Bestel & Ors v R [2013] EWCA Crim 1305

“(4) A person benefits from conduct if he obtains property as a result of or in connection with the conduct”

“29. We nevertheless think that we should make clear the general approach of this court, over many years, to change of law cases. An extension of time will not be granted routinely in such a case simply because the law has changed. It will be granted only if substantial injustice would otherwise be done to the defendant, and the mere fact of change of law does not ordinarily create such injustice. Nor is the case where an extension will be refused limited to where, if the law had been correctly understood at the time of the proceedings in the Crown Court, a different charge or different procedure might well have left the defendant in a similar position to that in which he now finds himself. The line of authority setting out this court’s approach culminates in R v Cotterall and Fletcher [2007] EWCA Crim 2016, [2008] 1 Cr App R 7, where the judgment was given by Sir Igor Judge P, as he then was. But that line of authority includes similar pronouncements by successive Lords Chief Justice from Lord Lane CJ onwards. An early example is R v Mitchell [1977] 65 Cr App R 185 in which Lane LJ (as he then was) expressly approved the decision of this court in R v Ramsden [1972] Crim LR 547. There, a defendant who had been convicted of dangerous driving before Gosney [1971] 55 Cr App R 502 had held that fault was a necessary ingredient of the offence, was refused leave to appeal out of time after the latter decision had been published. The court observed that alarming consequences would flow from permitting the general re-opening of old cases on the ground that a decision of a court of authority had removed a widely held misconception as to the prior state of the law on which the conviction on which it was sought to appeal had been based. No doubt otherwise everyone convicted of dangerous driving over a period of several years could have advanced the same application. A similar proposition was recently adumbrated by the Supreme Court of Ireland in A v Governor of Arbour Hill Prison [2006] IEFC 45 where the court held that absolute retro-activity would lead to “dysfunctional effects in the administration of justice”

“18(1) A person who wishes to appeal under this part of this Act to the Court of Appeal, or to obtain the leave of that court to appeal, shall give notice of appeal or, as the case may be, notice of application for leave to appeal, in such manner as may be directed by rules of court. (2) Notice of appeal, or of application for leave to appeal, shall be given within 28 days of the date of the conviction, verdict or finding appealed against, or in the case of appeal against sentence, from the date on which sentence was passed or, in the case of an order made or treated as made on conviction, from the date of the making of the order. (3) The time for giving notice under this section may be extended, either before or after it expires, by the Court of Appeal.”

“Though power is given by the same section [section 7] to extend this time, except in the case of sentence of death, it is clear that the Act, the practice and the rules of this court all contemplate that the application for appeal should be made within 10 days. … as was laid down by Lord Alverstone in the case of E. Rhodes 74 J. P. 380: 5 Cr. App. R. 35: 1910, it must not be understood that an extension of time will be granted as a matter of course; the court will require substantial reason to be advanced before they will grant such an extension … In this case it is clear that the appellant never thought that he had any ground for appealing until he heard that Spinney’s conviction had been quashed. In itself the mere fact that a fellow prisoner’s conviction has been quashed is no ground for extending the time for appealing of another prisoner. In the present case it is to be observed that there was a clear distinction between the appellant’s case and Spinney’s case, and considering the particular part played by this appellant the jury might well have convicted him, at any rate, of false pretences.”

“… it being rule and practice of this court not to grant any considerable extension of time unless we are satisfied upon the application that there are such merits that the appeal would probably succeed, we are quite unable to say in this case that there was no evidence upon which these applicants could properly be convicted on some, at least, of the counts of this indictment. We, therefore, do not grant the applications for an extension of time.”

“He submits that while the Court of Appeal has power to extend the 28 day time limit for applying for leave to appeal, the court has traditionally been reluctant to do so save where the extension sought is relevantly short and good reason is shown for the failure to apply in time. In the ordinary run of cases the extension sought is a matter of days and the application is usually made because of some mishap or misunderstanding or administrative delay in the settlement of documents. Such indulgence is not traditionally shown where the defendant, acting on advice has pleaded guilty or where he has taken a conscious decision not to appeal. In our view the submission is well founded and the court should be satisfied that good reason exists for granting leave to appeal out of time in circumstances such as the present.”

