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House of Lords
Session 1997-98
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Judgments

Judgments - Regina v. Emmett and Another

HOUSE OF LORDS

  Lord Goff of Chieveley   Lord Slynn of Hadley   Lord Nicholls of Birkenhead
  Lord Steyn   Lord Clyde

OPINIONS OF THE LORDS OF APPEAL FOR JUDGMENT IN THE CAUSE

REGINA

v.

EMMETT AND ANOTHER
(RESPONDENTS)
(ON APPEAL FROM THE COURT OF APPEAL
(CRIMINAL DIVISION))

ON 13 NOVEMBER 1997



LORD GOFF OF CHIEVELEY


My Lords,

     I have had the advantage of reading in draft the speech of my noble and learned friend, Lord Steyn. For the reasons he gives I would allow this appeal.



LORD SLYNN OF HADLEY


My Lords,

     I have had the advantage of reading in draft the speech of my noble and learned friend Lord Steyn. For the reasons he gives, with which I agree, I would allow this appeal.



LORD NICHOLLS OF BIRKENHEAD


My Lords,

     I have had the advantage of reading in draft the speech of my noble and learned friend Lord Steyn. For the reasons he gives, with which I agree, I would allow this appeal.



LORD STEYN


My Lords,

The drugs enterprise

     On 7 November 1993, after months of preparations in England and Spain, a group of men started to unload a cargo of 4 metric tonnes of cannabis resin at Bideford Quay. Customs and Excise officers arrested the men as well as others engaged in the enterprise. The respondents in the present appeals, Brian Emmett and Michael Emmett, were two of the four principal organisers of the enterprise. The other two, who are not before the House, were Bracken and Lemonnier. The street value of the cannabis was some £13 million. The outlay for the whole operation was probably of the order of £3 million.

The proceedings in the Crown Court

     On 25 October 1994 in the Crown Court at Exeter a number of accused including Brian Emmett and Michael Emmett pleaded guilty to the offence of being knowingly concerned in the fraudulent evasion of the prohibition on the importation of a controlled drug contrary to section 170(2) of the Customs and Excise Management Act 1979. The Drug Trafficking Offences Act 1986 was applicable. (Subsequently the 1986 Act was substantially repealed and replaced by the Drug Trafficking Act 1994.) The trial judge had first to consider whether the accused had benefited from drug trafficking and, if so, to make appropriate confiscation orders under the 1986 Act. In the result counsel for the four principal organisers, acting on instructions, invited the trial judge to make agreed confiscation orders. At the start of his sentencing observations the judge stated:

     ". . . it was agreed between counsel, so I was not invited to carry out a trial on this, but the benefits accruing to Bracken, Lemonnier and both Emmetts amounted to £100,000. It was agreed that a confiscation order in the sum of £1,000 should be made against Peter Bracken, in the sum of £37,484.32p. in the case of Lemonnier, £1,000 in the case of Brian Emmett, and £20,705.21p. in relation to Michael Emmett.

The judge made the agreed confiscation orders and imposed sentences of imprisonment in default. The judge then sentenced all the accused to lengthy terms of imprisonment. In the cases of Bracken, Lemonnier, Brian Emmett and Michael Emmett he imposed terms of 12½ years imprisonment.

The proceedings in the Court of Appeal

     With the leave of the single judge these four defendants appealed to the Court of Appeal against their sentences and the confiscation orders. On 5 February 1996 the Court of Appeal allowed the appeals of the four men against sentence to the extent that the court quashed the custodial terms and substituted in each case a term of 9 years imprisonment. On the same day the Court of Appeal also heard argument on the appeals against the confiscation orders. The court reserved judgment on that aspect. On 16 February in a clear and careful judgment on behalf of the court Mr. Justice Collins upheld the confiscation orders made in respect of Bracken and Lemonnier but quashed the confiscation orders of Brian Emmett and Michael Emmett. The Court of Appeal refused an application by the Crown for leave to appeal against the orders quashing the confiscation orders made against the Emmetts but certified that points of law of general importance were involved in the relevant decisions. Those certified questions were the basis on which the Appeal Committee granted leave to appeal.

