Constantine, R. v [2010] EWCA Crim 2406

[2010] EWCA Crim 2406

Case No 201000851 A7

IN THE HIGH COURT OF JUSTICE

COURT OF APPEAL (CRIMINAL DIVISION)

ON APPEAL FROM PLYMOUTH CROWN COURT

His Honour Judge LEEMING Q.C.

S20090022

Venue Royal Courts of Justice, Strand, London, WC2A 2LL

Date 26/10/2010

Before

LORD JUSTICE AIKENS

MR JUSTICE OPENSHAW

HIS HONOUR JUDGE JACOBS

(Sitting as a Judge of the Court of Appeal Criminal Division)

Between

ReginaRespondent

Mark Anthony CONSTANTINEAppellant

Mr Matthew Dors for Prosecution

Mr Llewellyn Sellick for Defendant

Hearing Hearing dates : Tuesday 12th October 2010

Judgment

[1]This is the judgment of the court to which all have contributed, in particular The Recorder of Norwich.

[2]On 26 January 2009 the appellant appeared before Plymouth Magistrates Court where he admitted 10 offences of applying a false trade description of goods contrary to the Trade Descriptions Act 1968 and was committed for sentence. He asked for 12 similar offences to be taken into consideration.

[3]On 5 March 2009 he appeared before his Honour Judge Leeming Q.C. at Plymouth Crown Court for sentence. This Court has been provided with a transcript of those proceedings. The prosecution opened the facts of the case. The opening described how the appellant purchased a number of vehicles at auction and then reduced or caused someone else to reduce the mileage displayed on the vehicles’ odometers. In some cases the reduction was by as much as 50%. The vehicles were then sold on to purchasers whose means were limited. The discrepancies were found simply by a later search of the Vehicle Operator Services website. This is a government site which sets out the actual mileage recorded at the time of the last Ministry of Transport test. The opening did not set out the appellant’s total profit from these activities but as the court was dealing with a total of 22 vehicles it was obviously very substantial.

[4]Counsel’s opening of the facts concludes with these words:

“your Honour, the defendant pleaded guilty on the second occasion in the magistrates court on 26 January. I do have a figure for costs as well should your Honour consider that to be appropriate. Your Honour unless I can assist you any further in going through in any more detail the charges?”

. There was no specific response from the judge to this form of wording which is so often used when counsel for the prosecution has finished opening the facts at a sentencing hearing. The judgethen heard mitigation and passed sentence.

[5]In doing so, Judge Leeming Q.C. set out the brief facts, acknowledged that the appellant had tried to compensate many of those who had been deceived. He then sentenced the appellant to concurrent terms of six months immediate imprisonment. No further mention was made of the question of costs. No one mentioned the relevant statutory provisions, in particular sections 13, 14 and 15 of the Proceeds of Crime Act 2002, a matter to which we will return later.

[6]Just as the appellant was about to go into the cells the prosecution raised the question of confiscation. There had been some priordiscussion about a resolution of the potential confiscation proceedings. There was then a short adjournment but the parties were unable to reach an agreement. So a confiscation timetable was set. The prosecution had already served its own statement under section 18 of the Proceeds of Crime Act 2002. The appellant was ordered to serve an affidavit disclosing his means by 2nd April 2009. The prosecution was ordered to serve its response by 14th May and the defendant any further response by 11 June 2009. It was accepted that the case would haveeither settled by mid May or go for a full hearing. In that event a provisional date of 26 June 2009 was settled upon.

[7]In fact that hearing took place on 10 December 2009. A dispute over the total “benefit” obtained by the appellant for the purposes of the 2002 Act was resolved after a short adjournment and a figure of £67,710 was agreed. There was then a further delay while the appropriate forms were completed. The “available amount” is not specifically referred to in the transcript but the Judge remarks at page 12 A that the “recoverable assets” exceeded that sum and the judge therefore confiscated the £67,710 gave six months to pay and imposed a default term of two years imprisonment. It transpired in later proceedings that the appellant had assets of £230,000.