“This seems to us therefore to be the very rare case where the court should exercise its undoubted discretion to allow the extension of time and grant leave to appeal against conviction. We wish to make it clear, however, that this is not to be taken as an invitation to all and sundry who have been convicted of this type of offence to present application to this court for leave to appeal out of time, because they will not be greeted with very much enthusiasm.”

“Counsel goes on to submit that a change in the law since the date of conviction or plea of guilty has not usually been regarded in the past as good reason for granting an extension of time in which to appeal. In support of that submission he has drawn our attention to Lesser [1940] 27 Cr App R 69, Ramsden [1972] Crim L R 547, Re Berkeley [1945] Ch 1 and Mitchell [1977] 65 Cr App R 185.”

“That practice may on its face seem harsh. On the other hand, the consequences of any other rule are equally unattractive. It would mean that a defendant who had roundly and on advice accepted that he had acted dishonestly and fraudulently and pleaded guilty, or who had been found guilty and chosen not to appeal, could after the event seek to re-open the convictions. If such convictions were to be readily opened it would be difficult to know where to draw the line or how far to go back. Counsel on behalf of the applicant suggests that there is a readily available line of demarcation which would distinguish those serving sentences from those who had completed their sentences. That, however, would not in our judgment be an altogether satisfactory line of demarcation in the case of those who were serving sentences for other offences as well as for offences against (in this case) section 15(1). It is plain, as we read the authorities, that there is no inflexible rule on this subject, but the general practice is plainly one which sets its face against the re-opening of convictions recorded in such circumstances. Counsel submits, and in our judgment submits correctly – that the practice of the court has in the past, in this and comparable situations, been to eschew undue technicality and ask whether any substantial injustice has been done. In suggesting that that is and has been the practice reference has been made to McHugh [1977] 64 Cr App R 92, R v Ayres [1984] 78 Cr App R 232, [1984] AC 447, Pickford [1995] 1 Cr App R 420 and Molyneux & Farmborough [1981] 72 Cr App R 111.”

“30. It is the very well established practice of this court, in a case where the conviction was entirely proper under the law as it stood at the time of trial, to grant leave to appeal against conviction out of time only where substantial injustice would otherwise be done to the defendant.R v Lesser [1939] 27 Cr App R 69 is an early example of emphasis that absent special reasons an application out of time will not be allowed. …”

“...but, the particular construction of the Human Rights Act apart, it is clear from both the speeches that this court’s practice to grant leave out of time only where substantial injustice would otherwise be done is recognised, and indeed endorsed.”

“37. We have no doubt that the practice is very fully established, endorsed by successive Lords Chief Justice, binding upon us and soundly based in justice.”

“In short, the principle is that the defendant seeking leave to appeal out of time is generally expected to point to something more than the mere fact that the criminal law has changed, or been corrected, or developed. If the appeal is effectively based on a change of law, and nothing else, but the conviction was properly returned at the time, after a fair trial, it is unlikely that a substantial injustice occurred”