The 1986 Act and the certified questions

     In order to render the certified questions intelligible I must briefly refer to the relevant provisions of the 1986 Act. Section 1(1) provides that the sentencing judge shall first determine whether the drug trafficker has benefited from drug trafficking. A person who has received any payment or other reward in connection with drug trafficking carried on by him has benefited from drug trafficking: section 1(2). If he has benefited, the court must determine the amount to be recovered: section 1(4) and section 4. Under the 1986 Act the burden was on the Crown to prove according to the criminal standard that the defendant had benefited from drug trafficking and what the value of his proceeds of drug trafficking was: see Dickens (1990) 12 Cr.App.R. (S.) 191. But the Crown's burden was eased by assumptions which the court was entitled to make unless it was inappropriate to do so: section 2(2). The assumption on which the Crown relied was that contained in section 2(3)(b), namely that any expenditure of his in the statutory period was met out of payments received by him in connection with drug trafficking carried on by him. Section 3 deals with the service of statements relating to drug trafficking. For present purposes subsection (1) is the critical provision. It reads as follows:

     "Where -

      (a) there is tendered to the Crown Court by the prosecutor a statement as to any matters relevant to the determination whether the defendant has benefited from drug trafficking or to the assessment of the value of his proceeds of drug trafficking, and

      (b) the defendant accepts to any extent any allegation in the statement,

     the court may, for the purposes of that determination and assessment, treat his acceptance as conclusive of the matters to which it relates."

Section 4(1) then provides that the amount to be recovered in the defendant's case under the confiscation order shall be the amount the Crown Court assesses to be the value of the defendant's proceeds of the drug trafficking.

Against this statutory background I now set out the certified questions:

     "(1) Where:- (i) a defendant has accepted an allegation made in a statement tendered to the court by the prosecution under section 3(1)(a) of the Drug Trafficking Offences Act 1986;

     (ii) the Crown Court has treated his acceptance of the allegation as conclusive of the matters to which it relates; and

     (iii) the Crown Court has made a determination in accordance with sec.4 of the DTOA of the amount to be recovered from the defendant by virtue of section 1 of the DTOA ('the section 4 determination'),

     whether it is open to the defendant to appeal to the Court of Appeal (Criminal Division) against the section 4 determination on the grounds either:

     (a) that his acceptance of the allegation was based upon a mistake of law; or

     (b) that his acceptance of the allegation was based upon a mistake of fact."

     "(2) If it is open to the defendant to appeal as aforesaid:

     (i) Is there any legal or evidential burden upon the defendant to prove that the mistake of law or mistake of fact was the reason which caused him to accept the allegation?

     (ii) Is the Court of Appeal (Criminal Division) entitled to vary or quash the section 4 determination made by the Crown Court before receiving and considering evidence from the defendant as to the reasons why he accepted the allegation?"

     It will be observed that the certified questions assume that Brian Emmett and Michael acted under a mistake of law or a mistake of fact. They further implicitly assume that the mistakes in question were causally relevant. My Lords, for reasons that I will explain I am satisfied that these assumptions were not justified on the materials before the Court of Appeal. Strictly therefore the certified questions do not arise on the present appeals. Nevertheless, it is necessary to remove, as far as it is possible to do so, uncertainty about the narrow points of law which have been raised in the certified questions.

