R v Churchill (No 2)
| Jurisdiction | England & Wales |
| Judge | MR. JUSTICE HINCHCLIFFE |
| Judgment Date | 21 March 1966 |
| Judgment citation (vLex) | [1966] EWCA Crim J0321-3 |
| Date | 21 March 1966 |
| Court | Court of Criminal Appeal |
| Docket Number | No. 1426/65 No. 1424/65 |
[1966] EWCA Crim J0321-3
IN THE COURT OF CRIMINAL APPEAL
Royal Courts of Justice
Mr. Justice Hinchcliffe
Mr. Justice Thompson
and
Mr. Justice John Stephenson
No. 1426/65
No. 1429/65
No. 1424/65
MR. A. CAMPBELL, Q.C., MR. ROSS MUNRO and MR. ROBERTS appeared as Counsel for the Appellants Leslie and John Churchill.
MR. L. LEWIS appeared as Counsel for Victor George Churchill.
MR. J. HAZAN and MR. A.S. TROUP appeared as Counsel for the Crown.
This is an appeal by the throe appellants John Churchill, Leslie Churchill and Victor Churchill against conviction and sentence. The trial started at the Central Criminal Court in April of 1965, was transferred to this building and it finished in the following June.
The original indictment charged fifteen persons with two offences, conspiracy to cheat and defraud the Crown and conspiracy to contravene Section 200, subsection (2) of the Customs and Excise Act, 1952. This indictment was split and five indictments took its place. Each indictment charged the same offences but against different combinations of defendants. All the trials finished in July, 1965.
We are now concerned with indictment number 1 which charged the three appellants together with Victor Churchill, a brother of John and Leslie and son of Pop Churchill; Alexander Lowdell, a petrol tank driver; and two companies, Universal Fuel Oils Limited and Olympic Petroleum Company Limited with the offences to which I have referred. It would I think be convenient to state the particulars of the two offences.
The first count charged the appellants between the 1st October, 1961 and the 9th October, 1963 that they conspired together and with Hans Georg Sauter and other persons unknown to cheat and defraud Her Majesty of the rebate of duty to be repaid on diesel fuel used in road vehicles. The second count charged as follows, between the same dates, conspired together and with Hans Georg Sauter and with other persons unknown, to use in road vehicles to which Section 200 of the Customs and Excise Act, 1952 applied, heavy oils in respect of which the rebate of duty had been allowed but a sum equivalent to the current rebate on such oils had not been paid to the Commissioners of Customs and Excise.
On the tenth day of the trial Victor Churchill pleaded guilty to conspiring with Sauter and the two companies to cheat and defraud the Revenue. He was sentenced to four years imprisonment and ordered to pay a sum not exceeding £6,000 towards the costs of the Prosecution.
The three appellants now apply to this Court for leave to appeal against their convictions and we are treating the application as the appeal since the Crown has been represented throughout. The grounds of appeal are contained in a document which is headed "Amended Grounds of Appeal", and which was settled by learned Counsel. We have heard argument by Counsel on each one of the grounds of appeal. Before dealing with the various grounds of appeal, it is necessary to refer to the fact3 of the case. They can be shortly stated.
There is a type of heavy oil which can be used in certain road vehicles when it is known as Derv, and it can also bo used to run stationary plant and hoating installations when it is known as gas oil Gas oil was chemically indistinguishable from Derv and carried a duty of 2d. a gallon. In July 1961 a red dye was added to it in order to distinguish it from Derv. The duty on Derv was 2/9d. a gallon. Thus, if a person could buy unmarked gas oil and sell it as Derv, the Revenue would be cheated out of 2/7d. a gallon and dishonest persons would be able to enrich themselves. It looks very much as if the Revenue had this in mind since the Customs and Excise Act of 1952, Section 200, Subsection (2) made it an offence to use this heavy oil in road vehicles unless duty had been paid to the Commissioners. The word in this section is "rebate". The position is that the duty payable on this heavy oil is 2/9d. a gallon but the duty is rebated to the extent of 2/7d. a gallon if it is to be used as gas oil.
The oil in this case was obtained from the B.P. refinery at the Isle of Grain. The wholesaler was a firm known as Petrofina. Up to October 1963 a dye was manually added at the refinery by a loader or filler. And the loader or the filler or perhaps the tanker driver could be persuaded or bribed not to put the dye into the oil invoiced as gas oil. This is what happened in this case and on a "big scale. The two companies, Universal Fuel Oils and Olympic Petroleum Company, operated by Victor Churchill Junior obtained thousands of gallons of unmarked gas oil and sold it as Derv. Between January, 1962 and October, 1963 sales of Derv by the companies exceeded their recorded purchases by nearly 300,000 gallons. Obviously unmarked gas oil had been obtained and sold as Derv, every gallon of which had been dishonestly acquired, more often than not by paying and corrupting a loader or tanker driver not to add the dye. On the 14th August, 1963 the Customs officers stopped a tanker which contained unmarked gas oil instead of marked and enquiries led at once to Universal Fuel Oils Limited and the Churchills.
