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Cite as: [2005] HCJAC 33, [2005] ScotHC HCJAC_33

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Hansen v. Her Majesty's Advocate [2005] ScotHC HCJAC_33 (04 March 2005)

APPEAL COURT, HIGH COURT OF JUSTICIARY

Lord Penrose

Lord Hamilton

Lord Weir

[2005HCJAC33]

Appeal No: XC976/04

OPINION OF THE COURT

delivered by LORD HAMILTON

NOTE OF APPEAL

FLEMMING LEIF HANSEN

Appellant;

against

HER MAJESTY'S ADVOCATE

Respondent:

_______

Appellant: Burns, Q.C., Jackson; Boyles, Arbroath

Respondent: Murphy Q.C., A.D.; Crown Agent

4 March 2005

[1] The appellant has been indicted in the Sheriff Court at Dundee with having, in respect of a number of loan transactions effected on various dates between 1997 and 2000, made fraudulent statements inducing various lenders to advance to him sums totalling £481,962. After various adjournments the appellant tendered, on 9 August 2004, a minute in terms of Schedule 6 to the Scotland Act 1998 in which he contended that insistence by the Lord Advocate in the prosecution was incompatible with the appellant's right to a hearing within a reasonable time under Article 6.1 of the European Convention on Human Rights. The sheriff, on 17 November, heard parties in debate on the minute. On 19 November he rejected the appellant's contention. On 3 December he granted leave to appeal against that decision.

[2] The appellant carried on business as a property developer and landlord. Certain information having come to the attention of the police, they obtained in April and in June 2000 warrants which allowed them to recover from various lending institutions in England certain documentation in relation to mortgage loans which had been obtained by the appellant. In November 2000 further warrants were obtained which authorised searches at three properties owned by the appellant in Scotland. On 29 March 2001 the appellant was cautioned and charged in relation to an offence in respect of a single loan transaction. On 5 July 2002 the police submitted a report to the procurator fiscal. On 21 January 2003 a petition warrant was granted in respect of the appellant, on which petition he first appeared before the court on 25 February 2003. On 27 November 2003 an indictment was served on him, the first diet occurring on 22 December 2003. At a continued first diet on 29 December, a diet of trial was fixed for March 2004.

[3] In his Note relative to his decision of 19 November 2004 the sheriff narrates the relevant history and the contentions of parties. Having considered these, he states:

"Having considered the whole facts and circumstances of this case, and the explanations and justifications put forward by the Crown, I am satisfied that whilst there has been a lengthy passage of time from the point when the [appellant] first became properly aware of the fact of charges against him, this period is not unreasonable. Accordingly there has been no contravention of the [appellant's] rights under Article 6(1)".

It is unnecessary for the purposes of this appeal to set out the full history, since the issue argued before us was narrow. In summary, having analysed the whole period from November 2000 into three chapters, namely, (1) the police investigation, (2) when the matter was in the hands of the procurator fiscal and (3) when the matter was in court after service of the petition, and having addressed an argument based on prejudice to the appellant, the sheriff reached the conclusion quoted above. In this appeal it is not contended that the sheriff, except in relation to his approach to the argument based on prejudice and the consequences of that approach, erred in a way in which this court should interfere with his decision. It was, however, contended that, in respect of the matter of prejudice, the sheriff had misdirected himself and that that misdirection had vitiated his decision.

[4] The sheriff in his Note narrates that, in support of the argument based on prejudice, counsel for the appellant referred to Dyer v. Watson 2002 SC (PC) 89 at para. 79. Counsel had argued that there was significant prejudice to the appellant caused by the delay and that that prejudice should be taken into account. According to the sheriff's Note, counsel:

"argued that the restraint proceedings served against the [appellant] had caused his business assets to be frozen, and this had given him severe difficulty in earning a living. He had attempted on one occasion to have the restraint order lifted, but this had been unsuccessful as the court had been advised that the trial was imminent, in April 2002. His affairs were now in the hands of a trustee, and he was able to arrange his businesses. However he had been in a state of uncertainty for an excessive period of time and his livelihood had been disrupted. That was significant prejudice, and must be taken into account".

In response to that argument the sheriff states:

"I have taken the view that in dealing with prejudice, I ought only to consider possible prejudice to the [appellant] in the conduct of the criminal proceedings. In this case the matter will be dealt with largely by documents. Identification is not an issue. Neither is recollection of events. To that extent there is no suggestion of unfairness due to the passage of time. Further, and in any event, nothing has prevented the [appellant] from returning to the civil court to make further attempts at recalling or restricting the effect of the restraint order, particularly given that the imminence of the trial date of April 2002 had turned out to be inaccurate. Accordingly I take the view that whilst it might be argued that there might have been some financial prejudice, this is not something that I am prepared to take into account in assessing whether or not there has been delay so excessive as to breach the [appellant's] rights under article 6(1)".

