Glaves v Crown Prosecution Service
| Jurisdiction | England & Wales |
| Judge | Lord Justice Toulson,Lord Justice Wilson,Lady Justice Arden |
| Judgment Date | 03 February 2011 |
| Neutral Citation | [2011] EWCA Civ 69 |
| Docket Number | CJA/85/2009 |
| Court | Court of Appeal (Civil Division) |
| Date | 03 February 2011 |
[2011] EWCA Civ 69
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM QUEEN'S BENCH DIVISION
(ADMINISTRATIVE COURT)
Mr Justice Collins
Before: Lady Justice Arden
Lord Justice Wilson
and
Lord Justice Toulson
CJA/85/2009
Case No: C1/2010/0032
Mr James Dennison (instructed by Central Confiscation Unit) for the Appellant
Mr Richard Thomas (instructed by Howells LLP) for the Respondent
Hearing dates: 12 October 2010
Lord Justice Toulson:
Introduction
On 16 December 2005 at Sheffield Crown Court the respondent, Alan Glaves, pleaded guilty to a charge of conspiracy to defraud between 30 March 2001 and 22 May 2003. The particulars were that he and his brother conspired with others to defraud Corus Engineering Steels Ltd by causing it to bear the costs of tipping waste removed from waste transfer stations in Yorkshire. The respondent and his brother were employed as tipper truck drivers by a company used by Corus to collect waste from manufacturing sites and take it to landfill tips. In the course of their employment they also carried out clandestine journeys to collect waste from sites operated by themselves and by acquaintances who paid them cash without questions for its disposal. They falsified their daily worksheets to cover up this activity, enabling them to use their employer's vehicles and fuel and to dispose of the waste at nil cost to themselves. The cost of the operation was borne by Corus, from whom they purported to have collected the waste.
On 7 April 2006 the respondent was sentenced to 3 years' imprisonment. He was released on 22 May 2007.
On 7 July 2006 a confiscation order was made in the Crown Court under s71 of the Criminal Justice Act 1988 ( CJA 1988) requiring the respondent to pay £145,000.00 within 12 months or in default to serve 30 months' imprisonment consecutive to his sentence for the offence.
After his release from prison the respondent made partial payments towards the confiscation order, but he claimed that his circumstances were such that he was unable to pay the full amount. There was correspondence between the parties which did not result in agreement, and so on 9 July 2009 the respondent issued an application in the Administrative Court for a certificate of inadequacy under s83 of CJA 1988. This section provided:
"(1) If, on an application made in respect of a confiscation order –
(a) by the defendant …
the High Court is satisfied that the realisable property is inadequate for the payment of any amount remaining to be recovered under the order the court shall issue a certificate to that effect, giving the court's reasons.
…
(3) Where a certificate has been issued under subsection (1) above, the person who applied for it may apply –
(a) where the confiscation order was made by the Crown Court, to that court..
for the amount to be recovered under the order to be reduced.
(4) The Crown Court shall, on an application under subsection (3) above –
(a) substitute for the amount to be recovered under the order such lesser amount as the court thinks just in all the circumstances of the case; and
(b) substitute for the term of imprisonment or of detention fixed under subsection (2) of section 31 of the Powers of Criminal Courts Act 1973 in respect of the amount to be recovered under the order a shorter term determined in accordance with that section in respect of a lesser amount."
The application was supported by a witness statement of the respondent dated 3 July 2009. In it he said that he had paid £94,400.00 towards the order and he asserted that there was an inadequacy of £36,678.40 in the funds available to him.
On 16 November 2009 the respondent made an updated statement amplifying some of the matters in his earlier statement.
The application was due to be heard on 23 November 2009. On 18 November the respondent's solicitors served a hearing bundle including the respondent's updated statement and a short skeleton argument in support of the application. The appellant responded by serving a 32 page skeleton argument which challenged a large number of the respondent's factual claims. The appellant's skeleton argument also contended that the respondent's application was bound to fail as a matter of law on the evidence put forward by him.
