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England and Wales Court of Appeal (Criminal Division) Decisions


You are here: BAILII >> Databases >> England and Wales Court of Appeal (Criminal Division) Decisions >> Lambert & Anor v R. (Rev 1) [2012] EWCA Crim 421 (08 March 2012)
URL: http://www.bailii.org/ew/cases/EWCA/Crim/2012/421.html
Cite as: [2012] EWCA Crim 421

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Neutral Citation Number: [2012] EWCA Crim 421
Case Nos: 201001755B1 & 201001756B1

IN THE COURT OF APPEAL (CRIMINAL DIVISION)
ON APPEAL FROM SWINDON CROWN COURT
HHJ HART

Royal Courts of Justice
Strand, London, WC2A 2LL
08/03/2012

B e f o r e :

LORD JUSTICE PILL
MR JUSTICE TREACY
and
MR JUSTICE KENNETH PARKER

____________________

Between:
Richard Lambert
First Appellant
Ian Alexander Walding
Second Appellant
- and -

The Queen
Respondent
and

The Secretary of State for the Home Department
Intervenor

____________________

Mr E Fitzgerald QC and Miss J Cecil (instructed by the Registrar) for the First and Second Appellants
Mr S Farrell QC and Miss L McLeod Henderson (instructed by the CPS) for the Respondent
Mr J Swift QC and Mr M Gullick (instructed by Treasury Solicitor ) for the Intervenor

Hearing date : 26 January 2012

____________________

HTML VERSION OF JUDGMENT
____________________

Crown Copyright ©

    LORD JUSTICE PILL :

  1. On 15th May 2009 in the Crown Court at Swindon before His Honour Judge Hart Richard Lambert pleaded guilty to producing a controlled drug of class C (count 1 – cannabis) and possessing a controlled drug of class B (count 2 – amphetamine sulphate).  On 18 May 2009 Lambert and Ian Walding  pleaded guilty to acquiring criminal property (count 4).  Walding also pleaded guilty to producing a controlled drug of class C (count 1 – cannabis) and possessing a controlled drug of class C (count 3 – cannabis).
  2. On 16th October 2009 both defendants were sentenced by His Honour Judge Hart to 27 months imprisonment on count 1 and to 9 months imprisonment concurrent on count 4.  On count 2, Lambert was sentenced to 1 month imprisonment concurrent and on count 3 Walding was sentenced to 1 month imprisonment concurrent.  The total sentence for each man was therefore one of 27 months imprisonment.
  3. Confiscation proceedings were taken against both Lambert and Walding under section 6 of the Proceeds of Crime Act 2002 ("the 2002 Act"). In a judgment dated 1 March 2010, Judge Hart found that each man had benefited from crime in the sum of £107,860. The judge found that Lambert had realisable assets of £116,887.49 and Walding realisable assets of £153,027. These figures are not now challenged. The sums for realisable assets included, in each case, the appellants' equity in the homes in which they lived.
  4. Confiscation orders were made against both men in the sum of £107,860, payable within 6 months. In default of payment, a 3 year sentence of imprisonment was to be served consecutively to the sentence for the offences proved.
  5. Lambert and Walding appeal against the confiscation orders by leave of the full court.
  6. The offences were discovered on 8 September 2008 when police officers attended an industrial unit and found that a commercial scale hydroponics system had been erected in the premises, which had been divided into 5 rooms each containing cultivated cannabis plants in various stages of growth. 342 cannabis plants were found. At Walding's home, a quantity of herbal cannabis and books on growing cannabis were recovered.
  7. Lambert was arrested on 12 September 2008 at his home. 23 snap seal bags of amphetamine sulphate were found. He had set up the cannabis factory in order to pay a large debt. Capital was provided by Lambert's creditor to whom the drugs were to be supplied. The arrangement was that Walding would grow the plants and Lambert would take the harvested material to London for supply to the creditor. What was left after payments to the creditor would be shared equally between Lambert and Walding.
  8. At the confiscation hearing, there was a stark conflict of evidence between the parties as to the value of the sums benefited. The prosecution alleged that each defendant had benefited from criminal conduct to a total value of £816,617.15. This included not only the wholesale value of the cannabis seized but the value of the estimated yield of the cannabis production.
  9. The judge did not accept the prosecution calculation. He found a benefit of £107,860.00, £80,000.00 being the proceeds of the business and £27,860.00 the potential yield value of the plants plus saleable material at the premises.
  10. The judge found that this was a joint venture between Lambert and Walding and they were to benefit jointly. Having referred to the decision of the House of Lords in R v May [2008] AC 2018, considered below, he stated that he was required "to make the order joint and several, rather than apportion between the two." That it was a joint venture is a finding of fact which is not now challenged.
  11. On behalf of the appellants, Mr Fitzgerald QC submitted that the confiscation orders were unlawful because the judge had failed to apportion the benefit figure of £107,860.00 between the appellants. Each should have been ordered to pay only half that sum. It is accepted that the judge was required to make an order under section 6 of the 2002 Act. Having found that the conditions in sections 6(2) and (3) were satisfied, and that each appellant had benefited, within the meaning of section 6(4), from his criminal conduct, the judge was obliged to make an order under section 6(5) of the 2002 Act:
  12. "If the court decides under subsection (4)(b) or (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."
  13. Section 7(1) and (2) of the 2002 Act provides:
  14. "(1) The recoverable amount for the purposes of section 6 is an amount equal to the defendant's benefit from the conduct concerned.
    (2) But if the defendant shows that the available amount is less than that benefit the recoverable amount is-
    (a) the available amount, or
    (b) a nominal amount, if the available amount is
    nil."

