Tilley, R. v [2009] EWCA Crim 1426

[2009] EWCA Crim 1426Case No 200902145D5
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CRIMINAL DIVISION)
ON APPEAL FROM CROWN COURT AT CAMBRIDGE
Mr Recorder Holborn
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 20/07/2009
Before
LORD JUSTICE SCOTT BAKERMR JUSTICE KINGHIS HONOUR JUDGE MOSS Q.C
Between
REGINAAppellantChristopher TilleyRespondent
(Transcript of the Handed Down Judgment ofWordWave International LimitedA Merrill Communications Company165 Fleet Street, London EC4A 2DYTel No: 020 7404 1400, Fax No: 020 7404 1424Official Shorthand Writers to the Court)
Allister Walker (instructed by Department for Work and Pensions) for the AppellantAngus Bunyan for RespondentHearing Hearing date: 16 June 2009
Judgment
[1]The prosecution apply for leave to appeal against a terminating ruling under Section 58 of the Criminal Justice Act 2003. We grant that leave.[2]The appeal arises in this way. Christopher Tilley (to whom we shall refer as the defendant) and Nicola Tilley face trial in the Crown Court at Cambridge. The indictment contains seven counts relating to fraudulent claims for social security benefits. Five of the counts are against Nicola Tilley and allege false representations to obtain benefit or failing to notify a change of circumstances that she knew would affect her entitlement to benefit. These are not the subject of this appeal. Counts two and four, which are the subject of this appeal, are against the defendant and allege offences under S.111A(1B) of the Social Security Administration Act 1992, as amended.[3]The statement of offence in each case is “causing or allowing another to fail to give a prompt notification of a change of circumstances.” The particulars of offence in count two read:
“Christopher Tilley, between 1st January 2002 and 2nd March 2007, dishonestly caused or allowed Nicola Tilley to fail to give a prompt notification to the Department for Work and Pensions in the prescribed manner of a change of circumstances that he knew would affect Nicola Tilley’s entitlement to Income Support, namely that he and Nicola Tilley were maintaining a common household.”
The particulars in count four are similar, but the end date is 11 May 2007 rather than 2 March 2007, the person to be notified is the Bedford Borough Council rather than the Department for Work and Pensions and the benefit is housing benefit and council tax benefit rather than income support.[4]It was agreed by both sides in the Crown Court that rather then empanel a jury and call what was effectively agreed evidence, Mr Recorder Holborn should hear argument on the basis of agreed facts and give his ruling on the point of law which is now the subject of this appeal. In short the issue was and is the meaning of the word “allows” in s.111A(1B) and whether it requires in this case any positive act on the part of the defendant for the offence to be committed.[5]The Recorder said in his ruling that the substantive issue was the construction of the word “allows”; first what the Crown has to show and secondly whether on the agreed facts there was sufficient evidence to go to the jury. He accepted the reality was that the defendant did nothing in terms of any positive act towards the commission of the offence with which he was charged. He said, “perhaps turning a blind eye, he did nothing”.[6]He concluded that the word “allows,” in the absence of any further assistance in the statute by way of a duty imposed by Parliament, requires the Crown to prove that the defendant did something rather than just stood back and did nothing. There was, he said no evidence that the defendant did anything and that the Crown was in effect, asking him to read words into the statute that were not there. He said that in the absence of a clear expressed intention Parliament cannot have, in these circumstances, intended to impose criminal liability on an individual for a failure to act.[7]It is common ground that the Recorder’s decision is a terminating ruling with the meaning of s.58 of the Criminal Justice Act 2003.[8]The undisputed facts are these. The defendant and Nicola Tilley maintain a common household. They are living together as man and wife and at least some of the defendant’s wages are paid into a bank account in which some of Nicola Tilley’s benefit is paid. The account is in her name. The defendant was said to be living rent free although there are no details about the ownership of the property in which they are living.[9]S.111A(1B) provides:
“A person shall be guilty of an offence if – (a) there has been a change of circumstances effecting any entitlement of another person to any benefit or other payment or advantage under any provision of the relevant social security legislation; (b) the change is not a change that is excluded by regulations from the changes that are required to be notified; (c) he knows that the change effects an entitlement of that other person to such a benefit or other payment or advantage; and (d) he dishonestly causes or allows that other person to fail to give a prompt notification of that change in the prescribed manner to the prescribed person.” (a) there has been a change of circumstances effecting any entitlement of another person to any benefit or other payment or advantage under any provision of the relevant social security legislation; (b) the change is not a change that is excluded by regulations from the changes that are required to be notified; (c) he knows that the change effects an entitlement of that other person to such a benefit or other payment or advantage; and (d) he dishonestly causes or allows that other person to fail to give a prompt notification of that change in the prescribed manner to the prescribed person.”
