McKinsley v Crown Prosecution Service [2006] EWCA Civ 1092

Case No C1/2005/2770[2006] EWCA Civ 1092
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
(QUEENS BENCH DIVISION) ADMINISTRATIVE COURT
Mr Justice Toulson
DTA/122/2004
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate Tuesday 25 th July 2006
Before
THE PRESIDENT OF THE QUEEN’S BENCH DIVISIONLORD JUSTICE SCOTT BAKERLADY JUSTICE HALLETT
Between
James McKinsleyAppellantThe Crown Prosecution ServiceRespondent
(Transcript of the Handed Down Judgment ofSmith Bernal WordWave Limited190 Fleet Street, London EC4A 2AGTel No: 020 7421 4040 Fax No: 020 7831 8838Official Shorthand Writers to the Court)
Tim Owen QC and Andrew Bodnar (instructed by Messrs Daniel Berman & Co) for AppellantDavid Perry and Ian Smith (instructed by The Confiscation Unit Organised Crime Division) for Respondent
Judgment
[1]This is the judgment of the court in an appeal against a decision of Toulson J given on 22 November 2005. It is brought with the permission of the judge. He decided that in proceedings for a certificate of inadequacy under section 17 of the Drug Trafficking Act 1994 (“the 1994 Act”) it was not open to the appellant to challenge the Crown Court judge’s findings as to the appellant’s realisable assets. Facts[2]On 15 February 2002 the appellant was convicted of conspiring to supply a class A drug namely cocaine and sentenced to 7 years imprisonment by Judge Coleman in the Crown Court at Peterborough. On 5 February 2003 the same judge made a confiscation order against him in the sum of £193,361.64 with 3 years imprisonment in default of payment, consecutive to his 7 year sentence.[3]He appealed against the confiscation order as to which he was given limited leave by the single judge. On 6 May 2004 the Court of Appeal (Criminal Division) allowed his appeal to a limited extent, reducing the amount of the confiscation order to £166,410.76. His renewed application for leave to appeal out of time on the wider grounds refused by the single judge was rejected except for one point on which the Crown conceded an obvious error had been made. In the result the appeal was allowed to the extent that the figure for the value of the appellant’s proceeds of drug trafficking was reduced by £38,650.26 and the figure for his realisable property, and thus the confiscation order, by £26,950.88 to £166,410.76.[4]In June 2005 the appellant applied to the Administrative Court for a certificate of inadequacy under section 17 of the 2004 Act. By this time £61,297.63 had been realised in part satisfaction of the order, but £130,887.55 was outstanding including interest which was accruing at 8% per annum.[5]The appellant’s application for a certificate of inadequacy came first before Lightman J. on 30 June 2005. The Crown Prosecution Service (who are the respondents to this appeal) contended it was not open to the appellant to raise the matters he was seeking to raise on the application. The point was this: of the sum held by the Crown Court to be realisable property, approximately £83,000 was in the form of “hidden assets”. What the appellant was seeking to do was to go behind the Crown Court order on the basis that he did not possess these assets.[6]The issue on this appeal is about the circumstances, if any, in which it is possible for an applicant in certificate of inadequacy proceedings to challenge findings by the Crown Court as to the amount which might be realised. The Crown’s case is simple: the court must take as an established fact that a defendant’s realisable assets at the date of the confiscation hearing were as found by the judge and that on an application for a certificate of inadequacy all that can be investigated is what has happened since then.[7]The application proceeded before Toulson J. on the basis that the appellant could prove that he did not have, and had not had when the order was made by Judge Coleman, the hidden assets found by the judge. Section 17[8]Section 17 of the 1994 Act provides:
“(1) If, on an application made in respect of a confiscation order by – (a) the defendant, or (b) a receiver appointed under section 26 or 29 of this Act or in pursuance of a charging order, the High Court is satisfied that the realisable property is inadequate for the payment of any amount remaining to be recovered under the confiscation order the court shall issue a certificate to that effect, giving the court’s reasons. (2) For the purposes of subsection (1) above – (a) in the case of realisable property held by a person who has been adjudged bankrupt or whose estate has been sequestrated the court shall take into account the extent to which any property held by him may be distributed among creditors; and (b) the court may disregard any inadequacy in the realisable property which appears to the court to be attributable wholly or partly to anything done by the defendant for the purpose of preserving any property held by a person to whom the defendant had directly or indirectly made a gift caught by this Act from any risk of realisation under this Act. (a) the defendant, or (b) a receiver appointed under section 26 or 29 of this Act or in pursuance of a charging order, (a) in the case of realisable property held by a person who has been adjudged bankrupt or whose estate has been sequestrated the court shall take into account the extent to which any property held by him may be distributed among creditors; and (b) the court may disregard any inadequacy in the realisable property which appears to the court to be attributable wholly or partly to anything done by the defendant for the purpose of preserving any property held by a person to whom the defendant had directly or indirectly made a gift caught by this Act from any risk of realisation under this Act. (3) Where a certificate has been issued under subsection (1) above, the person who applied for it may apply to the Crown Court for the amount to be recovered under the confiscation order to be reduced. (4) The Crown Court shall, on an application under subsection (3) above  (a) substitute for the amount to be recovered under the order such lesser amount the court thinks just in all the circumstances of the case; and (b) substitute for the term of imprisonment or of detention fixed under subsection (2) of section 139 of the Powers of Criminal Courts (Sentencing) Act 2000 in respect of the amount to be recovered under the order a shorter term determined in accordance with that section (as it has effect by virtue of section 9 of this Act) in respect of the lesser amount.”