    On the judge's findings in relation to the available amount, section 7(1) operates to fix the benefit, subject to argument about apportionment, at £107,860. There is no challenge in this appeal to the manner in which the sum for benefit is ascertained in proceedings such as these.

  15. It is not now alleged that the 2002 Act is incompatible with the obligations of the United Kingdom under the European Convention on Human Rights, article 1 of the First Protocol. The submission is that under section 3 of the Human Rights Act 1998 ("the 1998 Act"), the 2002 Act "must be read and given effect in a way which is compatible with the Convention rights". Reliance is placed on article 1 of the First Protocol. That provides:
  16. "Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.
    The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties."
  17. It was submitted that the entitlement to enjoyment of possessions involves reading the duty to make a confiscation order under section 6(5) of the 2002 Act subject to the overriding principle that the order should not be disproportionate. It was submitted that the orders were disproportionate because their combined effect would result in the state receiving the full benefit figure twice. Having concluded that there was a joint enterprise and a joint benefit from it, the court should stand back and, viewing the circumstances as a whole, make a confiscation order against each defendant for one half of the sum held to be benefit. It was submitted that whenever the total sum confiscated would otherwise be more than the total benefit, and certainly when it far exceeds the total benefit, an apportionment is required. Otherwise, the confiscation order is disproportionate to the objects of the legislation. Alternatively, it was argued that to pursue each defendant for the full benefit was an abuse of process.
  18. Mr Fitzgerald's submissions involved a detailed examination of the authorities. A sum obtained by a defendant jointly with others was as much his as if he had acted alone (May, paragraph 46) but none of the reported cases deals precisely with the present situation. Where defendants have each been ordered to pay the entire amount of a benefit jointly obtained, the overall sum ordered has been less than the overall benefit obtained. That is because overall realisable assets are very frequently substantially less than overall benefit. If the objective is deterrence, Mr Fitzgerald submitted, that is achieved by the power to imprison for the offences themselves and in the requirement to impose a further sentence if the sum ordered is not paid.
  19. Mr Fitzgerald said that there may be other injustices associated with the confiscatory regime, and also that apportionment could lead to anomalies as between defendants, but the power to apportion would remedy an obvious injustice. It is possible to read a limited exception into section 6(5) to cover situations such as the present. To permit apportionment would not be inconsistent with Parliament's intentions. The principle of apportionment, formerly accepted in Porter [1991] 1 WLR 1260, should be applied.
  20. Addressing his alternative submission on abuse of process, Mr Fitzgerald accepted that it was a narrower remedy and was normally treated as an all-or-nothing remedy. He accepted that a confiscation order in the region of £50,000 against each appellant would have been required in this case. Effect could be given to the abuse principle by requiring from the prosecution an undertaking not to seek recovery of more than £50,000 from each appellant. A means should be found to temper the effect of the double recovery which the present orders involved, it was submitted.
  21. For the prosecution, Mr Farrell QC submitted that major deterrence was legitimately required in relation to the proceeds of crime. It was not disproportionate to make an order against each defendant for the total benefit received, as that is defined in the statute and the authorities, up to the extent of his realisable assets. The order against a particular defendant could properly be related to the benefit received. This was not an order compensating an identifiable loser for a sum lost; it was an order depriving a defendant of the benefit obtained. Mr Farrell accepted that, in an extreme case, the court could protect a defendant by finding an abuse of process. Subject to that, no discretion was permitted by the wording of section 6(5) of the 2002 Act.
