Transcript Civil Recovery and Human Rights

Civil Recovery: an Appraisal
Peter Alldridge
University of Manchester, October
2014
The perceived problem
‘... it simply is not right in Modern Britain that
millions of law-abiding people work hard to
earn a living, whilst a few live handsomely off
the profits of crime. The undeserved trappings
of success enjoyed by criminals are an affront
to the hard-working majority.’
Tony Blair, foreword to Cabinet Office Performance and
Innovation Unit, Recovering the Proceeds of Crime (London,
Cabinet Office 2000)
The Procedure – Proceeds of
Crime Act 2002 Part 5
In rem action for “property which is, or represents,
property obtained through unlawful conduct”, is in
the hands of someone other that a bona fide
purchaser for value.
Powers to freeze seize &c (POCA ss.243 et seq)
interim trustee
Strong investigatory powers (POCA ss. 340 et seq)
Proprietary right to be conferred by court (like
bankruptcy) on a trustee on success of action.
“Recovery”? “Civil”?
“Ce corps qui s'appelait ... le saint empire
romain n'était en aucune manière ni saint, ni
romain, ni empire.”
Voltaire, Essai sur l'histoire generale et sur
les moeurs et l'espirit des nations, Ch. 70
(1756)
v.t. L. recupero recuperare re and capio, to
take.
1.To regain; to get or obtain that which was
lost; as, to recover stolen goods; to recover
a town or territory which an enemy had
taken; to recover sight or senses; to recover
health or strength after sickness.
“David recovered all that the Amalekites had
carried away.” 1 Samuel ch 30. (King James
Version) OED
“Civil Recovery”- Rationales
1. to prevent the criminal committing further
crimes; or
2. because the criminal has no proper title to
property obtained by crime; or
3. because the fact that the property was obtained
by crime implies that the State acquires a
proprietary interest in them; or
4. to deter crime by removing the financial
incentive to commit it; or
5. wouldn’t it be nice if …?
6. because it makes people feel better.
The Human Rights Issues
Article 6 - are “civil recovery” proceedings
criminal proceedings in disguise?
First protocol - is the civil recovery procedure
an disproportionate interference with
individual property rights?
Walsh v Director, Assets
Recovery Agency [2005] NICA 6
Decision: Civil recovery is not governed by
Article 6.2 and 6.3, because it does not
involve a criminal charge.
The reason in Walsh
Dealing with Lord Bingham’s advice in McIntosh v
HMA and the supposed analogy with confiscation
But Mr McCollum focussed on the statement that the confiscation
proceedings did not involve any inquiry into the commission of
drug trafficking offences and suggested that, if such an inquiry had
been required, the Privy Council would have held that the
respondent had been charged with a criminal offence. Again we do
not accept that submission. We do not regard the fact that there
was no inquiry into drug trafficking offences as pivotal to the
decision. (Kerr LCJ, para 26)
Critique
Lord Bingham in McIntosh says confiscation
is not covered by article 6.2 and .3 because
there has already been a conviction.
Kerr LCJ in Walsh says Article 6.2 and .3
don’t apply to civil recovery because civil
recovery is just like confiscation.
BUT there is no conviction in civil recovery.
Lord Bingham in McInstosh v HMA para “There are a number of compelling reasons why
[someone subject to confiscation proceedings] he would not be … regarded [as being subject
to a criminal charge for the purposes of Article 6].
(1) The application is not initiated by complaint or indictment and is not governed by the ordinary
rules of criminal procedure.
(2) The application may only be made if the accused is convicted, and cannot be pursued if he is
acquitted.
(3) The application forms part of the sentencing procedure.
(4) The accused is at no time accused of committing any crime other than that which permits the
application to be made.
(5) When, as is standard procedure in anything other than the simplest case, the prosecutor lodges a
statement under section 9, that statement (usually supported by detailed schedules) is an
accounting record and not an accusation.