Subsection (5), which it is unnecessary to recite, contains a rule-making power.[9]The Crown’s position is that the certificate of inadequacy procedure under this section is intended to be used only where there has been a genuine change in the applicant’s financial circumstances since the confiscation order was made, where for example an asset has dropped in value as could be the case with a property or shares. The appellant has a right of appeal against a confiscation order (which was exercised in this case) under section 9(1) of the Criminal Appeal Act 1968 and that is the route he should follow if he challenges the confiscation order.[10]The appellant, on the other hand, says that the wording of section 17 is not restricted in this way and it makes sense for one court, namely the Administrative Court, or in future, under the Proceeds of Crime Act 2002 (“the 2002 Act”), the Crown Court to look at the whole picture together and if there has been a manifest error on the part of the court making the original order to correct it. A defendant, so he submits, is prima facie entitled to a certificate of inadequacy whenever he can satisfy the Administrative Court that his assets are inadequate to pay the amount of the confiscation order. The Court is concerned solely with the current worth of the defendant’s assets. The fact that he never had the assets is a reason for the inadequacy rather than a challenge to the original confiscation order. The legislative framework[11]It is necessary to say a word about the framework of the relevant legislation. The power to make a confiscation order was first introduced by the Drug Trafficking Offences Act 1986 (“the 1986 Act”) which imposed a mandatory obligation on the Crown Court to confiscate the proceeds of drug trafficking. The Criminal Justice Act 1988 (“the 1988 Act”) extended the confiscation regime to cover all indictable offences and certain summary offences where the benefit accruing to the defendant was likely to be high. The 1986 Act was replaced by the 1994 Act, which came into force on 3 February 1995. Both the 1988 Act and the 1994 Act have been repealed and replaced by the 2002 Act. The relevant provisions of the 2002 Act came into force on 24 March 2003. The transitional arrangements provide that in the case of offences committed before that date, the earlier legislation will continue to apply.[12]By section 2 of the 1994 Act the Crown Court is under a duty to hold an inquiry into whether a person convicted of a drug trafficking offence has benefited from drug trafficking. If it concludes that he has, it must then determine(1) the amount of the defendant’s proceeds of drug trafficking (sections 2 and 5) and(2) the value of his realisable property available to satisfy a confiscation order in the amount of his benefit (section 5(3)).[13]By section 2(3):
“For the purposes of this Act, a person has benefited from drug trafficking if he has at any time (whether before or after the commencement of this Act) received any payment or other reward in connection with drug trafficking carried on by him or another person.”
[14]Once the prosecution has proved, on the balance of probabilities, the amount of benefit, the burden is on the defendant to satisfy the court that the amount that might be realised is less. Otherwise the amount of the confiscation order is the value of the defendant’s proceeds of drug trafficking.[15]The material parts of section 5 provide:
“(1) Subject to subsection (3) below, the amount to be recovered in the defendant’s case under the confiscation order shall be the amount the Crown Court assesses to be the value of the defendant’s proceeds of drug trafficking….” ---- (3) if the court is satisfied that the amount that might be realised at the time the confiscation order is made is less than the amount the court assesses to be the value of his proceeds of drug trafficking, the amount to be recovered in the defendant’s case under the confiscation order shall be – (a) the amount appearing to the court to be the amount that might be so realised; or (b) a nominal amount, where it appears to the court (on the information available to it at the time) that the amount that might be so realised is nil.” (a) the amount appearing to the court to be the amount that might be so realised; or (b) a nominal amount, where it appears to the court (on the information available to it at the time) that the amount that might be so realised is nil.”
