Adams v Crown Prosecution Service
| Jurisdiction | England & Wales |
| Judge | Lord Justice Hamblen,Lord Justice Irwin,Lord Justice Longmore |
| Judgment Date | 27 March 2017 |
| Neutral Citation | [2017] EWCA Civ 185 |
| Court | Court of Appeal (Civil Division) |
| Date | 27 March 2017 |
| Docket Number | Case No: C1/2014/2864 |
[2017] EWCA Civ 185
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE QUEEN'S BENCH DIVISION (ADMINISTRATIVE COURT)
THE HONOURABLE MRS JUSTICE DAVIES
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Longmore
Lord Justice Hamblen
and
Lord Justice Irwin
Case No: C1/2014/2864
Mr. Ivan Krolick (instructed by Clarke Barnes Solicitors LLP) for the Appellant
Mr. Kennedy Talbot QC (instructed by Crown Prosecution Service) for the Respondent
Hearing dates: 16 March 2017
Approved Judgment
Introduction
This is an appeal against the decision of Nicola Davies J to refuse to issue the appellant a certificate of inadequacy under s.83(1) of the Criminal Justice Act 1988 ("the 1988 Act").
Such a certificate may be applied for where a defendant in respect of a confiscation order contends that his realisable property is inadequate for the payment of any remaining amount due to be recovered under the order. If the court is satisfied that this has been established then a certificate to that effect may be issued.
Once a certificate of inadequacy is issued the defendant may apply to the Crown Court under s.83(3) of the 1988 Act for a reduction in a confiscation order made against him.
In the present case the appellant ("Mr Adams") was subject to a confiscation order requiring payment by 30 th September 2007 of the sum of £750,000. Approximately £365,000 has been paid and in December 2012 Mr Adams was informed that the balance due was £380,713.81. Interest continues to accrue and by the date of judgment, 11 August 2014, £651,611 was outstanding under the order.
The factual background
On 6 February 2007 Mr Adams pleaded guilty to one count of conspiracy to conceal the proceeds of criminal conduct for which he received a sentence of 7 years imprisonment. On 9 March 2007 a confiscation order was made against him requiring him to pay £750,000 by 30 th September 2007, with a default sentence of 4 years imprisonment.
The background to the criminal proceedings against the appellant is set out in the judgment of the Court of Appeal in his unsuccessful appeal against sentence, R v Adams [2009] 1 WLR 301:
"4. The background facts are as follows. The defendant was for a significant period of time a highly successful career criminal and was well known as such. By his basis of plea it is plain that he was asserting and it was accepted by the prosecution, the criminality in question had ceased in or about 1993…. The basis of plea was:
"(a) I will plead guilty to count 10 only excluding drugs on the basis of a full fact opening. (b) The prosecution will not undermine any suggestion that the criminality which created the funds was five to six years before 1998 (consequently the defendant will mitigate on the basis that although money from crime was laundered in accordance with the time frame in Count 10, no other crime has been committed since five to six years before 1998). (c) The prosecution are content for the defence to mitigate on the basis that the total value of the criminal activity at the time of offences was £1m. (d) Confiscation – figure for realizable assets is £750,000. (e) Prosecution cost £50,000."
5. The defendant had clearly amassed a considerable fortune by the time of the end of his criminal activity and it was expended on a lavish lifestyle which involved, according to the prosecution, significant numbers of first class flights to different destinations around the world, expensive jewellery, private education for his child and the acquisition of antiques, works of art and other property. When he was ultimately arrested on 30 April 2003 his home, Fallowfields was a large property in a desirable area of North London. The police found substantial quantities of valuable property and the clear indications were that the defendant had been able to maintain his lifestyle because of the criminal activities in question.
6. The defendant had paid no income tax for a significant period. There was an investigation into his position in 1995, and eventually in 1996 he agreed to pay £95,000 settlement, covering his tax liabilities. But that was on the basis of false information that he had provided. It then became apparent to him that he would have, in some way or another, to account in a way which would satisfy the authorities for the wealth that he had amassed. It was in those circumstances that he obtained the assistance of others in order to disguise the proceeds of crime.
7. It was principally done through sham companies that were set up, in particular Skye Consultancy Ltd., and Clouds Consultancy Ltd., which gave him effectively bogus employment and an income generated by the companies on the basis that he was some form of consultant. The precise details of the way in which those companies were operated is not of any materiality for the purposes of the sentencing exercise. Suffice it to say that means were found to enable an apparently honest source of income to be developed over a substantial period of time. Indeed, the prosecution case was in reality that the whole of the period from 1996 onwards was a period in which the defendant was seeking, by bogus means, to hide the way in which he had come by his money.
