R v Aloke Varma and Others
| Jurisdiction | England & Wales |
| Judge | Lord Dyson,Lord Clarke,Lord Mance,Lord Phillips,Lord Reed |
| Judgment Date | 10 October 2012 |
| Neutral Citation | [2012] UKSC 42 |
| Date | 10 October 2012 |
| Court | Supreme Court |
[2012] UKSC 42
THE SUPREME COURT
Michaelmas Term
On appeal from: [2010] EWCA Crim 1575
Lord Phillips
Lord Mance
Lord Clarke
Lord Dyson
Lord Reed
Appellant
David Perry QC
William Hays
(Instructed by Crown
Prosecution Service)
Respondent
Hugh Southey QC
Rupert Hallowes
(Instructed by Frame
Smith Solicitors)
Heard on 27 June 2012
Lord Clarke (with whom Lord Dyson and Lord Reed agree)
On 27 November 2008, at the Crown Court in Isleworth, the respondent, Aloke Varma, pleaded guilty to three offences of being knowingly concerned in the fraudulent evasion of duty, contrary to section 170(2)(a) of the Customs and Excise Management Act 1979. The offences were committed on 24 October 2007 and 3 and 13 April 2008. On each occasion the defendant was stopped at Gatwick Airport and found to be in possession of a quantity of tobacco which he had brought into the United Kingdom without payment of the relevant import duties. Following his pleas of guilty, the matter was adjourned for sentence.
I take these facts from the agreed statement of facts and issues. On 15 January 2009 His Honour Judge Katkhuda ("the judge"), exercising his powers under section 12 of the Powers of Criminal Courts (Sentencing) Act 2000, sentenced Varma to a conditional discharge for a period of two years. In deciding that this was the appropriate sentence, the judge referred to Varma's psychological problems and facial neuralgia. Confiscation proceedings under Part 2 of the Proceeds of Crime Act 2002 ("the 2002 Act") were postponed.
The confiscation hearing was held on 3 April 2009. The judge found the value of the defendant's benefit to be £7,257.86 and the available amount to be £1,500. Each of these figures had been agreed between the parties. A confiscation order was made in the sum of £1,500, which was ordered to be paid by 31 March 2010, with a term of imprisonment of 45 days in default of payment.
On 13 July 2009 Varma sought leave to appeal out of time against the confiscation order. He relied on R v Clarke [2009] EWCA Crim 1074, [2010] 1 WLR 223, in which the Court of Appeal (comprising Hooper LJ, Cox J and the Recorder of Nottingham) held in a reserved judgment that the Crown Court does not have the power to make a confiscation order against a defendant following conviction for an offence if he or she is made the subject of an absolute or conditional discharge in respect of that same offence. The essential reasoning was that it was inappropriate to punish a defendant by imposing a confiscation order in a case in which (by virtue of the fact that a conditional discharge had been imposed) the court thought that punishment was inexpedient.
Varma's appeal was heard on 10 June 2010, together with three similar cases. The defendant in each of the four cases before the Court of Appeal had pleaded guilty in the Crown Court to one or more offences, had received a conditional discharge and had been made the subject of a confiscation order under the 2002 Act. The ground of appeal in each case was that, following Clarke, the Court had no power to make a confiscation order. According to the agreed statement of facts and issues, oral argument was constrained by the Court of Appeal's clear indication that it wished to focus on whether it was bound by Clarke. On 8 July 2010 the Court of Appeal (Lord Judge CJ, Goldring LJ and Rafferty, Wilkie and King JJ) handed down their judgment in each of the four appeals: R v Magro, R v Brissett, R v Smith and R v Varma [2010] EWCA Crim 1575, [2011] QB 398.
The Court of Appeal held that, following the decision in Clarke, the Crown Court did not have power to make a confiscation order against a defendant following conviction for an offence if he or she receives an absolute or conditional discharge in respect of that offence. Giving the judgment of the court, Lord Judge CJ made clear (at para 29) that, but for the decision in Clarke, the court would have reached a contrary conclusion. On this basis, the Court of Appeal extended time to appeal in the case of Varma, allowed the appeal against sentence and quashed the confiscation order. The court held that a point of law of general public importance was involved in their decision and certified the following question:
"Does the Crown Court have power to make a confiscation order against a defendant following conviction for an offence if he or she receives an absolute or conditional discharge for that offence?"