[5] Subsequent to the lodging of this appeal the sheriff prepared and transmitted a Supplementary Note in which he reiterates and expands as follows on the narrative given to him by counsel:

"[Counsel] stated that a note was presented to the Court of Session to lift the restraint order without success. He accepted that the appellant could have returned later in order to try again, given that the trial did not proceed in April 2002 as had been thought at the time of the application. The appellant's affairs were now in the hands of a trustee, but the appellant had reached an arrangement with the trustee to allow him to earn a living. For a while, the appellant was unable to pursue his business interests".

[6] In the final paragraph of his Supplementary Note the sheriff states:

"It can be seen that the submissions on behalf of financial prejudice were brief. I could not see how the financial prejudice referred to could possibly interfere with the appellant's right to a fair trial, although I accept that it was a factor which could be taken into account, in the balance of factors to be considered when having regard to the appellant's rights under article 6(1). As I indicated in the penultimate paragraph of my note, I considered the full facts and circumstances put forward on behalf of the appellant. I did not find that his right under article 6(1) had been breached".

[7] Mr. Burns for the appellant submitted to this court that the sheriff had misdirected himself in taking the view that he ought only to consider possible prejudice to the appellant in the conduct of criminal proceedings. It was appropriate to have regard to wider considerations, including financial prejudice suffered as a result of delay. Reference was made to Dyer v. Watson, per Lord Hope of Craighead at paras. 78-9 and per Lord Rodger of Earlsferry at para. 149. In the present case a restraint order under the Proceeds of Crime (Scotland) Act 1995 had, in April 2001, been obtained at the instance of the Lord Advocate. That order had interdicted the appellant from dealing with his realisable property, including all his personal and business assets. That order had remained in place, although some of the properties had, with the consent of the Crown, been released from the restraint and sold. The existence of an order, which effectively froze the appellant's business properties and affected his livelihood as a property owner and developer, made it incumbent on the Crown and the police to take particular steps to expedite the criminal process. The sheriff had wrongly disregarded this aspect of the delay; such disregard was particularly inappropriate in circumstances where the sheriff had expressed some, albeit not grave, concern about the length of the time the police investigation had taken. At some stage a trustee had been appointed to manage the appellant's business properties but he required to be paid, with the result that extra expense had been incurred for the business. The appellant had been restricted in what he could do in carrying on his business, including in the finding of tenants. As a result, half the properties had remained empty. The appellant had, in May 2002, sought to have the restraint order recalled or varied. But this application had been opposed by the Crown and refused by the court. At that stage it had been understood that the criminal proceedings would come to trial shortly. That had not in the event transpired. It was wrong to criticise the appellant for not making another application to have the restraint order recalled or varied. He had no funds and had been left as a result of the 2002 application with an, as yet undischarged, liability in expenses of some £6,000. Had the sheriff properly addressed the matter of financial prejudice to the appellant, he might well have concluded that in all the relevant circumstances the delay had been unreasonable. The appropriate course was to remit to the sheriff to consider the issue of new upon a sound basis in law. Alternatively, this court should itself consider the issue and grant to the appellant the remedy he sought, namely, dismissal of the indictment. There was, so far as counsel was aware, no authority dealing directly with the effect of financial prejudice on the assessment of a reasonable time for the purposes of Article 6. But it was clear that prejudice to health was relevant; financial prejudice was analogous. Reference was made to Gibson v. H.M. Advocate 2001 S.C.C.R. 51, where the relevance of prejudice was recognised.

[8] The Advocate depute submitted that, while there might be questions over certain aspects of the sheriff's approach, that approach was in substance correct and his decision was reasonable in all the circumstances of the case. While the Crown had certain reservations as to the sheriff's choice of November 2000 as the starting point for assessing a reasonable time, it was content for present purposes to accept that date. Having regard to the observations in Dyer v. Watson, the Crown also accepted that the sheriff's initial approach to the issue of prejudice might be too narrow. Relevant prejudice might extend beyond prejudice directly affecting the presentation or conduct of a defence to the criminal charge; protracted apprehension as to the outcome of proceedings might be relevant, as might other natural consequences of delay, including prejudice to health (X v. France (1991) 14 E.H.R.R. 483). Financial prejudice could, in some circumstances, be relevant - for example, where the conduct of a business required the personal attendance of an accused and his absence, due to the protraction of proceedings, adversely affected his livelihood or that of others. Here, however, the Proceeds of Crime (Scotland) Act 1995, under which the restraint order had been made, itself made provision for relief against the type of financial prejudice claimed. Reference was made in particular to section 28(2) (as originally enacted). The sheriff had addressed what steps the appellant had taken and could have taken, but failed to take, to obtain relief. His decision was reasonable and should not be disturbed. Moreover, the appellant had taken no steps after 2002 to alert the Crown to any continuing financial prejudice being suffered by him by reason of delay.