(6) The sum ordered to be confiscated need not be the profit made from the drug trafficking offence
of which the accused has been convicted, or any other drug trafficking offence.
(7) If the accused fails to pay the sum he is ordered to pay under the order, the term of
imprisonment which he will be ordered to serve in default is imposed not for the commission
of any drug trafficking offence but on his failure to pay the sum ordered and to procure
compliance.
(8) The transactions of which account is taken in the confiscation proceedings may be the subject
of a later prosecution, which would be repugnant to the rule against double jeopardy if the
accused were charged with a criminal offence in the confiscation proceedings.
(9) The proceedings do not culminate in a verdict, which would (in proceedings on indictment) be a
matter for the jury if the accused were charged with a criminal offence.
Does it differentiate Confiscation
from Civil recovery?
Applies to
Confiscation
Applies to Civil
Recovery
(1) The application is not initiated by complaint or indictment and is not
governed by the ordinary rules of criminal procedure.
(2) The application may only be made if the accused is convicted, and
cannot be pursued if he is acquitted.
(3) The application forms part of the sentencing procedure.
(4) The accused is at no time accused of committing any crime other than
that which permits the application to be made.
(5) When, as is standard procedure in anything other than the simplest case,
the prosecutor lodges a statement under section 9, that statement
(usually supported by detailed schedules) is an accounting record
and not an accusation.
(6) The sum ordered to be confiscated need not be the profit made from the
drug trafficking offence of which the accused has been convicted, or
any other drug trafficking offence.
(7) If the accused fails to pay the sum he is ordered to pay under the order,
the term of imprisonment which he will be ordered to serve in
default is imposed not for the commission of any drug trafficking
offence but on his failure to pay the sum ordered and to procure
compliance.
(8) The transactions of which account is taken in the confiscation
proceedings may be the subject of a later prosecution, which would
be repugnant to the rule against double jeopardy if the accused were
charged with a criminal offence in the confiscation proceedings.
(9) The proceedings do not culminate in a verdict, which would (in
proceedings on indictment) be a matter for the jury if the accused
were charged with a criminal offence.
Y
Y
Y
N
Y
N
Y
Y
Y
N
Y
N
Y
N
Y
Y
Y
Y
Aftermath
Application for leave to appeal to HL refused.
(House of Lords minutes 7 July 2005, 17th
Report from the Appeal Committee, para
12.)
ECHR appeal failed: Walsh v United Kingdom
[2006] E.C.H.R. 1154
Now SOCA v Gale [2011] UKSC 49; [2010]
EWCA Civ 759
ECHR conclusions
Civil recovery is covered by 6.1 but not
necessarily 6.2 and 6.3
A1P1 will not usually be a problem (as in
confiscation – Waya, [2012] UKSC 51
Ahmad [2014] UKSC 36).
But …
• Adequacy of the civil/criminal distinction as
a human rights axiom: continuum or binary
opposition?
• Human rights culture and the State as
avoider: ‘creative compliance’ by the State
Proof of what?
Proceeds of Crime Act 2002 s.241-2
241 “Unlawful conduct”
(1) Conduct occurring in any part of the United Kingdom is unlawful conduct if it
is unlawful under the criminal law of that part.
(2) Conduct which—
(a) occurs in a country outside the United Kingdom and is unlawful under the
criminal law of that country, and
(b) if it occurred in a part of the United Kingdom, would be unlawful under the
criminal law of that part,
is also unlawful conduct.
(3) The court or sheriff must decide on a balance of probabilities whether it is
proved—
(a) that any matters alleged to constitute unlawful conduct have occurred, or
(b) that any person intended to use any cash in unlawful conduct.
242 “Property obtained through unlawful conduct”
(1) A person obtains property through unlawful conduct
(whether his own conduct or another's) if he obtains
property by or in return for the conduct.
(2) In deciding whether any property was obtained through
unlawful conduct—
(a) it is immaterial whether or not any money, goods or
services were provided in order to put the person in
question in a position to carry out the conduct,
(b) it is not necessary to show that the conduct was of a
particular kind if it is shown that the property was obtained
through conduct of one of a number of kinds, each of
which would have been unlawful conduct.