[10]As the Recorder observed, four things have to be proved: i) A change of circumstances effecting any entitlement of another person to any benefit. That is accepted in the present case. ii) That the change is not a change that is excluded by regulations from the changes that are required to be notified. It is not suggested that the changes in this case are excluded by the regulations. iii) That the defendant knows that the change affects an entitlement of that other person to such benefit or other payment or advantage. It is accepted that this too is met. iv) That the defendant dishonestly causes or allows that other person to fail to give a prompt notification of that change in the prescribed manner to the prescribed person. There is no evidence that the defendant caused the failure on the part of Nicola Tilley and during the course of the hearing below it was agreed that the words “caused or” should be deleted from the particulars of Counts two and four. The focus was therefore on the meaning of dishonestly allowing Nicola Tilley to fail to give the necessary prompt notification.[11]It is necessary to say a word about the structure of the social security fraud legislation. Section 16 of the Social Security Fraud Act 2001 (“the 2001 Act”), which is headed: “Offence of failing to notify a change of circumstances,” brought new provisions into the Social Security Administration Act 1992 (“the 1992 Act”). Until the Social Security Administration (Fraud) Act 1997 (“the 1997 Act”) the only specific offence relating to social security fraud was the summary offence of obtaining benefit by making a false statement or producing a false document (section 112 of the 1992 Act). The 1997 Act created a new offence, triable either way, of dishonestly making a false statement or producing a false document with a view to obtaining benefit (section 13 inserting section 111A of the 1992 Act). The new legislation also included offences of omission as well as commission e.g. dishonestly failing to report a change of circumstances (section 111A(1)(c). This, according to the note in Current Law Statutes [2001] chapters 1 – 19, 11 – 31, was designed primarily to deal with claimants paid benefit by direct credit to their bank or building society account. In such cases there would be no signature of the claimant on which to base a prosecution for a false claim. The 1997 Act also inserted a parallel summary offence into the 1992 Act, (section 14 of the 1997 Act amending section 112 of the 1992 Act). That, however, was not end of the matter. It did not prove workable to define offences in terms of failing to comply with requirements under regulations. The 2001 Act introduced a new approach in defining offences as failing to report changes in circumstances affecting entitlement to benefit rather than failing to comply with requirements under regulations. That is the underlying concept that we are dealing with the present case. Section 16(2) of the 2001 Act inserted seven new subsections into section 111 of the 1992 Act as previously amended.[12]Section 111A(1A) is the reformulation of the offence of dishonestly failing to notify a relevant change of circumstances. The offence is committed when the claimant knows that a change affects benefit entitlement and dishonestly fails to give prompt notification of that change.[13]Section 111A(1B), with which the present case is directly concerned, is the reformulation of the offence of dishonestly causing or allowing another person to fail to notify a relevant change in circumstances. An example of the kind of situation this subsection is obviously designed to catch is where a claimant is in receipt of unemployed job seekers’ allowance and has a partner in part time work and the latter’s earnings increase but he does not tell the claimant. The change of circumstances in the present case is not however something that is unknown to the claimant; it is that she and the defendant are living in a common household, a fact of which both will be equally aware.[14]It is, we think, worth looking at the predecessor to s.111A(1B) to see how it was framed as this suggests that Parliament was not intending to extend the ambit of the liability of persons other than the recipient of the benefit, rather it was reformulating the offence in terms that were easier to establish in a criminal court. S.111A of the Social Security Administration Act as amended read: i) If a person dishonestly – a) Makes a false statement or representation; b) Produces or furnishes, or causes or allows to be produced or furnished, any document or information which is false in a material particular; c) fails to notify a change of circumstance which regulations require him to notify; or d) causes or allows another person to fail to notify a change of circumstances which such regulations require the other person to notify with a view to obtaining any benefit or other payment or advantage under the social security legislation (whether for himself or for some other person),[15]It will thus be apparent that the concept of dishonestly causing or allowing appeared in the previous legislation, not only in relation to the type of situation with which the present case is concerned but also in relation to producing a false document or information.