Mrs Bessie Edwards v The Crown Prosecution Service (Proceeds of Crime Unit)
| Jurisdiction | England & Wales |
| Judge | Mr Justice Cranston |
| Judgment Date | 04 July 2011 |
| Neutral Citation | [2011] EWHC 1688 (Admin) |
| Docket Number | Case No: DTA/69/2006 |
| Date | 04 July 2011 |
| Court | Queen's Bench Division (Administrative Court) |
[2011] EWHC 1688 (Admin)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Royal Courts of Justice Strand, London, WC2A 2LL
Mr Justice Cranston
Case No: DTA/69/2006
In the matter of Stephen Edwards
and
In the matter of the Drug Trafficking Act 1994
Nicholas Johnson QC (instructed by Tuckers Manchester) for the Applicant
Mark Sutherland Williams (instructed by Crown Prosecution Service) for the Respondent
Hearing dates: 14 April 2011
Approved Judgment
Introduction
This is an application by Mrs Bessie Edwards for a declaration that she holds a 50 percent beneficial interest in property held jointly between herself and her husband, Mr Stephen Edwards. Mr Edwards is the defendant in proceedings under the Drug Trafficking Act 1994. The properties relevant to the application are as follows: "40 Turton Heights", Bolton ("Turton Heights"); Urciudad Quesada Congunto, Gloria 10, Spain ("Gloria"); and Urciudad Quesada C-San Gabriel 22, Rojales, Alicante, Spain ("Gabriel"). Mrs Edwards' application is opposed by the prosecution. The legal issue concerns the circumstances when the starting point of a 50/50 beneficial interest in jointly owned property should be displaced.
Background facts
Mr and Mrs Edwards married in 1972. Prior to that, Mrs Edwards had 2 children, aged 6 and 9. Following their marriage they had a son, born in 1975. Mr Edwards had various jobs, but at one point operated his own road haulage business. He had an interest in cart racing. In 1992 he was sentenced to 18 months imprisonment for theft of a motor vehicle. Mrs Edwards brought up the children but until 1996 also had employment, at various times as a child minder and nursing auxiliary.
On 14 August 2006 Customs officers stopped Mr Edwards at the ferry terminal in Hull. A search was undertaken of the large motor-home vehicle he was driving. 91.9kg of cocaine was discovered packed within a compartment inside his vehicle. Mr Edwards was arrested and interviewed. During interviews, he stated that he had been an international haulier operating his own haulage business for approximately ten years up to 1997–98, but had sold this in 1997–98 for £225,000. He made admissions stating that much of his business activity was "off-record", this ultimately coming to the attention of the tax-authorities, resulting in his being assessed for many thousands of pounds in tax arrears. He also made admissions as to money laundering over the previous decade: in 1997 or 1998 he had agreed to use his vehicle to smuggle holdalls of cash to the continent, in return for payment of between £2000 to £5000 a trip.
During the course of the interviews Mr Edwards admitted to having properties in Spain, as well as bank accounts abroad. He gave information about the properties relevant to this case in answer to questions from Mr Revell and Mr Wood. In relation to "Gabriel" he said:
Revell: "So then you send ten thousand pounds over to Spain."
Edwards: "Yeah."
Revell: "Erm, so its not going to take very long for the mortgage, for that money to be used."
Edwards: "No, in fairness when we bought the property and we got the mortgage we didn't anticipate being as less well off than what we were in actual fact because we expected to sell the house, coz it went on the market at eight hundred and we thought we'd get that but we didn't realise, well I didn't realise that I would incur so much debt waiting for it to be sold."
Revell: "Right."
Edwards: "So we were hoping that there'd be sufficient money from the sale of the house to buy the one in Bolton ["Turton Heights"] and buy the small one over there ["Gloria"] but because we couldn't buy it at the time we took a mortgage out and the mortgage rate was low so…"
…
In relation to the property known as "Gloria", Mr Edwards said this in interview:
Edwards: "Let's say that I own it, I would rather say that than disclose anything else because it incriminates other people, but I own it."
Wood: "Why does it incriminate them?"
Edwards: "I don't want to. I'm in enough trouble as it is and I don't want to. It's got nothing to do with why I am here…and I'd just rather if…me and my wife who are on the deeds…so that in effect we own it."
Later in the interview he said this:
Revell: "And you also own that other property in Spain?"
Edwards: "Yes."
Revell: "Combined with somebody else that you don't want to talk about. Why didn't you want to talk about them?"
Edwards: "Because I would rather leave it at that at the moment, until such time as I have a chance to have someone to speak to them, just because I give their name forward because it's…I don't want to."
