R v Hilton

 
FREE EXCERPT

[2020] UKSC 29

Supreme Court

Trinity Term

On appeal from: [2017] NICA 73

before

Lord Kerr

Lord Wilson

Lord Lloyd-Jones

Lord Briggs

Lady Arden

R
and
Hilton
(Respondent) (Northern Ireland)

Appellant

David McDowell QC

Andrew Brownlie BL

(Instructed by Public Prosecution Service (Northern Ireland))

Respondent

Gavan Duffy QC

Luke Curran BL

(Instructed by McKeown & Co Solicitors (Belfast))

Heard on 2 December 2019

Lord Kerr

(with whom Lord Wilson, Lord Lloyd-Jones, Lord Briggs and Lady Arden agree)

Introduction
1

On 22 September 2015, Bernadette Hilton was convicted at Belfast Magistrates' court on her plea of guilty of three offences contrary to section 105A of the Social Security Administration (Northern Ireland) Act 1992. One of the offences related to her failure to notify the Social Security Agency of a change in her circumstance which would have affected her entitlement to claim Income Support. The other two offences involved the making of false statements in order to obtain Income Support.

2

Following her conviction, Ms Hilton was committed to the Crown Court and that court was asked to make a confiscation order under section 156 of the Proceeds of Crime Act 2002. This application was heard by His Honour Judge Miller QC on 20 October 2016. It had been calculated that Ms Hilton had wrongly obtained a total sum of £16,517.59 as a result of her crimes. The judge assessed the benefit that she had gained to be that sum.

3

The only property held by Ms Hilton at the time of the hearing before Judge Miller was a house which was owned jointly with a former partner. She contended that the value of her half share in the property, after deduction of an outstanding mortgage was £10,263.50. The judge accepted that contention. He assessed the available amount as that sum and made a confiscation order in respect of it. Ms Hilton was ordered to pay that amount within three months. In default of its payment, it was directed that she serve six months' imprisonment.

4

Ms Hilton appealed. Although not included in her original grounds of appeal, before the Court of Appeal she argued that Judge Miller had failed to comply with the requirements of section 160A(2) of the 2002 Act because neither the co-owner nor the mortgagee had been given the opportunity to make representations about the making of the confiscation order. It transpired that neither Ms Hilton's former partner nor the building society which was the mortgagee was aware of the criminal proceedings or the application for a confiscation order.

The proceedings in the Court of Appeal
5

Deeny J in an extempore judgment gave the decision of the court (Gillen LJ, Deeny J and Keegan J) on 12 May 2017: [2017] NICA 73. The principal issue which concerned the court (and which is the only matter involved in the appeal before us) was in relation to the requirements of section 160A(2) of the 2002 Act and whether the judge's order contravened those requirements. Two other matters were argued before the Court of Appeal, namely, whether a reduction in the amount to be recovered should have been made in order to reflect the costs of the sale of the property and whether article 8 of the European Convention of Human Rights (ECHR) should have been taken into account at the time of the making of the confiscation order, as opposed to the making of an order for its enforcement. It is not necessary to say anything on either issue.

6

The Court of Appeal decided that section 160A(2) required that, at the time of making a confiscation order, the Crown Court must give to anyone who is thought to hold or who, it is considered, may hold an interest in the property an opportunity to make representations on whether a confiscation order should be made and, if so, in what amount. Deeny J observed that the subsection had not been drawn to the attention of Judge Miller but, in any event, the failure to give Ms Hilton's estranged partner and the building society the chance to make representations was “fatal to the decision of the judge” (para 7 of the Court of Appeal judgment).

7

The Director of Public Prosecutions applied for permission to appeal to this court and for a certificate that a point of law of general public importance arose on the appeal. On 6 March 2018, the Court of Appeal refused permission to appeal but certified the following points of law of general public importance:

“1. Where property is held by the defendant and another person, in what circumstances is the court making a confiscation order required by section 160A of the Proceeds of Crime Act 2002, in determining the available amount, to give that other person reasonable opportunity to make representations to it at the time the order is made?

2. If section 160A does so require, does a failure to give that other such an opportunity render the confiscation order invalid?”