[16]Section 111A(1C) and (1D) extend the ambit of the offence of dishonestly failing to notify a change in circumstances to third parties who have a right to receive payment of benefit on behalf of a claimant (e.g. appointees). Section 111A(1E) extends the third party offence of dishonestly causing or allowing a failure on the part of the claimant whose responsibility it is to notify the change of circumstances (see subjection (1B)) to the types of situation envisaged in subsection (1C) i.e. where somebody other than the claimant has the right to receive payments of benefit. It is unnecessary for present purposes to recite the remaining new subsections.[17]It is to be noted that the concept of “dishonestly causing or allowing,” apart from appearing in the section under consideration and its predecessor, also appears in s.111A itself and s.111A(1E)(c) as does a dishonest failure in s.111(1D)(c).[18]The primary obligation to give prompt notification of a change of circumstances is on the person whose entitlement to benefit is liable to be reduced, in this case Nicola Tilley. Subsection 111A(1B) places on a third party, in this case the defendant, a secondary obligation which he owes not to the authority, but to the recipient of the benefit, in this case Nicola Tilley. It is an offence if he dishonestly causes or allows her to fail to give the appropriate notification.[19]But what is the extent of the obligation on him? Her obligation is to report a change of circumstances. His obligation is, in a sense, a negative one i.e. not to cause or allow her to fail in her obligation. Subsection 111A(1B) says nothing about the relationship between the person entitled to the benefit and the third party. Ordinarily, we imagine there would be likely to be some relationship between the two as, for example in the present case, living in the same household. But the subsection on its face does not require this.[20]To what kind of change of circumstances is s.111A(1B) directed? The answer is in subsections (b) and (c); it is any change that is not excluded from those required to be notified, and one which the third party knows affects the other person’s entitlement. It is not limited to a change in the circumstance just of the third party on the one hand or just of the claimant on the other.[21]The position seems to us to be relatively straightforward where it is the third party’s circumstances that have changed and this change affects the claimant’s benefit. If the third party leaves the claimant unaware of the change so that the third party does not report it he is plainly allowing the third party not to give notification of the change and if he does so dishonestly he is guilty of an offence under s.111A(1B). He has the means to ensure she does not report the change by not giving her the relevant information e.g. that his wages have increased.[22]The position is more difficult where the change of circumstances is something of which the claimant is aware, without the need for the third party to tell her. Here the claimant’s obligation to report already exists without the necessity for the third party to tell her anything. In the present case Nicola Tilley’s own circumstances were changed and changed, so it is alleged, to her knowledge because she was maintaining a common household with the respondent.[23]It is easy to envisage circumstances in which someone in the shoes of the defendant would be guilty of aiding and abetting Nicola Tilley’s dishonest failure to give a prompt notification of a change of circumstances to the authorities. Why, therefore, is the s.111A(1B) offence necessary where the relevant information is already in the hands of the claimant? Nicola Tilley was, so far as we are aware, perfectly well able to tell the authorities she was living in a common household with the defendant.[24]One possibility is that Parliament intended to criminalise the conduct of someone who is well aware that a change has occurred that ought to be notified to the authorities and yet stands by and does nothing perhaps, as here, benefiting indirectly from the non-disclosure. If this is the correct interpretation, how can the section be construed so as not to criminalise the conduct of say a neighbour who has no relationship with the claimant and yet knows that a change in circumstances has occurred that ought to be reported? What the legislation does not do is to require anyone other than the recipient of the benefit to notify the authorities. The answer may be that you cannot be said to allow something that you have no means of preventing. That poses the question what could the defendant have done to get Nicola Tilley to report the change?[25]Another possibility is that s.111A(1B) is only directed towards a change of circumstances of which the third party, but not the claimant herself, is aware. However that is not the way in which the subsection is phrased and to construe it in this way would in our view do violence to the language used.