[8]At that point on 10 December 2009, just as the court was about to adjourn, prosecution counsel raised the question of costs again. Some schedules were handed in. It became clear that, at that confiscation hearing, the prosecution was seeking not only the costs of confiscation proceedings but also the costs of the original investigation culminating in sentence on 5 March 2009. That, it will be recalled, was the occasion on which prosecution counsel had mentioned he had a figure for costs, although no actual figure was, in fact, given.

[9]The appellant’s counsel conceded at that hearing that a costs order of £2,500 for the confiscation proceedings could be made against the appellant. No such concession was made in relation to a claim for the other costsfor the proceedings which took place up to 5 March 2009, which aredescribed in the transcript as being just short of £9,000. The applicant’s counsel objected initially on the basis that if costs were to be awarded they should have been awarded at the time the appellant was sentenced to his term of imprisonment. The matter was then adjourned. Once again no reference was made by either counsel or the judge to sections 13, 14 and 15 of the Proceeds of Crime Act 2002, but the decision to adjourn was a deliberate and specific one. The judge ordered that there be an exchange offurther skeleton arguments on the question of the Crown’s right to an order for this element of the costs. The judge said that the parties would have to come back to argue the point in 2010. On 4 February 2010, that is almost a year after the appellant had been originally sentenced and about seven weeks after the confiscation order had been made, the matter was concluded when the judge held that the Crown could recover costs in the total sum of £8,992.97.

[10]The Judge’s conclusion was that section 18 of the Criminal Costs Act 1985, which provided for such costs to be paid by the accused to the prosecutor as the Court considered just and reasonable did not seem to provide any limitation on time. The prosecution had acceptedthat this provision obviously could not be open ended, but submittedthat costs could be awarded at any stageuntil the conclusion of the case. In the circumstances of this case that meant the conclusion of the confiscation proceedings. The logic was that at such a point the full means of the appellant would be apparent That argument necessarily proceeded on the basis that implicitly the question of costs of the proceedings generally (as opposed to those relating to confiscation) had been specifically reserved on 5 March 2009 to the conclusion of the subsequent confiscation proceedings.

[11]The defence submission had been that the award of costs had to be made in the course of the proceedings which culminated in the sentence for the substantive offences. After 56 days from sentence the court would be functus officio. There could only be an appeal, which would not arise in this case as no costs order had been made.

[12]The single judge in giving leave to appeal very succinctly and clearly focused what had become an unstructured and diffuse argument below. He said the questions were whether the Judge: 1. could properly, and if so, 2. on the facts, in particular in the light of the immediate custodial sentence, did leave over until the conclusion of the confiscation proceedings in question of the costs of the case as a whole (apart from the confiscation proceedings).

[13]We will deal with a single judge’s two questions in that order.

[14]The starting point is to examine the provisions of the Proceeds of Crime Act 2002 which govern the procedure relating toconfiscation hearings. As we have already note,unfortunately that Act was not referred to in the course of the discussions at any of the hearings before the judge. The relevant sections are sections 13, 14 and 15. Counsel for the appellant accepted before us that he had not particularly concentrated on those sections when preparing his argument for the hearing of this appeal.

[15]Those sections provide:

“13. Effect of order on court's other powers (1) If the court makes a confiscation order it must proceed as mentioned in subsections (2) and (4) in respect of the offence or offences concerned. (2) The court must take account of the confiscation order before – (a) it imposes a fine on the defendant, or (b) it makes an order falling within subsection (3) (3) These orders fall within this subsection – (a) an order involving payment by the defendant, other than an order under section 130 of the Sentencing Act (compensation orders); (b) an order under section 27 of the Misuse of Drugs Act 1971 (forfeiture orders); (c) an order under section 143 of the Sentencing Act (deprivation orders); (d) an order under section 23 of the Terrorism Act 2000 (forfeiture orders). (4) Subject to subsection (2), the court must leave the confiscation order out of account in deciding the appropriate sentence for the defendant. (5) Subsection (6) applies if - (a) the Crown Court makes both a confiscation order and an order for the payment of compensation under section 130 of the Sentencing Act against the same person in the same proceedings, and (b) the court believes he will not have sufficient means to satisfy both the orders in full. (6) In such a case the court must direct that so much of any sums recovered under the confiscation order; and the amount it specifies must be the amount it believes will not be recoverable because of the insufficiency of the person's means. 14. Postponement (1) The court may - (a) proceed under section 6 before it sentences the defendant for the offence (or any of the offences) concerned, or (b) postpone proceedings under section 6 for a specified period. (2) A period of postponement may be extended. (3) A period of postponement (including one as extended) must not end after the permitted period ends. (4) But subsection (3) does not apply if there are exceptional circumstances. (5) The permitted period is the period of two years starting with the date of conviction. (6) But if – (a) the defendant appeals against his conviction for the offence (or any of the offences) concerned, and (b) the period of three months (starting with the day when the appeal is determined or otherwise disposed of) ends after the period found under subsection (5), the permitted period is that period of three months. (7) A postponement or extension may be made – (a) on application by the defendant; (b) on application by the prosecutor; (c) by the court of its own motion. (8) If - (a) proceedings are postponed for a period, and (b) an application to extend the period is made before it ends, the application may be granted even after the period ends. (9) The date of conviction is – (a) the date on which the defendant was convicted of the offence concerned, Or (b) if there are two or more offences and the convictions were on different dates, the date of the latest. (10) References to appealing include references to applying under section 111 of the Magistrates' Courts Act 1980 (statement of case). (11) A confiscation order must not be quashed only on the ground that there was a defect or omission in the procedure connected with the application for or the granting of a postponement. (12) But subsection (11) does not apply if before it made the confiscation order the court – (a) imposed a fine on the defendant; (b) made an order falling within section 13(3); (c) made an order under section 130 of the Sentencing Act (compensation orders). 15. Effect of postponement (1) If the court postpones proceedings under section 6 it may proceed to sentence the defendant for the offence (or any of the offences) concerned. (2) In sentencing the defendant for the offence (or any of the offences) concerned in the postponement period the court must not – (a) impose a fine on him, (b) make an order falling within section 13(3), or (c) make an order for the payment of compensation under section 130 of the Sentencing Act. (3) If the court sentences the defendant for the offence (or any of the offences) concerned in the postponement period, after that period ends it may vary the sentence by – (a) imposing a fine on him, (b) making an order falling within section 13(3), or (c) making an order for the payment of compensation under section 130 of the Sentencing Act. (4) But the court may proceed under subsection (3) only within the period of 28 days which starts with the last day of the postponement period. (5) For the purposes of – (a) section 18(2) of the Criminal Appeal Act 1968 (time limit for notice of appeal or of application for leave to appeal), and (b) paragraph 1 of Schedule 3 to the Criminal Justice Act 1988 (time limit for notice of application for leave to refer a case under section 36 (of that Act), the sentence must be regarded as imposed or made on the day on which it is varied under subsection (3). (6) If the court proceeds to sentence the defendant under subsection (1), section 6 has effect as if the defendant's particular criminal conduct included conduct which constitutes offences which the court has taken into consideration in deciding his sentence for the offence or offences concerned. (7) The postponement period is the period for which proceedings under section 6 are postponed.” (1) If the court makes a confiscation order it must proceed as mentioned in subsections (2) and (4) in respect of the offence or offences concerned. (2) The court must take account of the confiscation order before – (a) it imposes a fine on the defendant, or (b) it makes an order falling within subsection (3) These orders