[16]Section 4(3) requires the court to make a number of assumptions. In summary the required assumptions are that any property held by the defendant since his conviction and any property received by him or any expenditure met by him at any time beginning 6 years prior to the institution of proceedings against him, was received or met by him in connection with drug trafficking carried on by him.[17]Section 4(4) provides that the court shall not make the required assumption in relation to any particular property or expenditure if  “(a) that assumption is shown to be incorrect in the defendant’s case; or (b) the court is satisfied that there would be a serious risk of injustice in the defendant’s case if assumption were to be made.”[18]Section 17 is within a group of sections headed:
“Further proceedings in connection with confiscation orders.”
Sections 13 to 17 cover four different circumstances but each is premised on the existence of a valid confiscation order. Section 13 provides for cases where the court has not proceeded under section 2. Section 14 covers a situation where the court has decided the defendant did not benefit from drug trafficking and the prosecutor has evidence, that was not before the court, that suggests that he did. It gives power to the court to reassess whether the defendant has benefited from drug trafficking. Section 15 provides for a revised assessment of the defendant’s proceeds of drug trafficking where the court has made an assessment under subsection 2(4), but the prosecutor thinks the defendant’s proceeds of drug trafficking were greater than their assessed value. Section 16 deals with the reverse of the situation in section 17, namely where there has been an increase in the realisable property of the defendant.[19]These sections, particularly section 16, are important because they throw light on the way the Act is intended to work and accordingly on the true construction of section 17. We shall return to them in more detail in a moment. As Lord Lane CJ pointed out in R v Dickens [1990] 2 QB 102, 105E the object of the drug trafficking legislation is to ensure that the convicted drug trafficker has to part with the proceeds of his trafficking and the extent of his realisable assets at the time of his conviction is likely to be peculiarly within his own knowledge. It is hardly surprising therefore, that evidential burdens are placed upon him and that rigorous penalties are imposed in the event of non-compliance with confiscation orders. In R v Benjafield and Others [2001] AC 1099 the House of Lords held that the confiscation procedure devised by Parliament was a fair and proportionate response to the need to protect the public interest.[20]An appeal against a confiscation order lies to the Court of Appeal (Criminal Division) by section 9 of the Criminal Appeal Act 1968 because section 50(1) of that Act defines sentence as including any order of the court when dealing with an offender. Discussion[21]It is to be observed that the 1994 Act has been carefully drafted to ensure that a confiscation order is made only after proceedings in which the defendant has the opportunity to rebut the prosecution case. The confiscation hearing gives the defendant the opportunity to challenge(1) the assertion that he has benefited from the offence(2) that any property received by him was a payment or reward in connection with drug trafficking(3) that his realisable property is worth less than the prosecution alleges and(4) that it is insufficient to meet any confiscation order. The Crown Court judge hearing the confiscation proceedings is, as in the present case, likely to have heard the evidence in the substantive criminal proceedings, and will be considering related issues as to the defendant’s benefit from his criminal activities. Further, Parliament has provided for a right of appeal against a confiscation order. The purpose of this is for any errors to be corrected. All this suggests to us that section 17 is there as a safety net to provide for post confiscation order events.[22]The heading to section 17 is “Inadequacy of realisable property.” “Inadequate” is described as meaning inadequate for the payment of any amount remaining to be recovered under the confiscation order. As Mr Perry for the respondents points out, the starting point is the existence of a valid confiscation order. If inadequacy is found the confiscation order remains untouched: an application has to be made to the Crown Court for amount realisable under it to be reduced. Section 16 deals with the converse situation where there has been an increase in realisable property. But again the validity of the confiscation order is not in question.[23]It is true that section 17 nowhere expressly states the court can only take into consideration changes that have occurred to the defendant’s financial position since the order was made. But nor does it say that the court can look at the defendant’s realisable property regardless of what the Crown Court has previously decided. Mr Owen Q.C, who has appeared for the appellant on this appeal argues that subsection (1) is expressed in wide terms. As Toulson J. pointed out there are three potentially different factual situations where a defendant seeks to argue that he currently does not have assets and never did: i) he wishes to reargue the identical case to that presented to the Crown Court; ii) he wishes to present a case directly contradictory to that presented to the Crown Court; iii) he wishes to adduce material that was not previously considered. Mr Owen’s arguments are only directed towards the third of these situations because the other two are obviously impermissible. The third situation is not, so he submits, truly to be regarded as relitigation of the same issue.