[26]Ordinarily a person is not guilty of a criminal offence if he merely stands by with the knowledge that a third party is committing an offence. The question that seems to us to arise in the present case is whether, in the context of a criminal non notification by the recipient of the benefit, Parliament intended to make someone in the shoes of the defendant criminally liable in circumstances where his conduct falls short of aiding and abetting an offence by the person primarily obliged to notify a change of circumstances. It can of course be said that the position is rather different where two people are living in a common household. They, rather than the authority paying the benefit, are likely to be the people who know about a material change of circumstances and it is hardly surprising that Parliament should impose criminal liability on those who deliberately fail to see that the authority obtains the relevant information. Especially, it can be said, where no offence is committed by the third party under the section unless he acts dishonestly. A case can therefore be made out that if he dishonestly does nothing and the other criteria in the subsection are met he should be criminally liable for ‘allowing’ the claimant to fail to give notification of the change.[27]In focussing on the meaning of “allows” it is necessary to consider whether the defendant should have done something, and if so what. The judge concluded that turning a blind eye and doing nothing was not enough to establish criminal liability.[28]Mr Walker, for the appellant, submits that ‘allows’ necessitates the pre-requisite knowledge and an ability to prevent, falling short of actively preventing. He argues that there is an obligation on the defendant to seek to prevent a failure to notify and that in this regard the relationship between the defendant and the recipient of the benefit is crucial. Whereas many people have the requisite knowledge, only a limited number will be in a position to prevent a failure to report a change of circumstances. Whether in any case the defendant is in such a position is a question of fact. If a third party in the shoes of the defendant is in a position to prevent the failure and does nothing about it there is a prima facie case of “allowing”. The question therefore is: what should the defendant have done?[29]The judge put this question to counsel for the Crown asking what steps the defendant should have taken to avoid criminal liability. Counsel gave the following examples, emphasising that they were only examples: i) Report his wife to the authorities; ii) Instruct her to stop or withdraw from the household; iii) Set up his own bank account.[30]The first suggestion of reporting Nicola Tilley to the authorities is not what the subsection is requires, and it would have been very simple for Parliament to have said so if this was what was intended. Indeed it is precisely what the recipient of the benefit (Nicola Tilley) is required to do when she knows of a change of circumstances effecting her entitlement. Parliament has deliberately under s.111A(1B)(d) focussed the third party’s obligation not on requiring the third party to report a change to the authorities but on getting the recipient to do so.[31]Instructing Nicola Tilley to stop receiving an amount to which she is not entitled implies that the respondent has in some way control over her. The respondent might persuade but could not compel. We do not think it would be appropriate for the law to expect him to withdraw from the household in circumstances where, if he stayed, he would not be aiding and abetting any offence by her. Finally, we cannot see that setting up his own bank account would be of any relevance or make any difference. Accordingly, no appropriate step that the defendant should take was advanced to the judge or to us other than trying to persuade Nicola Tilley to comply with her legal duty.[32]We turn back to the words in the subsection “dishonestly causes or allows.” The emphasis in the present case is, of course, on the word “allows” but it seems to us that the four words must be considered together. “Allows” plainly means something less than “causes”. The judge said it required some positive act on the part of the respondent, but it is difficult to envisage a category of positive acts that would not fall within the description “causes.” He noted the appellant’s submission that “allows” should be construed as a failure to act or at least so as to include a failure to act, but he pointed out the Crown would normally be expected to prove an actus reus and mens rea. It is not a criminal offence, for example, to stand by and do nothing to prevent an assault or the continuation of an assault. That, however, is not a very helpful analogy because the defendant in the present case must have been dishonest.[33]The Recorder considered s.5 of the Domestic Violence, Crime and Victims Act 2004 which creates the offence of causing or allowing the death of a child. The Crown relied on this as an example of Parliament imposing criminal liability on someone who has failed to act. That legislation was, however, enacted in order to deal with a very specific problem namely where a child has died in a household in which one of two adults caused the death but it was impossible on the evidence to say which. As the judge pointed out, s.5(1)(d) set out with some precision the circumstances in which a defendant would be liable if it was not his act that caused the death. No assistance is therefore to be obtained from the meaning of “allows” in this Act.[34]We were also referred to Vehicle Inspectorate v Nuttall [1999] 1WLR 629. That case was concerned with the owner of a coach business permitting drivers to exceed the maximum number of driving hours or distance. The court was concerned with s.96(11A) of the Transport Act 1968 as amended, and the words “caused or permitted the contravention”. It was held that permitting in the section meant failing to take reasonable steps to prevent contravention by drivers. Lord Steyn said at 635C:
“It is sufficient to consider the matter generally in regard to what constitutes the prohibited conduct actus reus and what is required to be proved in respect of the mental element mens rea. I deal first with the prohibited conduct. Section 96(11A) prohibits the employer of a driver from “causing” or “permitting” a driver to contravene the requirements of the applicable Community rules. Depending on the context the word “permit” is capable of bearing, on the one hand, a narrow meaning of assenting to or agreeing to or, on the other hand, a wider meaning of not taking reasonable steps to prevent something in one’s power. But I am persuaded that the second or wider meaning best matches the context.”
Lord Hobhouse of Woodborough said at 639G:
“This offence of permitting is a crime of omission which arises from the duty to act and involves the failure to perform that duty. What actual conduct will amount to the offence of permitting will be a question of fact depending on the circumstances of the particular case.”
[35]There are important differences between Nuttall and the present case. Nuttall was concerned with an employer’s duty vis a vis the actions of his employees. Secondly, the mens rea in the present case requires that the defendant acts dishonestly. The material word in, the present case is ‘allows’ rather than ‘permits’. Like ‘permits’ ‘allows’ is a word capable of a range of meanings and it has to take its meaning from its context, we do not find Nuttall of any assistance in the present case.[36]Crabtree v Fern Spinning Co. Limited (1901) 85 LT 549 was a case involving safety at work under the Factory and Workshop Act 1985. Darling J said at p552 it seemed to him that a man could not be said to allow something of which he is unaware or that which he cannot prevent. A little later he said that the defendants did not sanction or permit what had occurred. These observations seem to us to be a helpful starting point. Knowledge of a change that affects entitlement is a specific element of the offence in the present case (see s.111A(1B)(c)) and it is not in issue that the defendant had such knowledge. But was there anything the defendant could have done to make Nicola Tilley discharge her duty under s.111(1A), or to put it the other way round to prevent her from failing to give a prompt notification to the authorities of the change? The evidence does not suggest that there was. The position would be otherwise if the defendant had the means to ensure that Nicola Tilley did not report the change, for example by failing to tell her about a change in his circumstances that affected her benefit. But that is not this case.[37]The word ‘causes’ as we have said has been removed in the present case, and so we are looking at ‘dishonestly allows’. The word ‘allows’ must have some meaning that is less than ‘causes’: so, is doing nothing sufficient, or is something more required that nevertheless falls short of “causing”?[38]It may be said that the word ‘allows’ in the present section imports the approval or sanction of the defendant. The appellant submits the mere fact that they are living together in the same household is sufficient, because the offence requires the mental element of dishonesty and dishonesty can be implied from the circumstances.[39]We think the critical question is whether there was evidence of anything the defendant could have done that would have prevented Nicola Tilley’s failure to give notice, bearing in mind that the obligation to give prompt notification was hers not his. No such evidence was before the court on the agreed facts.[40]It was apparently agreed before the Recorder that it was not appropriate to look at Hansard and no reference to Hansard was made in argument in the appeal before us. However, after the conclusion of the hearing we invited written submissions from the parties on the appropriateness of obtaining assistance from Hansard as to the true construction of the section. In Thet v Director of Public Prosecutions [2007] 1 WLR 2022. Lord Phillips of Worth Matravers C.J said at p. 227 para 15:
“I would, however, question the use of Pepper v Hart [1993] AC 593 in the context of a criminal prosecution. Mr Chalk was not able to refer the court to any case in which Pepper v Hart has been used in that context. If a criminal statute is ambiguous, I would question whether it is appropriate by the use of Pepper v Hart to extend the ambit of the statute so as to impose criminal liability upon a defendant where, in the absence of the Parliamentary material, the court would not do so. It seems to me at least arguable that if a criminal statute is ambiguous, the defendant should have the benefit of the ambiguity.”
