to be offered cigarettes. My only experience of contraband cigarettes is that they are sold through public houses. This has nothing to do with me and it is ridiculous to suggest otherwise."
"The businesses listed above either made little or no profit, were made insolvent or just seem far too small i.e. selling fish door to door or fridges from the back of vans to be able to claim that Mr. Bosworth's and, therefore, by default, Mrs. Bosworth's income could possibly of [sic] funded the recoverable property as identified at paragraph 3.2 of my claim statement."
"Throughout his response to my claim for civil recovery Mr. Bosworth states that the majority of his income is derived from profits from legitimate trading that he has failed to declare to HM Revenue & Customs. Whilst, as per the paragraphs above, and in my previous witness statement, I would contest this notion, I note the recent decision of the Court of Appeal in Northern Ireland in the case of ARA v. Lovell [2009] NICA 27 [Mr. Thompson then quoted from paragraphs 31 and 41 of the judgment]
Notwithstanding my comments on Mr. Bosworth's ability to use his income derived from his second hand furniture business, it would appear from the above that any profits from income not declared to HM Revenue & Customs have been accepted, by the Court of Appeal in Northern Ireland, as being deemed recoverable property under POCA."
Sources of the assets the subject of the claim
"Mr. Bosworth has consistently chopped and changed his account when confronted with inconvenient facts. These have compelled him to admit that his initial explanations for the funding of many of his assets were not correct. The applicant suggests that Mr. Bosworth is simply not a credible witness and that no weight can be attached to his subsequent explanations.
"1.49 In February 2003 I purchased an apartment in Spain for 69,000 Euros which at that time equated to £45,000. I recall that I paid a deposit of 25,000 Euros or less and the balance of about 44,000 Euros was paid on the 5th May 2003. Both amounts of money were paid in cash and the money was undeclared proceeds from the Discount Furniture Warehouse and Fair Deals Trading. The money had been kept at my home address at 4 Penkernick Close hidden in the top of a kitchen unit with a false top on top of that. The amounts I have quoted are correct and I disagree the figures put on the property by the Prosecution. They are variously describing me as having paid £70,000 for the property and £93,500 for the property. Neither of which is correct.
1.50 The sale transaction took place between myself and the agent in Spain Jan Van Parijs. I paid the deposit to Mr. Parijs at his office in Calpe Alacante [sic] in January or February 2003. It was in April 2003 that I returned to Spain and paid the balance again to Mr. Parijs totalling 69,000 Euros. As far as I can recall there was no part payment made with bankers draft it was all in Euros cash. This money was loaned to me by my mother indefinitely. [It is unnecessary to quote the remainder of this paragraph]."
"The court should look at the evidence "in the round"."
Constructive trust
Conclusion