R EMU v Westminster Magistrates' Court
| Jurisdiction | England & Wales |
| Judge | Mr Justice Collins,Lord Justice Burnett |
| Judgment Date | 27 July 2016 |
| Neutral Citation | [2016] EWHC 2561 (Admin) |
| Docket Number | CO/5209/2015; CO/2827/2016 |
| Court | Queen's Bench Division (Administrative Court) |
| Date | 27 July 2016 |
[2016] EWHC 2561 (Admin)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
DIVISIONAL COURT
Royal Courts of Justice
Strand
London WC2A 2LL
Lord Justice Burnett
Mr Justice Collins
CO/5209/2015; CO/2827/2016
Miss Hannah Hinton (instructed by Janes Solicitors) appeared on behalf of the Claimant Emu
Mr N Rudolph (instructed by Janes Solicitors) appeared on behalf of the Appellant Gangar
Mr W Hays (instructed by the Government Legal Department) appeared on behalf of Secretary of State for Justice in Emu
Mr J Hall QC (instructed by the SFO) appeared on behalf of the Respondent in Ganagar
These two cases have been heard together because each raises a similar, if not identical, point which depends upon the construction of section 79(2) of the Magistrates' Court Act 1980. The cases involve consideration of the correct term of imprisonment or detention which is to be imposed by magistrates when a confiscation order has not been paid in full within the period which was allowed for its payment. The problem that arises is that interest accrues on such payments, and so albeit a payment of part of the amount may have been made, it may well not affect, and certainly will not affect to a complete extent, the amount that remains outstanding. The relevant section allows there to be a calculation of the amount which should be allowed in relation to any such payment. When I say the amount to be allowed, I mean that there should be a pro rata reduction in the term of imprisonment or detention which has been imposed.
The two cases involve in one an application for judicial review and in the other an appeal by way of case stated. Mr Peter Emu is challenging a decision made by a district judge to impose the relevant sentence of imprisonment in 2008. The reason why it has considerable importance for him is that if he is correct in his challenge, the release date from his sentence will be next month, whereas if the total period remained in being, it would be significantly longer than that. The amount in the other case, Mr Gangar, is somewhat less, but equally of course is of considerable importance for him.
So far as Mr Emu is concerned, he was stopped at Heathrow attempting to leave the United Kingdom in May 2002. He is a Nigerian national. When his bag was searched it was found to contain a significant sum of United States dollars and at his home when searched were found 11 kilograms of cocaine. It was clear from the evidence that he had been involved in drug trading. In December 2002 he was sentenced to a total of 22 years' imprisonment, which was reduced on appeal to 20 years. A confiscation order was imposed in the sum of £2 million with 2 years to pay being given and a default sentence of 10 years' imprisonment. That order was imposed on 6 August 2003.
After the 10 years, when the full amount had not been paid, the matter came before the magistrates' court in order to impose the appropriate sentence of imprisonment. That was done on 19 August 2008. He did not at the time appreciate that there could be any challenge to that order, and in the result nothing was done until his claim was lodged before this court. He was given permission to pursue judicial review out of time.
Mr Gangar was convicted of serious fraud. He was subject to a confiscation order in the sum of £2,750,000 in July 2010, but that was reduced by the Court of Appeal to a sum of £2,289,974.03, a somewhat detailed amount. So far as he is concerned, the matter came on for the purpose of imposition of the default sentence, which was 6 years' imprisonment, on 4 February 2016. By then, he had paid something over £67,500, but interest amounting to some £730,000 had accrued. Accordingly, the amount outstanding remained in fact in excess of the sum that had been ordered to be paid by the Court of Appeal. It was something approaching £3 million.
Going back to Mr Emu's case, he also had made payment in part. The payments that he had made again were subject to interest which had accrued of £408,497. He had paid some £394,000, but because of interest which had accrued the amount outstanding by the time the magistrates had to impose the default sentence was £2,408,497.