  22. For the intervenor, Mr Swift QC first submitted, in relation to Convention considerations, that the court was not concerned with the overall question of the total sum recovered but whether it was proportionate to interfere with an individual defendant's property. Unfairness to a particular defendant did not arise as a result of other defendants having to make payments. The court must look at the position of an individual defendant because it is the individual's right that is protected by the Convention.
  23. Mr Swift further submitted that there is no authority for applying an overriding principle of proportionality to the present statutory wording. A deterrent approach is legitimate. Section 6(5) requires the court to make a confiscation order and does not permit a discretion. Moreover, the abuse jurisdiction does not permit a court to disregard legislation.
  24. The statutory scheme, judged in the round, is beneficial, it was submitted. It is necessarily a general scheme and the emergence of hard cases does not render the scheme contrary to the Convention, or permit words to be inserted into section 6(5). The duty under section 3 of the 1998 Act was considered in Ghaidan v Mendoza [2004] UKHL 30. Lord Steyn stated, at paragraph 33:
  25. "The meaning imported by application of section 3 must be compatible with the underlying thrust of the legislation being construed. Words implied must, in the phrase of my noble and learned friend Lord Rodger of Earlsferry, 'go with the grain of the legislation'."

    Section 6(5) of the 2002 Act provides that the court must make an order requiring a defendant to pay "that amount", which is the assessed amount of the benefit. Additional words should not be inserted, it was submitted.

  26. In R v May [2008] AC 1028, the House of Lords dismissed an appeal against a decision of this court, Keene LJ presiding [2005] 1 WLR 2092, where a confiscation order was made following convictions of conspiracy to cheat by creating companies for the purpose of dishonestly retaining and reclaiming VAT. May was a case in which the Revenue had been cheated of a specific sum. Lord Bingham of Cornhill delivered the opinion of a Committee of the House of Lords, also including Lord Phillips of Worth Matravers CJ, Baroness Hale of Richmond, Lord Carswell, and Lord Brown of Eaton-under-Heywood.
  27. Lord Bingham summarised the submissions for the defendant and the prosecution, summarised the judgment of the Court of Appeal and, at paragraph 46, stated this conclusion:
  28. "The sum which the appellant, jointly with others, was found to have fraudulently obtained from HM Customs and Excise was, in law, as much his as if he had acted alone. That conclusion leads ineluctably to the further conclusions that he benefited from his offending, and benefited to an extent substantially greater than the confiscation order made against him (because of the deduction erroneously made by the judge as recorded in para 6 above). The order made was less than his realisable assets. It is entirely consistent with the legitimate objects of the legislation, and it requires, that he be ordered to pay such sum, which involves no injustice or lack of proportionality. The legislation is, as Lord Steyn described it in R v Rezvi [2003] 1 AC 1099, para 17, 'a precise, fair and proportionate response to the important need to protect the public'. R v Porter [1990] 1 WLR 1260 is not authority that the court has power to apportion liability between parties jointly liable, a procedure which would be contrary to principle and unauthorised by statute. No error was shown in the reasoning of Keene LJ, with which the committee generally agrees, while stressing that in any given case the statutory questions must be answered by applying the statutory language, shorn of judicial glosses and paraphrases, to the facts of that case."
  29. In an Endnote, at paragraph 48, the Committee added, amongst other things:
  30. "The legislation is intended to deprive defendants of the benefit they have gained from relevant criminal conduct, whether or not they have retained such benefit, within the limits of their available means. It does not provide for confiscation in the sense understood by schoolchildren and others, but nor does it operate by way of fine. The benefit gained is the total value of the property or advantage obtained, not the defendant's net profit after deduction of expenses or any amounts payable to co-conspirators."

