High Court of Ireland Decisions

1. A single question arises for determination in this application. It is this. Is the offence in respect of which it is sought to extradite the Applicant to Northern Ireland a revenue offence? If it is, then the Applicant must be released. If it is not, he must be extradited to Northern Ireland since no other grounds have been advanced which would justify his release.

2. The Applicant is a farmer. He is aged 44 years and normally resides with his wife and twelve children at Strandfield House, Mount Pleasant, Dundalk, Co. Louth. There he farms 130 acres and also operates a lairage facility on the farm for livestock which are destined for export from the nearby port of Greenore.

3. On the 19th April, 1995 the Applicant was arrested at his home on foot of a warrant issued in Northern Ireland and endorsed for execution in the State by the Respondent who is a Deputy Commissioner of An Garda Siochana.

4. The warrant was dated the 21st December, 1994 and was issued by Francis Gerald Harty, a Resident Magistrate and Justice of the Peace in Northern Ireland.

5. The warrant named Douglas Fraser Neish as the Complainant. He is described as a Senior Investigation Officer of Her Majesty's Customs and Excise Investigation Division with an address at Vigilant House, 72/76 Inchinnan Road, Paisley, Scotland. The Applicant in these proceedings is identified in the warrant as the Defendant. The warrant is couched in the following terms:

6. Following his arrest, the Applicant was brought before the District Court and on the 31st May, 1995 an application for his extradition to Northern Ireland to answer the charge set forth in the warrant was heard and determined. The District Court made an Order for his extradition.

7. On the 2nd June, 1995 the present proceedings were commenced. They seek an Order directing the Applicant's release pursuant to the provisions of Section 50 of the Extradition Acts, 1965 to 1994.

8. It is common case that the Applicant's alleged co-conspirators have been brought before the Courts of Northern Ireland and have pleaded guilty to charges arising out of conduct identical with that which underlies the charge alleged against the Applicant. On the 7th February, 1992 at Belfast Crown Court, Morris James Lutton, David Thompson Lutton and Sean Gerard Stanley were sentenced.

9. It is also common case that the prosecuting authorities in Northern Ireland allege that between the 1st June, 1986 and the 4th August, 1988 the Applicant was engaged in a scheme to subvert the Agricultural Levies (Export Control) Regulations, 1983 of the United Kingdom, which regulations were made pursuant to obligations imposed under Articles 38, 39 and 235 of the Treaty of Rome and pursuant to Council Regulations (EEC) 729/1970 and (EEC) 974/1971, superceded by Council Regulation (EEC) 677/85 consolidating the foregoing and by Council Directive 81/77/EEC.

10. These regulations established a scheme the purpose of which was to ensure, as far as practicable, that all farmers within the European Economic Community (as it then was), now the European Union, would be selling the same produce at the same price irrespective of fluctuations in exchange rates between the Member States.

11. Such a result was sought to be achieved by adjusting in a negative or a positive way the price of agricultural produce as it crossed the borders between individual Member States of the European Union.

12. The Applicant accepts that the Affidavit of George Nicholas Dixon sworn on the 3rd April, 1996 which has been filed on behalf of the Respondent contains an accurate description of the functioning of the scheme of levies and compensations established by the Agricultural Levies (Export Control) Regulations, 1983. It is that scheme which the Applicant is alleged to have conspired to breach. The relevant paragraphs from that Affidavit read as follows:

13. The Applicant contends that the gravamen of the charge which has been laid against him in Northern Ireland is one of conspiracy to avoid paying sums of money to the Government of the United Kingdom which he was required by the law of that jurisdiction to pay upon the export from the United Kingdom to the Republic of Ireland of grain. He contends that these monies were collectable by the Government of the United Kingdom on behalf of the European Union. This he contends is a revenue offence as defined in the Extradition Acts.

14. Section 50 of the Extradition Act, 1965 as amended by the Extradition Amendment Act, 1994 insofar as it is relevant reads as follows:

15. The term 'revenue offence' is defined in the definition section of the 1965 Act as amended by the 1994 Act as follows:

16. The Applicant accepts that he must establish that the offence in respect of which it is sought to extradite him is a revenue offence, if he wishes to obtain an Order directing his release under Section 50 of the Act.

17. I must make a finding as to whether or not the offence charged is a revenue offence as defined in the Act. This is something which falls to be determined as a matter of Irish law. In the present case affidavit evidence has been furnished to me setting forth the views of both lawyers and economists on the topic. Whilst these may be of some help they are not determinative of the question. That is a matter of Irish law.

