Chan, R. v [2010] EWCA Crim 2596

[2010] EWCA Crim 2596Case No 201001638 A2
IN THE COURT OF APPEAL
CRIMINAL DIVISION
Venue Royal Courts of JusticeDate Friday, 6th August 2010
Strand
London, WC2A 2LL
B e f o r e:
LORD JUSTICE LAWS
MR JUSTICE MCCOMBE
MR JUSTICE KING
Between
R E G I N ACrownv
Between
CHUNG YAN CHAN
Computer Aided Transcript of the Stenograph Notes ofWordWave International LimitedA Merrill Communications Company165 Fleet Street London EC4A 2DYTel No: 020 7404 1400 Fax No: 020 7404 1424(Official Shorthand Writers to the Court)
Mr N Sekhon appeared for Appellant
J U D G M E N T
[1]MR JUSTICE KING: This is an appeal against a sentence with the leave of the single judge. On 1st February 2010, at Doncaster before Her Honour Judge Davies, the appellant pleaded guilty to an offence of permitting premises to be used for producing a Class B controlled drug, namely cannabis. On that day he was facing trial on an indictment charging him with a count of producing cannabis. The indictment was amended to add a count to which he then pleaded guilty. The judge, in passing sentence, expressly stated that this count was being added to reflect what the appellant had always stated had been his involvement in the case, and the judge said therefore there would be "appropriate credit for his guilty plea". A verdict of not guilty was entered on the production count. We agree with Mr Sekhon on behalf of the appellant, that this meant that the appellant was entitled to significant, if not maximum, credit for his guilty plea, albeit it had been entered at a late stage in the chronology.[2]On 5th March 2010 the appellant was sentenced to five years' imprisonment, credit being given for the 21 days spent on remand. A confiscation order was made under the Proceeds of Crime Act in the sum of £10,000. An order was made for forfeiture, disposal and destruction of the drugs.[3]On the same occasion a co-accused, Yan Chen, who had previously pleaded guilty to the production count, was sentenced to three years' imprisonment. He had pleaded on the basis that his involvement in the production had been that of a gardener.[4]The appellant is 58 years of age. Before these matters he was, in effect, a man of good character and was so treated by the court. A number of supportive character references were before the court below and are before us today.[5]The circumstances of his offending are these. On 22nd June 2009 police officers executed a search warrant at the Dragon Springs Trading Estate in Conisborough, South Yorkshire. There was on the site a large warehouse in which the police discovered a very substantial operation for the growing and production of cannabis. The judge described it as sizeable and a sophisticated operation which had been in force for about six months. There were a number of partitioned rooms adapted for the growing of cannabis. A total of 5,547 cannabis plants were recovered in various stages of growth. The potential yield from the plants was 109 kilograms of skunk cannabis with a potential street value of over £1 million. A living space, in the form of a kitchen, bathroom and bedroom, had been created. A number of people had been living there, including the co-accused Chen, the gardener. The front of the premises were covered by CCTV, which was linked to a monitor in the living quarters of the factory.[6]The warehouse was owned by the appellant. He himself lived on site in a bungalow overlooking the warehouse. There was within the warehouse a vast amount of electrical equipment used to grow the cannabis, including lighting, fans, extractor units and power packs. The electricity supply to the warehouse had been diverted from one of the rooms in the appellant's own home. The electricity meter had been bypassed and cables had been routed underground and over other times in the yard into the factory. The water required for the plants came from a pipe attached to an outdoor tap at the bungalow.[7]The appellant was not present at the start of the search but he arrived during its course and was arrested. When interviewed he denied knowing cannabis was growing in the factory. He said that in around March 2009 he had been approached by two Chinese men who wanted to use the factory for storage. He had agreed a rent of £2,000 per month, which they paid in cash. He did not know their names. He fully accepted that he lived in the bungalow from where the electricity and water was being supplied, but stated that he knew nothing else about that. The judge, in passing sentence said, however, that she found it impossible to accept his account that he was unaware of anything that had been going on in the warehouse and that he thought the warehouse was simply being used for storage. We have sympathy with the judge in this regard. She referred to the photographs showing the proximity of the appellant's property to the factory. Water was being diverted from a tap at the back of his home. As the judge said, it was obvious to the court looking at the photographs that the appellant must have been aware that something was happening with the electricity.[8]The judge did accept that the background to the appellant's involvement had been financial difficulty owing to his business collapsing and massive debts accruing. This is a matter which has been emphasised on his behalf in the written submissions. Evidently his indebtedness to the bank was in excess of £250,000. It appears that the appellant, since moving to the United Kingdom in 1971, had built up a succession of businesses, so that by 2007 he was running a successful business in noodle production business and was providing well for his family. Subsequently, however, as a result of flooding, which had destroyed all his dry stock and all his equipment and machinery, for which he had no insurance cover, the business folded. We understand further that a restaurant he was running ceased trading in March 2009. By that date, on any view, he was in considerable financial trouble. It was no doubt with grateful thanks that he accepted the offer from the two unknown Chinese men to rent out his flat for £2,000 a month. It may also be true, as the appellant said to the probation officer, that in April 2009, when he was walking in his own yard close to the warehouse, he was warned off by those associated with the men and told that if other people knew about the warehouse he would be killed.[9]This all said, however, it has to be remembered that by pleading guilty to the offence he did the appellant was admitting knowingly permitting the premises to be used for the production of drugs. He cannot have been, as he seems to have suggested at various times, in complete ignorance of the illegal purpose for which the premises were being used.[10]In her sentencing remarks the judge described the culpability of the appellant and that of his co-accused in terms which made clear the judge regarded the appellant as having accepted that he had played an important part in the drug operation, described by her as very significant, sophisticated and commercial. The judge said that the appellant and the co-accused had each played an important, though separate, role in that operation. She clearly, however, regarded the appellant as having played the more important role. As regards the appellant, the judge said this:
"... more importantly, in your case, Chung Yan Chan, without this factory/warehouse, there would have been no home for this operation. You were well-known in the community as somebody involved in the food business and so you had a legitimate reason, to the outside world, for having this property."
Further into her remarks

the judge announced the sentence of five years with these words:

"As I've said, in your case in particular, you provided the means with which this operation got off the ground and without people like you, such operations would not."
[11]Given what we have said as to the circumstances in which the appellant had entered his plea of guilty, this sentence must represent a starting point after trial of some seven years or so.[12]We turn to the grounds of appeal. The primary point taken is that the sentence passed by the judge did not properly reflect the nature of the offence to which the appellant had pleaded guilty, namely that of permitting premises to be used for the production of cannabis, as distinct from that of being involved in production.[13]We accept that it is clear that the circumstances in which the count to which the appellant pleaded guilty had been added on the day of trial, and the verdict of not guilty was entered on the original count, that the Crown were accepting, certainly by the day of sentence, that the appellant had not been involved in the production of the cannabis as such. This is further demonstrated by the manner in which the proceedings for a confiscation order were resolved. The order made by the court, with the agreement of both parties, was in the sum of £10,000. This was to represent the rent he had received. In other words, it was agreed by the Crown and endorsed by inference by the court in making the order, that the appellant's benefit from the criminal conduct to which he had pleaded guilty was restricted solely to the rent he had received for the premises and did not include anything to do with the fruits of the operation taking place inside.[14]The judge, in passing the sentence she did, relied upon the guidance given by this court in R v Xu and others [2007] EWCA Crim 3129. She described this authority as detailing the hierarchy of those involved in the offences of the kind with which she was dealing. She referred to other authorities in which this guidance had been applied.[15]This court in Xu was expressly dealing with the appropriate level of sentencing in cases of "large scale cultivation and production of cannabis", and did so by distinguishing between categories of offenders according to their level of involvement in a particular operation, and emphasising that starting points within any particular category would vary according to the level of production and the value of the cannabis involved. The court described the usual hierarchy of the level above a worker as being managers, such as those making arrangements for the plants to be brought in and the crop to be distributed, followed by organisers, those who played a part in setting up the operation by obtaining premises, workers and equipment and so forth, and then controllers, those who controlled a substantial number of such operations. The court, although emphasising it was not a guideline judgment, indicated sentencing brackets for those within the hierarchy so identified. For managers the starting point was said to be somewhere between three and seven years, depending on the level of their involvement and the value of the cannabis being produced.[16]The submission made on behalf of the appellant is that this guidance was aimed at those actually involved in the production of the drug, and the appellant was not so involved and did not fit into any of the roles described by this court. Hence, it is submitted the guidance should not have been followed so closely by the judge. The submission is made that the level of sentence passed suggests the appellant was being sentenced as if he was closely involved in the drug operation as a manager, but that this was a wrong approach given the nature of the offence to which he pleaded guilty.[17]It is further said that the sentence did not adequately reflect the personal mitigation, particularly the specific factors that had led the appellant to become involved, his age, his lack of any relevant antecedent history and his character.[18]We have been ultimately persuaded by these submissions to a degree. The offence to which he pleaded guilty, namely permitting premises to be used for the production of a controlled drug, has the same maximum sentence as that attaching to the offence of production, which in the case of a Class B drug such as cannabis is 14 years. The judge was fully entitled to regard the appellant's offending as not necessarily being any less serious as someone involved in production, and, as we have said, by pleading to the offence he did the appellant was admitting knowledge that the premises were to be used for such production, and the judge was equally right to observe that without the provision of the premises the operation would not have got off the grounds. However, we also accept that the guidance of this court in Xu does not deal expressly with the appropriate sentencing bracket for those who permit their premises to be used for producing a drug, as distinct from those involved in actual production.[19]The relative culpability of such a person, compared to those involved in the actual operation of production of cannabis of a large scale kind with which this case is concerned, must necessarily depend in part upon the degree to which the defendant was aware of the scale of the operation and the extent to which he was benefiting from an involvement in that operation himself. In the particular circumstances of this case, where the court itself acknowledged that the count to which the appellant had pleaded guilty was designed to reflect his actual involvement as distinct from that reflected in the count of production, and where the appellant's benefit for the purpose of the confiscation proceedings was restricted to that of the receipt of rent, we consider there is merit in the submission that the judge was wrong to sentence the appellant, as she appears to have done, on the basis that he had played a part in the operation itself. Although the appellant patently knew more about what was going on in his warehouse than he was originally prepared to concede, and has shown throughout, as noted in the pre-sentence report, a tendency to minimise his responsibility, we accept it may well be the case that he was not aware of the full scale of the operation. Moreover, as again assessed by the author of the pre-sentence report, in addition to financial motivation, the appellant's fear for his own safety and that of his family may well have contributed to his continuing involvement in the offence. A custodial sentence was, however, still inevitable in this case and the judge was entitled to consider the need to include an element of deterrence.[20]In our judgment, taking into account the personal mitigation available to the appellant and his plea of guilty in the circumstances in which it came to be entered, the proper sentence should have been one of three and a half years. We accordingly quash the sentence of five years and substitute a sentence of three and a half years' imprisonment. To this extent this appeal is allowed.