Certified Question No.1: Ouster of right of appeal

     The Crown rightly accepts that with leave an appeal does lie against a confiscation order as part of a sentence: see section 11 and section 50(1) of the Criminal Appeal Act 1968 and Reg. v. Johnson [1990] 91 Cr.App.R. 332. But the Crown submitted that the general right to appeal against a confiscation order has been excluded by section 3(1) in respect of a defendant's acceptance of any allegation in a statement tendered by the prosecutor which has been acted on by the court. The foundation of this submission is that section 3(1) provides that the court may treat the defendant's acceptance as "conclusive of the matters to which it relates." The submission is that "conclusive" means conclusive for all purposes including an appeal to the Court of Appeal. Counsel for the Crown pointed out that this is precisely what Lord Justice Glidewell, giving the judgment of the Court of Appeal in Tredwen [1994] 99 Cr.App.R. 154 held that section 3(1) of the 1986 Act means. Moreover, in Crutchley and Tonks [1994] 15 Cr. App.R. (S.) 627 Lord Justice Glidewell reiterated this view. Counsel also pointed out that after the decision in Tredwen Parliament re-enacted the provision in section 3(1) in substantially similar terms: see section 11(7) of the 1994 Act. Counsel suggested that Parliament endorsed the principle enunciated in Tredwen. Finally, counsel said that if the law were otherwise the position would be wide open to defendants to manipulate the system by accepting section 3 statements tendered by the prosecutor in order to avoid being cross examined and then challenging the statements on appeal.

     The Court of Appeal felt constrained to deal with the precedent of Tredwen rather gingerly but Collins J. did express the tentative view that the word "may" indicates that the trial court has a discretion and that the discretion might be reviewable. I would approach the matter rather differently. There is a strong presumption that except by specific provision the legislature will not exclude a right of appeal as of right or with leave where such a right is ordinarily available: Reg. v. Cain [1985] A.C. 46, per Lord Scarman at 55G-56D. The starting point is that, unless section 3(1) expressly or by necessary implication excludes a right of appeal, there is as a matter of jurisdiction a right of appeal against a confiscation order in all cases. There is plainly no express ouster of the right of appeal. Does the use of the word "conclusive" warrant a necessary implication to oust the right of appeal? It is significant that neither section 3 nor any other part of the 1986 Act contains any express provisions dealing with appeals to the Court of Appeal. Section 3(1) is a procedural provision designed to facilitate proof that a defendant has benefited from drug trafficking and to establish what the value of his proceeds of his drug trafficking was. The focus of the section is on the Crown Court, and it then provides that the Crown Court may treat the defendant's acceptance as conclusive of the matters to which it relates. In the context that is capable of meaning no more than that the Crown Court may treat the acceptance as proof of the matters to which it relates. In these circumstances no necessary implication ousting the jurisdiction of the Court of Appeal is justified. The language of the section is not apt to deal with the jurisdiction of the Court of Appeal to hear an appeal against confiscation orders even if uncontested and arising from a decision under section 3(1). It cannot therefore oust the jurisdiction of the Court of Appeal in any respect. The right of appeal to appeal with leave under the Criminal Appeal Act 1968 is as a matter of jurisdiction untouched: see section 11 and section 50(1). It is of course true that if there is an appeal the Court of Appeal may have to take account of the fact that a judge had decided to treat an acceptance of an allegation in a prosecution statement as conclusive and the Court of Appeal may have to give proper and due weight to the consideration. That is, however, an altogether different matter from saying that section 3(1) operates pro tanto as an exclusion of the right of appeal. It does not detract from what I have said about the jurisdictional issue.

     So far I have principally concentrated on the wording of section 3(1) and concluded that as a matter of language it contains no ouster of any right of appeal. Broader considerations point in the same direction. The submission of the Crown is that section 3(1) precludes the Court of Appeal from considering an argument that a defendant's acceptance of a section 3(1) was initiated by a fundamental mistake of law or fact. Here it is instructive to consider the analogous position of the jurisdiction of the Court of Appeal to hear an appeal following an unequivocal and informed plea of guilty. Earlier in this century it may not have been possible to put forward as a ground of appeal that the plea of guilty arose from a mistake of law or fact of the defendant: Forde [1923] 2 K.B. 400, at 403, per Avory J. Nowadays it is clear that as a matter of jurisdiction the Court of Appeal has power in such a case to consider an argument that the plea of guilty was induced by a fundamental mistake of law or fact: see Boal [1992] Q.B. 591 (a mistake of law); Lee [1984] 1 W.L.R. 578, at 583E (a mistake of fact); and Blackstone, Criminal Law and Practice, 1997, para. D22-12, at 1512-1514. Given that the powers of the Court of Appeal extend to cases when a plea was entered on a mistaken view of the law or fact, it is difficult to see what rational basis there could be to exclude such a right of appeal under section 3(1). Even drug traffickers have rights and they too are entitled to justice.