“42. These cases present issues of great sensitivity and latent tension. Those convicted on the basis of the old law assert that their convictions were based on an erroneous understanding of the criminal law and that they have therefore suffered an injustice. At the same time there is a continuing public imperative that so far as possible there should be finality and certainty in the administration of criminal justice. In reality, society can only operate on the basis that the courts administering the criminal justice system apply the law as it is. The law as it may later be declared or perceived to be is irrelevant. Change of law appeals create quite different problems to those which arise in the normal case where an individual is wrongly convicted on the basis of the law which applied at the date of conviction. These tensions are not confined to England and Wales. 43. The issue presented itself to the Supreme Court of Ireland in A v Governor of Arbour Hill Prison [2006] IESC 45. The facts were simple. In June 2004 Apleaded guilty and was convicted of unlawful carnal knowledge contrary to section 141 of the Criminal Law Act 1935. In May 2006, in CC v Ireland & Others the Supreme Court declared that section 1(1) was inconsistent with provisions of the Constitution of Ireland. Aappealed against his conviction. The argument was simple. His conviction was null. It depended on a law which, because it was inconsistent with the Constitution, did not exist. The High Court agreed. The prosecution appealed. Murray CJ and the remaining members of the court conducted a comprehensive analysis of both common law and civil justice systems, which demonstrated the effective universality of the problem. He observed: “85...Absolute retroactivity based solely on the notion of an Act being void ab initio so as to render any previous final judicial decision null would lead the constitution to have dysfunctional effects in the administration of justice … The application of such a principle … in the field of criminal law would render null and of no effect final verdicts or decisions effected by an act which at the time had been presumed or acknowledged to be constitutional and otherwise had been fairly tried. Such unqualified retroactivity would be a denial of justice to the victims of crime and offend against fundamental and justice interests of society”

“125..In a criminal prosecution where the state relies in good faith on a statute in force at the time and the accused does not seek to impugn the bringing or conduct of the prosecution, on any ground which may in law be open to him or her, including the constitutionality of the statute, before the case reaches finality on appeal or otherwise, then the final decision in the case must be deemed to be and to remain lawful notwithstanding any subsequent ruling that the statute, or a provision, is unconstitutional. That is the general principle. 125.. I do not exclude … some extreme feature of an individual case, which might require, for wholly exceptional reasons related to some fundamental unfairness amounting to a denial of justice … ” “85...Absolute retroactivity based solely on the notion of an Act being void ab initio so as to render any previous final judicial decision null would lead the constitution to have dysfunctional effects in the administration of justice … The application of such a principle … in the field of criminal law would render null and of no effect final verdicts or decisions effected by an act which at the time had been presumed or acknowledged to be constitutional and otherwise had been fairly tried. Such unqualified retroactivity would be a denial of justice to the victims of crime and offend against fundamental and justice interests of society”. “125..In a criminal prosecution where the state relies in good faith on a statute in force at the time and the accused does not seek to impugn the bringing or conduct of the prosecution, on any ground which may in law be open to him or her, including the constitutionality of the statute, before the case reaches finality on appeal or otherwise, then the final decision in the case must be deemed to be and to remain lawful notwithstanding any subsequent ruling that the statute, or a provision, is unconstitutional. That is the general principle. 125.. I do not exclude … some extreme feature of an individual case, which might require, for wholly exceptional reasons related to some fundamental unfairness amounting to a denial of justice … ”

“102. Murray CJ’s description of the effect of a decision which alters the law as previously understood can be applied to Scots law. For instance, in Smith v Lees 1997 JC 73 the Court of Five Judges overruled Stobo v HM Advocate 1994 JC 28and thereby laid down a more restrictive test for corroboration in cases of sexualassault. The new test applied to the appellant’s case and to other cases that werestill live. But it could never have been suggested that the decision meant thatconvictions in completed cases, which had been obtained on the basis of the law aslaid down in Stobo, were ipso facto undermined or invalidated. Similarly, in Thompson v Crowe 2000 JC 173, the Full Bench overruled Balloch v HM Advocate 1977 JC 23 and re-established the need to use the procedure of a trialwithin a trial when the admissibility of statements by the accused is in issue. But,again, this had no effect on the countless completed cases where convictions hadbeen obtained on the basis of evidence of such statements by the accused whichjudges had admitted in evidence without going through that procedure. So, here,the Court’s decision as to the implications of article 6(1) and (3)(c) of theConvention for the use of evidence of answers to police questioning has no directeffect on convictions in proceedings that have been completed. To hold otherwisewould be to create uncertainty and, as Murray CJ rightly observes, cause widespread injustices. And the Strasbourg court has pointed out that the principle of legal certainty is necessarily inherent in the law of the European Convention: Marckx v Belgium (1979) 2 EHRR 330, 353, para 58. In the Irish case Geoghegan J said, [2006] 4 IR 88, 200, para 286, that he was “satisfied … that it would be wholly against good order if convictions and sentences which were deemed to be lawful at the time they were decided had to be reopened.”