[9] In his Supplementary Note the sheriff describes the submissions made in respect of financial prejudice as "brief". The main thrust of the discussion before him appears to have been directed to other matters and little to demonstrating actual and significant financial prejudice suffered by the appellant. Likewise before this court the material presented on the matter was very limited.

[10] It appears that in April 2001 an application, under section 28 of the Proceeds of Crime (Scotland) Act 1995, was presented by the Lord Advocate to the Court of Session. In the relative petition it was narrated that on 29 March 2001 police officers had charged the appellant with fraud in relation to one mortgage application, the amount alleged to have been defrauded by that offence being stated at £25,775.62; it was also averred that it was anticipated that the appellant would be charged with further offences. On the ex parte application of the Lord Advocate the Lord Ordinary, on 20 April 2001, made an order interdicting the appellant from dealing with his realisable property, including particular heritable properties in Dundee and Montrose and certain items of moveable property. The Lord Advocate was appointed to give notice of the order to the appellant. No immediate steps appear to have been taken by the appellant in response to the making of that order. It seems (although we were provided with no documentary material on the matter) that in or about April or May 2002 the appellant made an application to the Court of Session seeking to have the existing restraint order recalled or varied. That application was opposed by the Crown and was unsuccessful. It is said to have been stated at that time that "the trial was imminent", though, as the police had not by that time submitted their report to the procurator fiscal, it is difficult to comprehend what was intended or understood by any such statement. At no later stage was any further application made by the appellant for recall or variation of the restraint order, although (by a procedure not satisfactorily explained to this court) certain of the properties with which the appellant had been interdicted from dealing were apparently disposed of with the agreement of the Crown. At some stage and by some mechanism a "trustee" (not apparently a trustee in bankruptcy nor, so far as we were informed, an administrator appointed under section 34 of and Schedule 1 to the 1995 Act) was appointed in respect of certain assets of the appellant; but the terms of his appointment and his powers of management were not vouchsafed before this court. The sheriff appears to have understood that, as the appellant's affairs were now in the hands of a trustee, the appellant was "able to arrange his businesses", the complaint being that the appellant "had been" in a state of uncertainty for an excessive period of time and that his livelihood had been disrupted. Mr. Burns suggested before us that there was continuing disruption and prejudice (including problems in respect of securing tenants for vacant properties and in the granting of tenancies to them) but the nature and extent of any disruption and prejudice was far from clear. Although it was said that the appellant had an outstanding liability in expenses for the unsuccessful application to the Court of Session in 2002, it was not demonstrated to our satisfaction (nor apparently to that of the sheriff) that, for financial reasons, it was impossible for the appellant to bring a fresh application to remove or mitigate any financial prejudice being sustained.

[11] It is clear that it is not necessary for a person, who is charged with a criminal offence and who claims that his Article 6(1) Convention entitlement to a hearing within a reasonable time has been violated, to show that he has suffered, or will suffer, actual prejudice; where, however, significant prejudice due to a period of delay is demonstrated, that can be taken into account when making the assessment as to whether the delay was reasonable (Dyer v. Watson, per Lord Hope at para. 79).

[12] None of the authorities cited to us considers whether and, if so, in what circumstances financial prejudice occasioned by delay in the bringing of criminal proceedings to a conclusion bears on that Convention entitlement. We are prepared, however, for the purposes of this case, to proceed upon the basis that in some circumstances financial prejudice occasioned by delay could have a bearing on the assessment of a reasonable time. But to have such a bearing, it would require to be demonstrated not only that prejudice of that kind had actually been or was being sustained but also that it had been or was significant. In that context due regard would also require to be had to, among other factors, the availability and use (or failure to make use) of means of avoiding or mitigating such prejudice. A restraint order might have been made, either initially or on variation, subject to conditions (1995 Act, section 28(2), as originally enacted). In an appropriate case the civil court could accordingly have made specific provision for the operation of a business, or some aspect of it, to be excepted from the order. Specific provision for such an exception was subsequently made by amending legislation (see Proceeds of Crime Act 2002, section 120(3)(b)). No doubt in any such case appropriate policing arrangements would require to be put in place.

[13] On his alternative approach to the issue of financial prejudice, the sheriff was not satisfied on the facts and circumstances laid before him (including those bearing on financial prejudice) that there had been a breach of Article 6(1). We are not persuaded that, on the material before him, that decision was unreasonable. Nor are we satisfied on the material placed before us, lacking as it does precision and specification, that it has been demonstrated that the appellant has suffered or will suffer financial prejudice of such significance as to alter the otherwise unchallenged conclusion that there has been no breach of Article 6(1).

[14] For these reasons this appeal is refused.