R v Reilly

JurisdictionEngland & Wales
Judgment Date16 March 1982
Judgment citation (vLex)[1982] EWCA Crim J0316-3
Docket NumberNo. 1850/C/81
CourtCourt of Appeal (Criminal Division)
Date16 March 1982
William Joseph Thomas Reilly

[1982] EWCA Crim J0316-3


Lord Justice Kerr

Mr. Justice Pain


Mr. Justice Beldam

No. 1850/C/81



Royal Courts of Justice

MR. B. LEARY, Q.C. and MR. R. GRIFFITH appeared on behalf of the Appellant.

MR. A. N. HITCHING appeared on behalf of the Crown.


On 25th March 1981, the appellant (William Reilly) pleaded guilty, at the Willesden Crown Court before His Honour Judge Palmer, to a number of offences in relation to the Inland Revenue. He pleaded guilty to four offences of conspiracy to defraud the Inland. Revenue under counts 2, 3, 4 and 5, and to three further offences of making false statements in his tax returns under counts 8, 9 and 10. He also asked for two other similar offences to be taken into consideration.


He was sentenced to concurrent terms of 3 years' imprisonment on each count. In addition he was disqualified from participating in the management of any company for a period of 5 years. In relation to the counts of conspiracy to defraud, a criminal bankruptcy order was made against him in the total sum of £178,000 in favour of the Inland Revenue. He was also ordered to contribute £250 towards his legally aided defence.


It is unnecessary for the purposes of the present appeal, which relates solely to the criminal bankruptcy order, to go into the facts at any length. He appeals to this court in relation to that order by leave of the single judge.


Very briefly the facts are that between May 1975 and April 1980 the appellant carried on business ostensibly through the medium of a number of companies as a supplier of labour to the construction industry. The position in relation to that is that following the Finance Act 1971, when sub-contractors, such as the appellant, were paid, income tax was to be deducted at source. That was the procedure for paying self-employed construction workers on what is usually known as "the lump". However, in the case of a corporate supplier of labour, such as the appellant purported to be, gross payments could still be made, since it was then the responsibility of the payee to make the appropriate deductions.


Counts 2 and 3 concerned the appellant's operations in the name of two companies (Roseville Contractors Ltd. and Lamadale Ltd.) during different periods when he was engaged to supply labour to a company called E.V7. Avent Ltd., from whom he received gross payments without any deduction of tax and he then failed to make the necessary deductions, being a director of both those companies.


Counts 4 and 5 were similar in relation to two other companies (Lurkhurst Builders Ltd. and Lobtone Ltd.) There although the appellant was not a director, he was a guarantor of the companies and clearly acted in the everyday management of both of them.


I need not go further into counts 8, 9 and 10, which related to failing to make appropriate tax returns, save to say that they related to another business, that of an insurance broker.


It is also unnecessary in the present context to say anything about the appellant's antecedents, save to say that the nature of the offences certainly would not make a criminal bankruptcy order inappropriate if there was power to make it.


This appeal relates to the submission that for two reasons there is no power to make such an order.


The power to make a criminal bankruptcy order arises under section 39 of the Powers of Criminal Courts Act 1973. I must read parts of that provision. Subsection (1): "Where a person is convicted of an offence before the Crown Court and it appears to the court that -(a) as a result of the offence, or of that offence taken together with any other relevant offence or offences, loss or damage (not attributable to personal injury) has been suffered by one or more persons whose identity is known to the court; and (b) the amount, or aggregate amount, of the loss or damage exceeds £15,000; the court may, in addition to dealing with the offender in any other way (but not if it makes a compensation order against him), make a criminal bankruptcy order against him in respect of the offence or, as the case may be, that offence and the other relevant offence or offences."


Then I go to subsection (3): "A criminal bankruptcy order shall specify - (a) the amount of the loss or damage appearing to the court to have resulted from the offence or, if more than one, each of the "offences; (b) the person or persons appearing to the court to have suffered that loss or damage; (c) the amount of that loss or damage which it appears to the court that that person, or each of those persons, has suffered; and (d) the date which is to be the relevant date for the purpose of the exercise by the High Court of its powers under paragraph 10 of Schedule 2 to this Act in relation to dispositions made by the offender, being the date which appears to the court to be the earliest date on which the offence or, if more than one, the earliest of the offences, was committed."


Then it is necessary to read section 40 (1), which provides: "No appeal shall lie against the making of a criminal bankruptcy order".