The 2002 Act
8

There are — or, at least, there can be — two stages to confiscation proceedings: the first is the making of the confiscation order itself and the second the order securing its enforcement. The first stage is provided for in sections 156 to 163B. That stage is triggered in the manner described in section 156. The obligation to make an order arises once the conditions in subsections (2) and (3) are satisfied. These are fairly routine. The order must be made if a defendant has been convicted of an offence before the Crown Court or is committed to that court with a view to a confiscation order being made — subsection (2); and if the prosecutor asks for such an order to be made or the court believes it appropriate to make it — subsection (3). The relative ease with which these conditions can be satisfied suggests that it was envisaged that the making of a confiscation order (as opposed to its enforcement) should be straightforward, indeed quasi-automatic.

9

If satisfied that the order should be made, the court is directed how to proceed by section 156(4) and (5), the relevant parts of which, so far as concerns the present case, are these:

“(4) The court must proceed as follows —

(c) if it decides that [the defendant] does not have a criminal lifestyle it must decide whether he has benefited from his particular criminal conduct.

(5) If the court decides under subsection (4) … (c) that the defendant has benefited from the conduct referred to it must —

(a) decide the recoverable amount, and

(b) make an order (a confiscation order) requiring him to pay that amount.

[A footnote to sub-paragraph (b) was inserted on 1 June 2015 by the Serious Crime Act 2015 (the 2015 Act) (c 9), section 88(3)(b), Schedule 4 paragraph 46; regulation 3(2)(b). It is to the following effect:

‘Paragraph (b) applies only if, or to the extent that, it would not be disproportionate to require the defendant to pay the recoverable amount.’]”

10

Section 157 deals with the calculation of the recoverable amount. The starting point is that the recoverable amount is an amount equal to the defendant's benefit from the conduct concerned — subsection (1). But if the defendant shows that the available amount is less than the benefit obtained, the recoverable amount is duly adjusted — subsection (2). The available amount is defined in section 159 of the Act. For present purposes it is sufficient to refer to subsection (1)(a) of section 159 which stipulates that the recoverable amount is the total of the values (at the time the confiscation order is made) of all the free property then held by the defendant minus the total amount payable in pursuance of obligations which then have priority. It was by dint of the operation of section 157(2) in tandem with section 159(1)(a) that the recoverable amount in Ms Hilton's case was found to be the sum which, it was considered, could be obtained from the sale of the property which she jointly owned. It is to be noted that section 159(1)(a) specifies that the recoverable amount is the total of the values of all the free property then held by the defendant minus the amount payable for debts which have priority. The emphasis is on property which the defendant holds. Section 227(3), which makes provision for determining a property's value, again makes clear that it is the market value of the defendant's interest in the property, rather than the overall value of the property which dictates the amount to be specified in the confiscation order.

11

Having made those preliminary observations, one must turn then to the section which is pivotal to this appeal — section 160A. (It was also inserted on 1 June 2015 by the 2015 Act (c 9), sections 24, 88(3)(a), The Serious Crime (2015 Act) (Commencement) Regulations (Northern Ireland) 2015 (SR 2015/190), regulation 3(1)(a)). Section 160A(1) provides:

“Where it appears to a court making a confiscation order that —

(a) there is property held by the defendant that is likely to be realised or otherwise used to satisfy the order, and

(b) a person other than the defendant holds, or may hold, an interest in the property,

the court may, if it thinks it appropriate to do so, determine the extent (at the time the confiscation order is made) of the defendant's interest in the property.”

12

Clearly, in this case, the judge formed a view as to the extent of Ms Hilton's interest in the jointly owned property. The critical question is whether he determined the extent of that interest under section 160A, so as to preclude any further representations by persons other than Ms Hilton who held or may hold an interest in the property. Ms Hilton's complaint is that he did and further that he failed to advert to subsection (2) of section 160A which provides:

“The court must not exercise the power conferred by subsection (1) unless it gives to anyone who the court thinks is or may be a person holding an interest in the property a reasonable opportunity to make representations to it.”

13

The significance of a determination under section 160A which precludes...

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