fall within this subsection – (a) an order involving payment by the defendant, other than an order under section 130 of the Sentencing Act (compensation orders); (b) an order under section 27 of the Misuse of Drugs Act 1971 (forfeiture orders); (c) an order under section 143 of the Sentencing Act (deprivation orders); (d) an order under section 23 of the Terrorism Act 2000 (forfeiture orders). (4) Subject to subsection (2), the court must leave the confiscation order out of account in deciding the appropriate sentence for the defendant. (5) Subsection (6) applies if - (a) the Crown Court makes both a confiscation order and an order for the payment of compensation under section 130 of the Sentencing Act against the same person in the same proceedings, and (b) the court believes he will not have sufficient means to satisfy both the orders in full. (6) In such a case the court must direct that so much of any sums recovered under the confiscation order; and the amount it specifies must be the amount it believes will not be recoverable because of the insufficiency of the person's means. (1) The court may - (a) proceed under section 6 before it sentences the defendant for the offence (or any of the offences) concerned, or (b) postpone proceedings under section 6 for a specified period. (2) A period of postponement may be extended. (3) A period of postponement (including one as extended) must not end after the permitted period ends. (4) But subsection (3) does not apply if there are exceptional circumstances. (5) The permitted period is the period of two years starting with the date of conviction. (6) But if – (a) the defendant appeals against his conviction for the offence (or any of the offences) concerned, and (b) the period of three months (starting with the day when the appeal is determined or otherwise disposed of) ends after the period found under subsection (5), the permitted period is that period of three months. (7) A postponement or extension may be made – (a) on application by the defendant; (b) on application by the prosecutor; (c) by the court of its own motion. (8) If - (a) proceedings are postponed for a period, and (b) an application to extend the period is made before it ends, the application may be granted even after the period ends. (b) on application by the prosecutor; (a) proceedings are postponed for a period, and (b) an application to extend the period is made before it ends, the application may be granted even after the period ends. (9) The date of conviction is – (a) the date on which the defendant was convicted of the offence concerned, Or (b) if there are two or more offences and the convictions were on different dates, the date of the latest. (10) References to appealing include references to applying under section 111 of the Magistrates' Courts Act 1980 (statement of case). (11) A confiscation order must not be quashed only on the ground that there was a defect or omission in the procedure connected with the application for or the granting of a postponement. (12) But subsection (11) does not apply if before it made the confiscation order the court – (a) imposed a fine on the defendant; (b) made an order falling within section 13(3); (c) made an order under section 130 of the Sentencing Act (compensation orders). (a) imposed a fine on the defendant; (b) made an order falling within section 13(3); (c) made an order under section 130 of the Sentencing Act (compensation orders). (c) made an order under section 130 of the Sentencing Act (compensation orders). (1) If the court postpones proceedings under section 6 it may proceed to sentence the defendant for the offence (or any of the offences) concerned. (2) In sentencing the defendant for the offence (or any of the offences) concerned in the postponement period the court must not – (a) impose a fine on him, (b) make an order falling within section 13(3), or (c) make an order for the payment of compensation under section 130 of the Sentencing Act. (b) make an order falling within section 13(3), or (c) make an order for the payment of compensation under section 130 of the Sentencing Act. (3) If the court sentences the defendant for the offence (or any of the offences) concerned in the postponement period, after that period ends it may vary the sentence by – (a) imposing a fine on him, (b) making an order falling within section 13(3), or (c) making an order for the payment of compensation under section 130 of the Sentencing Act. (b) making an order falling within section 13(3), or (c) making an order for the payment of compensation under section 130 of the Sentencing Act. (4) But the court may proceed under subsection (3) only within the period of 28 days which starts with the last day of the postponement period. (5) For the purposes of – (a) section 18(2) of the Criminal Appeal Act 1968 (time limit for notice of appeal or of application for leave to appeal), and (b) paragraph 1 of Schedule 3 to the Criminal Justice Act 1988 (time limit for notice of application for leave to refer a case under section 36 (of that Act), the sentence must be regarded as imposed or made on the day on which it is varied under subsection (3). (6) If the court proceeds to sentence the defendant under subsection (1), section 6 has effect as if the defendant's particular criminal conduct included conduct which constitutes offences which the court has taken into consideration in deciding his sentence for the offence or offences concerned. (7) The postponement period is the period for which proceedings under section 6 are postponed.”

