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URL: http://www.bailii.org/uk/cases/UKHL/1992/4.html
Cite as: [1992] UKHL 4, [1993] AC 442, [1993] 1 All ER 1

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JISCBAILII_CASE_CRIME

    Parliamentary Archives,
    HL/PO/JU/18/252

    Director of Public Prosecutions (Appellant)

    v.

    Gomez
    (On Appeal from the Court of Appeal (Criminal Division))

    JUDGMENT

    Die Jovis 3° Decembris 1992

    Upon Report from the Appellate Committee to whom was
    referred the Cause Director of Public Prosecutions against Gomez,
    That the Committee had heard Counsel as well on Monday the 20th
    as on Tuesday the 21st and Wednesday the 22nd days of July last
    upon the Petition and Appeal of the Director of Public
    Prosecutions of 4/12 Queen Anne's Gate, London SW1H 9AZ, praying
    that the matter of the Order set forth in the Schedule thereto,
    namely an Order of Her Majesty's Court of Appeal (Criminal
    Division) of the 22nd day of April 1991, might be reviewed before
    Her Majesty the Queen in Her Court of Parliament and that the
    said Order might be reversed, varied or altered or that the
    Petitioner might have such other relief in the premises as to Her
    Majesty the Queen in Her Court of Parliament might seem meet; as
    upon the case of Edwin Gomez lodged in answer to the said Appeal;
    and due consideration had this day of what was offered on either
    side in this Cause:

    It is Ordered and Adjudged, by the Lords Spiritual and
    Temporal in the Court of Parliament of Her Majesty the Queen
    assembled, That the said Order of Her Majesty's Court of Appeal
    (Criminal Division) of the 22nd day of April 1991 complained of
    in the said Appeal be, and the same is hereby, Set Aside and that
    the convictions at Isleworth Crown Court of the 20th and 24th
    days of April 1990 be, and the same are hereby, Restored: And
    it is also further Ordered, That the Cause be, and the same is
    hereby, remitted back to the Court of Appeal (Criminal Division)
    to do therein as shall be just and consistent with this Judgment.

    Cler: Parliamentor:

    Judgment: 3.12.92

    HOUSE OF LORDS

    DIRECTOR OF PUBLIC PROSECUTIONS
    (APPELLANT)

    v.

    GOMEZ

    (RESPONDENT)

    (ON APPEAL FROM THE COURT OF APPEAL
    (CRIMINAL DIVISION))

    Lord Keith of Kinkel
    Lord Jauncey of Tullichettle
    Lord Lowry
    Lord Browne-Wilkinson
    Lord Slynn of Hadley


    LORD KEITH OF KINKEL

    My Lords.

    This appeal raises the question whether two decisions of
    your Lordships' House upon the proper construction of certain
    provisions of the Theft Act 1968 are capable of being reconciled
    with each other, and, if so, in what manner. The two decisions
    are Lawrence v. Metropolitan Police Commissioner [1972] A.C. 626
    and Reg. v. Morris [1984] A.C. 320. The question has given rise
    to much debate in subsequent cases and in academic writings.

    The facts of this case are that the respondent, Edwin
    Gomez, was employed as assistant manager at a shop trading by
    retail in electrical goods. In September 1987 he was asked by an
    acquaintance called Jit Ballay to supply goods from the shop and
    to accept payment by two stolen building society cheques, one for
    £7,950 and the other for £9,250, which were undated and bore no
    payee's name. The respondent agreed, and prepared a list of
    goods to the value of £7,950 which he submitted to the manager,
    Mr. Gilberd, saying that it represented a genuine order by one
    Johal and asking him to authorise the supply of the goods in
    return for a building society cheque in that sum. Mr. Gilberd
    instructed the respondent to confirm with the bank that the
    cheque was acceptable, and the respondent later told him that he
    had done so and that such a cheque was "as good as cash." Mr.
    Gilberd agreed to the transaction, the respondent paid the cheque
    into the bank, and a few days later Ballay took possession of the
    goods, the respondent helping him to load them into his vehicle.
    Shortly afterwards a further consignment of goods to the value of
    £9,250 was ordered and supplied in similar fashion (apart from one
    item valued at £1,002.99 which was not delivered), against the
    second stolen building society cheque. Mr. Gilberd agreed to this
    transaction without further inquiry. Later the two cheques were
    returned by the bank marked "Orders not to pay. Stolen cheque."


    The respondent, Ballay and another employee of the shop,
    named Rai, were arrested and later tried on an indictment the
    fourth and fifth counts in which charged all three with theft
    contrary to section 1(1) of the Theft Act 1968 in respect of the
    two transactions. After evidence had been led for the prosecution
    counsel for the respondent submitted that there was no case to
    answer on the theft charges because the manager of the shop had
    authorised the transactions, so that there had been no
    appropriation within the meaning of section 1(1) of the Theft Act.
    The trial judge rejected this submission, whereupon the respondent
    pleaded guilty to count 4, but defended himself on count 5 on the
    basis that he had acted under duress. The jury, however,
    convicted him on this count, and he was sentenced to two years'
    imprisonment on each count to run concurrently. The respondent
    appealed to the Court of Appeal (Criminal Division) which on 22
    April 1991 (Lord Lane C.J., Hutchison and Mantell 33.) quashed the
    convictions: ([1991] 1 W.L.R. 1344). Lord Lane C.J., delivering the
    judgment of the court, after considering Lawrence v. Commissioner
    of Metropolitan Police
    [1972] A.C. 626 and Reg. v. Morris [1984]
    A.C. 320, said at p. 1338:

    "What in fact happened was that the owner was
    induced by deceit to agree to the goods being transferred to
    Bailey. If that is the case, and if in these circumstances
    the appellant is guilty of theft, it must follow that anyone
    who obtains goods in return for a cheque which he knows
    will be dishonoured on presentation, or indeed by way of any
    other similar pretence, would be guilty of theft. That does
    not seem to be the law. Reg. v. Morris [1984] A.C. 320
    decides that when a person by dishonest deception induces
    the owner to transfer his entire proprietary interests that is
    not theft. There is no appropriation at the moment when
    he takes possession of the goods because he was entitled to
    do so under the terms of the contract of sale, a contract
    which is, it is true, voidable, but has been avoided at the
    time the goods are handed over."

    And later, at p. 1339:

    "We therefore conclude that there was de facto, albeit
    voidable, contract between the owners and Ballay; that it
    was by virtue of that contract that Ballay took possession
    of the goods; that accordingly the transfer of the goods to
    him was with the consent and express authority of the
    owner and that accordingly there was no lack of
    authorisation and no appropriation."

    The court later granted a certificate under section 1(2) of the
    Administration of Justice Act 1960 that a point of law of general
    public importance was involved in the decision, namely

    "When theft is alleged and that which is alleged to be
    stolen passes to the defendant with the consent of the
    owner, but that has been obtained by a false representation,
    has (a) an appropriation within the meaning of section 1(1)
    of the Theft Act 1968 taken place, or (b) must such a
    passing of property necessarily involve an element of
    adverse inference with or usurpation of some right of the
    owner?"

    - 2 -

    The Crown now appeals, with leave granted here, to your
    Lordships' House.

    The provisions of the Theft Act 1968 principally relevant
    are these:

    Section 1(1)

    "A person is guilty of theft if he dishonestly appropriates
    property belonging to another with the intention of
    permanently depriving the other of it; and 'thief and 'steal'
    shall be construed accordingly."

    Section 3(1)

    "Any assumption by a person of the rights of an owner
    amounts to an appropriation, and this includes, where he has
    come by the property (innocently or not) without stealing it,
    any later assumption of a right to it by keeping or dealing
    with it as owner."

    Section 4(l)

    "'Property' includes money and all other property, real or
    personal, including things in action and other intangible
    property."

    Section 7

    "A person guilty of theft shall on conviction on indictment
    be liable to imprisonment for a term not exceeding ten
    years."

    Section 15(1)

    "A person who by any deception dishonestly obtains property
    belonging to another, with the intention of permanently
    depriving the other of it, shall on conviction on indictment
    be liable to imprisonment for a term not exceeding ten
    years."

    It is to be observed that by section 26 of the Criminal Justice
    Act 1991 the maximum sentence for theft was reduced from 10 to
    7 years. The section 15(1) penalty was left unchanged.