[24]We can see no justification for construing section 17 in this way. Not only the defendant but also a receiver is entitled to apply for a certificate of inadequacy. If a defendant is entitled to go behind the confiscation order the same must be the case for a receiver but we cannot envisage circumstances in which that could possibly be appropriate.[25]There are other pointers towards Mr Perry’s construction being the correct one. Under section 17(3), if the Administrative Court issues a certificate of inadequacy the next step is for the person who applied for it to apply to the Crown Court for the amount to be recovered under the confiscation order to be reduced. The Crown Court then has a mandatory obligation to substitute for the amount to be recovered under the order such lesser amount as it thinks just in all the circumstances of the case.[26]Section 16, which is the comparable provision dealing with an increase in realisable property, contains two important differences from section 17. Section 16 applies if the amount under the confiscation order is less than the amount assessed to be the value of the defendant’s proceeds of drug trafficking. Section 16(2) provides:
“If, on an application made in accordance with subsection (3) below, the High Court is satisfied that the amount that might be realised in the case of the person in question is greater than the amount taken into account in making the confiscation order (whether it was greater than was thought when the order was made or has subsequently increased) the court shall issue a certificate to that effect, giving the court’s reasons.”
[27]The words in brackets make it clear that the court is entitled to take into account assets that were unknown to the court when the confiscation order was made. There are no comparable words in section 17. Second, where the Administrative Court has issued a certificate of increase in realisable property, the court has a discretion on an application to it to increase the amount to be recovered and substitute for that amount such amount as appears to be appropriate but not exceeding the amount that has been assessed to be the value of the defendant’s proceeds of drug trafficking. This discretion in subsection 16(4) is in contradistinction to the duty in subsection 17(4).[28]Mr Owen argues that where an obvious error has been made as to the amount of the confiscation order the sensible and practical course is for the matter to be determined by an Administrative Court judge in the certificate of inadequacy proceedings. He submits that particularly is that so in the present case because the Court of Appeal (Criminal Division) has already heard and determined an appeal against the confiscation order and the only route back to the Court of Appeal (Criminal Division) would be by referring the matter to the Criminal Cases Review Commission. He submits that that would be a time consuming procedure and that it is by no means certain the Commission would refer the case back to the Court of Appeal with the result that the appellant could find himself serving an unjust sentence in default of payment. The liberty of the subject, he argues, is at stake.[29]We are unpersuaded by this submission. In a case where there has been no appeal the appropriate course is for the defendant to seek leave to appeal out of time and the Court of Appeal (Criminal Division) will consider the application for an extension of time and the leave application on their merits. In a case where there has already been an appeal, if the prosecution accepts the case advanced by the defendant and supplies a letter to that effect we cannot see any reason why the Criminal Cases Review Commission would not expeditiously refer the matter to the Court of Appeal to be dealt with as a matter of urgency.[30]In our judgment a close examination of section 17 against the background of the 1994 Act, as a whole points strongly to the construction that the Administrative Court is limited to consideration of post confiscation order events and is not entitled to go behind the confiscation order even if there has been a manifest error.[31]It is our view therefore that the structure of the Act points strongly towards the construction that it is not open to an applicant on an application for a certificate of inadequacy to challenge the Crown Court judge’s findings as to the applicant’s realisable assets. We turn next to consider whether this construction of section 17 is supported by authority. Authority[32]The courts have, over the years, become increasingly familiar with the certificate of inadequacy procedure. But nowhere is there to be found in the authorities any clear statement of principle in support of Mr Owen’s submissions. There are, however a great many dicta to contrary effect. Perhaps the strongest observations in Mr Owen’s favour are to be found in Re L (unreported 25 June 1996). Keene J, as he then was, was considering an application for a certificate of inadequacy under section 14 of the Drug Trafficking Offences Act 1986. It is to be noted that he in fact dismissed the application. He said:
“It was at one point being suggested by Mr Talbot on behalf of the Customs and Excise that there was some form of issue estoppel which might operate in a case like this. He says that there was a finding by the Crown Court judge as to what was realisable. This in effect is a relitigation of that issue when there is a right of appeal to the Court of Appeal, which in this case failed because leave was not granted. There was some suggestion that it might be against public policy to grant this application or perhaps even to allow it to be considered on the substantive merits. I say straightaway I do not accept that there is a form of issue estoppel or that there is any abuse of process. I am satisfied that I have jurisdiction under s 14 of the 1986 Act.”