18. The Applicant contends that the Court in undertaking its task ought to adopt a strict approach to the construction of the statutory provisions upon which he relies in seeking his release. He says the definition of revenue offence must be strictly construed and no gloss put upon it. He points out that as recently as 1994 the 1965 Act was amended and that had the legislature desired to exclude offences of the type involved here concerning MCAs from the revenue offence exception it could have done so. It did not. He submits that the offence charged is a revenue offence since it is one brought in connection with taxes duties or exchange control.

19. In my view, absent any obligation imposed on the Court by European law, the Applicant is correct when he asserts that the Court ought to adopt a strict approach to the construction of the statutory provisions in question.

20. The Extradition Act trenches upon personal liberty and any enactment which has that effect must, in my view, be construed strictly. This approach to the construction of an extradition statute is not by any means peculiar to the law of this State. Such an approach has been approved by judicial authorities in England and Wales. For example, in Tzu Tsai Cheng v The Governor of Pentonville Prison 1973 AC 931 Lord Simon of Glaisdale said:

21. Whilst Lord Simon's speech constituted the principal minority view of the Law Lords in that case, the above quoted principles were not dissented from by the other members of their Lordships House. These views of Lord Simon were cited with approval by Stuart-Smith LJ in R. v. Chief Metropolitan Magistrate ex parte Secretary of State for the Home Department (1989) 1 AER 151. He pointed out that although in a minority, that did not matter for the statements of principle set forth by Lord Simon.

22. Kilner Browne J. in delivering the judgment of the Divisional Court in R v The Governor of Pentonville Prison ex parte Khubchandani (1980) 71 Crim. App. R 241 said:

23. These authorities satisfy me that in approaching the construction of the relevant provisions of the Extradition Act and absent any obligation of construction imposed by European law, I must do so in accordance with the rules of strict construction.

24. The effect of this means that I am not permitted to put any gloss upon the words used in the Act and must assume that the words and phrases are used in their ordinary and natural meaning.

25. To return to what Lord Simon said in Cheng's case (at p. 950)

26. Finally, on this topic I refer to Maxwell on Interpretation of Statutes (12th edition) at p. 239, where it is stated that

27. The net effect of this from the point of view of construing the Extradition Act is that:-

28. I propose to apply these rules in my consideration of the Applicant's case. However, as will become clear later in this judgment, I am not convinced that this is the correct approach to take in a case such as this given the obligations imposed on this Court by European law as enunciated both in the Treaties, Regulations, Directives and the jurisprudence of the European Court of Justice.

29. For the moment, however, I will adopt the strict constructionist approach which is of course more beneficial to the Applicant. I will therefore examine whether on such a basis the offence charged against him falls within the revenue exception permitted by Section 50 of the Act.

30. In seeking to ascertain whether the offence charged is a revenue offence or not I must look to its true nature. (See State (Hully) v. Hynes 100 ILTR 145 and Buchanan v. McVeagh (1954) IR 106).

31. The charge in respect of which it is sought to extradite the Applicant is that of conspiracy to defraud the Intervention Board for Agricultural Produce of Monetary Compensation Amounts due to it. These amounts became payable pursuant to the provisions of the Agricultural Levies (Export Control) Regulations, 1983. These are Regulations made by the Minister of Agriculture, Fisheries and Food in the United Kingdom. The Regulations recite as follows:-

32. Amongst the agricultural products which are set forth in the Schedule to these Regulations are cereals.

33. These Regulations revoked an earlier set of Regulations known as the Agricultural Levies (Export Control) Regulations, 1981.

34. As is clear from the recitals to these 1983 Regulations, they were made by the relevant Ministers in the United Kingdom Government pursuant to powers on that behalf contained in Section 2(2) of the European Communities Act, 1972. That same Act by Section 6 thereof set up the Board known as the Intervention Board for Agricultural Produce. As is clear from the terms of Section 6(1) of the United Kingdom European Communities Act, 1972, that Board is charged, subject to the direction and control of the Ministers, with such functions as are from time to time determined in connection with the carrying out of the obligations of the United Kingdom under the Common Agricultural Policy of the Economic Community. Subsection (2) of the same section provides for Orders in Council being made which enables that Board to arrange for its functions to be performed by other bodies on its behalf. Section 6(4) provides that agricultural levies of the Economic Community, so far as they are charged on goods exported from the United Kingdom or shipped as stores, are to be paid to and recoverable by the Board. The same subsection permits Ministers to make such provisions supplementary to any directly applicable Community provision as the Ministers consider necessary for securing the payment of any agricultural levy so charged, including provision for the making of declarations or the giving of other information in respect of goods exported, shipped as stores, warehoused or otherwise dealt with.