    The facts in Lawrence v. Metropolitan Police Commissioner
    [1972] A.C. 626, as set out in the speech of Viscount Dilhorne,
    were these:

    "The appellant was convicted on December 2, 1969, of theft
    contrary to section 1(1) of the Theft Act 1968. On
    September 1, 1969, a Mr. Occhi, an Italian who spoke little
    English, arrived at Victoria Station on his first visit to this
    country. He went up to a taxi driver, the appellant, and
    showed him a piece of paper on which an address in
    Ladbroke Grove was written. The appellant said that it was
    very far and very expensive. Mr. Occhi got into the taxi,
    took £1 out of his wallet and gave it to the appellant who
    then, the wallet being still open, took a further £6 out of

    - 3 -

    it. He then drove Mr. Occhi to Ladbroke Grove. The
    correct lawful fare for the journey was in the region of 10s.
    6d. The appellant was charged with and convicted of the
    theft of the £6."

    The conviction was upheld by the Court of Appeal (Criminal
    Division) which in granting leave to appeal to your Lordships'
    House certified the following questions as involving a point of law
    of general public importance:

    "(1) Whether section 1(1) of the Theft Act 1968 is to be
    contrued as though it contained the words 'without the
    consent of the owner' or words to that effect and (2)
    Whether the provisions of section 15(1) and of section 1(1)
    of the Theft Act 1968 are mutually exclusive in the sense
    that if the facts proved would justify a conviction under
    section 15(1) there cannot lawfully be a conviction under
    section 1(1) on those facts."

    Viscount Dilhorne, whose speech was concurred in by Lord
    Donovan, Lord Pearce, Lord Diplock and Lord Cross of Chelsea,
    after stating the facts, and expressing some doubts as to what Mr.
    Occhi had meant when he said that he "permitted" the taxi driver
    to take £6, continued, at p. 631:

    'The main contention of the appellant in this House
    and in the Court of Appeal was that Mr. Occhi had
    consented to the taking of the £6 and that, consequently,
    his conviction could not stand. In my opinion, the facts of
    this case to which I have referred fall far short of
    establishing that Mr. Occhi had so consented.

    "Prior to the passage of the Theft Act 1968, which
    made radical changes in and greatly simplified the law
    relating to theft and some other offences, it was necessary
    to prove that the property alleged to have been stolen was
    taken 'without the consent of the owner' (Larceny Act 1916,
    section 1(1)).

    "These words are not included in section 1(1) of the
    Theft Act, but the appellant contended that the subsection
    should be construed as if they were, as if they appeared
    after the words 'appropriates.' Section 1(1) reads as
    follows:

    'A person is guilty of theft if he dishonestly
    appropriates property belonging to another with the
    intention of permanently depriving the other of it;
    and 'thief and 'steal' shall be construed accordingly.'

    "I see no ground for concluding that the omission of
    the words 'without the consent of the owner' was
    inadvertent and not deliberate, and to read the subsection as
    if they were included is, in my opinion, wholly unwarranted.
    Parliament by the omission of these words has relieved the
    prosecution of the burden of establishing that the taking was
    without the owner's consent. That is no longer an ingredient
    of the offence.

    - 4 -

    "Megaw L.J., delivering the judgment of the Court of
    Appeal, said [1971] 1 Q.B. 373, 376 that the offence created
    by section 1(1) involved four elements; '(i) a dishonest (ii)
    appropriation (iii) of property belonging to another (iv) with
    the intention of permanently depriving the owner of it.'

    "I agree. That there was appropriation in this case is
    clear. Section 3(1) states that any assumption by a person
    of the rights of an owner amounts to an appropriation.
    Here there was clearly such an assumption. That an
    appropriation was dishonest may be proved in a number of
    ways. In this case it was not contended that the appellant
    had not acted dishonestly. Section 2(1) provides, inter alia,
    that a person's appropriation of property belonging to
    another is not to be regarded as dishonest if he appropriates
    the property in the belief that he would have the other's
    consent if the other knew of the appropriation and the
    circumstances of it. A fortiori, a person is not to be
    regarded as acting dishonestly if he appropriates another's
    property believing that with full knowledge of the
    circumstances that other person has in fact agreed to the
    appropriation. The appellant, if he believed that Mr. Occhi,
    knowing that £7 was far in excess of the legal fare, had
    nevertheless agreed to pay him that sum, could not be said
    to have acted dishonestly in taking it. When Megaw L.J.
    said that if there was true consent, the essential element of
    dishonesty was not established, I understand him to have
    meant this. Belief or the absence of belief that the owner
    had with such knowledge consented to the appropriation is
    relevant to the issue of dishonesty, not to the question
    whether or not there has been an appropriation. That may
    occur even though the owner has permitted or consented to
    the property being taken. So proof that Mr. Occhi had
    consented to the appropriation of £6 from his wallet without
    agreeing to paying a sum in excess of the legal fare does
    not suffice to show that there was not dishonesty in this
    case. There was ample evidence that there was.

    "I now turn to the third element 'property belonging
    to another.' Mr. Back Q.C., for the appellant, contended
    that if Mr. Occhi consented to the appellant taking the £6,
    he consented to the property in the money passing from him
    to the appellant and that the appellant had not, therefore,
    appropriated property belonging to another. He argued that
    the old distinction between the offence of false pretences
    and larceny had been preserved. I am unable to agree with
    this. The new offence of obtaining property by deception
    created by section 15(1) of the Theft Act also contains the
    words 'belonging to another.' 'A person who by any
    deception dishonestly obtains property belonging to another,
    with the intention of permanently depriving the other of it'
    commits that offence. 'Belonging to another' in section 1(1)
    and in section 15(1) in my view signifies no more than that,
    at the time of the appropriation or the obtaining, the
    property belonged to another, with the words 'belonging to
    another' having the extended meaning given by section 5.
    The short answer to this contention on behalf of the
    appellant is that the money in the wallet which he
    appropriated belonged to another, to Mr. Occhi.

    - 5 -

    "There was no dispute about the appellant's intention
    being permanently to deprive Mr. Occhi of the money.

    "The four elements of the offence of theft as defined
    in the Theft Act were thus clearly established and, in my
    view, the Court of Appeal was right to dismiss the appeal."

    In the result, each of the certified questions was answered in the
    negative.

    It will be seen that Viscount Dilhorne's speech contains two
    clear pronouncements, first that it is no longer an ingredient of
    the offence of theft that the taking should be without the owner's
    consent and second, that an appropriation may occur even though
    the owner has permitted or consented to the property being taken.
    The answer given to the first certified question was in line with
    those pronouncements, so even though Viscount Dilhorne was of
    opinion that the evidence fell short of establishing that Mr. Occhi
    had consented to the taking of the £6 it was a matter of decision
    that it made no difference whether or not he had so consented.

    Reg. v. Morris [1984] A.C. 320 involved two cases of price
    label switching in a supermarket. In the first case the defendent
    had removed the price label from a joint of meat and replaced it
    with a label showing a lesser price which he had removed from
    another joint. He was detected at the check-out point before he
    had paid for the joint and later convicted of theft contrary to
    section 1(1) of the Theft Act. In the second case the defendant
    had in similar manner switched price labels on goods in a
    supermarket but was not arrested until after he had passed the
    check-out point and paid the lesser prices for the goods. He was
    charged with two counts of theft contrary to section 1(1) and one
    count of obtaining property by deception contrary to section 15(1).
    The jury convicted him on the counts of theft, but by directions
    of the recorder returned no verdict on the section 15(1) count.
    Appeals against conviction by both defendants were dismissed by
    the Court of Appeal (Criminal Division) and by this House. Lord
    Roskill, in the course of a speech concurred in by Lords Fraser of
    Tullybelton, Edmund-Davies, Brandon of Oakbrook and Brightman,
    at p. 331 referred to the Lawrence case with apparent approval as
    having set out the four elements involved in the offence of theft
    and as having rejected the argument that there could not be theft
    within section 1(1) if the owner of the property had consented to
    the defendant's acts. He observed that in Lawrence the House did
    not have to consider the precise meaning of "appropriation" in
    section 3(1) and continued:

    "Mr. Denison submitted that the phrase in section 3(1)
    'any assumption by a person of the rights' (my emphasis) 'of
    an owner amounts to an appropriation' must mean any
    assumption of 'all the rights of an owner.' Since neither
    defendant had at the time of the removal of the goods from
    the shelves and of the label switching assumed all the rights
    of the owner, there was no appropriation and therefore no
    theft. Mr. Jeffreys for the prosecution, on the other hand,
    contended that the rights in this context only meant any of
    the rights. An owner of goods has many rights - they have
    been described as 'a bundle or package of rights.' Mr.
    Jeffreys contended that on a fair reading of the subsection

    - 6 -

    it cannot have been the intention that every one of an
    owner's rights had to be assumed by the alleged thief before
    an appropriation was proved and that essential ingredient of
    the offence of theft established.