He then recited section 14(1) of the 1986 Act and continued:
“That subsection deals with the situation which may frequently be some time after the date when the confiscation order was made. But the court is given a discretion there, and it is for this court to make up its mind on the basis of the evidence before it. On the other hand I do take the view that I am entitled to take into account the fact that the Crown Court judge considered the matter of the realisable assets and arrived at a particular conclusion having heard evidence on that topic. I am entitled to place greater weight on events occurring since that date than on matters which were before the Crown Court judge at the time. That is the view I have taken today. Many of the matters which are referred to in the applicant’s affidavit are ones which were as true or false at the time of the Crown Court decision as they are today. He says - and references to paras 6 and 14 of his affidavit will suffice - that he has no assets and he had no assets at the time when the order was made. In a number of passages the applicant in his affidavit appears in essence to be complaining about the making of the order in the first place.” “That subsection deals with the situation which may frequently be some time after the date when the confiscation order was made. But the court is given a discretion there, and it is for this court to make up its mind on the basis of the evidence before it. On the other hand I do take the view that I am entitled to take into account the fact that the Crown Court judge considered the matter of the realisable assets and arrived at a particular conclusion having heard evidence on that topic. I am entitled to place greater weight on events occurring since that date than on matters which were before the Crown Court judge at the time. That is the view I have taken today. Many of the matters which are referred to in the applicant’s affidavit are ones which were as true or false at the time of the Crown Court decision as they are today. He says - and references to paras 6 and 14 of his affidavit will suffice - that he has no assets and he had no assets at the time when the order was made. In a number of passages the applicant in his affidavit appears in essence to be complaining about the making of the order in the first place.”
[33]Keene J’s observations have to be seen against the background that he was not satisfied on the evidence that the applicant’s realisable property was inadequate for payment of the confiscation order that had been made. The applicant had a number of foreign connections and the mere fact that the Customs and Excise was not able to identify assets did not necessarily mean no such assets existed. There does not appear to have been any argument on the abuse of process question.[34]In our judgment the law is put beyond doubt in Gokal v Serious Fraud Office [2001] EWCA Civ 368 in which, incidentally, Keene L.J gave the leading judgment of the Court of Appeal with which the others members of the court agreed. Gokal, after a lengthy trial, was convicted of two counts of conspiracy to defraud. He was sentenced to 14 years imprisonment and the judge made a confiscation order of £2,943,115 to be paid within two years with a further 3 years imprisonment to be served consecutively in default of payment. He appealed against conviction and sentence and his appeal against sentence included an appeal against the confiscation order. The Court of Appeal (Criminal Division) dismissed his appeals. He paid nothing under the confiscation order and, through the passage of time, on 9 May 1999 became in default of it. On 1 November 1999 he applied for a certificate of inadequacy under section 83 of the Criminal Justice Act 1988, whose terms are for practical purposes identical to section 17 of the 1994 Act. Newman J ordered the application to be struck out as an abuse of process because the issues Gokal was seeking to raise had been adjudicated upon by a court of competent jurisdiction.[35]Gokal’s appeal was dismissed. He was seeking to prove he had no realisable property to be applied in satisfaction of the confiscation order. He wished to produce evidence to show that money which went into his personal bank accounts had been dissipated. It would take the form of schedules produced by accountants and available at the time of the hearing before the Court of Appeal (Criminal Division) but not produced to that court. Keene L.J said at para 17:
“That is not a proper basis on which to seek a certificate. It amounts to an attempt to go behind the original confiscation order finding as to the amount of the defendant’s realisable assets. Such a finding can only be challenged by way of an appeal against the confiscation order. The trial judge clearly rejected the argument that the money in the personal bank accounts had gone back to the companies or had been otherwise dissipated. An application for a certificate does not provide an opportunity to try to make good deficiencies in the case presented at the time of the confiscation order or at the appeal against it. This is a principle to which it will be necessary to return in due course.”