The Standard of proof
241 (3) The court or sheriff must decide on a balance
of probabilities whether it is proved-
(a) that any matters alleged to constitute unlawful
conduct have occurred, ...
Types of Evidence – (i)
Unaccounted wealth/lifestyle
33 In SOCA v Gale [2009] EWHC 1015 Griffith Williams J.
“14 ... While a claim for civil recovery may not be sustained solely upon
the basis that a respondent has no identifiable lawful income to warrant
his lifestyle, the absence of any evidence to explain that lifestyle may
provide the answer because the inference may be drawn from the
failure to provide an explanation or from an explanation which was
untruthful (and deliberately so) that the source was unlawful”.
10 While there is no burden on a respondent to
provide answers, clearly, if an answer is not
provided to an important question, and the court is
satisfied that the respondent had the knowledge to
answer the question and chose not to, an inference
adverse to that respondent may be drawn but any
decision as to a failure to answer must have regard
to delay, which must be ruled out as a possible
explanation for the failure to answer before any
adverse inference may be drawn.
Types of Evidence (ii) (SOCA v Gale
[2009] EWHC 1015)
1.
2.
3.
4.
5.
his criminal record from his youth until when he was 32 years old
together with his criminal associates;
police intelligence material which reveals that he was suspected of
drug trafficking in the United Kingdom before he emigrated to Spain
and on his return to the United Kingdom between 2001 and 2005;
an attempt to breach the Interim Receiving Order within days of
service by opening a new bank account in the name of Mrs Peel with
a transfer of 167,000 Euros from a Solbank account;
the compromise of proceedings bought in Ireland to restrain funds
which were the proceeds of crime;
his access to funds, not identified by the Interim Receiver or disclosed
to the Interim Receiver, which he has used to fund his living expenses
from July 2005 to date.
Types of Evidence (iii) Illegally
obtained evidence
Olden v SOCA [2010] EWCA Civ 143 (Evidence excluded in
criminal trial under s.78 PACE admitted in civil recovery
proceedings).
CPR 32.1(2) gives the court power to exclude evidence that
would otherwise be admissible. That power must be
exercised in accordance with the overriding objective in
Part I of the CPR to deal with cases justly [...] ;. .. the
exercise of the court's power involves balancing any
unlawfulness against the importance of the court reaching
the correct decision on the basis of all the evidence
available.
Types of Evidence (iv) Privilege
against self-incrimination?
Pre claim form - ‘criminal’ phase - no
privilege but answers not admissible in
criminal proceedings. (Proceeds of Crime Act
2002 s. 000)
Post claim form - ‘civil’ phase – no privilege
arising only from the fact that the defendant
would face civil recovery proceedings.
(Belton v Director ARA NI [2006] N.I.C.A. 2)
The Right to legal representation
Squirrell v Natwest [2005] EWHC 664
Proceeds of Crime Act 2002 (Legal Expenses
in Civil Recovery Proceedings) Regulations
2005 SI 2005 No. 3382
Proceeds of Crime Act 2002 245C(5) and
252(4). Proceeds of Crime Act 2002 (Legal
Expenses in Civil Recovery Proceedings)
(Amendment) Regulations 2008 No. 523
Institutional Framework
ARA to SOCA to NCA
Anthony King & Ivor Crewe, The Blunders of
Our Governments (Oneworld, 2013) ch 11.
Do we now have better results or just worse
data?
Some questions
Financial Success?
£48 million was collected in 2012-13 from civil
recovery, cash forfeitures and tax recovery on
criminal proceeds. (NAO Confiscation Orders HC
738 2013-14, 50% to prosecution p. 22 ).
Constitutional significance – incidence of the
duty to explain oneself to the State
What are good (cash?) and bad (tax?) areas?
Would it be a good policy for a net (properly
costed) break-even?