“(1) The court may at any time vary or set aside a property freezing order... (4) If the court decides that any property to which a property freezing order applies is neither recoverable property nor associated property, it must vary the order so as to exclude the property.”

“34. The answer to this aspect of the case is to be found in the observation that the retrospective effect of a judicial decision is excluded from cases already finally determined. There is nothing exceptional about this case: it is no different from that which would obtain in any case where the common law (or the construction of a statute) takes a line which differs from previously decided cases with the result that one or more earlier decisions of the court would be decided differently had the law then been understood in the way that it is now explained. If that fact itself was exceptional, the critically important principle of finality of litigation would be undermined. Once seen in that light and, additionally, it is also recognised that the decision of Kenneth Parker J is a final determination, neither can the re-opening of the decision be said to be necessary to remedy a real injustice: his decision was correctly made in the light of the law as it was then understood to be. In my judgment, the pre-requisites identified in CPR 52.17 for re-opening the decision of the court are not met. 35. This conclusion is reinforced if attention is focused on the subject-matter of the decision that it is sought to reopen, namely the refusal of permission to appeal. The only point raised in the application concerned Kenneth Parker J’s refusal of a stay; there was no other challenge to his order. In particular, no issue was raised about the territorial reach of the order, even though Perry was then before the Supreme Court. It cannot be said to be necessary, for theavoidance of injustice, to re-open the refusal of permission by reference to a point of law that could have been but was not taken at the time. 36. On that basis, the civil recovery order remains a binding order of the court. Accepting that to be the case (and it is important to underline that Mr O’Docherty did not initially seek to re-open this appeal but applied only to vary the property freezing order), it is necessary to turn to the other orders which are consequent upon the civil recovery order.”

“48. ... At the time the order was made, it was entirely justified in law and nobody suggested the contrary. When the contempt was committed, the order remained entirely valid; again, nobody suggested the contrary. When Kenneth Parker J came to deal with the breach, the order continued to be valid. Mr O’Docherty, who could have sought to set aside the order, or appeared to challenge either the breach or the committal or both, did not choose to take any of these steps. It is only the subsequent change to the law that gives rise to issues of jurisdiction but none of that affects the legitimacy of the order when it was made or the gravamen of the breach. 49. In the circumstances, I would reject Mr Mitchell’s application to extend time within which to appeal the order of committal although, for the avoidance of all doubt, I would, in any event, have rejected it on the merits.”

“64. Since that order was made nothing has changed, save the interpretation of the 2002 Act.According to Perry the definition of “property” in s. 316(4) of the 2002 Act as “property wherever situated” does not include property wherever situated, but only property situated in the UK. Nothing was said in Perry about final orders already made by the courts on the basis of a different interpretation. The general rule against the retrospective effect of judicial decisions on final court orders is clear. It was held in Cadder v. HM Advocate [2010] 1 WLR 2601, which is cited by Leveson LJ at [20], that, at common law, a judicial decision, such as Perry,has a retrospective effect in relation to matters or cases not yet finally determined: but it is excluded from cases already finally determined, either at first instance and unappealed, or unsuccessfully appealed. Mr Andrew Sutcliffe QC appearing for SOCA described those as “closed cases”

“23 (1) This section applies if – (a) A court has made a confiscation order, and (b) The defendant, or a receiver appointed under section 50 applies to the Crown court to vary the order under this section. (2) In such a case the court must calculate the available amount, and in doing so it must apply section 9 as if references to the time the confiscation order is made were to the time of the calculation and as if references to the date of the confiscation order were to the date of the calculation. (3) If the court finds that the available amount (as so calculated) is inadequate for the paying of any amount remaining to be paid under the confiscation order it may vary the order by substituting for the amount required to be paid such smaller amount as the court believes is just. (4) If a person has been adjudged bankrupt or his estate has been sequestrated, or if an order for the winding up of a company has been made, the court must take into the account the extent to which realisable property held by that person or that company may be distributed among creditors. (5) The court may disregard any inadequacy which it believes is attributable (wholly or partly) to anything done by the defendant for the purpose of preserving property held by the recipient of a tainted gift from any risk of realisation under this part. …”