Victor, John and Leslie are brothers; they are the sons of Pop Churchill. Victor is a man of considerable business ability; John was a driver by trade; Leslie was a roundsman and general dealer and Pop was a retired postman. In 1957 Victor and John Churchill set up in business as the Churchill Brothers dealing in fuel oils. They made an agreement with Petrofina for the purchase and sale of gas oil. In 1961 the agreement was renewed and this agreement referred to a rebated price for gas oil. In 1957 Universal Fuel Oils was incorporated. Victor and John were directors. John was the secretary and Leslie was the door to door salesman of paraffin. In 1960 Pop, on retirement from the Post Office, was taken on as book-keeper. The company had premises at Croydon with storage tanks both for gas oil and for Derv. In 1961 Sauter entered the employment of Universal Fuel Oils and become a director. In April 1963 most of the unmarked gas oil was received at, and distributed from, Croydon. In 1962 the Olympic Petroleum Company Limited was formed. Victor and John were directors and the premises were at Gillingham. This company dealt in petrol and gas oil. Some of the unmarked gas oil went there and was sold from there and some was sent on to Croydon. The depot at Gillingham was managed at first by the man Sauter.
In 1964 Universal Fuel Oils went into liquidation and the Olympic Petroleum Company was taken over by a firm called Murco.
Lowdell was convicted on Count 1. He was a driver employed by the Olympic Petroleum Company and was concerned with the collection and delivery of unmarked gas oil. Sauter should have been in the dock but he fled the country. As I have stated, on the tenth day of the trial, after evidence had been given by a man named Ralph, a Petrofina driver, Victor Churchill pleaded guilty to conspiring with Sauter and the two companies to cheat and defraud the Revenue. Thereafter, as it seems to this Court, the main issue of fact was/whether the appellants were parties to the conspiracy. The Prosecution submitted that they were; that each played a significant part; each co-operated and must have been aware of what was going on. John was the transport manager; Leslie was his assistant and salesman; Pop was the office manager and cashier.
In a careful and most helpful Summing-up, the learned Judge reviewed the evidence which tended to show that the three appellants were all in the swindle. There was a good deal of such evidence but it will suffice if I refer to Mr. Pudney who was brought in by the auditors. He told the Court that cash takings and cheques were handed to him by Victor Churchill or Pop Churchill and he said Pop Churchill seemed to be as much in charge of the cash takings as was Victor. There was a minute of December, 1962 which referred to service agreements whereby Victor was to receive £3,000; John and Leslie £1,500 and Pop £1,000 a year. These were never put into operation but it was some evidence that this was a family affair. There was evidence that John signed contracts for the supply of oil describing himself as manager or company director or both. Leslie introduced customers to Universal Fuel Oil Company Limited, particularly fairground people; Pop dealt with documents, books and cash and attended a number of business meetings with Victor.
The learned Judge then reviewed the evidence as to the obtaining of the unmarked gas oil and selling it as Derv. The jury wore reminded that between January 1962 and October, 1963 the excess of sales over purchases of Derv amounted to over 300,000 gallons and that in August, 1963, after the Customs had started their inquiries, a large increase in the purchase of Derv took place and it was suggested by the prosecution that this was really a cover operation. Furthermore there was evidence that the drivers or loaders who left out the dye from the gas oil were paid for so doing and paid by Victor or by Pop. There was also evidence that invoices of the driver Ralph showing delivery of gas oil wore receipted either by John or by Leslie or by Pop. In addition there was a good deal of documentary evidence, which included false invoices, some of them made out by Pop; others by John and that Leslie had dealings with a man named Lavender who made out cheques payable to Leslie. Much of the trading was done on a cash basis and it was suggested that perhaps the appellants received their reward for the parts they played out of these cash receipts.
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Attorney General's Reference (No. 1 of 1995); R v B; R v F
... ... 21 That passage was expressly approved in the decision of the House of Lords in Churchill v Walton [1967] 2 AC 224, a conspiracy case. At page 236 G Lord Dilhorne, with whom all the other members of the Judicial Committee agreed, said: "The question is, 'What did they agree to do?' If what they agreed to do was, on the facts known to them, an unlawful act, they are guilty ... ...
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...in the offence of conspiracy what matters is the agreement. Numerous cases make that clear – for example Griffiths [1966] 1QB 589 at 597, Churchill [1967] 2 AC 224 at 232 and Bolton (1991) 94 Cr App R 74 at 80. 52 It seems clear to us from an examination of count 1 and count 1A that each ch......
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R v Saik
...this feature of the legislation lies in the ingredients of the common law offence of conspiracy as enunciated by your Lordships' House in R v Churchill [1967] 2 AC 224. There the defendant was charged with the common law offence of conspiracy to commit a statutory offence. The statutory off......