Peacock and another

JurisdictionEngland & Wales
JudgeLady Justice Black,Lady Justice Arden,Lord Justice Thomas,Lord Justice Etherton
Judgment Date20 December 2010
Neutral Citation[2010] EWCA Civ 883,[2010] EWCA Civ 1465
Docket NumberCase No: C1/2010/0090 & 0091
CourtCourt of Appeal (Civil Division)
Date20 December 2010

[2010] EWCA Civ 1465

IN THE HIGH COURT OF JUSTICE

COURT OF APPEAL (CIVIL DIVISION)

ON APPEALS FROM THE HIGH COURT OF JUSTICE

Royal Courts of Justice

Strand, London, WC2A 2LL

Mitting J & Pitchford J

Before : Lady Justice Arden

Lord Justice Thomas

and

Lord Justice Etherton

Case No: C1/2010/0090 & 0091

In the Matter of Peacock
Appellant/

Mr Orlando Pownall QC & Mr Christopher Finch (instructed by Creed Lane Law Group) for the Appellant

Mr Andrew Munday QC & Mr James Dennison (instructed by The Crown Prosecution Service) for the Crown Prosecution Service

1

Hearing date : 10 November 2010

Lady Justice Arden
2

Lady Justice Arden :

3

1. This is an appeal from the order of Mitting J dated 18 May 2005 and the order of Pitchford J (as he then was) dated 18 December 2009. The central issue in the appeal is whether under s 16 of the Drug Trafficking Act 1994 (“the DTA 1994”) the Crown Court has jurisdiction to grant a certificate of increase in realisable assets by reference to assets acquired after the date of the conviction (“after-acquired assets”). After-acquired assets include lawful earnings after the date of conviction, but not for example, assets which were hidden at the date of the conviction or assets then known which have increased in value. In this case, the Crown is not in a position to say that the assets came from some tainted source so we have proceeded on the basis that the assets with which we are concerned are after-acquired assets in the sense given above. The relevant provisions of the DTA 1994 have been repealed and replaced by provisions of the Proceeds of Crime Act 2002 (“ POCA 2002”), but that Act does not apply because the confiscation order in this case was made before 24 March 2003 (see The Proceeds of Crime Act 2002 (Commencement No 5, Transitional Provisions, Savings and Amendment) Order 2003 (SI 2003 No 233)).

4

2. The background is not controversial and can be taken from the helpful judgment of Black LJ when she gave permission to appeal in this case:

“This is a matter which arises in relation to section 16 of the Drug Trafficking Act 1994. The proposed appellant committed offences in 1995 and pleaded guilty to five counts of conspiracy to supply controlled drugs on 8 January 1997. His sentence of 12 years’ imprisonment was reduced on appeal on 5 October 1998 to 10 years’ imprisonment. He served that term of imprisonment and was released in November 2000.

2. The Crown Court had identified the benefit received from drug trafficking following a confiscation hearing in the sum of £273,717.07 in respect of each of the two accused who were the subject of the criminal proceedings. The appellant's realisable assets were identified as £823 and that sum was to be paid over. It might have looked therefore that by November 2000, when the appellant emerged from prison, the slate was clean except that the benefit received had vastly exceeded the amount of realisable assets as they were identified by the Crown Court in 1997.

3. Having emerged from prison, I do not think there is any dispute that, by his legitimate efforts, the appellant acquired further assets. Their existence led the prosecutor to make an application in 2005. First there was an application for a restraining order to prevent the appellant from disposing of any of his assets. Secondly there was an application which was heard in front of Mitting J in May 2005 for a certificate of an increase in the assets, that would enable the Crown Prosecution Service to make an application in the Crown Court for an increase in the sum that they could recover under the confiscation order.

4. The proceedings in front of Mitting J were not contested. The appellant neither appeared nor was represented. The reason for that was that he had been advised by counsel that counsel could see no legitimate objections to the section 16 application for a certificate of increase. He advised that it would not necessarily follow that the assets would be taken in the Crown Court proceedings that would follow, although I think it is fair to say that he was not particularly optimistic about that matter.