35. Section 6(5) provides that agricultural levies of the Economic Community, so far as they are charged on goods imported into the United Kingdom are to be levied, collected and paid and the proceeds dealt with, as if they were Community customs duties and in relation to those levies certain enactments are to apply. These enactments are the general provisions of the Customs and Excise Act of 1952 and certain provisions of the Import Duties Act, 1958. These are to apply as if, in connection with any such Community arrangements the Commissioners of Customs and Excise are charged with the performance, on behalf of the Board or otherwise, of any duties in relation to the payment of refunds or allowances on goods exported or to be exported from the United Kingdom.

36. Finally, under Section 6(8) of the European Communities Act, 1972 the term 'agricultural levy' is defined as including "any tax not being a customs duty, but of equivalent effect, that may be chargeable in accordance with any such Community arrangements as aforesaid" .

37. It is clear from the definition of agricultural levy which is contained in the 1983 Regulations that in order to qualify for that definition the levy must be a tax or charge, not being a customs duty, chargeable under Community arrangements on agricultural products or on goods which are processed from agricultural products and are the subject of arrangements under Article 235 of the EEC Treaty.

38. From this definition contained in the 1983 Regulations it is clear that the whole notion of the agricultural levy has its roots in arrangements brought about by European Community obligations.

39. The most relevant of these obligations is to be found in Regulation 729/70 on the financing of the Common Agricultural Policy. Article 1 of that Regulation set up the European Agricultural Guidance and Guarantee Fund (EAGGF). That Fund formed part of the budget of the Communities and comprised two sections, namely, the Guarantee Section and the Guidance Section. The Guarantee Section was obliged to finance refunds on exports to third countries and intervention intended to stabilise the agricultural markets. The Guidance Section was obliged to finance common measures adopted in order to achieve the objectives set out at Article 39(1)(a) of the Treaty including structural adaptation necessary for the proper working of the common market.

40. Article 8 of the same Regulation required each Member State in accordance with national provisions laid down by law, regulation or administrative action to take the measures necessary to

41. The Member States were obliged to inform the Commission of the measures taken for those purposes and in particular of the state of the administrative and judicial procedures.

42. The Common Agricultural Policy was a corner stone of the Treaty of Rome and the objectives of that Policy are contained in Article 39 thereof. Regulation 729/70 imposed obligations on every Member State in relation to the financing of the EAGGF. The obligation to operate the system of MCAs is one which was applicable to every Member State. These obligations involved the harmonisation of prices throughout the European Union. The relevant paragraphs from the Affidavit of George Nicholas Dixon, which I have already cited in this judgment, indicate how that was done.

43. The Applicant contends that having regard to the definition of agricultural levy which is set forth in Section 6(8) of the United Kingdom European Communities Act, 1972 and in Regulation 1(2) of the 1983 Regulations, there can be no doubt but that what was involved in the instant case was a tax and therefore falls within the revenue exemption contained in Section 50 of the Extradition Act, 1965 as amended. Reliance is placed upon the fact that the very definition of agricultural levy both in the Act and the Regulations is expressly described as a tax. The Applicant says that tax is defined by the Oxford dictionary as "a compulsory contribution to the support of Government, levied on persons, property, income, commodities, transactions, etc. now at fixed rates mostly proportional to the amount to which the contribution is levied" . He contends that this approach must involve a finding in his favour. He gleans support for this proposition by reference to an Affidavit of Kevin J. Finnegan, who is a Queen's Counsel practising at the Bar of Northern Ireland. It was Mr Finnegan who appeared as Defence Counsel in the trial of the Applicant's co-conspirators. In a very short Affidavit he expresses the opinion that the charge laid against the Applicant is one in connection with taxes, duties or exchange control as defined under Section 3(1) of the Extradition Act, 1965 and is therefore a revenue offence falling within the scope of Section 50 of the Act. He furthermore relies on an Affidavit sworn by Alan Matthews, who is the Head of the Department of Economics at Trinity College, Dublin. In the course of that Affidavit Professor Matthews says

44. Later in the same Affidavit he says

45. Whilst of course I pay attention to these expressions of opinion, they are nothing more than that, one coming from a member of the Inner Bar of Northern Ireland and the other from a Professor of Economics. The issue which I have to determine in this case is an issue of Irish law in respect of which opinion evidence from the two experts named is of comparatively little value or relevance.

46. It appears to me that having regard to the European genesis of the agricultural levies in question, I must have regard to any decisions of the European Court of Justice which may have a bearing on the question. These decisions are, of course, binding upon me and consequently are of infinitely greater weight, importance and relevance than opinions of experts, whether in economics or law, and whether cited by the Applicant or the Respondent. In my view there are a number of decisions of the European Court which have a bearing upon my consideration of this matter.