    The Committee did acknowledge that "mere couriers or custodians or other very minor contributors to an offence, rewarded by a specific fee and having no interest in the property or the proceeds of sale, are unlikely to be found to have obtained that property." That state of affairs does not arise in the present case.

  31. In Green [2008] AC 1053, heard immediately after May, Lord Bingham on behalf of a Committee of identical composition stated, at paragraph 16:
  32. "It is a curious feature of this case that the confiscation order made by the judge was, as a result of errors made by him . . . very much smaller than the statute required on the findings made. But that does not affect the principle. The committee cannot, however, regard it as disproportionate to make an order depriving a defendant of a benefit which he has in fact and in law obtained, within the limits of his realisable assets, and it notes that challenges to the proportionality of the confiscation regime (as in Phillips v United Kingdom (2001) 11 BHRC 280 and R v Rezvi [2002] UKHL 1, [2003] 1 AC 1099) have not succeeded. In construing a UK statute, the meaning of which it judges to be clear, the committee cannot be influenced by the legislation of other countries, even if (as may be the case) those countries have chosen to give effect to common international obligations in a different way."
  33. In Phillips, the European Court of Human Rights ("ECtHR") had stated:
  34. "50.  The Court observes that the "possession" which forms the object of this complaint is the sum of money, namely GBP 91,400, which the applicant has been ordered by the Crown Court to pay, in default of which payment he is liable to be imprisoned for two years. It considers that this measure amounts to an interference with the applicant's right to peaceful enjoyment of his possessions and that Article 1 of Protocol No. 1 is therefore applicable.
    51.  As previously stated, the compensation order constituted a "penalty" within the meaning of the Convention. It therefore falls within the scope of the second paragraph of Article 1 of Protocol No. 1, which, inter alia, allows the Contracting States to control the use of property to secure the payment of penalties. However, this provision must be construed in the light of the general principle set out in the first sentence of the first paragraph and there must, therefore, exist a reasonable relationship of proportionality between the means employed and the aim sought to be realised (see, among many examples, Allan Jacobsson v. Sweden [1989] ECHR 10842/84 at para 55).
    52. As to the aim pursued by the confiscation order procedure, as the Court observed in Welch v UK [1995] ECHR 17440/90 at para 36, these powers were conferred on the courts as a weapon in the fight against the scourge of drug trafficking. Thus, the making of a confiscation order operates in the way of a deterrent to those considering engaging in drug trafficking, and also to deprive a person of profits received from drug trafficking and to remove the value of the proceeds from possible future use in the drugs trade.
    53.  The Court has already noted that the sum payable under the confiscation order was considerable, namely £91,400. However, it corresponded to the amount which the Crown Court judge found the applicant to have benefited from drug trafficking over the preceding six years and was a sum which he was able to realise from the assets in his possession. The Court refers to its above finding that the procedure followed in the making of the order was fair and respected the rights of the defence.
    54.  Against this background, and given the importance of the aim pursued, the Court does not consider that the interference suffered by the applicant with the peaceful enjoyment of his possessions was disproportionate. It follows that there has been no violation of Article 1 of Protocol No. 1."
  35. Mr Fitzgerald relied on the Committee's statement in May that it "generally agrees" with the reasoning of Keene LJ. He referred to paragraph 41 of the judgment in the Court of Appeal:
  36. "We see force in that point as a general proposition, and in some circumstances it may lead the court to adopt an apportionment approach. For example, there may be cases where the defendants have substantial assets, with the result that making orders for the full benefit in each case would lead to the Revenue recovering far more than the conspiracy or joint enterprise had obtained. In such a case the court may be prepared to apportion the benefit. But that situation does not apply here. In particular, the total of the confiscation orders made by the judge was well below the £12 million of which the Revenue had been cheated by these conspirators."
  37. Mr. Fitzgerald referred to the willingness of Keene LJ to accept that there may be cases where the court is "prepared to apportion the benefit." That part of the reasoning of Keene LJ had been cited by the Committee at paragraph 45 and, it was submitted, was part of the reasoning of Keene LJ with which the Committee generally agreed.
  38. In reply, Mr Farrell and Mr Swift made the following points in relation to May:
  39. (1) In its conclusions in May, at paragraph 46, the Committee stated in terms that to apportion liability would be "a procedure which would be contrary to principle and unauthorised by statute." The Committee had added that "in any given case the statutory questions must be answered by applying the statutory language, shorn of judicial glosses and paraphrases, to the facts of that case." That approach is confirmed in the Endnote, it was submitted.