More recently in R v JTB [2009] UK HL 20 the House of Lords put weight on Parliamentary materials in concluding that Section 34 of the Crime and Disorder Act 1998 abolished not merely the presumption but the defence of doli incapax. Both Lord Phillips and Lord Brown of Eaton-Under-Heywood referred to the comparative rarity of utilising the Pepper v Hart principle.[41]We are quite satisfied that the word “allows” in s.111A(1B)(d) is not immediately clear in its meaning and while we agree that it would be inappropriate to use Ministerial statements in Hansard to conclude a wide meaning and thereby expose the defendant to criminal liability when on a narrower view he would not be liable, we think that in this case that is not the position. Observations by Baroness Hollis during the passage of the Bill through the House of Lords lend some support to the defendant’s submissions. On 6 February 2001 see Hansard HL Vol 621 Col 1116 she said that:
“The liability occurs when the third party knows that the change affects benefit and causes or allows the beneficiary not to report the change. Third parties are not responsible if they do nothing and the claimant fails to report it.”
This answer was made in response to a question whether professionals could be liable if they did not pass on information and we have some doubt therefore whether the Baroness had in mind circumstances such as those in the present case. She came back however to the point on 27 February 2001 (Hansard Vol 622 Col 1152) when she said:
“Finally, let me point out once more for the record that the offence in Clause 15 relating to “causing or allowing” a claimant to fail to notify a change of circumstances does not include third parties who merely learn of a change. To become guilty of an offence, a third party would have to be active in some way in the failure.”
This seems to us to support our view that the respondent is not criminally liable in the present case on the basis that he simply did nothing and Nicola Tilley failed to report the change. He would, as the Baroness said, have to have been active in some way in the failure and there is no evidence that he was.[42]The actus reus of the offences alleged against the respondent in each of the two offences is causing or (as the charge now stands) allowing Nicola Tilley to fail to give a prompt notification to the authorities of a change of circumstances that he knew that would effect her entitlement. The mens rea is doing so dishonestly. The actus reus is therefore allowing an act of omission by a third party. Such an actus reus is not readily to be found in the criminal law. In deciding what must be proved to establish “allowing” on the part of the respondent the wording of the subsection is important. Dishonestly causing or allowing indicates that there are two ways of committing the offence, but that in either case the respondent must have acted dishonestly. On any view “allowing” must mean something less than “causing”. As was pointed out by Cussen J in Gilbert v Gulliver [1918] VLR 185, 189 – 190 the meaning of the word “allow” may vary according to the circumstances and the class of enactment in which it is found. Conclusion[43]The change of circumstances relied on in the present case is that the defendant and Nicola Tilley were maintaining a common household. The primary obligation to report this was on Nicola Tilley as the recipient of the benefit (see s.111A(1A)). It is not suggested that the respondent did anything that “caused” her not to report this and if he had done any such thing he would probably be guilty of aiding and abetting an offence by her. In a case, as here, where Nicola Tilley was as aware as the defendant of the circumstances that needed to be reported in our view for the defendant to be liable under s.111A(1B) there had to be some action that he could have taken that would have resulted in Nicola Tilley discharging her obligation to report. As the agreed facts do not disclose anything that he could appropriately have done we think the judge was correct in the conclusions that he reached. This is not one of those cases in which the defendant unbeknown to the recipient of benefit is aware of circumstances that he knows affects the recipient’s entitlement. Accordingly the appeal is dismissed and the terminating ruling stands. We direct the defendant’s acquittal under s.61(3) of the Criminal Justice Act 2003.