It was obvious that the time allowed for the application would not be sufficient to resolve the factual issues between the parties, but the judge, Collins J, was invited by the respondent's counsel, with the agreement of the appellant's counsel, to decide as a preliminary issue of law whether the application was bound to fail. He agreed to do so. He held that the application was not bound to fail and made an order declaring "that the claimant is in principle entitled to pursue the application for a certificate of inadequacy despite a finding of hidden assets being made by the Crown Court". He directed that the matter should be adjourned to a date to be fixed for a consideration of the facts of the application. The appellant appeals against the order, with leave of Collins J, and seeks an order dismissing the respondent's application for a certificate of inadequacy. Pending this appeal, there has been no investigation of the facts.
The course taken by the judge, at the parties' invitation, was unusual. Counsel knew of no previous example. For reasons which will become clear, I think that it is unfortunate that the judge was persuaded to follow it. It has not resulted in a saving of time or costs, and on an application for a certificate of inadequacy the court's judgment of the facts is crucially important. If the application raises a controversial question of law, that question is likely to be best decided against a proper understanding of the facts.
CJA 1988 has been repealed and replaced by the Proceeds of Crime Act 2002 ( POCA 2002), but the structure of the Acts is similar. (See May [2008] UKHL 28, [2009] 1 Cr App R (S) 31 para 8 and Allpress [2009] EWCA Crim 8, [2009] 2 Cr App R (S) 58, para 7). The court is required, before making a confiscation order, to address three questions:
1. Has the defendant (D) benefited from the relevant criminal conduct?
2. If so, what is the value of the benefit D has so obtained?
3. What sum is recoverable from D?
On the first and second questions the burden of proof rests on the prosecution (subject to any statutory assumptions, with which we are not presently concerned). As to the sum recoverable, CJA 1988 s71(6) provided that:
"…the sum which an order made by a court under this section requires an offender to pay shall be equal to —
(a) the benefit in respect of which it is made; or
(b) the amount appearing to the court to be the amount that might be realised at the time the order is made,
whichever is the less."
POCA 2002 s7(2) provides that it is for the defendant to show that the amount available to him is less than the amount of the benefit. That section makes explicit what was implicit in the previous legislation. In Wallbrook and Glasgow (1994) 15 CR App R (S) 783, 786, the Court of Appeal Criminal Division considered the effect of a similar provision in the Drug Trafficking Offences Act 1986. Dyson J, giving the judgment of the court, said at page 786:
"As has been emphasised in a number of authorities, the effect of section 4(3) of the Act is to impose on a defendant the burden of satisfying the court that the amount that might be realised in respect of property is less than the value of the proceeds of drug trafficking.
This must, in our view, mean that where a defendant has an asset in the form of a debt, the onus is on him to satisfy the court that the realisable value of the debt is less than its face value. In our view, this he must do by producing clear and cogent evidence; vague and generalised assertions unsupported by evidence will rarely if ever be sufficient to discharge the burden on the defendant."
In Summers [2008] EWCA Crim 872, [2008] 2 Cr App R (S) 101 the Court of Appeal Criminal Division applied the same principle in relation to s71 of the CJA 1988. Penry-Davey J said at para 11:
"It is clearly established by authority and was accepted in this case that the burden of establishing that the realisable amount was less than the benefit so as to justify a lower figure for the confiscation order was on the appellant to the civil standard on the balance of probabilities and it is equally clear that if he sought to establish that he had to do so by clear and cogent evidence; Wallbrook and Glasgow…followed in Anderson [2005] EWCA Crim 3384. Following from that, it is also clear that there is no burden on the prosecution to show a prima facie case of hidden assets, but for the appellant to provide evidence demonstrating the extent of his realisable assets: Barwick [2001] 1 Cr App R (S) 129 (p 445) and Barnham [2006] 1 Cr App R (S) 16 (p 83)."
The expression "hidden assets", used in Summers and other cases, is not an expression found in the legislation and it is capable of misleading. There may be cases in which a court makes a positive finding that a defendant has hidden away all or part of the proceeds of his crime, but it is not incumbent on the prosecution to establish that fact. In Barnham Gage LJ, giving the judgment of the court, said at para 41:
"To hold that the prosecution must, in some way, show a prima facie case that the defendant has hidden assets in our judgment would defeat the object of the legislation. It is designed to enable the court to...
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