     The matters that I have outlined were not put before the Court of Appeal in Tredwen. I conclude that Lord Justice Glidewell's observations about the meaning and effect of section 3(1) of the 1986 Act are incorrect. And it is implausible to say that Parliament intended to endorse that decision when it passed this Drug Trafficking Act 1994. The Crown's submissions in the support of Tredwen must be rejected. And, as I will attempt to show in the discussion of the second certified questions, the Crown's fears that the overruling of Tredwen will enable defendants to manipulate the system are exaggerated.

     In my view the answer to the first certified question is Yes.

Certified Question No.2: Burden

     The answer to the second certified question is self evident: the burden rests on an appellant, who asserts that his acceptance of any allegation in a section 3 statement was the result of a mistake of law or fact, to persuade the Court of Appeal that his assertion is correct. Strictly, nothing more need be said about the certified question.

     At the hearing of the appeal before the House counsel debated how a defendant must discharge such a burden and how the Court of Appeal should deal with such an assertion e.g. by receiving information from counsel, affidavits or oral evidence. That will be a matter for the Court of Appeal to consider and I will not presume to express a view on what procedure the Court of Appeal should adopt.

     Lest it be thought, however, that my observations are some kind of open sesame to such appeals I would mention four matters. First, the question in such cases will be not what mistake counsel made but what mistake the defendant made. Secondly, and particularly in regard to matters peculiarly within the knowledge of a defendant, the burden on a defendant of proving a mistake may not easily be discharged. Thirdly, the focus in such cases will be on a material and causatively relevant mistake, viz a material mistake which in fact induced the defendant to accept the correctness of a section 3 statement. Fourthly, even if the defendant can persuade the Court of Appeal on these three points, the Court of Appeal may still have to consider whether, absent a material mistake, the particular confiscation order would nevertheless have been inevitable. If that is the case, the appeal may have to be dismissed on the ground that on a global view of the case no injustice can be shown.

The mistake put forward

     The mistake relied on is that counsel for the respondents, and the respondents, allegedly assumed at the time of the hearing before the trial judge that the drugs seized by the Customs officers at Bideford could by themselves amount to a benefit received by the respondents under the 1986 Act. It was common ground that such an assumption would have been wrong. The subsequently reported decisions in Akengin [1995] 16 Cr. App. Rep. (S) 499 and Thacker [1995] 16 Cr. App. Rep. (S) 461 make that clear.

     Counsel appearing for both the respondents before the House submitted, albeit somewhat tentatively, that the judge acted on such a mistaken view and therefore misdirected himself. There is nothing to support this argument. The judge was never called upon to consider the legal position. And nobody knows what view he would have taken on the point of law. He simply recorded the agreement of counsel that the benefits accruing to the four principal conspirators amounted to £100,000 each and he made the orders of £1000 in the case of Brian Emmett and £20,705 in the case of Michael Emmett pursuant to the agreement of counsel. I would therefore reject this part of the argument of counsel for the respondents.

     Counsel for the respondents also submitted that counsel for the Crown acted upon the mistaken view of the law. How this fact, if established, could help the respondents was never clarified. But this argument is also without foundation. The Crown's position was that there was sufficient circumstantial evidence to trigger the assumption in section 2(3)(b) viz that the principal organisers must have incurred expenditure in respect of the purchase of the drugs. For this contention the Crown relied on the roles of the Emmetts and all the circumstances of the case which, of course, included possession of the drugs. Later in this speech I will examine the merits of that contention. At this stage I merely make clear that the Crown did not rely on the seized drugs as by themselves constituting a benefit to the respondents. I would therefore also reject this part of the argument of counsel for the respondents.