47. The second is that in the case of Nordgetreide v. Hauptzollamt Hamburg-Jonas (1985) ECR 3127. In that case the European Court held that

48. That is the way in which the European Court of Justice has characterised MCAs.

49. As I have already pointed out, the system under which they are operated in the United Kingdom pursuant to Regulation 729/70 is by means of the provisions of the European Communities Act, 1972 and the 1983 Regulations which are in suit. The 1983 Regulations have as their object not the raising of revenue but the facilitation of the free movement of goods in accordance with the Common Agricultural Policy which is binding upon each Member State of the European Community.

50. These quotations coupled with the wording of Regulation 729/70 and the relevant statutory provisions which are applicable in the United Kingdom appear to me to establish the following propositions:-

51. It follows from these conclusions that the agricultural levy which the Applicant is alleged to have conspired not to pay, although called a levy and although defined as being a tax in the 1983 Regulations and the 1972 Act, is not in fact a tax in any real meaning of that term. The principal object of a tax is to raise revenue. But that was not the object of the levy here. Rather it was to implement the Common Agricultural Policy by facilitating the free movement of cereal goods which fell within the ambit of that policy. My views in this regard are supported by the dicta of the European Court of Justice and by the fact that any loss occasioned by the activity of the Applicant was not that of the United Kingdom but rather of the EAGGF which, as I have already pointed out, was a fund set up by Regulation 729/70. Furthermore, it is clear that MCAs need not always be a charge on either exports or imports but could be a refund on either of these. Such is not a normal characteristic of a tax. I therefore take the view that, as a matter of Irish law, the offence charged against the Applicant is not a revenue offence.

52. In order to come to this conclusion, I have analysed the true nature of the offence charged. MCAs are not taxes, duties or exchange control measures. Such a conclusion does not involve any departure from the strict constructionist approach to the legislation.

53. But I am far from satisfied that the strict or literal approach to the construction of the Extradition Act is appropriate in the circumstances of this or similar cases. My reasons for this arise from the following.

54. As is already clear from this judgment, the whole genesis of the levy involved in this case is founded in European law. The obligations imposed on all of the Member States in respect of MCAs derive from European law. I have already quoted from the relevant Articles of Directive 729/70 and the jurisprudence of the European Court of Justice in that regard.

55. In approaching the construction of the relevant provisions of the Extradition Act in this case with its overlying European dimensions, the Court must, if required, have regard to the dicta of the European Court of Justice concerning the status of European Union law in this and indeed all other Member States.

56. Article 209A of the European Union Treaty inserted by Title 2 and Article E(77) of the Maastricht Treaty provides:-

57. Most recently in Faccini Dore v. Recreb (1995) All England Law Reports European Cases, the European Court said:-

58. Each Member State was obliged pursuant to Regulation 729/70 in accordance with national provisions to take the measures necessary to prevent and deal with irregularities and to recover sums lost as a result of irregularities or negligence. This is so having regard to Article 8 of the Regulation which itself has been the subject of judicial interpretation by the European Court of Justice on a number of occasions. Two appear to me to be relevant. The first is the decision of that Court in Belgium and Luxembourg v. Mertens (1974) ECR. In that case the Court held that:-

59. In the light of these observations it appears to me that, given the European dimension to the instant case, the appropriate way to construe the relevant provisions of the Extradition Act is to do so in a manner which is consistent with the obligations of the State to the European Union. The obligation of this country as a Member State of the European Union is to, inter alia, protect the financial interests of that Union and this obligation would be impeded by, in the case of an ambiguity, construing the relevant provisions of the Extradition Act in a manner which would conclude that the offence charged against the Applicant here is a revenue one and thereby prevent his extradition.

60. It would follow from this approach that in the case of an ambiguity in the legislation, the strict constructionist approach would have to give way to an interpretation which would comply with the State's obligations in European law. There is no such ambiguity here so the matter does not arise.

61. If, however, there is an ambiguity, the Act must be construed in the manner set forth in the preceding paragraph. A construction which would lead to the conclusion that the offence charged is a revenue one would not be consistent with this State's obligations as a member of the European Union.

62. I therefore conclude that as a matter of Irish law the offence in respect of which extradition is sought is not a revenue offence. This is so because it is not one connected with taxes, duties or exchange control. Rather it is connected with monetary compensation amounts which are not taxes or duties or exchange control measures.

63. It follows that this application fails. The Order sought is refused and the Applicant's extradition to Northern Ireland may proceed as directed by the District Court.