    (2) In May, Porter [1991] 1 WLR 1260 was disapproved. The headnote in the Law Reports states that it was "distinguished" but it appears to us that in its detailed analysis of Porter at paragraph 27, and in this court's analysis at paragraph 31, the decision was disapproved. The Committee stated that in Porter orders in the full sum "should have been made against each of [the Defendants] severally."

    (3) At paragraph 34, the Committee cited with apparent approval the case of Sharma [2006] 2 Cr App R (S) 63, Pill LJ presiding, where the defendant was convicted of conspiracy to defraud. Giving the judgment of the court, Newman J stated, at paragraph 19:

    "We emphasise that the Act focuses on the individual benefit obtained by each defendant, the total amount of which is not limited by the amount of the victim's loss."
    At paragraph 25, Newman J stated:
    "In our judgment, since the Act is concerned to force a defendant to surrender the benefit he has obtained from his criminal activity, so long as the benefit he obtained is correctly calculated, it cannot be disproportionate for him to be made accountable for what he obtained. The amount of the benefit he obtained is not affected by the amount which might also be obtained by others to whom he transfers any part of the benefit. The amount of money which might be recovered pursuant to a confiscation order is irrelevant. In every case, at the time a confiscation order is made, there can be no certainty that the amount to be paid will be paid and thus, where more than one confiscation order is made in respect of a victim's loss, the question of double recovery may not arise."

    (4) In Chrastny (No.2) [1991] 1 WLR 1385 and in Reece (unreported 19 July 1990), a similar approach was followed. These cases were also cited by the Committee in May.

    (5) In Simpson [1998] 2 Crim. App. R. (S) 111, this court considered circumstances in which the same sum by way of benefit passed through several hands of successive dealers. In May, neither this court, at paragraph 32, nor the Committee, at paragraph 30, found anything objectionable in that when ordering that each holder should be ordered to pay the full amount of the benefit.

