The Limits of Proportionality 2

 

The Supreme Court’s (SC) judgment in Waya ([2013] 1 A.C. 294) has been rightly lauded as a landmark decision in the field of post-conviction confiscation, writes Roger Sahota in the third of a series of articles considering the impact of the case.

 

Last week I noted how the SC in Waya were careful to emphasise that their decision did not provide Judges with a discretion to tailor confiscation orders to suit the facts of a case.

 

However two further important qualifications also applied to the Courts decision.

 

First, the SC made it clear that A1P1 will have limited application to S.75 “lifestyle” cases where the assumptions are triggered.

 

Second, the SC also upheld the House of Lords observations in May concerning an offenders benefit.

 

Proportionality in Lifestyle Cases

 

In certain cases POCA allows the court to assume that any property transferred to or held by an offender in a six year period prior to the commencement of the proceedings represents the proceeds of criminal conduct. The burden is on the offender to displace the assumption.

 

S10(6)(a) and (b) of POCA allows the court to disapply the assumptions if they can be shown to be incorrect or if making them would give rise to a serious risk of injustice.

 

In the SC’s opinion the operation of these “safety valve” provisions made it very unlikely that any order would “court the danger of being disproportionate because the assumptions will only by applied if they can be made without risk of serious injustice.”

 

R v May Still Rings True

 

The SC was also at pains to state that the operation of A1P1 would not result in a new definition of an offender’s real benefit.

 

Nor would it allow criminals to set off the expense of committing their crimes as if they were legitimate business costs against the sum they were required to pay to the court. The findings of the House of Lords in May still rang true and a “legitimate, and proportionate, confiscation order may have one or more of three effects:

 

(a) it may require the defendant to pay the whole of a sum which he has obtained jointly with

 

others;

 

(b) similarly it may require several defendants each to pay a sum which has been obtained,

 

successively, by each of them, as where one defendant pays another for criminal property;

 

(c) it may require a defendant to pay the whole of a sum which he has obtained by crime

 

without enabling him to set off expenses of the crime.”

 

So When is an Order Disproportionate?

 

Unfortunately the SC gave scant guidance as to when it would be unfair to make a confiscation order. References were made to two past cases that the Court felt that should have been decided differently as examples of where in future a confiscation order “ought to be refused” by the Judge as a disproportionate measure.

 

Confiscation in Excess of the Victims Loss or Offenders Reward

 

Citing R v Shabir (a pharmacist overcharged the NHS by £464 but the Crown applied for a confiscation order in excess of £400,000) confiscation orders where the victim’s loss or offenders reward is disproportionate to the quantum of the order may be disproportionate.

 

Full Recovery

 

An order where the offender had repaid the sole victim the extent of his loss in full may also be disproportionate as in R v May.

 

While these examples give some clues as to the approach endorsed by the SC, the category of cases amenable to challenge must remain open and is likely to provide fertile ground for argument in the future.

 

The Future Post Waya?

 

According to the editors of the Criminal Law Review there are many decisions where confiscation orders have been upheld that may now be in question. They provide some pointers to the avenues that could be explored;

 

Where the Defendant repays an amount equivalent to the sum he receives from the fraud – query if the order should not be based on the sum obtained but the profit made from itR v Farquhar

 

VAT evasion cases – where the goods liable to duty are seized and so any pecuniary advantage to the offender is purely notional

 

Money Laundering – should a launderer receiving a specific fee for allowing monies to wash through his account be liable for the entire sum passing through his hands (Allpress)

 

R v Neuberg – a business providing value to customers but operating under a name closely associated to another venture now in liquidation, should the order take into account it’s entire turnover

 

The original article can be found at www.confiscationorder.com