5. The reason for counsel's advice was the existence of the authority, under a precursor to the 1994 Act, of Tivnan [1999] 1 Cr App R(S) 92. The Court of Appeal had held in that case that an equivalent section under the previous legislation applied to assets which were acquired after conviction. Counsel also cited a case called Saggar [2005] EWCA Civ 174 where it appears the Court of Appeal had also proceeded on the basis that section 16 applies to after-acquired assets.

6. The matter was then the subject of a significant hearing in front of HHJ Slinger in the Crown Court. He had to determine issues as to the ownership of the assets that had been identified as potentially the appellant's. He found that the realisable assets were £273,717 and certified that in, I think, September 2007.

7. There was an appeal against that to the Criminal Division of the Court of Appeal. The points taken on the appeal concerned the ownership of the assets which had been thought to be the appellant's. There was no argument as to the question of whether the court, in the person of Mitting J, had had jurisdiction to certify that the assets had increased in the first place which had been the gateway into the hearing in front of HHJ Slinger. However, I am told that an application was made to the Criminal Division to certify a point of law of public importance and that point was the question of jurisdiction in relation to after acquired assets. Mr Pownall freely concedes that application was doomed. It had not been argued in front of the Criminal Division and nor could it have been because the authorities dictate that the right place for such an argument is the Civil Division of the Court of Appeal, the original certificate having been granted by the Administrative Court of the Queen's Bench Division.

8. It seems that it was some time in the middle of 2009 that that transpired in the Criminal Division. That was not very long before the matter came to the Administrative Court again and was heard ultimately on 18 December 2009 by Pitchford J. The application to the CPS at that point was for a receiver to be appointed to enforce the order that HHJ Slinger had made back in 2007. I am told that the hearing on 18 December 2009 was the second attempt to have the matter heard. The exact date of the commencement of those proceedings in the Administrative Court is not known but it seems that they must have been not very long after the Criminal Division had considered the matter in the middle of the year.

9. Pitchford J did have advanced to him the argument about jurisdiction. By this point there were two authorities in the House of Lords which had considered that question but not centrally because it had not arisen for determination in either of the cases. By, I think, a complete coincidence they are both called May(e). One is Re Maye (AP) Northern Ireland [2007] UKHL 9 and the second is May [2008] UKHL 28. It is, of course, of interest to know whether the 2007 Maye case had been determined by the time HHJ Slinger considered the matter, and judging from the email which has been produced today from counsel who appeared in front of the Criminal Division on the appeal in relation to that, it may be that that 2007 decision had perhaps not been determined by the time that the matter was in front of HHJ Slinger.

10. In the light of those two authorities a forcible submission was made by Mr Pownall to Pitchford J on the question of jurisdiction. The House of Lords had indicated that there was an important and difficult question to be determined as to whether after acquired assets could in fact be caught by an earlier confiscation order. The application for the appointment of a receiver was also resisted on a second ground which was that the assets had fallen in value and it would not be worth the while of the CPS to proceed against them because insufficient money would be recovered.

11. Pitchford J was not persuaded against the appointment of a receiver. He appointed a receiver but he did suspend the powers of the receiver in order to give the appellant time to proceed in this court to seek leave to appeal against Mitting J's original order and of course there would be a need to appeal against Pitchford J's ancillary order.

12. The appellant did indeed appeal against both of those orders on the basis of the difficulty in the statutory construction in relation to section 16 identified by the House of Lords. Stanley Burnton LJ refused the application for permission to appeal on paper, I think it is fair to say largely on the basis that there had been undue delay in proceeding in relation to the applications although he did consider that it was a development that the statute in question had now been replaced.

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3. The appellant contends that the order of Mitting J was made without jurisdiction and that accordingly the orders of Pitchford J and HHJ Slinger cannot stand.

6

4. It will be observed that the application under s 16 was made some 8 years after the date of conviction. The position is thus the same as the appellant winning on the national lottery 20 years after the date of conviction with a ticket bought out of his lawful earnings 19 years after conviction. If the order of Mitting J was rightly made, the Crown could apply to the Crown Court for a certificate that there had been an increase in realisable assets and the judge would then have to decide by what amount to increase that certificate. It is not known whether this point was raised with Mitting J as we do not have a copy of his judgment.

7

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