“9 (1) For the purposes of deciding the recoverable amount, the available amount is the aggregate of – (a) the total of the values (at the time that the confiscation order is made) of all the free property then held by the defendant minus the total amount payable in pursuance of obligations which then have priority, and (b) the total of the values (at that time) of all tainted gifts. (2) An obligation has priority if it is an obligation of the defendant – (a) to pay an amount due in respect of a fine or other order of a court which was imposed or made on conviction of an offence and at any time before the confiscation order is made, or (b) to pay a sum which would be included among the preferential debts if the defendant’s bankruptcy had commenced on the date of the confiscation order or his winding up had been ordered on that date. (3) “Preferential debts” has the meaning given by section 386 of the Insolvency Act 1986.” (a) A court has made a confiscation order, and (b) The defendant, or a receiver appointed under section 50 applies to the Crown court to vary the order under this section. (2) In such a case the court must calculate the available amount, and in doing so it must apply section 9 as if references to the time the confiscation order is made were to the time of the calculation and as if references to the date of the confiscation order were to the date of the calculation. (3) If the court finds that the available amount (as so calculated) is inadequate for the paying of any amount remaining to be paid under the confiscation order it may vary the order by substituting for the amount required to be paid such smaller amount as the court believes is just. (4) If a person has been adjudged bankrupt or his estate has been sequestrated, or if an order for the winding up of a company has been made, the court must take into the account the extent to which realisable property held by that person or that company may be distributed among creditors. (5) The court may disregard any inadequacy which it believes is attributable (wholly or partly) to anything done by the defendant for the purpose of preserving property held by the recipient of a tainted gift from any risk of realisation under this part. …” (a) the total of the values (at the time that the confiscation order is made) of all the free property then held by the defendant minus the total amount payable in pursuance of obligations which then have priority, and (b) the total of the values (at that time) of all tainted gifts. (2) An obligation has priority if it is an obligation of the defendant – (a) to pay an amount due in respect of a fine or other order of a court which was imposed or made on conviction of an offence and at any time before the confiscation order is made, or (b) to pay a sum which would be included among the preferential debts if the defendant’s bankruptcy had commenced on the date of the confiscation order or his winding up had been ordered on that date. (3) “Preferential debts” has the meaning given by section 386 of the Insolvency Act 1986.”

“24. … 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. In the present case the appellant does not seek to demonstrate where the realisable property of over £2 million was in May 1997 nor to show how it has decreased in value or otherwise diminished since then.”

“My conclusion is that he has had massively ample time to prepare for these proceedings, it is in principle a simple case, there is no answer to the benefit claim, subject to my studying the detailed evidence in respect of the income assumption items, realisable assets could have been demonstrated with some ease. It is highly likely, or at the lowest perfectly possible, the defendant is abusing the process by non-co-operation, but the clean-sure reason is that there is absolutely no reason to think that we will be in any different position in two months’ time or any time in the future that I might choose to adjourn these proceedings for. There is no reason to think he will start to co-operate, whether his inability to do so is due to illness or whether in truth he is refusing to do so as a tactic.”

“I find on the evidence that the defendant has benefited from his particular and general criminal conduct in the sum of £9,427,123 sterling. The defendant has not shown that his realisable assets are less than that sum so I make a confiscation order in that sum. I allow 6 months to pay and set the default term at 10 years. I record that no compensation is sought. Costs are adjourned with permission to apply.”