[16]We should also note thatRule 58.2 of the Criminal Procedure Rules 2005 states: “The Crown Court may grant a postponement under section 14 (1) (b) of the proceeds of Crime Act 2002 without a hearing. That power was confirmed by this court in the case of CrownProsecution Service v Neish

[2010] EWCA Crim. 1011

[17]Section 13 (2) of the 2002 Act therefore requires a court to take account of the confiscation order before it makes any order falling within section 13(3). In other words, an order falling within section 13(3) cannot effectively be made until the court has determined all the matters necessary for it to be able to make a confiscation order. Orders covered by section 13(3)include, by paragraph (a) “any order involving payment by the defendant”.

[18]Once we had drawn sections 13 – 15 to Mr Sellick’s attention and he had had an opportunity to consider them, his submission to us was that section 13(3)(b) should be given a restrictive interpretation. He accepted that “any order involving payment by the defendant” would encompass an order for costs that was made against a defendant. But he submitted that the wording did not include a situation where, either expressly or impliedly, the judge had made no order for costs against a defendant. Therefore, if upon the correct analysis of what had happened on 5 March 2009, the judge had impliedly made no order as to costs of the proceedings (excluding the confiscation proceedings) against the appellant, then that was a valid order because it was not within the restriction imposed by section 13(2) and (3).

[19]We do not accept that argument. First, we are quite satisfied that the correct interpretation of section 13(2) and 13(3)(a) is that a court must take account of a confiscation order before making any order “involving payment by the defendant”. That wording must embrace both an order that the defendant pays costs and one that he pay nothing. Either way the order “involves” payment by the defendant in the sense that it affects or concerns payment. This means that the court must take account of a confiscation order beforemaking an order “involving payment by the defendant” of costs relating to all of the proceedings that have gone on so far.

[20]Section 14 provides for the postponement of proceedings leading to the making of a confiscation order. Section 15(1) permits the court to proceed to sentence a defendant for the offences concerned if it postpones making a confiscation order under section 6 of the 2002 Act. But if it does so, then section 15(2)prohibits the sentencing court from making an order which comes within section 13(3) in a case in which postponement has been ordered. It therefore follows that if a court postpones the making of a confiscation order in accordance with section 14 of the 2002 Act, the court must not make an order falling within section 13(3) of the Act. This means that the court must not make an order “involving payment” by the defendant. Thus, for the reasons we have given above, this means that when there is a postponement of the making of a confiscation order under section 14, the court must not make any costs order affecting the defendant.

[21]In view of the effect ofsections 13, 14 and 15 of the Proceeds of Crime Act 2002 and in view of the decision of the court on 5 March 2009 to postpone the making of a confiscation order, the court was constrained not to make any order concerning costs at all. In not making any order the judge (albeit perhaps unwittingly) acted correctly.

[22]We would add for good measure that it is impossible to say that this appellant was given any expectation that he would not ultimately have to meet a costs order. On 5 March 2009 the prosecution applied for costs. No decision was made one way or the other. It is unfortunate that the prosecution application did not refer to the relevant legislation or that it was not referred to during any of the lengthy discussions which followed but at no point was any indication given that the Court would not ultimately make an order against the appellant for the costs of all the proceedings at the postponed hearing as it was plainly entitled to do so.

What did the judge do in fact?

[23]We have already recorded what the judge did on 5 March 2009. He made no order as to costs at all. Subsequently it seems that the original date of the 26 June 2009 which had been set for the full confiscationhearing was put back to 10 December 2009. It is unclear why this was done. However, it is clear from the terms of Section 14 of the 2002 Act that postponement of prosecution proceedings can take administratively.

[24]On 10 December 2009 the confiscation order was made. At that point the confiscation proceedings were therefore concluded. That was, in the words of section 15(4), the “last day of the postponement period”. Section 15(4) of the 2002 Act requires that any order falling within section 13(3) must be made within 28 days of the last day of the postponement period. In this case however the decision as to part of costs of the proceedings as a whole was specifically adjourned by the judgeto a date outside the 28 day period to enable legal argument to take place.

[25]It is argued by Mr Sellick that because the costs order under challenge was only made after the further hearing before Judge Leeming Q.C. on 4 February 2010, which was more than 28 days after the last day of the postponement period (ie. more than 28 days after 10 December 2009), the costs order inrespect of the proceedings other than the confiscation proceedings was invalid. He emphasises the mandatory terms of section 15(4) of the 2002 Act.

