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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Criminal Division) Decisions >> Padda v R. [2013] EWCA Crim 2330 (12 December 2013) URL: https://www.bailii.org/ew/cases/EWCA/Crim/2013/2330.html Cite as: [2014] Crim LR 469, [2014] WLR 1920, [2014] 2 Cr App R (S) 22, [2014] Lloyd's Rep FC 223, [2013] EWCA Crim 2330, [2013] WLR(D) 496, [2014] 1 WLR 1920 |
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ON APPEAL FROM SHREWSBURY CROWN COURT
His Honour Judge Barrie
T20050206
Strand, London, WC2A 2LL |
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B e f o r e :
The Hon Mr Justice Irwin
and
The Recorder of Maidstone
His Honour Judge Carey
____________________
Gurpreet Singh Padda |
Appellant |
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- and - |
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Regina |
Respondent |
____________________
Miss Fiona Jackson (instructed by The CPS) for the Respondent
Hearing dates: Tuesday 3 December 2013
____________________
Crown Copyright ©
Mr Justice Irwin:
The Facts
The Appellant's Subsequent History
The Application
"The Prosecutor has requested that the court proceed to re-consider the available amount for confiscation under section 22(1)(c) of [POCA] . It is considered appropriate for the court to proceed under section 22 (4), as it is believed that the Defendant has acquired sufficient means to satisfy, or satisfy in part, a confiscation order made against him in a crown court, for which there is an outstanding balance and for which the amount required to be paid at the time was the amount found under section 7(2)."
"6.6. The outstanding balance of the Defendant's confiscation order is £146,706.04. I believe that unless the Defendant can show otherwise, the amount now available for uplift to satisfy the original Confiscation order is £103,162.41.
6.7. This does not include the assets attributable to the company "Hire Me a Car Ltd".
6.8. The Defendant has attempted to show that the funds in his bank accounts have been derived legitimately and therefore should not be confiscated to satisfy the original confiscation order. However, section 22(3) states that:
"in a case where this section applies the court must make the new calculation, and in doing so must apply section 9 as if references to the time the confiscation order is made were to the time of the new calculation and as if reference to the date of the confiscation order were to the date of the new calculation."
Section 9 clearly states that the available amount is:
"the aggregate of 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 the pursuance of obligations which then have priority and the total of the values (at that time) of all tainted gifts"
I respectfully suggest that all of the Defendant's restrained assets are in fact free property for the purpose of this Act.
6.9. Therefore the amount which the court may order to be confiscated under Section 22 of [POCA] is £103,162.4.41."
The Legislation
"(1) This section applies if-
(a) a court has made a confiscation order,
(b) the amount required to be paid was the amount found under section 7(2)
.
(3) In a case where this section applies the court must make the new calculation, and in doing, so it must apply section 9 as if references to the time the confiscation order is made were to the time of the new calculation and as if reference to the date of the confiscation order were to the date of the new calculation.
(4) If the amount found under the new calculation exceeds the relevant amount the court may vary the order by substituting for the amount required to be paid such amount as-
(a) it believes is just, but
(b) does not exceed the amount found as the defendant's benefit from the conduct concerned.
(5) In deciding what is just the court must have regard in particular to [ ]
(7) In deciding under this section whether one amount exceeds another the court must take account of any change in the value of money.
(8) The relevant amount is-
(a) the amount found as the available amount for the purposes of the confiscation order, if this section has not applied previously;
(b) the amount last found as the available amount in pursuance of this section, if this section has applied previously.
(9) The amount found as the defendant's benefit from the conduct concerned is-
(a) the amount so found when the confiscation order was made, or
(b) if one or more new calculations of the defendant's benefit have been made under section 21 the amount found on the occasion of the last such calculation."
Submissions
"There comes a time .when rehabilitation should be encouraged. Mr Padda has set up a legitimate business which trades in car hire. In all the circumstances of this case, "what is just" should take into consideration such factors as the period over which Mr Padda has been released, his legitimate activity in the car hire business, the legitimate sources of the money upon which the prosecutor relies in support of the application the period of time which has elapsed since the original order, the efforts towards rehabilitation, and the impact any such order would have upon his business and any other legitimate activity."