    "My Lords, if one reads the words 'the rights' at the
    opening of section 3(1) literally and in isolation from the
    rest of the section, Mr. Denison's submission undoubtedly has
    force. But the later words 'any later assumption of a right'
    seem to me to militate strongly against the correctness of
    the submission. Moreover the provisions of section 2(1)(a)
    also seem to point in the same direction. It follows
    therefore that it is enough for the prosecution if they have
    proved in these cases the assumption by the [defendants] of
    any of the rights of the owner of the goods in question,
    that is to say, the supermarket concerned, it being common
    ground in these cases that the other three of the four
    elements mentioned in Viscount Dilhorne's speech in Reg. v.
    Lawrence (Alan)
    had been fully established.

    "My Lords, Mr. Jeffreys sought to argue that any
    removal from the shelves of the supermarket, even if
    unaccompanied by label switching, was without more an
    appropriation. In one passage in his judgment in Morris's
    case, the learned Lord Chief Justice appears to have
    accepted the submission, for he said [1983] Q.B. 587, 596:

    'it seems to us that in taking the article from the
    shelf the customer is indeed assuming one of the
    rights of the owner - the right to move the article
    from its position on the shelf to carry it to the
    check-out.'

    "With the utmost respect, I cannot accept this
    statement as correct. If one postulates an honest customer
    taking goods from a shelf to put in his or her trolley to
    take to the checkpoint there to pay the proper price, I am
    unable to see that any of these actions involves any
    assumption by the shopper of the rights of the supermarket.
    In the context of section 3(1), the concept of appropriation
    in my view involves not an act expressly or impliedly
    authorised by the owner but an act by way of adverse
    interference with or usurpation of those rights. When the
    honest shopper acts as I have just described, he or she is
    acting with the implied authority of the owner of the
    supermarket to take the goods from the shelf, put them in
    the trolley, take them to the checkpoint and there pay the
    correct price, at which moment the property in the goods
    will pass to the shopper for the first time. It is with the
    consent of the owners of the supermarket, be that consent
    express or implied, that the shopper does these acts and
    thus obtains at least control if not actual possession of the
    goods preparatory, at a later stage, to obtaining the
    property in them upon payment of the proper amount at the
    checkpoint. I do not think that section 3(1) envisages any
    such act as an "appropriation,' whatever may be the meaning
    of that word in other fields such as contract or sale of
    goods law.

    - 7 -

    "If, as I understand all your Lordships to agree, the
    concept of appropriation in section 3(1) involves an element
    of adverse interference with or usurpation of some right of
    the owner, it is necessary next to consider whether that
    requirement is satisfied in either of these cases. As I have
    already said, in my view mere removal from the shelves
    without more is not an appropriation. Further, if a shopper
    with some perverted sense of humour, intending only to
    create confusion and nothing more both for the supermarket
    and for other shoppers, switches labels, I do not think that
    that act of label switching alone is without more an
    appropriation, though it is not difficult to envisage some
    cases of dishonest label switching which could be. In cases
    such as the present, it is in truth a combination of these
    actions, the removal from the shelf and the switching of the
    labels, which evidences adverse interference with or
    usurpation of the right of the owner. Those acts, therefore,
    amount to an appropriation and if they are accompanied by
    proof of the other three elements to which I have referred,
    the offence of theft is established. Further, if they are
    accompanied by other acts such as putting the goods so
    removed and relabelled into a receptable, whether a trolley
    or the shopper's own bag or basket, proof of appropriation
    within section 3(1) becomes overwhelming. It is the doing
    of one or more acts which individually or collectively
    amount to such adverse interference with or usurpation of
    the owner's rights which constitute appropriation under
    section 3(1) and I do not think it matters where there is
    more than one such act in which order the successive acts
    take place, or whether there is any interval of time
    between them. To suggest that it matters whether the
    mislabelling precedes or succeeds removal from the shelves
    is to reduce this branch of the law to an absurdity."

    The answer given to the question certified by the Court of Appeal
    was this:

    "There is a dishonest appropriation for the purposes of the
    Theft Act 1968 where by the substitution of a price label
    showing a lesser price on goods for one showing a greater
    price, a defendant either by that act alone or by that act
    in conjunction with another act or other acts (whether done
    before or after the substitution of the labels) adversely
    interferes with or usurps the right of the owner to ensure
    that the goods concerned are sold and paid for at that
    greater price."

    In my opinion Lord Roskill was undoubtedly right when he
    said in the course of the passage quoted that the assumption by
    the defendant of any of the rights of an owner could amount to
    an appropriation within the meaning of section 3(1), and that the
    removal of an article from the shelf and the changing of the price
    label on it constituted the assumption of one of the rights of the
    owner and hence an appropriation within the meaning of the
    subsection. But there are observations in the passage which, with
    the greatest possible respect to my noble and learned friend Lord
    Roskill, I must regard as unnecessary for the decision of the case
    and as being incorrect. In the first place, it seems to me that
    the switching of price labels on the article is in itself an

    - 8 -

    assumption of one of the rights of the owner, whether or not it is
    accompanied by some other act such as removing the article from
    the shelf and placing it in a basket or trolley. No one but the
    owner has the right to remove a price label from an article or to
    place a price label upon it. If anyone else does so, he does an
    act, as Lord Roskiil puts it, by way of adverse interference with
    or usurpation of that right. This is no less so in the case of the
    practical joker figured by Lord Roskill than in the case of one
    who makes the switch with dishonest intent. The practical joker,
    of course, is not guilty of theft because he has not acted
    dishonestly and does not intend to deprive the owner permanently
    of the article. So the label switching in itself constitutes an
    appropriation and so to have held would have been sufficient for
    the dismissal of both appeals. On the facts of the two cases it
    was unnecessary to decide whether, as argued by Mr. Jeffreys, the
    mere taking of the article from the shelf and putting it in a
    trolley or other receptacle amounted to the assumption of one of
    the rights of the owner, and hence an appropriation. There was
    much to be said in favour of the view that it did, in respect that
    doing so gave the shopper control of the article and the capacity
    to exclude any other shopper from taking it. However, Lord
    Roskill expressed the opinion that it did not, on the ground that
    the concept of appropriation in the context of section 3(1)
    "involves not an act expressly or impliedly authorised by the owner
    but an act by way of adverse interference with or usurpation of
    those rights." While it is correct to say that appropriation for
    purposes of section 3(1) includes the latter sort of act, it does not
    necessarily follow that no other act can amount to an
    appropriation and in particular that no act expressly or impliedly
    authorised by the owner can in any circumstances do so. Indeed,
    Lawrence v. Commissioner of Metropolitan Police is a clear
    decision to the contrary since it laid down unequivocally that an
    act may be an appropriation notwithstanding that it is done with
    the consent of the owner. It does not appear to me that any
    sensible distinction can be made in this context between consent
    and authorisation.

    In the civil case of Dobson v. General Accident Fire and
    Life Assurance Corporation plc
    [1990] 1 Q.B. 274 a Court of
    Appeal consisting of Parker and Bingham L.JJ. considered the
    apparent conflict between Lawrence and Morris and applied the
    former decision. The facts were that the plaintiff had insured
    property with the defendant company against inter alia "loss or
    damage caused by theft." He advertised for sale a watch and ring
    at the total price of £5,950. A rogue telephoned expressing an
    interest in buying the articles and the plaintiff provisionally agreed
    with him that the payment would be by a building society cheque
    in the plaintiff's favour. The rogue called on the plaintiff next
    day and the watch and the ring were handed over to him in
    exchange for a building society cheque for the agreed amount.
    The plaintiff paid the cheque into his bank, which informed him
    that it was stolen and worthless. The defendant company denied
    liability under its policy of insurance on the ground that the loss
    of the watch and ring was not caused by theft within the meaning
    of the Act of 1968. The plaintiff succeeded in the county court
    in an action to recover the amount of his loss, and the decision
    was affirmed by the Court of Appeal. One of the arguments for
    the defendants was that there had been no theft because the
    plaintiff had agreed to the transaction with the rogue and reliance

    - 9 -

    was place on Lords Roskill's statement in Morris at p. 332 that
    appropriation

    "involves not an act expressly or impliedly authorised by the
    owner but an act by way of adverse interference with or
    usurpation of those rights."