Revell: "Are they involved in drugs?"
Edwards: "No, no, no. It's they have lent me money alright. They, they, it's a complete, it's like a straightforward businessman, but I don't think it is right and proper until I speak to him and tell him what is happening, or have someone to speak to him and tell him what's happening on my behalf."
In November 2006, Mr Edwards pleaded guilty to the importation of 91.9kg of cocaine (Count 1 of the indictment). Subsequent to that plea, he also pleaded guilty to two money laundering charges, namely entering into or becoming concerned in an arrangement which he knew or suspected facilitated the acquisition, use or control of criminal property on 9 August 2006 (Count 2); and assisting another to retain the benefit of drug trafficking between the dates of 31 December 1996 and 9 August 2006 (Count 3). Essentially this covered Mr Edwards' laundering cash to the continent. Mr Edwards was sentenced to 9 years' imprisonment for the cocaine importation and a further three years for each of the two money laundering offences, to run concurrent with each other, but consecutive to the nine years, making a total of 12 years imprisonment.
On 13 September 2006, the late Hodge J issued an order which restrained Mr Edwards from dealing with his assets. Mrs Edwards was also restrained from dealing with her interests in certain assets listed in the restraint order. In August 2007 the order was varied to facilitate the sale of a Spanish property called "Gloria" and in September 2008 to facilitate the sale of an Iveco van.
In response to that restraint order Mr Edwards made a statement on 18 October 2006 in which he confirmed that he jointly owned the property known as "Turton Heights". There was no mortgage on that property. He was also a joint owner of the property known as "Gloria". There was no mortgage on this property as it was purchased with the proceeds of sale of "The Grange", his previous Bolton property, owned jointly with his wife. This property was being marketed at the time of his arrest, but no dealing had occurred. Thirdly, he confirmed that he was the joint owner of a property known as "Gabriel". There was a mortgage of £156,000 (approximately 200,000 Euros) on the property. The property was owned in equal shares with his wife and mortgage payments on the property amounted to 1,600 Euros. In the response Mr Edwards also said this in relation to "The Grange", which he said was sold for £775,000 in May 2003.
"During the course of 1997 (date unknown as at the date of the Response), I purchased the property known as The Grange. The property was purchased for £221,000 utilising a deposit drawn from the funds received from the sale of my business S Edwards Transport Limited and a mortgage of £150,000 from the National Westminster Bank."
As a result of an order in June 2007 made by HH Judge Morrell under the Drug Trafficking Act 1994, Mr Edwards made a further statement on 9 August 2007. In it he referred to certain payments that had passed through the joint NatWest bank account at the Farnworth Branch in Bolton he held with Mrs Edwards. In relation to a credit on 4 May 2005, "Travelworld Cash", he said:
"This was payment made through Travel World…The payment was from my business partners in Australasia and the Far East. This money was sent by way of a loan as I required capital fast to purchase San Gabriel, Spanish property."
About a credit of £51,000 on 31 May 2005 he explained:
"This is from a loan account set up by the NatWest Bank. A transfer of the loan was made for £51,000 to pay back JSW loan which is a company owned by Regency Factors who are the holding company for the group. This essentially pays back the VAT loan to pay HM Revenue & Customs the money owed to them from the assessment."
In anticipation of confiscation proceedings, an officer of HM Revenue & Customs, Simon Cloke, prepared a Financial Statement dated 27 July 2007. That recorded that in the 6 years prior to Mr Edwards' arrest over £1.2 million had passed through identified bank accounts, some held jointly with his wife. It calculated a benefit figure of nearly £22 million. Realisable assets were worth some £545,000. The Financial Statement recorded that "Turton Heights" was registered at the Land Registry in the names of Mr Edwards and Mrs Edwards. The Land Registry documents showed that the property was purchased on 16 May 2006 for the sum of £317,500.00. It was estimated to be worth £327,076.00. Secondly, there was "Gloria" said by Mr Edwards to have been purchased in 2004 for £100,000 with no mortgage. Two independent valuations said it was worth €180,832 and €194,954 respectively. The property known as "Gabriel" was said by Mr Edwards to have been purchased in 2004 for £200,000. There was a mortgage of €200,000 on the property, leaving equity of £50,000.
Mr Leigh Wright, a solicitor at Tuckers, prepared a response to the prosecution's Financial Statement on Mr Edwards' behalf. It was dated 20 December 2007. It said that Mrs Edwards had a 50 percent interest in all the real property. There was an unbroken...
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