The relevant section is exceedingly badly drafted and is by no means easy to apply. But we have been, as will become apparent, assisted because the Court of Appeal has very recently in R (on the application of Gibson v Secretary) of State for Justice [2015] EWCA Civ 1148 decided how the exercise to be carried out under section 79(2) should be applied. The section as currently enacted provides as follows:
"(2) Where, after a period of imprisonment or other detention has been imposed on any person in default of payment of any sum adjudged to be paid by the conviction or order of a magistrates' court or for want of sufficient distress to satisfy such a sum, payment is made in accordance with rules of court of part of the sum, the period of detention shall be reduced by such number of days as bears to the total number of days in that period less one day the same proportion as the amount so paid bears …"
Having cited that, I do not doubt that it will be well understood that its construction is by no means easy.
There is what I can perhaps describe as a subissue, namely the reference to "less one day" and the approach that should be made to the deduction of that one day. I shall come to that in due course.
It must I think be clear that there are three possible approaches to that provision. First, the most unfavourable for any particular individual, is to look at the amount which was ordered by the Court and to see what is the result of any payment made, bearing in mind the increase caused by interest; and, if there is no reduction in the amount imposed by the Court, then there is no benefit to be obtained from those payments. That is the approach which was adopted by both the magistrates whose decisions are under attack in these cases.
That stems from a decision of the Divisional Court in Crown Prosecution Service v City of London Magistrates' Court [2007] EWHC 1924 (Admin). That case involved a person called Hartley. What the court there decided, dealing, as it happened, with a slightly different provision, was the approach which was said to be desirable. What Sedley LJ said in paragraph 7 was this:
"What the enforcing justices have to work with, therefore, is something like a measuring jug. It has a fixed capacity which cannot be exceeded, but within it the amount of the debt may both fall as the capital sum is paid off and rise as interest accrues on the balance. When they come to activate a default term, the justices must activate the same proportion of it as the amount in the jug — that is principal and interest together — bears to its capacity."
That was not precisely the same provision in issue, but it is an approach which is certainly a possible approach having regard to the language of section 79(2). It is, as I have said, the most unfavourable for the individual in question.
The most favourable is that the starting point remains fixed at the amount imposed by the Crown Court and payments made will reduce pro rata, even if interest has meant that there has in effect been not only no reduction but still more outstanding.
The middle course, if I may describe it as such, is to take it to mean that the exercise to determine pro rata what deduction there should be is to look to see what is the amount outstanding at the date of the decision made to impose the default sentence and to measure against that sum the amount of payment that has been made by the individual, which means that he will get some benefit but by no means the same amount of benefit as would be obtained were what I have referred to as the first, least favourable, approach taken.
In Gibson, the Court of Appeal decided that the third approach which I have mentioned was the correct approach. The result of that is that, assuming it was applied as it should be, in each case the total amount of sentence should be reduced because, as I have said, the sentence imposed by the judges was simply the original which had been set to be the default sentence.
In Mr Emu's case, the order that had been made by the judge required that the full sentence should remain to be served and there was to be no reduction. The total period was 3,650 days. I will come as I said to the "one day" issue, but the exercise that the Gibson case requires to be carried out it is agreed would result in a reduction to 3,053 days. The result of that, as I have said, means that his release date is advanced to the middle of next month.
So far as Mr Gangar is concerned, the amount that was decided by the magistrate that should be served was again the total amount. Suffice it to say, without the need to go into the figures in detail, that the reduction would be a period of 49 days.
It is of course of considerable importance to the Prison Service, because the Prison Service has to assess the correct release date, that the approach should be made clear. It has, we have been told, effectively approached the matter in the way that Gibson ultimately decided, but apparently has decided that the sensible approach is effectively to freeze the date that the magistrate imposed whatever sentence was appropriate. Section 79(2) on the face of it will continue to apply, but it is not necessary for us, nor is it in my...
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