    In dealing with this argument Parker L.J. said, at p. 281:

    'The difficulties caused by the apparent conflict between
    the decisions in Reg. v. Lawrence (Alan) [1972] A.C. 626
    and Reg. v. Morris (David) [1984] A.C. 320 have provided,
    not surprisingly, a basis for much discussion by textbook
    writers and contributors to articles to law journals. It is,
    however, clear that their Lordships in Reg. v. Morris did not
    regard anything said in that case as conflicting with Reg. v.
    Lawrence
    for it was specifically referred to in Lord
    Roskill's speech, with which the other members of the
    Judicial Committee all agreed, without disapproval or
    qualification. The only comment made was that, in Reg. v.
    Lawrence,
    the House did not have to consider the precise
    meaning of 'appropriation' in section 3(1) of the Act of
    1968. With respect, I find this comment hard to follow in
    the light of the first of the questions asked in Reg. v.
    Lawrence
    and the answer to it, the passages from Viscount
    Dilhorne's speech already cited, the fact that it was
    specifically argued 'appropriates is meant in a pejorative,
    rather than a neutral, sense in that the appropriation is
    against the will of the owner,' and finally that dishonesty
    was common ground. I would have supposed that the
    question in Reg. v. Lawrence was whether appropriation
    necessarily involved an absence of consent."

    Parker L.J. then said that he found other difficulties in Lord
    Roskill's speech in Morris, and after setting out the facts of the
    case and quoting a long passage from that speech at p. 332 and
    also the answer to the certified question he continued, at p. 283:

    "In the passage at p. 332 Lord Roskill, as it seems to
    me, impliedly envisages that mere label switching could be
    an appropriation and that this is so is confirmed by the
    answer to the certified question which specifically uses the
    words 'either by that act alone.' What then is it which
    would make label switching alone something which adversely
    affects or usurps the right of the owner? At p. 332 it
    appears to be envisaged that it will depend upon the
    question whether the label switching was dishonest and
    coupled with the other elements of the offence of theft or
    was due to a perverted sense of humour. This, however,
    appears to run together the elements of dishonesty and
    appropriation when it is clear from Reg. v. Lawrence (Alan)
    [1972] A.C. 626 that they are separate. That the two
    elements were indeed, at any rate to some extent, run
    together is plain from the fact that the answer to the
    certified question begins with the words 'There is a
    dishonest appropriation.'

    "Moreover, on general principles, it would in my
    judgment be a plain interference with or usurpation of an

    - 10 -

    owner's rights by the customer if he were to remove a label
    which the owner had placed on goods or put another label
    on. It would be a trespass to goods and it would be
    usurping the owner's rights, for only he would have any
    right to do such an act and no one could contend that there
    was any implied consent or authority to a customer to do
    any such thing. There would thus be an appropriation. In
    the case of the customer with a perverted sense of humour
    there would however be no theft for there would probably
    be no dishonesty and certainly no intent permanently to
    deprive the owner of the goods themselves.

    "The case of the customer who simply removes goods
    from the shelves is of course different because the basis on
    which a supermarket is run is that customers certainly have
    the consent of the owner to take goods from the shelves
    and take them to the checkout point there to pay the
    proper price for them. Suppose, however, that there were
    no such consent - in, for example, a shop where goods on
    display were to be taken from the shelves only by the
    attendant. In such a case a customer who took from the
    shelves would clearly be usurping the right of the owner.
    Indeed he would be doing so if he did no more than move
    an item from one place on a shelf to another. The only
    difference appears to be that in the one case there is
    consent and in the other there is not. Since, however, it
    was held in Reg. v. Lawrence (Alan) [1972] A.C. 626 that
    consent is not relevant to appropriation there must, one
    would have supposed, be no difference between the two
    cases on that aspect of the offence.

    'There are further matters in Reg. v. Morris (David)
    A.C. 320 in which I find difficulty. I mention only two.
    The first is the observations made on Reg. v. McPherson
    [1973] Crim.L.R. 191. That was a case in which the
    defendant took two bottles of whisky from the shelves and
    put them in her shopping bag. The sole question in issue
    was whether there had been an appropriation. It was held
    in the Court of Appeal that there had been. As to this
    Lord Roskill said, at p. 333:

    'That was not, of course, a label switching case, but
    it is a plain case of appropriation effected by the
    combination of the acts of removing the goods from
    the shelf and of concealing them in the shopping bag.
    Reg. v. McPherson is to my mind clearly correctly
    decided as are all the cases which have followed it.
    It is wholly consistent with the principles which I
    have endeavoured to state in this speech.'

    "Reference to the transcript of the judgment in that
    case however reveals that the decision did not turn on
    concealment in the shopping bag but was expressly upon the
    ground that the goods were appropriated when they were
    taken from the shelves. This indeed was recognised in
    Anderton v. Wish (Note) (1980) 72 Cr.App.R. 23, 25, where
    Roskill L.J. giving the judgment of the court said:

    - 11 -

    'The Court of Appeal . . . held . . . they were guilty
    of theft because when the bottles were taken there
    was a dishonest appropriation. If that decision is
    right and, with respect, it seems to me plainly right .

    "Furthermore in Reg. v. Morris (David) [1984] A.C. 320 Lord
    Roskill said, at p. 334: ' . . . I understand all your
    Lordships to agree that Anderton v. Wish . . . was rightly
    decided for the reasons given."'

    Later Parker L.J. quoted this passage from the speech of
    Lord Roskill in Morris, at p. 334:

    "without going into further detail I respectfully suggest that
    it is on any view wrong to introduce into this branch of the
    criminal law questions whether particular contracts are void
    or voidable on the ground of mistake or fraud or whether
    any mistake is sufficiently fundamental to vitiate a
    contract. These difficult questions should so far as possible
    be confined to those fields of law to which they are
    immediately relevant and I do not regard them as relevant
    questions under the Theft Act 1968."

    And continued:

    "After anxious consideration I have reached the conclusion
    that whatever Reg. v. Morris did decide it cannot be
    regarded as having overruled the very plain decision in Reg.
    v. Lawrence (Alan)
    [1972] A.C. 626 that appropriation can
    occur even if the owner consents and that Reg. v. Morris
    itself makes it plain that it is no defence to say that the
    property passed under a voidable contract."

    On this ground Parker L.J. dismissed the appeal.

    Bingham L.J., at p. 287, plainly took the view that a
    customer in a supermarket assumes some of the rights of an owner
    when he takes goods into his possession and exercises control over
    them by putting them in a basket or trolley, and thus appropriates
    them. Later, at p. 289, he mentioned that in Lord Roskill's
    speech in Morris no reference was made to Viscount Dilhorne's
    ruling in Lawrence that appropriation might occur even though the
    owner has permitted or consented to the property being taken, and
    continued:

    "I do not find it easy to reconcile this ruling of Viscount
    Dilhorne, which was as I understand central to the answer
    which the House gave to the certified question, with the
    reasoning of the House in Reg. v. Morris (David) [1984] A.C.
    320. Since, however, the House in Reg. v. Morris
    considered that there had plainly been an appropriation in
    Reg. v. Lawrence (Alan) [1972] A.C. 626, this must (I think)
    have been because the Italian student, although he had
    permitted or allowed his money to be taken, had not in
    truth consented to the taxi driver taking anything in excess
    of the correct fare. This is not wholly satisfactory
    reconciliation, since it might be said that a supermarket
    consents to customers taking goods from its shelves only

    - 12 -

    when they honestly intend to pay and not otherwise. On
    the facts of the present case, however, it can be said, by
    analogy with Reg. v. Lawrence, that although the plaintiff
    permitted and allowed his property to be taken by the third
    party, he had not in truth consented to the third party
    becoming owner without giving a valid draft drawn by the
    building society for the price. On this basis I conclude that
    the plaintiff is able to show an appropriation sufficient to
    satisfy section 1(1) of the Theft Act 1968 when the third
    party accepted delivery of the article."

    It was argued for the respondent in the present appeal that
    the case of Dobson was wrongly decided. I disagree, and on the
    contrary find myself in full agreement with those parts of the
    judgment of Parker L.J. to which I have referred. As regards the
    attempted reconciliation by Bingham L.J. of the reasoning in
    Morris with the ruling in Lawrence it appears to me that the
    suggested basis of reconciliation, which is essentially speculative, is
    unsound. The actual decision in Morris was correct, but it was
    erroneous, in addition to being unnecessary for the decision, to
    indicate that an act expressly or impliedly authorised by the owner
    could never amount to an appropriation. There is no material
    distinction between the facts in Dobson and those in the present
    case. In each case the owner of the goods was induced by fraud
    to part with them to the rogue. Lawrence makes it clear that
    consent to or authorisation by the owner of the taking by the
    rogue is irrelevant. The taking amounted to an appropriation
    within the meaning of section 1(1) of the Theft Act. Lawrence
    also makes it clear that it is no less irrelevant that what
    happened may also have constituted the offence of obtaining
    property by deception under section 15(1) of the Act.

