Anthony Bennett v The Chief Constable of Merseyside Police
| Jurisdiction | England & Wales |
| Judge | Lord Justice Leggatt,Mrs Justice Andrews |
| Judgment Date | 29 November 2018 |
| Neutral Citation | [2018] EWHC 3591 (Admin) |
| Date | 29 November 2018 |
| Docket Number | CO/1945/2018 |
| Court | Queen's Bench Division (Administrative Court) |
[2018] EWHC 3591 (Admin)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
DIVISIONAL COURT
Royal Courts of Justice
Lord Justice Leggatt
Mrs Justice Andrews
CO/1945/2018
APPEARANCES
Mr T Forte (instructed by DDE Law) appeared on behalf of the Appellant.
Ms A WHyte QC and Mr P Sigee (instructed by the Merseyside Police Force Solicitor) appeared on behalf of the Respondent.
This is an appeal by case stated from a magistrates' court in Liverpool against its decision to make no order for costs after the Chief Constable of Merseyside Police withdrew an application for forfeiture of cash seized from the appellant.
The background facts found by the magistrates' court can be summarised as follows. On 2 June 2015, Merseyside Police executed a search warrant at a property in Birkenhead. It was obvious on entering the property that it had been used as a cannabis farm. There was a strong smell of cannabis, the electricity meter had been bypassed and paraphernalia associated with cannabis production such as fans, pumps and lighting were present. Cannabis leaves were found throughout the premises.
Present at the property when the warrant was executed were the appellant, his cousin Neil Bennett and an individual called Jason Woods. The appellant was found to be in possession of around £960 in cash which was seized by the police.
Later that day, the police searched the appellant's home and found £43,838.36 in cash in a safe in a bedroom. The appellant's partner, who was also his company secretary, denied any knowledge of the safe, or of the cash. This cash was also seized, making the total amount seized £44,789.36.
The home of the appellant's cousin, Neil Bennett, was also searched by the police and a substantial cannabis farm was found on the premises.
The appellant was arrested and interviewed by the police. In interview he made no comment. He was subsequently charged with an offence of money laundering.
On 16 June 2015, the appellant undertook in a letter from his solicitors to explain the origins of the cash seized from him by 30 June 2015. Despite a number of reminders, no explanation had yet been provided when, on 21 August 2015, the Chief Constable issued an application in the magistrates' court under s.295 of the Proceeds of Crime Act 2002 for forfeiture of the cash.
The forfeiture proceedings were adjourned by agreement to await the outcome of the criminal proceedings against the appellant. Ultimately, when the criminal proceedings came to trial the prosecution offered no evidence and the charge was formally withdrawn on 16 January 2017.
The forfeiture proceedings then resumed and in March 2017 a report from a forensic accountant was served on behalf of the appellant. This report analysed the accounts and the accounting records of the appellant's company, A & B Developments (UK) Limited, and expressed the opinion that those accounting records were consistent with the appellant's contention that the cash seized by the police was generated by his business.
The Merseyside Police asked to see various documents referred to in the accountant's report which had not been disclosed with it. The last documents requested were provided on 5 October 2017. On 24 October 2017, the Chief Constable agreed to withdraw the forfeiture application.
On 15 January 2018, a hearing took place before District Judge Lloyd, at which the magistrates' court formally ordered the return of the cash seized from the appellant and the appellant sought an order that the Chief Constable pay his costs of the forfeiture proceedings. The district judge declined to make such an order and made no order as to the costs of the proceedings. It is against that decision that this appeal has been brought.
By way of legal background, Chapter 3 of Part 5 of the Proceeds of Crime Act 2002 contains a regime which establishes a summary process for the recovery of cash which represents the proceeds of crime through civil proceedings in a magistrates' court.
Section 294 confers a power to seize cash which is reasonably suspected to be the proceeds of unlawful conduct or intended for use in such conduct. Pursuant to s.295, cash seized under s.294 may be detained initially for a period of 48 hours but this period may be extended by an order made by a magistrates' court, which may authorise the detention of the cash for up to six months if either of two conditions is satisfied. The condition relevant for present purposes is that:
“(5) there are reasonable grounds for suspecting that the cash is recoverable property and that either —
(a) its continued detention is justified while its derivation is further investigated or consideration is given to bringing proceedings against any person for an offence with which the cash is connected, or
(b) proceedings against any person for an offence with which the cash is connected have been started and have not been concluded.”
The magistrates' court may make further orders under s.295 continuing the detention of the cash for up to six months at a time subject to an overall maximum of two years.
Where cash has been detained under s.295, an application for its forfeiture may be made to the magistrates' court under s.298 of the Act. The court may order forfeiture if it is satisfied that the cash is “recoverable property” or is intended by any person for use in unlawful conduct. Such an order may be made whether or not criminal proceedings have been brought for an offence with which the cash is connected: see s.240(2).
Section 304(1) of the Act provides that property obtained through unlawful conduct is “recoverable property”. “Unlawful conduct” in this context means conduct which is unlawful under the criminal law, but whether such conduct has occurred is established by applying the civil standard of proof on a balance of probability, rather than the criminal standard of proof: see s.241.
The rationale underpinning those provisions is that the possession of a large quantity of cash is inherently suspicious in an age of electronic banking: see R (Merida Oil Traders Ltd) v Central Criminal Court [2017] EWHC 747 (Admin), para 57. As Sullivan J said in R (Director of Assets Recovery Agency) v Green [2005] EWHC 3168 (Admin) at paras 32–33:
“In today's ‘cashless society’, the ordinary law-abiding citizen does not normally have any need to keep large numbers of banknotes in his possession. It will almost always be safer (bearing in mind the risk of loss through accident or crime), more profitable (bearing in mind the opportunity to earn interest), and more convenient (bearing in mind the many other ways of paying for lawful goods and services) not to be in possession of a large sum of money in the form of banknotes. The other characteristic shared by all of the forms of cash listed in [the Act] is that cash is readily negotiable and unless seized promptly has a tendency to disappear without trace.
Just as the law-abiding citizen normally has no need to keep large amounts of banknotes in his possession, so the criminal will find property in that particular form convenient as an untraceable means of funding crime.”
In the present case, as already mentioned, the Merseyside Police, having seized cash in the sum of over £44,000 found in the possession of the appellant in the circumstances I have described, made an application under s.298 of the 2002 Act for forfeiture of the cash on the ground that it was “recoverable property” or intended for use in unlawful conduct. However, once the appellant had provided an accountant's report and supporting documents which were consistent with his assertion that the cash had been generated through lawful business activity, the application was withdrawn.
When it comes to costs, a magistrates' court has a discretionary power under s.64(1) of the Magistrates' Court Act 1980 and s.52(3)(b) of the Courts Act 1971 to make such order as to costs as it thinks just and reasonable. The principles on which the discretion should be exercised in a case of this kind were considered by the Court of Appeal in R (Perinpanathan) v City of Westminster Magistrates' Court [2010] EWCA Civ 40; [2010] 1 WLR 1508. In that case, like the present case, the police had applied under s.298 of the 2002 Act for the forfeiture of cash seized under the provisions of that Act. Unlike the present case, the forfeiture application in the Perinpanathan case was pursued by the police to a hearing in the magistrates' court. At the...
To continue reading
Request your trial