“27(1) This section applies if the following two conditions are satisfied. (2) The first condition is that a defendant absconds after – (a) he is convicted of an offence or offences in proceedings before the Crown Court. (b) he is committed to the Crown Court for sentence of an offence offences under section 3, 4 or 6 of the Sentencing Act, or (c) he is committed to the Crown Court in respect of an offence or offences under section 70 below (committal with a view to a confiscation order being considered), (3) The second condition is – (a) the prosecutor applies to the Crown Court to proceed under this section, and (b) the court believes it is appropriate for it to do so. (4) If this section applies the court must proceed under section 6 in the same way as it must proceed if the two conditions there mentioned are satisfied; but this is subject to sub-section (5). (5) If the court proceeds under section 6 as applied by this section, this part has effect with these modifications. (a) … (b) … (c) … (d) sections 10, 16(4), 17 and 18 must be ignored; (e) … (6) Once the defendant ceases to be an absconder section 19 has effect as if sub-section (1) (a) read – (a) at a time when the first condition under section 27 was satisfied the court did not proceed under section 6. (7) If the court does not believe it is appropriate for it to proceed under this section, once the defendant ceases to be an absconder section 19 has effect as if sub-section 1(b) read – (b) there is evidence which is not available to the prosecutor on the relevant date.”

“(2) But if the defendant shows that the available amount is less than that benefit the recoverable amount is – a) the available amount, or b) a nominal amount, if the available amount is nil. …”

“11.4 At paragraph 6 of the restraint order of 28 September 2010, appendix xviii, the defendant is prohibited from dealing with 36 properties in which he holds an interest and shares held in several limited companies. Appended to the witness statement dated 16 September 2010 made in support of the application for the said restraint order is a table detailing all properties in which the defendant holds an interest. 11.5 The spread sheet shows the 36 properties particularised at paragraph 6 of the restraint order and a further 59 properties. These 59 properties were not included in the restraint order as at the time the order was made the properties were in the hands of receivers of rent appointed under the Provisions of the Law of Property Act 1925 on the instructions of the various mortgage lenders due to arrears. 11.6 It is acknowledged that the defendant does not have control of the properties whilst the receivers remain appointed, however he is entitled to receive any equity generated from property sales. The situation from the properties at the moment is very fluid. Several properties have been re-possessed and sold by the lenders since the table was prepared. I am also informed that as a result of the receivers of rent being appointed several of the mortgage accounts are now in an advanced [sic] position. As stated above the onus remains with the defendant to provide the court with full details of all his free property, including valuations, at the time of the confiscation hearing.”

“21. It is understood that on 13 July 2012 the court made an order that the amount available to Mr Bestel was the same as the benefit figure, namely £9,427,123.35. 22. The figure of £9,427,123.35 is the cumulative figure of the mortgage advances made by all of the lending institutions during the relevant period. 23. It is submitted that the making of an order that Mr Bestel has an amount available to him of £9,427,123.35 must be wrong. 24. As the court will be aware when a lending institution advances monies in return for placing a charge (as security) over a property, on sale of the property, the lending institution is guaranteed to receive an amount equal to the outstanding amount on the mortgage account, subject to the property being sold for a figure to cover this sum. 25. In the present case it is understood that the mortgage advances by the lending institutions accounted for a significant (c.90%) amount of the purchase price of the property. On the paperwork available the Crown has failed to value the properties and provide a realistic figure of the equity available to Mr Bestel from the sale of these properties (after the lending institutions advance has been repaid together with their contractual interest payments, charges etc). This is something the Crown could have ascertained without information provided by Mr Bestel. If the available amount was based solely on the value of the properties (as appears to have been the case) the correct sum to have been ordered for the purpose of the available amount should have been equity available to Mr Bestel after the lending institutions have had their loans (and relevant costs) repaid following the sale of the property. An appropriate amount for sale costs/CGT etc should also be subtracted from this figure. 26. It is clear that this sum would be vastly smaller than the figure of £9,427,123.35 which was ordered to be the amount available to Mr Bestel.”

“There is simply no material on which I can find today that he has any real prospect of showing that his assets are below the amount of the benefit whatever it is.”

“42. In economic terms, the benefit that Mr Waya obtained from the offence of which he was convicted was credit obtained on better terms than those he could expect to get if he told the truth. …”