    In my opinion it serves no useful purpose at the present
    time to seek to construe the relevant provisions of the Theft Act
    by reference to the Report which preceded it, namely the Eighth
    Report of the Criminal Law Revision Committee (1966) Cmnd.
    2977. The decision in Lawrence was a clear decision of this
    House upon the construction of the word "appropriate" in section
    1(1) of the Act, which had stood for twelve years when doubt was
    thrown upon it by obiter dicta in Morris. Lawrence must be
    regarded as authoritative and correct, and there is no question of
    it now being right to depart from it.

    It is desirable to say a few words about the cases of Reg.
    v. Skipp
    1975 Crim.L.R. 114 and Reg. v. Fritschy 1985 Crim.L.R.
    745. In the first case the defendant, posing as a haulage
    contractor, was instructed to collect consignments of goods from
    three different places and deliver them to a certain destination.
    He collected the goods and made off with them. The Court of
    Appeal, on his appeal against his conviction for theft upon one
    count covering all three consignments, on the ground that the
    count was bad for duplicity in that there were three separate
    appropriations, held that there had been no appropriation until the
    last of the goods were loaded, or probably until the defendant
    deviated from the route to the proper destination. In the second
    case the defendant was instructed by the owner to collect a
    quantity of Krugerrands in London and deliver them to a safe
    deposit in Switzerland. Although the short report is not very clear
    on the matter, it seems that the defendant, having collected the

    - 13 -

    coins, took them to Switzerland and there made away with them.
    The trial judge directed the jury if at the time he collected the
    coins the defendant had formed the dishonest intention of keeping
    them for himself he was guilty of theft. The Court of Appeal
    overturned the resultant conviction for theft on the ground,
    following Morris, that there had been no appropriation in England
    because the defendant had there taken possession of the
    Krugerrands with the owner's authority. In my opinion both these
    cases were inconsistent with Lawrence and were wrongly decided.

    There were cited to your Lordships a number of cases
    involving the abstraction of moneys from a limited company by a
    person who was in a position to give the consent of the company
    to the abstraction. It is sufficient to say that I agree with what
    my noble and learned friend Lord Browne-Wilkinson has to say
    about these cases in the speech to be delivered by him, and that
    in my opinion a person who thus procures the company's consent
    dishonestly and with the intention of permanently depriving the
    company of the money is guilty of theft contrary to section 1(1)
    of the Act of 1968.

    My Lords, for the reasons which I have given I would
    answer branch (a) of the certified question in the affirmative and
    branch (b) in the negative, and allow the appeal.

    LORD JAUNCEY OF TULLICHETTLE

    My Lords,

    I have had the advantage of reading in draft the speeches
    of my noble and learned friends, Lord Keith of Kinkel and Lord
    Browne-Wilkinson, and for the reasons which they give I agree that
    the appeal should be allowed and the questions answered in the
    way in which my noble and learned friend, Lord Keith of Kinkel,
    proposes.

    LORD LOWRY

    My Lords,

    This is an appeal brought by the Director of Public
    Prosecutions with the leave of the Court of Appeal (Criminal
    Division) from a decision of that court on 22 April 1991 allowing
    the appeal of the present respondent, Edwin Gomez, against his
    convictions on 20 and 24 April 1990 at Isleworth Crown Court on
    two counts of theft, for which he received concurrent sentences of
    2 years' imprisonment, and quashing those convictions.

    The facts are as follows. Gomez was the assistant manager
    of the Ealing Branch ("the shop") of a chain of retail electrical
    goods shops trading as "Bennetts Retail". On 14 September 1989
    an acquaintance, Jit Ballay, asked Gomez, and Gomez agreed, to
    supply goods from the shop in exchange for two undated building

    - 14 -

    society cheques for £7,950 and £9,250, which both Ballay and
    Gomez knew to be stolen and worthless cheques. Gomez then
    prepared and submitted to the manager of the shop, Mr. Gilberd, a
    list of goods to the value of £7,950, telling him that the list
    represented a bona fide order placed by one Johal and asking him
    to authorise the supply of the goods against a building society
    cheque for that amount. On being told by the manager to check
    with the bank, he pretended to have done so and assured the
    manager that the cheque was "as good as cash", whereupon the
    manager authorised the transaction. On 20 September Gomez paid
    the cheque into his employers' bank and on 23 September Ballay
    took possession of the listed goods. Gomez helped to load the
    goods into Ballay's van. A further consignment of goods was
    ordered and supplied against the second stolen cheque, Mr. Gilberd
    having agreed to the transaction without further inquiry.

    The judge's note of Mr. Gilberd's evidence when he was
    cross-examined at the trial included the following:

    "I was involved in both transactions. Exceptionally high
    orders. I would expect to be consulted as I was. I
    authorised discount. I authorised release. I expressly
    authorised this."

    The manager at all times believed that the stolen cheques were
    genuine. On 5 October 1989, however, both cheques were returned
    by the bank marked "Orders not to pay. Stolen cheque."

    Gomez, Ballay and Jatindur Rai, another employee of
    Bennetts Retail, were arrested and jointly tried on an indictment
    alleging two counts of handling the stolen cheques against Ballay
    (counts 1 and 2), one count of conspiracy (count 3, which was not
    proceeded with) and two counts of theft of the electrical goods
    against all the defendants (counts 4 and 5). All three were found
    guilty as charged, save that Gomez had pleaded guilty to count 4
    after a ruling against him on a legal submission. He had
    continued to plead not guilty in respect of count 5, but the only
    defence made after the legal ruling was the defence of duress,
    which was rejected by the jury and with which the Court of
    Appeal was not concerned.

    Under the law before 1968 the facts of this case would
    have led to charges, to which there would have been no defence,
    of obtaining goods by false pretences. Since the passing of the
    Theft Act 1968 the accused could equally well have been
    prosecuted successfully for obtaining property by deception
    contrary to section 15 of the Act. Under the old law they could
    not have been found guilty of larceny, because the seller agreed to
    transfer the property in the goods to Ballay, and the fact that the
    seller's agreement was obtained by a fraud does not affect that
    conclusion. Indeed, if the seller's consent could have been vitiated
    in that way, Parliament would never have needed to create the
    statutory offence of obtaining by false pretences. The accused in
    this case, however, were prosecuted for theft under section 1(1) of
    the Act and were convicted notwithstanding the submission of
    counsel for the defence to the effect that the crime for which the
    accused were indicted did not amount to theft because the seller
    had consented to sell the property, albeit consent had been
    obtained by fraud, as alleged. When Gomez appealed, the Court

    - 15 -

    of Appeal upheld that submission and quashed his convictions. In
    order to restore those convictions, the Crown must say that the
    Theft Act has altered the law in such a way (among others) that
    anyone who, by a false representation such as a worthless cheque,
    induces an owner to sell property is thereby guilty of stealing.

    Section 1(1) of the Theft Act 1968 provides:

    "A person is guilty of theft if he dishonestly appropriates
    property belonging to another with the intention of
    permanently depriving the other of it; and 'thief and 'steal'
    shall be construed accordingly."

    This appeal turns on the meaning in that subsection of the word
    "appropriates" and will involve the consideration, among other
    things, of conflicting statements in this House, which I shall come
    back to at a later stage. One was by Viscount Dilhorne in R. v.
    Lawrence
    [1972] AC 626 ("Lawrence") where, having noted the
    absence from the subsection of the words "without the consent of
    the owner", he said at p. 632A:

    "Parliament by the omission of these words has relieved the
    prosecution of the burden of establishing that the taking was
    without the owner's consent. That is no longer an
    ingredient of the offence."

    Lord Roskill, on the other hand, in R. v. Morris [1984] A.C. 320
    ("Morris") said at p. 332D):

    "In the context of section 3(1), the concept of appropriation
    in my view involves not an act expressly or impliedly
    authorised by the owner but an act by way of adverse
    interference with or usurpation of those rights."

    The certified question in this appeal is -

    "When theft is alleged and that which is alleged to be
    stolen passes to the defendant with the consent of the
    owner, but that consent has been obtained by a false
    representation, has

    1. an appropriation within the meaning of section 1(1) of
      the Theft Act 1968 taken place, or

    2. must such a passing of property necessarily involve an
      element of adverse interference with or usurpation of some
      right of the owner?"

    I can say now that I would answer (a) "No" and (b) "No, because
    such a passing of property does not involve an appropriation".

