Property and Theft—Developments since Preddy
| Author | Jessica Holroyd |
| Published date | 01 June 1998 |
| Date | 01 June 1998 |
| DOI | http://doi.org/10.1177/002201839806200308 |
| Subject Matter | Article |
PROPERTY AND THEFT-DEVELOPMENTS
SINCE
PREDDY
Jessica Holroyd
Once again a loophole in theft law has been filled by the creation of a new
offence. The provisions of s 15A of the Theft Act 1968 are considered
below. This offence, obtaining a money transfer by deception, originated
as a result of certain conduct characterised as mortgage fraud which,
according to the House of Lords, did not fall either under s I or s 15 of
the
1968
Act.IBut with any new offence, two questions quickly arise.
What kind of conduct comes within its ambit and what is the degree of
overlap between the new law and the old? This article examines both those
questions in the light of decisions since Preddy and also briefly considers
some previous cases in an attempt to highlight the salient features of
s 15A and its particular role in the law concerning dishonesty.
The new offence was drafted by the Law Commission as an urgent
response to Preddy. 2As is now well known, the case established that,
where an accused obtains certain non-cash loans as a result of furnishing
false information to the lender, no crime of theft or criminal deception is
committed. This is because the borrower obtains no 'property belonging
to another' as required by either the s I or s 15 offence. The Crown had
argued that intangible property was the subject of the offence-namely a
chose in action or credit balance belonging to the lender which was
transferred from the former's bank account to that of the borrower.
However, the House of Lords analysed the transaction otherwise:
When the bank account of the defendant (or his solicitor) is credited [with
the amount of the loan], he does not obtain the lending institution's chose in
action. On the contrary that chose in action is extinguished or reduced . . .
and a chose in action is brought into existence representing a debt in an
equivalent sum owed by a different bank to the defendant or his solicitor
...
In truth, the property which the defendant has obtained is the new chose in
action constituted by the debt now owed to him by his bank, and represented
by the credit entry in his own bank account. This did not come into existence
until the debt so created was owedto him by his bank, and so neverbelonged
to anyone else . . .
This analysis of the nature of certain fraudulent transactions using the
medium of banks created the Preddy loophole and dictated the format of
the new s 15A, which has been designed to fill that loophole. The scope
of the new offence is as yet untested. The Law Commission, while
acknowledging its immediate purpose, did not give any theoretical
examples to illustrate its further use. The new offence is drafted in terms
which avoid the necessity for the prosecution to identify any property that
1
See
Preddy [1996] AC 815.
2Law Com No 243, 'Offences of Dishonesty: Money Transfers'.
271
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