[36]Keene L.J then dealt with an argument on behalf of Gokal that he had an interest in assets being realised by the liquidators of BCCI, pointing out that anything realised from the company assets in question must be extraneous to the £2.94 million and would incidentally be swallowed up in meeting the civil liability of $830 million to the BCCI liquidator for which judgment had been obtained. He continued at para 24:
“Consequently there does remain the question: what has happened since the making of the confiscation order to the £2.94 million of realisable property found by the judge to be held by the appellant? Evidence as to that is crucial to the grant of a certificate of inadequacy. As has been said many times in the authorities, it is not enough for a defendant to come to court and say that his assets are inadequate to meet the confiscation order, unless at the same time he condescends to demonstrate what has happened since the making of the order to the realisable property found by the trial judge to have existed when the order was made; see R v C, unreported, 18 November 1997 and R v W unreported, 29 January 1998. Any other approach would amount to an attempt to go behind the finding embodied in the confiscation order, and such an attempt would be an abuse of process.”
[37]The next point taken by Gokal was that he should be allowed to call evidence from the recipients of gifts to relatives amounting to £636,000 to explain why they did not give evidence at the confiscation order hearing and to show that the money received from the appellant had been dissipated so that they had no money. They would be unable to discharge the amount which they received from the appellant. This, it was argued, was new evidence which ought to be taken into account to show that the realisable property was inadequate to meet the confiscation order. The prosecution argued, inter alia, that it was not open to someone in Gokal’s position to come back on a certificate of inadequacy application and rely on evidence which could have been produced at the confiscation order hearing to the effect that the gifts had already been dissipated by then. Keene L.J said at para 38:
“It is nowhere suggested that in the witness statement of Mr Cowell lodged in support of the s 83 application that the evidence of the recipients of these gifts could not have been produced at the Crown Court hearing or at least at the subsequent appeal. These recipients were relatives of the defendant and one of them at least was in court at the confiscation order hearing. Evidence as to the past dissipation of gifts, if it is to be relied on at all, must be produced at that stage of the process. Section 83 is not to be used as if it were a further appeal stage or for a second bite of the cherry. In my judgment, it is an abuse of process to seek to challenge the inclusion of these gifts in the order on such a basis, and yet that is what this argument amounts to.”
[38]The only other authority to which it is necessary to refer in any detail is Re Norris [2001] 3 All ER 961. That was a decision of the House of Lords and the case involved third party rights. It was held that where a third party claimed an interest in a property which formed the subject matter of enforcement proceedings a claim in High Court proceedings was not an abuse of process merely because the judge and the Crown Court had rejected the third party’s evidence that she was the owner and held instead that the property was beneficially owned by the defendant. Lord Hope of Craighead observed that the scheme of the Act, so far as third party interests, is concerned, is for their claims to be resolved in the High Court. Lord Hobhouse of Woodborough said at 969C, para 17:
“It is therefore part of the structure of the Act that questions may have to be determined as to the respective interests of different persons in the same property. Although the extent of the defendant’s interest is relevant to the Crown Court’s assessment of the value of his realisable property, the question of what other persons, if any, have an interest and what is the extent of their interests must be decided by the High Court in the exercise of that jurisdiction.”
Then at 974G, para 25:
“The issues to be determined in the Crown Court and in the High Court are related but are not the same. To adapt the language of Lord Diplock in Hunter’s case [1981] 3 All ER 727 at 729, 733, [1982] AC 529 at 536, 541, the question decided in the Crown Court was not on any view ‘identical’ to that to be decided in the High Court nor was the Crown Court a ‘competent court’ to decide against Mrs Norris what are her rights. Mrs Norris is not ‘misusing’ the procedure of the High Court; she is making the proper use of the civil jurisdiction of the High Court to protect her proprietary rights as the 1986 Act contemplates that she should. (26) The principles applied in Hunter’s case and Ashmore v British Coal Corp [1990] 2 All ER 981, [1990] 2 QB 338 do not apply. In Hunter’s case the plaintiff was engaged in trying to relitigate in a civil court a factual issue which had already been decided against him in a criminal case in which he had been a party. It involved a collateral attack upon a decision in previous proceedings to which he had been a party, fully represented and with complete control over the evidence he wished to put before the court.”