    Since the question turns on the meaning of the word
    "appropriates" in section 1(1) of the Theft Act 1968, the problem
    is therefore one of statutory interpretation and it will be helpful
    to start by setting out the immediately relevant provisions of the
    Act:-

    "Definition of 'theft'

    - 16 -

    "l.-(l) A person is guilty of theft if he dishonestly
    appropriates property belonging to another with the intention
    of permanently depriving the other of it; and 'thief and
    'steal' shall be construed accordingly.

    (2.) It is immaterial whether the appropriation is made
    with a view to gain, or is made for the thief's own benefit.

    (3.) The five following sections of this Act shall have
    effect as regards the interpretation and operation of this
    section (and, except as otherwise provided by this Act, shall
    apply only for purposes of this section).

    "2.-(l) A person's appropriation of property belonging
    to another is not to be regarded as dishonest -

    1. if he appropriates the property in the belief that he
      has in law the right to deprive the other of it, on behalf of
      himself or of a third person; or

    2. if he appropriates the property in the belief that he
      would have the other's consent if the other knew of the
      appropriation and the circumstances of it; or

    (c) (except where the property came to him as trustee or
    personal representative) if he appropriates the property in
    the belief that the person to whom the property belongs
    cannot be discovered by taking reasonable steps.

    (2) A person's appropriation of property belonging to
    another may be dishonest notwithstanding that he is willing
    to pay for the property.

    "3.-(1) Any assumption by a person of the rights of an

    owner amounts to an appropriation, and this includes, where
    he has come by the property (innocently or not) without
    stealing it, any later assumption of a right to it by keeping
    or dealing with it as owner.

    (2) Where property or a right or interest in property is
    or purports to be transferred for value to a person acting in
    good faith, no later assumption by him of rights which he
    believed himself to be acquiring shall, by reason of any
    defect in the transferor's title, amount to theft of the
    property.

    "4.-(1) 'Property' includes money and all other
    property, real or personal, including things in action and
    other intangible property.

    (2) A person cannot steal land, or things forming part of
    land and severed from it by him or by his directions, except
    in the following cases, that is to say -

    (a) when he is a trustee or personal representative, or is
    authorised by power of attorney, or as liquidator of a
    company, or otherwise, to sell or dispose of land belonging
    to another, and he appropriates the land or anything forming
    part of it by dealing with it in breach of the confidence
    reposed in him; or

    - 17 -

    (b) when he is not in possession of the land and
    appropriates anything forming part of the land by severing it
    or causing it to be severed, or after it has been severed; or

    (c) when, being in possession of the land under a tenancy,
    he appropriates the whole or part of any fixture or
    structure let to be used with the land.

    For purposes of this subsection 'land' does not include
    incorporeal hereditaments; 'tenancy' means a tenancy for
    years or any less period and includes an agreement for such
    a tenancy, but a person who after the end of a tenancy
    remains in possession as statutory tenant or otherwise is to
    be treated as having possession under the tenancy, and 'let'
    shall be construed accordingly.

    . . .

    "5.-(1) Property shall be regarded as belonging to any

    person having possession or control of it, or having in it any
    proprietary right or interest (not being an equitable interest
    arising only from an agreement to transfer or grant an
    interest).

    . . .

    "6.-(1) A person appropriating property belonging to

    another without meaning the other permanently to lose the
    thing itself is nevertheless to be regarded as having the
    intention of permanently depriving the other of it if his
    intention is to treat the thing as his own to dispose of
    regardless of the other's rights; and a borrowing or lending
    of it may amount to so treating it if, but only if, the
    borrowing or lending is for a period and in circumstances
    making it equivalent to an outright taking or disposal.

    (2) Without prejudice to the generality of subsection (1)
    above, where a person, having possession or control (lawfully
    or not) of property belonging to another, parts with the
    property under a condition as to its return which he may
    not be able to perform, this (if done for purposes of his
    own and without the other's authority) amounts to treating
    the property as his own to dispose of regardless of the
    other's rights.

    ...”

    Fraud and blackmail

    "15.-(1) A person who by any deception dishonestly

    obtains property belonging to another, with the intention of
    permanently depriving the other of it, shall on conviction on
    indictment be liable to imprisonment for a term not
    exceeding ten years.

    (2) For purposes of this section a person is to be treated
    as obtaining property if he obtains ownership, possession or
    control of it, and 'obtain' includes obtaining for another or
    enabling another to obtain or to retain.

    - 18 -

    (3) Section 6 above shall apply for purposes of this
    section, with the necessary adaptation of the reference to
    appropriating, as it applies for purposes of section 1.

    (4) For purposes of this section 'deception' means any
    deception (whether deliberate or reckless) by words or
    conduct as to fact or as to law, including a deception as to
    the present intentions of the person using the deception or
    any other person."

    To be guilty of theft the offender, as I shall call him, must
    act dishonestly and must have the intention of permanently
    depriving the owner of property. Section 1(3) shows that in order
    to interpret the word "appropriates" (and thereby to define theft),
    sections 1 to 6 must be read together. The ordinary and natural
    meaning of "appropriate" is to take for oneself, or to treat as
    one's own, property which belongs to someone else. The primary
    dictionary meaning is "take possession of, take to oneself,
    especially without authority", and that is in my opinion the
    meaning which the word bears in section 1(1). The act of
    appropriating property is a one-sided act, done without the consent
    or authority of the owner. And, if the owner consents to transfer
    property to the offender or to a third party, the offender does not
    appropriate the property, even if the owner's consent has been
    obtained by fraud. This statement represents the old doctrine in
    regard to obtaining property by false pretences, to which I shall
    advert presently.

    The references in sections 2, 3 and 4 qualify but do not
    impair the meaning of the words "appropriates" and "appropriation",
    as they are used in section 1. Section 2(1) does not change the
    meaning of appropriation but it tells us when appropriation is not
    to be regarded as dishonest (and so does not amount to stealing).
    Paragraphs (a), (b) and (c) of the sub-section all describe
    unilateral, though honest, acts of the appropriator, who takes the
    property for himself and treats it as his own. For the benefit of
    those who would suggest that section 2(1)(b) shows that
    appropriation is something which can be done with the consent of
    the owner, I would paraphrase that provision by saying "if he
    appropriates the property in the belief that he would have the
    other's consent if the other knew what he had done and the
    circumstances in which he did it." The opportunity for confusion
    arises from the use of the word "appropriates" in a clearly
    unilateral sense followed by the word "appropriation" (describing
    what the appropriator has unilaterally done) hypothetically linked
    to the idea of consent.

    Coming now to section 3, the primary meaning of
    "assumption" is "taking on oneself", again a unilateral act, and this
    meaning is consistent with subsections (1) and (2). To use the
    word in its secondary, neutral sense would neutralise the word
    "appropriation", to which assumption is here equated, and would
    lead to a number of strange results. Incidentally, I can see no
    magic in the words "an owner" in subsection (1). Every case in
    real life must involve the owner or the person described in section
    5(1); "the rights" may mean "all the rights", which would be the
    normal grammatical meaning, or (less probably, in my opinion) "any
    rights": see R. v. Morris [1984] A.C. at p. 332H. For present

    - 19 -

    purposes it does not appear to matter; the word "appropriate" does
    not on either interpretation acquire the meaning contended for by
    the Crown. Still looking at section 3(1), I point out that "any
    later assumption of a right to it" (that is, a right to the property)
    amounts to an appropriation of a right to it and that normally "a
    right to it" means a right to the property and not a right in it".
    Section 3(2) protects an innocent purchaser from an accusation of
    theft when, having bought in good faith from someone with a
    defective title, he later treats the property as his own.

    Section 4(2) lists three exceptions to the general proposition
    that a person cannot steal land etc. The word "appropriates" in
    paragraph (a), (b) and (c) is thoroughly consistent with unilateral
    action.

    Section 6(1) introduces a deemed intention of permanently
    depriving the owner of his property when the person appropriating
    the property "for the time being", as one might say, intends "to
    treat the thing as his own to dispose of regardless of the other's
    rights". Here again the offender's act is unilateral and the same
    can clearly be said of section 6(2).

    Mr. Hacking Q.C., for the respondent, also drew attention to
    sections 24(4) and 28(6) of the Theft Act, which can be required
    only on the basis that section 15, in at least some respects is not
    dealing with theft. He also pointed out the amendment in section
    26 of the Criminal Justice Act 1991 (effective from 1 October
    1992) reducing the maximum term of imprisonment for theft from
    10 to 7 years, thereby distinguishing theft from obtaining by
    deception, the maximum term for which remains at 10 years.