     That leads to the major point of counsel for the respondents, viz that junior counsel acting on behalf of the Emmetts laboured under such a mistaken view of the law. Junior counsel who appeared for Michael Emmett at first instance informed the Court of Appeal that he was unhappy about the proposed agreement. The judgment of the Court of Appeal records:

     "He was concerned that the cannabis could not be regarded as the proceeds of drug trafficking since he maintained none of the defendants, in particular his client, had paid anything toward the purchase of the cannabis or had any direct financial interest in it."

     Nevertheless, in the best interests of his client, he did agree to the making of the confiscation orders. In these circumstances the suggested mistaken assumption by counsel for Michael Emmett as to the law is not established. Brian Emmett was separately represented. It is not known on what basis counsel for Brian Emmett acted and advised. Given that in the case of Brian Emmett the confiscation order was only for £1000 the legal position may not have loomed large in counsel's consideration of the case. In any event, it is not established that counsel for Brian Emmett acted under a mistake of law. Furthermore, there is no evidence whatever as to the basis on which the two respondents agreed to the confiscation orders. It is true that counsel for Brian Emmett told the Court of Appeal on instructions that "none of the defendants, in particular his client had paid anything toward the purchase of the cannabis or had any direct financial interest in it." Such self serving protestations by the principal organisers of the massive drugs operations, who were wholly unresponsive in police interviews and thereafter, carry no weight. All one knows is that the principal organisers must have known how the drugs operation was funded. But one simply does not know why the respondents agreed to the confiscation orders.

     For these reasons I am satisfied that it has not been established that the respondents agreed to the confiscation orders as a result of a mistaken view of the law.

The state of the evidence

     The Court of Appeal did not decide the appeals of the four principal organisers on the basis of an argument that each acted under a mistake of law. Instead the Court of Appeal considered whether the state of the evidence justified the confiscation orders. In the case of Bracken and Lemonnier the Court of Appeal concluded that on the facts the appeals against the confiscation orders must be dismissed. Turning to the Emmetts Collins J. observed:

      "The position of the Emmetts was different. In their cases, there was no evidence of large sums of cash, previous successful drug trafficking or of anything beyond their involvement in the importation of the cannabis. Naturally, there is a great suspicion that they may have put money up to purchase the cannabis, but that is not enough and we do not think that an inference could properly be drawn that they did put up any purchase money.

      "In those circumstances, we have come to the conclusion that in the case of the Emmetts, Mr. Wilcken is correct that Reg. v. Akengin makes clear that the cannabis cannot be regarded as the proceeds of drug trafficking."

This conclusion fails to take into account that the Emmetts instructed their counsel to agree to the making of the confiscation orders. The judge acted upon that agreement. For my part I would regard the agreement of the Emmetts as an acceptance within the meaning of section 3(1) of the 1986 Act, which the judge treated as conclusive. But, if for some technical reason the agreement fell outside the scope of section 3(1), it was nevertheless in law a sufficient basis for the making of the order. Given that the agreement was freely made, on instructions, and that it was unaffected by any mistake of law, the conclusion follows that the Court of Appeal erred in deciding the case in the case of the Emmetts as it did.

     Since the state of the evidence, irrespective of the agreement on the confiscation order, was the subject of detailed submissions before the House, I propose to indicate briefly how in my view the matter should be approached. For this purpose I draw on the summary of the facts, which was common ground before the Court of Appeal. The Emmetts were among the four principal organisers of a massive drugs operation. Absent any explanation from them during police interviews, or subsequently, I take the view that it was legitimate in the circumstances to infer that they jointly incurred substantial expenditure in connection with their drug trafficking. That seems to me a common sense inference in the circumstances of this particular drugs operation. On this basis the assumption contained in section 2(3)(b) comes in to play. If it were necessary to examine the state of the evidence, I would therefore have been inclined to conclude that the confiscation orders were, in any event, justified on the state of the evidence.

     For these reasons I would differ from the view which prevailed in the Court of Appeal.

Conclusion

     I would allow both appeals and restore the confiscation orders in respect of Brian Emmett and Michael Emmett.



LORD CLYDE


My Lords,

     I have had the advantage of reading a draft of the speech of my noble and learned friend Lord Steyn. For the reasons he has given, I too would allow this appeal.



 
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