And finally at 975E, para 26:
“Attempts to relitigate issues which have already been the subject of judicial decision may or may not amount to an abuse of process. Ordinarily such situations fall to be governed by the principle of estoppel per rem judicatem or of issue estoppel (admitted not to be applicable in the present case). It will be a rare case where the litigation of an issue which has not previously been decided between the same parties or their privies will amount to abuse. As previously explained, the present case does not involve such relitigation nor is there evidence to support the more simple types of abuse. Your Lordships were also referred to the recent decision of the Court of Appeal in Gokal v Serious Fraud Office [2001] EWCA Civ 368, a case under the comparable provisions of the Proceeds of Crime Act 1995. The Court of Appeal distinguished between the position of the defendant who in the Crown Court, with the burden of proof resting upon him, could seek to satisfy that court that the amount which might be realised at the time the confiscation order is made would be less than the amount of benefit he had from the relevant offence or offences, who had a right of appeal and was thereafter bound by the outcome (para [17]) and the position of a third party such as Mrs Norris (para [41]). For the defendant to seek to reopen the decision by which he is bound was an abuse of process.”
All the other members of the House agreed with Lord Hobhouse.[39]We find nothing in Norris that throws any doubt on the principle in Gokal. Indeed the observations of Lord Hobhouse seem to me if anything to fortify it. In our judgment clarification of a third party’s interest in property, such as that of Mrs Norris, is properly to be regarded as a post confiscation order event.[40]There are numerous observations in other cases that support the approach in Gokal. In Re Forwell [2003] EWCA Civ 1608 Schiemann L.J, giving the judgment of the court, recognised the seriousness of the implications but proceeded on the basis that that was the law. In Re O’Donoghue [2004] EWCA Civ 1800 the Court of Appeal upheld Lightman J’s refusal of a certificate of inadequacy under the provisions in the 1988 Act. Laws L.J described the reasoning of the judge as “obviously right”. That was his view unassisted by authority, but he went on to point out that it was also in line with the judgment of Keene L.J in Gokal. What the judge said was this:
“It is clear that on an application for a certificate it is not possible to go behind the finding in the original confiscation order as to the amount of the defendant’s realisable assets and accordingly he was the beneficial owner of the sum of £35,000. A challenge can only be made by way of appeal against that finding in the confiscation order. It is likewise clear that the burden is on the defendant to establish that the value of his assets is inadequate to satisfy all the value of the confiscation order, and for this purpose it is not sufficient for him to come to court and say that his assets are inadequate unless at the same time he condescends to demonstrate what has happened since the making of the confiscation order to the realisable property found by the trial judge to have existed when the confiscation order was made…….”
[41]Toulson J in the present case, having considered the authorities, said that despite attempts to persuade him that the dicta in Gokal and the later authorities should be regarded as obiter or distinguishable they appeared to him to demonstrate that the courts had adopted what he described as a “hard edged rule” and that the appellant’s only remedy was to seek to go back out of time to the Court of Appeal (Criminal Division). (We think his case would have to be referred by the Criminal Cases Review Commission because his appeal against the confiscation order has already been determined). The judge went on to say that had he been able to consider the matter at large he could see some finely balanced arguments; there was what appeared to have been an obvious mistake and one could envisage cases in which it was sought to raise matters of that kind as well as what had happened since the initial order. There was something to be said for the matter being dealt with by one court rather than two.[42]It is true that under the 2002 Act an application for a certificate of inadequacy is no longer to be made to the Administrative Court; in future the Crown Court is seized of the whole procedure. We do not, however, regard this as a point in favour of Mr Owen’s submission. In passing the 2002 Act in the terms that it has Parliament must be taken to have affirmed the hard edged rule laid down in Gokal.[43]We agree with the judge that he was bound by the hard edged rule. In our view this court too is likewise bound. But absent authority we should have reached the same conclusion. Having listened to detailed argument on the construction of the statute we are persuaded that it points clearly to the hard edged rule. Further, this accords with the general principle that it is not ordinarily open to a party to relitigate an issue that has already been decided against him in the Crown Court.[44]In our judgment the Administrative Court does not have jurisdiction in certificate of inadequacy proceedings to go behind the basis of the confiscation order made by the Crown Court. In our view an attempt to do so, as in this case, is an abuse of the process of the court. We would accordingly dismiss the appeal and the appeal is therefore dismissed.

Cited in 21 later judgments

and 12 more of the most senior