[26]This argument caused us some concern. The wording of section 15(4) is indeed mandatory. In R v Menocal

[1980] AC 598

the House of Lords held that the Crown Court had no power to extend the 28 day period in which it could vary or rescind a sentence. It could be argued that the same principle should apply, by analogy, to section 15(4) of the 2002 Act. The actual reason for the adjournment was to enable both sides to research the matter and to find a date convenient to all parties on which the matter could be argued. But it is fair to say (as both counsel frankly admitted before us)that no one (including the judge) had the terms of section 15(4) in mind when the hearing on costs was adjourned on 10 December 2009.

[27]We have concluded that the correct analysis is as follows: first,it is established by R v Hayden

(1974) 60 Cr. App. R 304

that an order that a defendant should pay all or part of the prosecution costs is itself a part of a sentence, because it is an order made by the court when dealing with an offender in respect of his sentence. Secondly, it is confirmed by the cases of R v Annesley

(1975) 2 Cr.App.R 113

and R v Gordon

[2007] 1 WLR 2117

, (see particularly paragraph 44 of the judgment of Sir Igor Judge P in the latter case) that the court has the power to adjourn the whole or a part of the exercise of passing a sentence if it is necessary to do so.

[28]R v Gordon was not concerned with the present question but with the issue of whether the court could deal with the correct calculation of time spent in custody on remand for the purposes of section 240 of the Criminal Justice Act2003 more than 28 days after sentence had been pronounced by the court, when section 155 of the Powers of Criminal Court (Sentencing) Act 2000 only gave the court 28 days after pronouncement in which to vary or rescind a sentence. In R v Gordon, Sir Igor Judge said (at paragraph 46) that the issue of the correct calculation of “remand time” could be dealt with outside the 28 day period because that exercise was no more than the final implementation of its order as to sentence and represented the conclusion of an adjourned part of the sentencing process. In our view the principle stated by Sir Igor Judge must apply, by parity of reasoning, to the present problem.

[29]Therefore, we conclude thirdly, that the action of the judge in adjourning the issue of costs on 10th December 2009 meant only that headjourned the final stage of the sentencing process for a period of about three weeks outside the 28 day period in order to allow legal argument about the appropriateness to make part of a costs order. At the subsequent hearing on 4 February 2010 the costs were awarded in the full sum requested.

Conclusions

[30]Accordingly, we make the following conclusions about the procedure from the hearing of 5 March 2009 until the costs order was made on 4 February 2010. First, on the correct interpretation of sections 13 – 15 of the Proceeds of Crime Act 2002, the judge did not have the power to make a costs order against the appellant on 5 March 2009 once the prosecution instigated confiscation proceedings and the making of a confiscation order was postponed. Secondly, the judge was obliged to take account of the confiscation order before he made any order for costs against the defendant(including costs of the proceedings other than the confiscation proceedings). Therefore, thirdly, even though the prosecution impliedly asked the judge to make a costs order against the appellant at the hearing on 5 March 2009, the judge was, albeit perhaps unwittingly, correct not to make any order at that stage. Fourthly, we find that the judge plainly did not, implicitly, make an order that the appellant should not pay costs of the proceedings. Fifthly, although the judge should, in the normal course of things, have made the costs order at the end of the confiscation proceedings (as postponed) on 10 December 2009, a costs order could be made up to 28 days after that time. Sixthly, the judge had the power to adjourn part of the sentencing exercise, viz. the issue of costs of the proceedings other than the confiscation proceedings, on 10 December 2009, if it was necessary to do so. Seventhly, on a proper analysis of the facts, all the judge did on 10 December 2009 was to exercise his power adjourn the final element in the sentencing exercise that the judge had to carry out, viz. whether or not to make a costs order as to the proceedings other than the confiscation proceedings. He had the power to adjourn that issue for more than the 28 day period mentioned in section 15(4) of the 2002 Act. Therefore, finally, the judge had the power to make the costs order he did on 4 February 2010.

[31]It is not contended by the appellant that he had no means to pay.

[32]For these reasons this appeal is dismissed.