    Accordingly, reading sections 1 to 6 as a whole, and also
    taking into account sections 24(4) and 28(6) and the 1991
    amendment, the ordinary and natural meaning of "appropriates" in
    section 1(1) is confirmed. So clear is this conclusion to my mind
    that, notwithstanding anything which has been said in other cases,
    I would be very slow to concede that the word "appropriates" in
    section 1(1) of the Theft Act is in its context ambiguous. But, as
    I have indicated, the Crown case requires that there must be
    ambiguity and further requires that the ambiguity must be resolved
    against the ordinary meaning of the word and in favour of the
    neutral meaning preferred and required by the Crown's argument.
    Therefore, my Lords, I am willing for the purpose of argument to
    treat the word "appropriates" as ambiguous in its context and, on
    that basis, following the principles enunciated in Black-Clawson
    International Ltd. v. Papierwerke Waldhof-Aschaftenburg A.G.
    [1975] A.C. 591 and the example of Lord Ackner in R. v. Kassim"
    [1992] 1 A.C. 9 at p. 16, where the construction of section 20(2)
    of the Theft Act 1968 was the question at issue, I turn, for such
    guidance as it may afford, to the Eighth Report of the Criminal
    Law Revision Committee, "Theft and Related Offences" (1966)
    (Cmnd. 2977).

    While the Report may not completely resolve the question
    for your Lordships, it provides in the first place a very useful
    summary of the state of the law in 1966. It also discusses in
    some detail the shortcomings of the law in regard to theft and
    kindred offences, as they appeared to the Committee, and it
    proposes remedies. A reading of the Theft Act, which was based

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    on the draft Bill annexed to the Report, leads me to the
    conclusion that, when using the very words of the draft,
    Parliament intended to implement the Committee's thinking. Of
    course, if the words of the Act clearly achieve a different result
    from that which seemed to be intended by the Committee, it is
    the words which must prevail and strained constructions must not
    be adopted in order to give effect to the Report.

    In paragraph 15 the Committee discuss "the chief defects in
    the existing law of larceny", including its failure to deal with
    certain kinds of dishonesty. In paragraph 16 they point out that
    the defects stem from regarding larceny as a violation of
    possession and not of rights of ownership, with the offence
    depending on a taking of the property. The notion of taking had
    been extended both judicially and by statute and examples of
    statutory extension by way of sections 17(l)(b) (embezzlement) and
    20(1)(iv) (fraudulent conversion) of the Larceny Act 1916 are given
    in paragraph 17. The Committee observed at paragraph 18 that
    the fact that misappropriation of property was dealt with under
    the three separate heads of larceny, embezzlement and fraudulent
    conversion inevitably made for difficulty and complication.
    Paragraph 19 introduces what will be seen as a specially relevant
    topic.

    "19. In addition to the division of misappropriation into
    three main offences the distinction between larceny and
    obtaining by false pretences contrary to 1916 s. 32 is
    sometimes very subtle. A person commits the latter
    offence if he

    'by any false pretence . . . with intent to defraud,
    obtains from any other person any chattel, money, or
    valuable security, or causes or procures any money to
    be paid, or any chattel or valuable security to be
    delivered to himself or to any other person for the
    use or benefit or on account of himself or any other
    person'.

    'The essential difference between this offence and larceny is
    that in larceny the victim does not part with the ownership
    but in obtaining by false pretences he does. But since
    "obtaining the possession by any trick' amounts to a taking
    for the purpose of larceny, it is notoriously difficult to draw
    any logical distinction between larceny by a trick and
    obtaining by false pretences and to decide whether a
    particular case amounts to the one offence or the other.
    The matter is made worse by the fact that the two
    offences are construed as being mutually exclusive; and the
    resulting difficulties are not entirely overcome by the
    provisions in 1916 s. 44 as to the verdicts open to the jury
    when they find that the accused committed an offence
    different from that charged (cf. paragraph 90)."

    Paragraph 21 exposes a gap, pointing out that an innocent
    acquisition followed by a dishonest decision to keep or dispose of
    the property was in general not larceny and that larceny by
    finding was committed only where at the time of the finding the
    finder believed that the owner could be discovered by taking
    reasonable steps. After discussing various loopholes in the law of

    - 21 -

    theft the Committee proceeded in what may be seen as a key
    paragraph.

    "30. The essence of the offence of fraudulent conversion
    under 1916 s. 20(1)(iv) (referred to in paragraph 17) is
    misappropriation of property by a person who has possession
    on behalf of somebody else. The offence was created by
    the Larceny Act 1901 (c. 10) in order to provide for cases
    of dishonest misappropriation which were not covered by
    larceny (in particular because there was no taking) or
    embezzlement (because the offender was not a clerk or
    servant) or by other statutory offences of fraudulent
    conversion which depended on the offender being in a
    special position, for example a trustee. The language of s.
    20(l)(iv)(b) is wide enough to cover larceny by a bailee or
    part owner and embezzlement; but it is a matter of dispute
    whether it does so or whether it is limited to those types
    of misappropriation, originally not criminal, for which the
    1901 Act was intended to provide. Whichever is the true
    view, the general offence of fraudulent conversion has
    proved valuable, covering as it does in clear language a
    wide range of circumstances in which property may be
    misappropriated. As will be seen (paragraph 35), the idea
    contained in the words 'fraudulently converts to his own use
    or benefit, or the use or benefit of any other person'
    corresponds to what we propose should be the essence of
    the new offence of theft."

    Paragraph 33 states an important conclusion:

    'The committee generally are strongly of opinion that
    larceny, embezzlement and fraudulent conversion should be
    replaced by a single new offence of theft. The important
    element of them all is undoubtedly the dishonest
    appropriation of another person's property - the treating of
    'tuum' as 'meum'; and we think it not only logical, but right
    in principle, to make this the central element of the
    offence. In doing so the law would concentrate on what the
    accused dishonestly achieved or attempted to achieve and
    not on the means - taking or otherwise - which he used in
    order to do so. This would avoid multiplicity of offences.
    Accordingly clause 1(1) of the draft Bill provides that -

    'A person is guilty of theft if he dishonestly
    appropriates property belonging to another with the
    intention of permanently depriving the other of it;
    and 'thief, 'steals' and 'stolen' shall be construed
    accordingly.'

    "This will be the main provision in the definition of theft,
    replacing the definition in 1916 s. 1(1). There are ancillary
    definitions in clause 1 and in clauses 2-5 which are referred
    to in the notes. The more important elements of the
    definition of the new offence are referred to in paragraphs
    34-58."

    This conclusion, in order to create a single comprehensive offence
    in place of larceny, embezzlement and fraudulent conversion,
    makes "appropriation" (the treating of "tuum" as "meum") the key

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    element in place of taking, and it is the activity expressed by the
    word "appropriation" which dispenses with the need for the phrase
    "without the consent of the owner", which preceded the words
    "takes and carries away" in the old definition of larceny in section
    1(1) of the 1916 Act. The opening lines of paragraph 34 further
    elucidate the Committee's thinking:

    "We hope, and believe, that the concept of 'dishonest
    appropriation' will be easily understood even without the aid
    of further definition. But there is a partial definition of
    'appropriates' in clause 3(1), which is included partly to
    indicate that this is the familiar concept of conversion but
    also for particular reasons later to be mentioned. Clause
    3(1) provides that -

    'Any assumption by a person of the rights of an
    owner amounts to an appropriation . . .'

    "It seems to us natural to refer to the act of stealing in
    ordinary cases as 'appropriation'. We see no reason why the
    word should seem strange for more than a short time. It is
    moreover not a new word to use in connection with theft.
    Sir James Fitzjames Stephen (afterwards Stephen J.), in his
    'General View of the Criminal Law' (1863 edition, p. 129),
    suggested as a definition of theft:

    'To steal is unlawfully, and with intent to defraud, by
    taking, by embezzlement, by obtaining by false
    pretences, or in any other manner whatever to
    appropriate to the use of any person any property
    whatever real or personal in possession or in action,
    so as to deprive any other person of the advantage of
    any beneficial interest at law or in equity, which he
    may have therein.'

    "Sir James Stephen added:

    'The effect of adopting this definition would be to
    include under one description all the cognate offences
    which at present make up the crime of theft. Its
    terms would include larceny, embezzlement, false
    pretences, larceny by bailees, fraudulent breaches of
    trust, and offences by factors, agents, and bankers,
    and thus five or six useless and intricate distinctions
    between cognate crimes would be abolished'."

    (I digress for a moment to point out that, while this proposal
    would have included obtaining by false pretences within the
    definition of stealing, that was not the option preferred by the
    Committee, as your Lordships will have noted.)