8. Although, at the end of the day, the prosecution were prepared to accept the basis of plea, it remains to some extent uncertain what the full extent of the financial situation was or indeed is. None the less the Judge was prepared to sentence the defendant on the basis of the matters which were accepted by the prosecution on that basis of plea. …"
Mr Adams' wife Ruth Adams ("Mrs Adams") had been jointly charged with Mr Adams with offences of fraudulent trading, furnishing false information and conspiring with others to conceal or disguise property which in whole or in part directly or indirectly represented the proceeds of relevant criminal conduct and/or drug trafficking. Mrs Adams became seriously ill before the hearing and the Crown decided not to pursue charges against her following Mr Adams' plea to the conspiracy count.
As to Mrs Adams' alleged role this was described by the judge as follows at [5]:
"….It was in early 1995 that the Special Compliance Office of the Inland Revenue began an investigation into Terence Adams's finances as a result of which it became necessary for him to provide details of his source of income over a period of some six years. Until he was murdered in November 1998, Solly Nahome played a principal part in organising Terence Adams's financial affairs. Following his death his role in relationship to Terence Adams's finances was assumed by three others – Ruth Adams, Nahome's widow Joanna Barnes and a friend, an accountant/bookkeeper. It was the Crown's case that these three individuals continued to practise the deceits necessary to conceal the fact that Terence Adams derived his income from the proceeds of crime. Joanna Barnes was also charged with forging a loan agreement ostensibly between her husband and Terence Adams, an offence to which she pleaded guilty."
In addition to the confiscation order, a Financial Reporting Order ("FRO") was also made in respect of Mr Adams on 21 May 2007 for a duration of 10 years. The FRO required him to submit financial reports (every 6 months when in custody and every 4 months when released).
As for Mr Adams' assets, Mr and Mrs Adams jointly owned the matrimonial home at Fallowfield, London NW7 ("Fallowfield"). Fallowfield was sold in 2009 and the proceeds were divided between Mr and Mrs Adams. Mr Adams's share of the net proceeds of sale was £234,166.21. This was applied towards the confiscation order. A Receiver was then appointed and he published his final account on 31 August 2010. He had disposed of all of the assets of Mr Adams which had been referred to in his letter of appointment, and had realised the total sum of £160,866.06. After deducting the relevant fees and disbursements, his net realisation was £130,323.39, which he had paid in part satisfaction of the confiscation order. It was Mr Adams's case that all assets held by him had then been realised.
In 2012 a tax rebate of £1,374.60 was credited to the confiscation account, and in December 2012 Mr Adams was informed by the CPS that the balance due under the Confiscation Order was £380,713.81, but statutory interest continued at £88.44 per day. The total sum realised from disposal of Mr Adams's assets, and paid in satisfaction of the Confiscation Order was accordingly £369,286.19.
Mr Adams was released from prison on 23 June 2010. He breached the terms of his FRO and was subsequently sentenced to 8 weeks imprisonment. He was returned to custody on 25 November 2011 and released on 25 July 2012.
On 30 May 2012, whilst still in custody, Mr Adams applied for a certificate of inadequacy pursuant to section 83 of the 1988 Act.
It was Mr Adams's case that he had exhausted all of his assets; that he had received minimal remuneration for some work he had been able to obtain since his release from prison and that he is, effectively, dependent on his wife. He gave an account of his financial affairs, and drew attention to the fact that his financial affairs had been under intense scrutiny and investigation both before, and after, the making of the confiscation order, and this scrutiny continued.
The CPS resisted the application. The CPS contended that Mr Adams could not prove on the balance of probabilities that that his current assets were worth less than the outstanding balance on the confiscation order. It was contended that Mr Adams had access to a substantial capital reserve which could be used to pay the confiscation order and that this was supported in particular by the financial transactions of Mrs...
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Benedicta Ojebode (also known as Benedicta Ojebode Oluremilekun Thomas) v the Criminal Justice Act 1988
...of inadequacy have recently been considered and reaffirmed by the Court of Appeal in the case of Adams v Crown Prosecution Service [2017] EWCA Civ 185, [2017] 1 WLR 3732. The defendant must satisfy the court that his or her “realisable property” is “inadequate” to pay the remaining amount......