  40. Mr Swift relied on the acceptance by the ECtHR of the principle of deterrence when considering the lawfulness of the procedure. The expression "scourge of drug trafficking" is used. There is a discretion in member states to decide how severe the deterrence may be. Provided no defendant is ordered to pay more than the sum by which he has benefited, there is no infringement of article 1 of the First Protocol. Mr Swift relied on the finding by the House of Lords Committee in May, at paragraph 46, and binding on this court, that the scheme "involves no injustice or lack of proportionality."
  41. The reference to "compensation order" in paragraph 51 of Phillips is a misnomer. There is no doubt that it was a confiscation order under consideration. In relation to Phillips, Mr Fitzgerald relied on the reference to "depriving a person of profits received" (paragraph 52), and to the applicant having "benefited", as demonstrating that it was contemplated that only the benefit from the unlawful enterprise, and not double recovery or multiple recovery, would occur. He also relied on the reference to the principle of proportionality. Phillips was a sole offender and no question of double, or multiple, recovery arose in that case.
  42. Mr Fitzgerald relied on the decision of the Court of Appeal of Northern Ireland in Leslie & Mooney [2008] NICA 28. The court held, at paragraph 19:
  43. "In the exceptional circumstances of this case a number of factors lead to the conclusion that the principle of proportionality favours an apportionment of the liability between the applicants."

    Amongst the circumstances relied on were the "exceptionally heavy burden on a defendant in a case where it was accepted that the proceeds of crime were to be split amongst the five defendants." We regret that we cannot apply that approach. The court relied not on the Committee's statement in May but on the summary by the Committee, at paragraph 45, of what was the decision of the Court of Appeal in May. The problem arising from paragraph 41 of the Court's judgment in May has already been mentioned but it is common ground in this appeal that, in its judgment at paragraph 45, the Committee was summarising the findings of the Court of Appeal and not expressing its own view.

  44. Since May, the statutory scheme has been considered in this court in Spears and McAllister [2009] EWCA Crim 2875, Elias LJ presiding. A nominal order was made against the defendants but was challenged because "each appellant remains potentially at risk with respect to that sum [the joint benefit assessed at £117,000]." The court stated at paragraph 21:
  45. "We note that in May the appellant was convicted with others of conspiracy to cheat. He was found to be jointly responsible with others for the fraud. The value stipulated was in excess of £3 million. One of the submissions advanced in that case was that if all the co-defendants were jointly liable in the same way, that could lead to the Revenue recovering a massively greater sum than they had in fact lost because there were sixteen conspirators named in the indictment and so the sum would be recovered sixteen times over. Notwithstanding that, the House of Lords held that the judge's analysis had been correct and that the value had been properly determined, given that the sum had been acquired as a result of crime committed jointly with the other co-defendants. Accordingly, even if we were faced with a proper application that this order conflicted with rights under the Convention, we would reject it."
  46. The abuse of process procedure was considered in this court in the present context in Nelson & Others [2009] EWCA Crim 1573, Lord Judge CJ presiding. At paragraph 34, the court referred to the legislative scheme as "draconian". The Lord Chief Justice stated, at paragraph 35:
  47. "Abuses of the confiscation process may occur and, when they do, the appropriate remedy will normally be a stay of proceedings. However an abuse of process argument cannot be founded on the basis that the consequences of the proper application of the legislative structure may produce an 'oppressive' result with which the judge may be unhappy. Although the court may, of its own initiative, invoke the confiscation process, the responsibility for deciding whether properly to seek a confiscation order is effectively vested in the Crown. When it does so, the court lacks any corresponding discretion to interfere with that decision if it has been made in accordance with the statute. The just result of these proceedings is the result produced by the proper application of the statutory provisions as interpreted in the House of Lords and in this court. However to conclude that proceedings properly taken in accordance with statutory provisions constitute an abuse of process is tantamount to asserting a power in the court to dispense with the statute."
  48. The court referred in Nelson to authorities on abuse of process, including Shabir [2009] 1 Cr App Rep (S) 84, which was also cited in the present appeal. The court concluded, at paragraph 37:
  49. "The 'benefits' are to be assessed in accordance with the statutory provisions, and in the light of the statutory assumptions. The assessment having been made, the defendant must be ordered to fund the confiscation order from the proceeds of his crime if they are available, or, if he has dissipated the proceeds, from funds lawfully available to him."
  50. In Shabir, the defendant was convicted of obtaining money transfers by deception. Fraudulent claims were made by a pharmacist for the cost of prescriptions dispensed. The total amount claimed was approaching £200,000 but the total amount obtained improperly was only £464. Following the application of assumptions under the 2002 Act, the confiscation order was made in a sum of over £200,000. The court, Hughes LJ presiding, referred to the case of Phillips and stated, at paragraph 25:
  51. "Even if it be accepted that the protocol may be capable of being infringed by a truly oppressive and thus disproportionate individual order for confiscation (as to which we express no opinion), it is clear that the court's power to stay for oppression provides the remedy."
  52. The court referred, at paragraph 27, to the "enormous disparity between the excess of Shabir's inflated claims (some few hundreds of pounds) and the confiscation order of over £212,000". Reference was made to the statutory scheme and to the operation of the criminal lifestyle provisions. Possible inflation of the benefit figure by reference to the criminal lifestyle provisions in the 2002 Act was a feature of Shabir, and resulted from the way the charges were framed. The court concluded, at paragraph 29:
  53. "We accept that those who determined to seek confiscation on the basis advanced did so in good faith, having not applied their minds to the question whether what was being done was oppressive. But we have no doubt that in fact it was. Whether or not, if the criminal lifestyle provisions had applied, there would have been a basis for applying one or more of the assumptions we do not know. But we are clear that without oppression the assumptions could not be brought into play and are thus irrelevant. It might have been different if there were a genuine dispute what the excess of the defendant's inflated claims was, and whether it did or did not exceed £5,000, but that situation did not arise."