Pausing there, what is said in this case is that notwithstanding section 40 (1) of the Act, an appeal (or something in the nature of an appeal) lies in this case because there was no jurisdiction to make this criminal bankruptcy order. It has rightly not been submitted on behalf of the Crown that if there was no jurisdiction, then this court could not interfere. Clearly if there was no jurisdiction, the order would be a nullity and would have to be set aside.


Pursuant to section 39 (3), the learned judge made the following criminal bankruptcy order: in relation to Roseville Contractors Ltd., the earliest date of the offence committed was 1st May 1975 and the tax loss was £55,000. In relation to Lamadale Ltd., the date was 30th September 1977, the sum being £8,000. In relation to Lurkhurst Builders, the date was 1st October 1977 and the sum was £80,000, and in relation to Lobtone, the date was 1st August 1978 and the sum £35,000. This made a total tax loss of £178,000. The loser (the person injured or damaged in each case) was stated to be the Inland Revenue. Accordingly a criminal bankruptcy order in the total sum of £178,000 was made against the appellant, which is now the subject matter of this appeal.


There are two grounds on which this appeal is put forward. The first arises as follows. Although counsel for the Crown had at an early stage of the hearing, when the appellant pleaded guilty, made it clear that he would invite the court to make a criminal bankruptcy order, this was not in fact done when the learned judge came to sentence the appellant. He then sentenced him to 3 years' imprisonment concurrent, as I have already said, as well as to the disqualification under the Companies Act. To need not read what he said on that occasion. But he then also said that he did not propose to make any criminal bankruptcy order and he dealt with the costs, as I have already mentioned. Having said that, and, on the face of it, completed the pronouncement of the sentence, he was reminded by counsel on behalf of the Crown that there was an application for a criminal bankruptcy order and counsel asked to be heard about that. There was some discussion about it and a measure of objection on behalf of the appellant.


Then, after a short adjournment, when certain further material was placed before the court, the criminal bankruptcy order, in the terms which I have already mentioned, was made.


The first ground of this appeal is that the learned judge, having completed the pronouncement of the sentence, had no jurisdiction to make the criminal bankruptcy order, or, at any rate, should not have done so, in the light of certain authorities to which I will refer in a moment. These turn on section 11 (2) of the Courts Act 1971. Section 11 provides, so far as relevant: "(1) A sentence imoosed, or other order made, by the Crown Court when dealing with an offender….. (2)…..may be varied or rescinded by the Crown Court within the period of 28 days beginning with the day on which the sentence or other order was imposed or made".


In the present case the variation (consisting of the addition of the criminal bankruptcy order was made on the same day after only a short adjournment. But what is said is that the proper interpretation of that provision is that there should be no fundamental change of mind – to use the phrase which was used by Mr. Leary, Q.C. on behalf of the appellant – by adding to or varying a sentence, so as to make it more severe, once the sentence has been pronounced. The case on which Mr. Leary mainly relied for that proposition was R. v. Grice (1978) 66 Cr.App.R. 167. That was a case in which a court, having imposed no prison sentence on a defendant in relation to a charge of unlawful sexual intercourse with his adopted daughter, aged 16, then came to hear that, contrary to an undertaking which he had given to the court, he had contacted her. The court called him back and purported then to vary the previous sentence by imposing a sentence of immediate imprisonment. That was strongly criticised by this court, consisting of Roskill L.J., Waller L.J. and Ackner J., in relation to the facts of that case. It was said that what had been done in that case, substantially increasing the sentence (indeed altering it fundamentally), was not something which should be done under the power to vary within that provision. However, not only were the facts of that case wholly different from those of the present case, since they concerned events which came to light after...

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2 books & journal articles
  • Administrative and Constitutional Law
    • Singapore
    • Singapore Academy of Law Annual Review No. 2008, December 2008
    • 1 December 2008
    ...jurisdiction, the proceedings would be invalid: Ng Swee Lang v Sassoon Samuel Bernard[2008] 2 SLR 597 at [19]. In contrast, in R v Reilly[1982] QB 1208; [1982] 3 WLR 149; [1982] 3 All ER 27 (CA) (discussed in R v Ashton[2007] 1 WLR 181) which concerned s 127(1) of the Magistrates” Courts Ac......
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    ...R v Rattray, 2008 ONCA 74................................................................................. 150, 184 R v Reilly, [1982] 3 All ER 27 (CA) ............................................................................. 366 R v Ribic, 2008 ONCA 790 ......................................

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