The Ruling
"Under sub-section 4 of section 22 I have the power to make an order in relation to such amounts as I believe to be just. And much of the discussion this afternoon has been in relation to the approach I ought to take to what is just, in the circumstances that have arisen for Mr Padda. And that is a completely open-ended question. Although the statute identifies some specific considerations that do not arise in this case, there is an overriding requirement that I should look broadly at the justice of the situation, from every point of view.
However the background to that consideration is this. That the scope of confiscation proceedings under the 2002 Act is often something which comes as a surprise to defendants who are pursued under these provisions, because the purpose of the legislation is to deprive criminals of a benefit that they have achieved from their criminal conduct that led up to their conviction, and it is not interested really in the source of the resources from which they might be expected to make good to the State the repayment of that benefit.
And so the Supreme Court in the decision in the case of Peacock [reference given] affirmed that it is entirely consistent with the purpose of the legislation which I have to deal with. The prosecution should ask the court to come along sometime after conviction, after a first payment has been made, when a defendant has subsequently come into further assets through entirely legitimate means, and ask the court to say that he is now in a position to make a further partial or complete payment towards what remains outstanding and the confiscation that was originally ordered.
What is said in this case is that it is very unfair and unjust to penalise Mr Padda for having worked hard and had some success in the enterprise that he started up after his release from prison. Of course, it is commendable that he has worked hard in an honest business and done well at it, and it shows the ability that he has, which I am sure will stand him in good stead in the future. But the fact that the court is now asked to look at earnings he has achieved through his own good work and business sense is not an answer to the application that the prosecution makes."
"That is approximately half the outstanding amount in relation to the original confiscation order. And I stand back from that and I look at it broadly, in terms of the circumstances that Mr Padda has been in, the business that he has run since he came out of custody and, as I say, the total liability under the original confiscation proceedings; and I ask myself whether it is just to make an order that he should pay a sum of that order, the majority of which, by a large measure, he can meet out of cash that is available in bank accounts in his own name. I have come to the conclusion that there is no just reason why I should not find that the available amount in relation to this confiscation order is now that sum and so my finding is that, looking at the matters as things stand today as I must the available amount today is £74,652 and I make a recovery order for the payment of that amount."
The Judge went on to make directions as to the timing of payments and the period of imprisonment in default.
The Grounds of Appeal
The Authorities
"16. Increase in realisable property.
(1) This section applies where, by virtue of section 5(3) of this Act, the amount which a person is ordered to pay by a confiscation order is less than the amount assessed to be the value of his proceeds of drug trafficking.
(2) If, on an application made in accordance with subsection (3) below, the High Court is satisfied that the amount that might be realised in the case of the person in question is greater than the amount taken into account in making the confiscation order (whether it was greater than was thought when the order was made or has subsequently increased) the court shall issue a certificate to that effect, giving the court's reasons.
(3) .
(4) Where a certificate has been issued under subsection (2) above the prosecutor may apply to the Crown Court for an increase in the amount to be recovered under the confiscation order, and on that application the court may-
(a) substitute for that amount such amount (not exceeding the amount assessed as the value referred to in subsection (1) above) as appears to the court to be appropriate having regard to the amount now shown to be realisable; and
(b) increase the term of imprisonment or detention fixed in respect of the confiscation order "
It will be seen that the 1994 Act uses the term "appropriate" rather than "just". The provisions are otherwise of similar effect, despite rather different procedure.
"1. Suppose that a convicted drug trafficker is found to have benefited from his trafficking to the extent of £1M but, having at the time realisable property worth only £100,000, a confiscation order is initially made against him just for this lesser sum. Suppose then that the defendant, entirely legitimately, later acquires property to the value of upwards of further £900,000. Is he at that stage liable to a further court order increasing to the full extent of his criminal gain the amount recoverable under the confiscation order by reference to these after acquired assets?