    The next four paragraphs are important in the Committee's
    scheme of things and I must ask your Lordships' indulgence while I
    quote them in full:

    "35. The idea of dishonest appropriation which underlies
    the new offence of theft corresponds, as mentioned in
    paragraph 30, to the idea in the words 'fraudulently converts
    to his own use or benefit, or the use or benefit of any

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    other person' in the definition of fraudulent conversion under
    1916 s. 20(l)(iv). The new offence will in fact consist of
    the present offence of fraudulent conversion without the
    requirement that the offender should, at the time of the
    conversion, be in possession of the property either in the
    circumstances mentioned in s. 20(1)(iv) or at all. With the
    removal of this requirement the offence will extend to
    ordinary stealing by taking property from another's
    possession. The effect will be as if fraudulent conversion
    were widened to include the whole of larceny and
    embezzlement; the new offence will indeed include conduct
    which may not be criminal under the present law such as
    the dishonest appropriation by a parent of things taken and
    brought home by a child under the age of criminal
    responsibility (cf. Walters v. Lunt (1951), 35 Cr. App. R.
    94). The expression 'dishonestly appropriates' in clause 1(1)
    means the same as 'fraudulently converts to his own use or
    benefit, or for the use or benefit of any other person' in
    1916 s. 20(1)(iv); but the former expression is shorter and,
    we hope, clearer. There is an argument for keeping the
    word 'converts' because it is well understood. But it is a
    lawyers' word, and those not used to legal language might
    naturally think that it meant changing something or
    exchanging property for other property. 'Appropriates'
    seems altogether a better word.

    "36. The offence will also cover cases of dishonest
    retention or disposal after an innocent acquisition such as
    are mentioned in paragraphs 21-5. This result is probably
    implicit in the concept of appropriation (or 'conversion'); but
    it is made explicit by the provision in clause 3(1) that a
    person's assumption of the rights of an owner 'includes,
    where he has come by the property (innocently or not)
    without stealing it, any later assumption of a right to it by
    keeping or dealing with it as owner'. It seems natural to
    regard dishonestly keeping or dealing with the property as
    theft (as it is now in the case of bailees). This has the
    advantage that the cases referred to will be brought within
    the single concept of dishonest appropriation. If taking
    were to be kept as the basis of the offence, it would be
    necessary to create a separate offence of dishonest
    retention or disposal in order to deal with these cases.

    "37. We propose however that there should be a special
    exception for one case. A person may buy something in
    good faith, but may find out afterwards that the seller had
    no title to it, perhaps because the seller or somebody else
    stole it. If the buyer nevertheless keeps the thing or
    otherwise deals with it as owner, he could, on the principles
    stated above, be guilty of theft. It is arguable that this
    would be right; but on the whole it seems to us that,
    whatever view is taken of the buyer's moral duty, the law
    would be too strict if it made him guilty of theft. Clause
    3(2) accordingly ensures that a later assumption of ownership
    in such circumstances will not amount to theft.

    "38. The sub-committee for a considerable time proposed
    that the general offence of theft should be made to cover
    the present offence of obtaining by false pretences under

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    1916 s. 32(1). It might seem appropriate to extend theft in
    this way in order to make it cover as many ways as
    possible of getting property dishonestly. But in the end the
    sub-committee gave up the idea (to the regret of some
    members), and the full committee agreed. In spite of its
    attractions, it seemed to the majority of the committee
    that the scheme would be unsatisfactory. Obtaining by false
    pretences is ordinarily thought of as different from theft,
    because in the former the owner in fact consents to part
    with his ownership; a bogus beggar is regarded as a rogue
    but not as a thief, and so are his less petty counterparts.
    To create a new offence of theft to include conduct which
    ordinary people would find difficult to regard as theft would
    be a mistake. The unnaturalness of including obtaining by
    false pretences in theft is emphasized by the difficulty of
    drafting a satisfactory definition to cover both kinds of
    conduct. The examination by Mr. Griffith-Jones's sub-sub-
    committee, mentioned in paragraph 3, showed also that it
    would be difficult to frame an indictment charging theft by
    false pretences."

    The Committee's proposed remedies for the defects of the
    law as they found it appear clearly from the foregoing paragraphs.
    "Fraudulent conversion" is accepted as the starting point for the
    new and comprehensive definition of theft and "dishonest
    appropriation" is chosen as a synonym. Both expressions embody
    the notion of an adverse unilateral act done to the prejudice of
    the owner and without his authority; indeed, fraudulent conversion
    can have no other meaning. Paragraph 38 shows that the
    Committee considered the idea, once recommended by Sir James
    Fitzjames Stephen, of making "theft" cover the offence of
    obtaining by false pretences. But that idea was ultimately
    abandoned for the reasons there mentioned.

    The Committee's philosophy with regard to obtaining by
    false pretences and its near relation, larceny by a trick, is
    expounded in paragraphs 86 to 90 of the Report. Draft clause 12
    was enacted as section 15 (which I have reproduced above) and
    section 16 of the Theft Act and has got rid of some defects and
    difficulties which had arisen from section 32 of the Larceny Act
    1916 and from judicial interpretations of that section. The false
    pretence (or "deception", to use the new term) was no long
    confined to pretence about an existing fact and no longer excluded
    a misrepresentation as to the offender's intention. An important
    point, with a view to interpreting the Theft Act and understanding
    comments, both judicial and academic, which have been made
    about it, is the fusion in clause 12 and section 15 of larceny by a
    trick and obtaining by false pretences. I refer to paragraph 90:

    "On the other hand clause 12(1) provides that

    'a person is to be treated as obtaining property if he
    obtains ownership, possession or control of it ..."

    "This is a departure from the present law, which requires
    that ownership should be obtained (Kilham [(1870) L.R. 1
    C.C.R. 261], mentioned in paragraph 89; Ball, [1951] 2 K.B.
    109; 35 Cr. App. R. 24). The extension of the offence to
    include obtaining possession or control will have the result

    - 25 -

    that if Kilham, although pretending that he only wanted to
    borrow the horse, had in fact intended to deprive the owner
    permanently, he would be guilty under the clause, because
    he obtained possession of the horse. The extension will also
    have the effect that the offences of theft and criminal
    deception will overlap and that conduct which under the
    present law is larceny by a trick and that which is obtaining
    by false pretences will be the same offence of criminal
    deception. In practice, if there is any doubt whether it is
    appropriate to charge theft or obtaining property by
    deception, it will be natural to charge the latter; and in our
    opinion it would be wise to do so, because this will be a
    much easier offence to establish than is the present offence
    of obtaining by false pretences, as it will be unnecessary to
    show that the owner was deceived into intentionally passing
    the ownership but sufficient to show that he was tricked
    into parting with the possession. Theft should be charged
    only in very clear cases. The new law will have the
    advantage that the prosecution will not be in the present
    difficulty (referred to in paragraph 19) of deciding which of
    two mutually exclusive offences to charge. The existing
    difficulties in this respect are considerably reduced by the
    provision in 1916 s. 44(3) that a person charged with larceny
    may be convicted of obtaining by false pretences and the
    provision in s. 44(4) that a person charged with obtaining by
    false pretences may be convicted of this offence even if the
    evidence proves larceny. But these provisions are not
    entirely satisfactory. If a person is rightly charged with
    larceny, but the jury in reliance on s. 44(3) mistakenly
    convict him of obtaining by false pretences, the Court of
    Criminal Appeal cannot substitute a verdict of guilty of
    larceny under s. 5(2) of the Criminal Appeal Act 1907 (c.
    23); for the verdict implies an acquittal of larceny, so that
    it cannot '[appear] to the Court of Criminal Appeal that the
    jury must have been satisfied of facts which proved him
    guilty of [larceny]' (Fisher (1921), 16 Cr. App. R. 53).
    Again, a person charged with attempted larceny cannot be
    convicted of attempting to obtain by false pretences
    (Gallagher (1929), 21 Cr. App. R. 172). The provision in s.
    44(4) has been criticized on the ground that it is wrong in
    principle that a person should be found guilty of an offence
    which the jury find that he did not commit. It seems to us
    that the Bill would be open to criticism if it had to rely on
    provisions such as those in 1916 s. 44(3) and (4). But it
    does not have to do so. Difficulties of the kinds provided
    for by those subsections will not arise, because the
    overlapping of the two offences under the Bill will have the
    result that the accused can be convicted of whichever
    offence is charged.
    It also seems right that the offence
    under clause 12(1), as well as applying to obtaining
    possession or control without ownership, should apply to
    obtaining ownership without possession or control. For
    ownership enables a person to pass the title to another in
    fraud of the person from whom the property is obtained,
    and this may make it difficult or impossible for the latter
    to recover the property."

    (I am not entirely clear about the wording of the sentence which I
    have underlined, but I think the sense is that the accused can be

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