    The court quashed the confiscation order and substituted a compensation order in the sum of £464 in favour of the Prescription Pricing Authority.

  54. What was found to be "patently oppressive" in Shabir, as stated in the opening words of paragraph 29, was reliance on the form of the counts for obtaining money transferred by deception to bring the criminal lifestyle provisions in the 2002 Act into operation. These provisions could not have applied, the court held, if the charges had reflected the very modest sum by which the claims had been dishonestly inflated. Inflation, by that means, of the benefit resulting from the enterprise is not a feature of the present case.
  55. Mr Fitzgerald did not put abuse of process in the forefront of his submissions and, in our view rightly so having regard to the way in which his main case is put. On the present facts, it would be extremely difficult to find an abuse if it is accepted that a confiscation order in a substantial sum can be made and the principle that the aggregate sum subject to compensation orders may exceed the sum benefit obtained is accepted. The alternative of a modest compensation order, available in Shabir, is not available on the present facts.
  56. In support of the proposition that the court should apply the plain wording of the statute, Mr Swift relied on the statement in a different context of Lord Bingham, with whose judgment the other members of the Committee agreed, in the House of Lords in R (Animal Defenders International) v Secretary of State for Culture, Media and Sport [2008] 1 AC 1312, at paragraph 33:
  57. "The weight to be accorded to the judgment of Parliament depends on the circumstances and the subject matter. In the present context it should in my opinion be given great weight, for three main reasons. First, it is reasonable to expect that our democratically-elected politicians will be peculiarly sensitive to the measures necessary to safeguard the integrity of our democracy. It cannot be supposed that others, including judges, will be more so. Secondly, Parliament has resolved, uniquely since the 1998 Act came into force in October 2000, that the prohibition of political advertising on television and radio may possibly, although improbably, infringe article 10 but has nonetheless resolved to proceed under section 19(1)(b) of the Act. It has done so, while properly recognising the interpretative supremacy of the European Court, because of the importance which it attaches to maintenance of this prohibition. The judgment of Parliament on such an issue should not be lightly overridden. Thirdly, legislation cannot be framed so as to address particular cases. It must lay down general rules: [authorities are cited]. A general rule means that a line must be drawn, and it is for Parliament to decide where. The drawing of a line inevitably means that hard cases will arise falling on the wrong side of it, but that should not be held to invalidate the rule if, judged in the round, it is beneficial."