2. It is not in doubt that, assuming his offences were committed after 24 March 2003, and that he were therefore subject to the provisions of the Proceeds of Crime Act 2002 ("POCA"), the answer would be a clear "yes"; see particularly section 22(3) of POCA. "
"26. The main argument in support of the appellant's case is that it is unfair and counter-productive to increase the amount of a confiscation order by reference to after-acquired assets. This, it is said, would militate against his reform and rehabilitation and be likely to discourage him (once he has satisfied any initial confiscation order and been released from any sentence of imprisonment) from engaging in lawful and openly profitable employment. And, of course, the longer after conviction it is sought to confiscate after-acquired assets, the more unfair it may appear. Such no doubt were the considerations which led the House of Lords in Re Maye [2008] 1 WLR 315 and in R v- May [2008] AC 1028 to leave open what Lord Scott in Re Maye, para 24 called this "important and difficult" question for later decision.
.
29. As for the main argument, based on fairness and rehabilitation, naturally I recognise Parliament could have chosen a different policy with regard to after-acquired assets. But it seems to me perfectly understandable that in fact Parliament decided (as indisputably it did when later enacting POCA) to leave it open to the courts as a matter of discretion to mulct a defendant of his criminal gains on an ongoing basis irrespective of precisely how and when he came by any increased wealth.
30. That the court does indeed have a discretion in the matter is plain ..This is not, however, the occasion to explore the approach to the proper exercise of that discretion or, indeed, the question whether its exercise could ever be affected by considerations arising under theHuman Rights Act
1998. As already noted, there is no challenge here to the exercise of the Crown Court's discretion, only to whether the section 16(2) certificate was lawfully issued."
"A newly-acquired asset may be obtained in place of another asset in numerous ways: for instance, by making changes in a portfolio of investments, or by remortgaging a house in order to pay the deposit on a second house, or by receiving cash on the surrender or maturity of a life policy. These may be termed substituted assets but they are not after-acquired property in the relevant sense, that is property accruing to a person (whether as earnings or by gift, inheritance or some other windfall) without a corresponding diminution in that person's existing assets."
It is necessary to keep in mind that the debate in Peacock, and in the instant case, concerns "after-acquired property" in the clear, and narrower, sense as defined by Lord Walker. Different considerations would arise in cases dealing with "substituted" assets.
"The 1995 Act removed from the Crown Court almost all discretion as to the making or quantum of a confiscation order, if it was applied for by the prosecution and the statutory requirements were satisfied. That remains the position under POCA. The Crown Court no longer has any power to use its discretion so as to mould the confiscation order to fit the facts and the justice of the case, even though a confiscation order may arise in every kind of crime from which the defendant has benefited, however briefly. The Crown Court has encountered many difficulties in applying POCA's strict regime. Many of the complexities and difficulties of confiscation cases, arising from the extremely involved statutory language, would undoubtedly be avoided if a measure of discretion were restored, but whether to restore it, and if so in which form, is a matter for Parliament and not for the courts."
"Recreation by another route of the general discretion once available to judges but deliberately removed. An order which the judge would not have made as a matter of discretion does not thereby ipso facto become disproportionate. So to treat the jurisdiction would be to ignore the rule that the parliamentary objective must, so long as proportionately applied, be respected."
"The combinations of these provisions, and especially [section 10(6)(b)] ought to mean that to the extent that a confiscation order in a lifestyle case is based on assumptions, it ought not, except in very unusual circumstances, court the danger of being disproportionate because those assumptions will only be applied if they can be made without risk of serious injustice."
As a matter of language and logic, this can readily be distinguished from the requirement in section 22 that a judge "may vary the order by substituting ..such amount as he believes is just". In our judgment, the latter formulation does indeed preserve a discretion to limit the additional payment to what is "just", not merely an obligation to avoid an infringement of A1 P1.
"Even if the proceeds have been spent, a confiscation order up to the value of the proceeds will follow against legitimately acquired assets to the extent that they are available for realisation."
See Waya paragraph 27.
"As for the main argument, based on fairness and rehabilitation, naturally I recognise that Parliament could have chosen a different policy with regard to after-acquired assets. But it seems to me perfectly understandable that in fact Parliament decided (as indisputably it did when later enacting POCA) to leave it open to the courts as a matter of discretion [emphasis added] to mulct a defendant of his criminal gains on an ongoing basis irrespective of precisely how and when he came by any increased wealth."
The Judge's Decision
Conclusions