This court subsequently granted permission to appeal. The three remaining applications for leave to appeal against sentence were adjourned pending the outcome of this appeal.
As agreed in the statement of facts and issues, the issue which arises for consideration in this appeal is whether the Crown Court has power to make a confiscation order against a defendant following conviction for an offence if he or she receives an absolute or conditional discharge for that offence.
Section 12 of the Powers of Criminal Courts (Sentencing) Act 2000, provides:
"(1) Where a court by or before which a person is convicted of an offence … is of the opinion, having regard to the circumstances including the nature of the offence and the character of the offender, that it is inexpedient to inflict punishment, the court may make an order either —
(a) discharging him absolutely; or
(b) if the court thinks fit, discharging him subject to the condition that he commits no offence during such period, not exceeding three years from the date of the order, as may be specified in the order …
(7) Nothing in this section shall be construed as preventing a court, on discharging an offender absolutely or conditionally in respect of any offence, from making an order for costs against the offender or imposing any disqualification on him or from making in respect of the offence an order under section 130, 143 or 148 below (compensation orders, deprivation orders and restitution orders)".
As is apparent, there is no reference in subsection (7) to confiscation orders.
At the date when section 12 of the 2000 Act came into force, section 2(6) of the Drug Trafficking Act 1994, repeating section 1(6) of the Drug Trafficking Offences Act 1986, provided:
"No enactment restricting the power of a court dealing with an offender in a particular way from dealing with him also in any other way shall by reason only of the making of an order under this section restrict the Crown Court from dealing with an offender in any way the court considers appropriate in respect of a drug trafficking offence."
Similar provision was made, with necessary alterations to the language, to deal with non-drug trafficking offences, by section 72(6) of the Criminal Justice Act 1988.
Section 14 of the 2000 Act provides:
"(1) Subject to subsection (2) below, a conviction of an offence for which an order is made under section 12 above discharging the offender absolutely or conditionally shall be deemed not to be a conviction for any purpose other than the purposes of the proceedings in which the order is made and of any subsequent proceedings which may be taken against the offender under section 13 above.
(3) Without prejudice to subsections (1) and (2) above, the conviction of an offender who is discharged absolutely or conditionally under section 12 above shall in any event be disregarded for the purposes of any enactment or instrument which —
(a) imposes any disqualification or disability upon convicted persons; or
(b) authorises or requires the imposition of any such disqualification or disability.
…
(6) Subsection (1) above has effect subject to section 50(1A) of the Criminal Appeal Act 1968 and section 108(1A) of the Magistrates' Courts Act 1980 (rights of appeal); and this subsection shall not be taken to prejudice any other enactment that excludes the effect of subsection ( 1) or (3) above for particular purposes."
Section 6 of the Proceeds of Crime Act 2002, as amended, provides:
"(1) The Crown Court must proceed under this section if the following two conditions are satisfied.
(2) The first condition is that a defendant falls within any of thefollowing paragraphs –
(a) he is convicted of an offence or offences in proceedings before the Crown Court; …
(3) The second condition is that —
(a) the prosecutor asks the court to proceed under this section, or
(b) the court believes it is appropriate for it to do so.
(4) The court must proceed as follows—
(a) it must decide whether the defendant has a criminal lifestyle;
(b) if it decides that he has a criminal lifestyle it must decide whether he has benefited from his general criminal conduct;
(c) if it decides that he 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)(b) or (c) that thedefendant 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.
(6) But the court must treat the duty in subsection (5) as a power if it believes that any victim of the conduct has at any time started or intends to start proceedings against the defendant in respect of loss, injury or damage sustained in connection with the conduct.
(7) The court must decide any question arising under subsection ( 4) or (5) on a balance of probabilities. …"
Section 13 of the 2002 Act provides:
"(1) If the court makes a confiscation order it must proceed as mentioned in subsections (2) and (4) in respect of the offence or offences concerned.
(2) The court must take account of the confiscation orderbefore –
(a) it imposes a fine on the defendant, or
(b) it makes an order falling within subsection (3).
(3) These orders fall within this subsection —
(a) … (compensation orders);
(b) …...
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