    Conclusions

  58. The use of confiscation orders as a weapon in the fight against the scourge of drug trafficking has been approved in the ECtHR (Phillips, paragraphs 50-54) and the House of Lords (May, paragraph 46). The challenges to the proportionality of the confiscation regime have not succeeded (Green, paragraph 16). The challenge in the present appeals is based on the potential for the amounts to be paid under the orders, if totalled, exceeding the total benefit obtained. The respondent and intervener accept that the particular challenge based on the facts of this case has not specifically been rejected in the Supreme Court or in this court. The appellants rely on the judgment of this court in May as keeping open the possibility of apportionment between defendants.
  59. In our judgment the statements of principle in May and Green are, and are intended to be, of general application and defeat the claim to apportionment. In May, the Committee stated, at paragraph 46, that apportionment between parties jointly liable would be "contrary to principle and unauthorised by statute". It was held that the statutory questions must be answered by "applying the statutory language, shorn of judicial glosses and paraphrases". That approach applies to the calculation of a defendant's "benefit" under section 4 of the 2002 Act, the calculation of "recoverable amount" under section 7, and to the duty on the court under section 6(5) to make a confiscation order.
  60. On an application of the statutory language, it is not disproportionate to make an order "depriving a defendant of a benefit which he has in fact and in law obtained, within the limits of his realisable assets" (Green, paragraph 16). The statutory language, as construed in the authorities, does require a defendant to be liable for the benefit he has obtained jointly with others. Statements in May and Green require this court to decline to order or permit apportionment in present circumstances.
  61. We respectfully confess a little surprise that the Committee in May, having fully summarised the views of the Court of Appeal in that case, and having expressed general agreement with its reasoning, did not in so many words reject the possibility of apportionment raised by Keene LJ at paragraph 41 in the Court of Appeal. However, what was said by the Committee did, in our judgment, involve rejection of that possibility. The general agreement expressed was with Keene LJ's reasoning when rejecting the claim to apportionment.
  62. That the principles stated by the Committee in May were intended to apply generally is supported by the citation with approval in May of cases such as Sharma. In Sharma it was stated that "it cannot be disproportionate for [a defendant] to be accountable for what he has obtained."
  63. The principles stated in May have subsequently been applied in this court, without qualification, in Spears and McAllister, where the apportionment argument was considered and expressly rejected. They were applied in Nelson & Others, where an argument based on abuse of process was rejected. In our judgment the principles apply in the present case.
  64. We also respectfully express agreement with the statements of principle in May. Confiscation orders are made to deprive drug dealers of the profits of their crime and also to deter them and others from drug dealing. It is legitimate that the entire realisable assets of a person who embarks on a joint drug dealing venture should be put at risk, up to the sum of the joint benefit obtained, and not merely his assets up to the limit of his share of that sum. While the present statutory scheme is in place, the refusal to apportion is a legitimate part of it. The scheme does provide some protection to minor contributors who have no interest in the property obtained (May, paragraph 48).
  65. Moreover, in the case of drug dealing, unlike, for example VAT frauds, there is no identifiable financial loser seeking recovery or compensation and the expression "double recovery" is inapt. The sum subject to the confiscation order is a penalty designed to deprive of benefit and also to deter. The offender has protection to the extent that the amount of the order will not exceed either the joint benefit or his own realisable assets.
  66. On those findings, the abuse of process claim must also fail. In any event, in a situation such as the present where a substantial confiscation order is on any view inevitable, it is not an abuse to seek an order. The manner in which the prosecution conducted its case in Shabir and the sums in issue, justified the court's findings in that case and we respectfully agree with them. However, the present circumstances are quite different.
  67. The appeal is dismissed.


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URL: http://www.bailii.org/ew/cases/EWCA/Crim/2012/421.html