Previous Section Back to Table of Contents Lords Hansard Home Page

Lord Goldsmith: I am grateful to the noble Lord for giving way. I noted his reference to policy and its effect on the judicial mind. Will he accept that it is no part of my argument that the law would be stretched, strained or twisted? The Government's view is that, on the existing case law, to be found in a number of cases, proceedings which confiscate property constitute civil proceedings and that will be the outcome by an application of European law both in Strasbourg and in the courts of this country. Will the noble Lord, Lord Kingsland, accept that that is the reasoning behind my argument? Also, if he is sympathetic to the policy, will he accept that the Government ought to be allowed to make that proposition good by the Bill going ahead in its current form?

Lord Kingsland: I have already said to the Committee that I am sympathetic to the policy.

13 May 2002 : Column 63

However, it is the Government's duty to balance whatever policy they wish to promote with the individual rights of the citizens of this country, and those rights have been enhanced by the Government as a result of the incorporation of the European Convention on Human Rights into our law.

The Government are under a duty in relation to this legislation, as in relation to all other legislation, to certify that each clause conforms with the European Convention on Human Rights. I accept that it is the noble and learned Lord's judgment that Part 5 does so conform. It is simply that, in my judgment, on a balance of probabilities and for the reasons that I have given, it does not. That is why I tabled the amendment.

I ask the Government to think again about their judgment in relation to these clauses. In my submission it is more likely than not that the Government are wrong. Meanwhile, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Kingsland moved Amendment No. 206:

    Page 147, line 36, at end insert—

"(3) The Scottish Ministers must make a code of practice in connection with the relationship between and the order of priority to be given to the criminal confiscation, civil recovery and revenue functions under Parts 3, 5 and 6 of this Act.
(4) Where they propose to issue a code of practice, they must—
(a) publish a draft;
(b) consider any representations made to them about the draft; and
(c) if they think it appropriate, modify the draft in the light of any such representations.
(5) They must lay a draft of the code before the Scottish Parliament.
(6) When they have laid a draft of the code before the Scottish Parliament, they may bring it into operation by order.
(7) They may revise the whole or any part of the code issued by them and issue the code as revised; and subsections (4) and (6) apply to such revised code as they apply to the original code.
(8) The code is admissible in evidence in criminal or civil proceedings and is to be taken into account by a court or tribunal in any case in which it appears to the court or tribunal to be relevant."

The noble Lord said: Amendment No. 206 was inspired by the Scottish Law Society. It makes provision for a code of practice which will specify the relationship between criminal confiscation, civil recovery and the revenue functions contained in Parts 3, 5 and 6 of the Bill.

As I understand it, assurances were given by Ministers both in the Scottish Parliament and in another place that there will be a hierarchy of proceedings; and that a criminal investigation will be given priority over civil recovery. However, as a number of Members of the Committee pointed out in earlier proceedings, that policy intention is not reflected on the face of the Bill.

If the new procedures are to operate effectively and evidence essential to a criminal trial is not to be prejudiced, then the relationship between, and the interaction of, civil and criminal powers should be

13 May 2002 : Column 64

fully explained in a code of practice which has the force of statute. That is what the amendment seeks to achieve. I beg to move.

The Earl of Mar and Kellie: It is not often that I oppose something inspired by the Law Society of Scotland. But Amendment No. 206 is not only a breach of devolution practice, it is also, and even more so, a breach of the Sewel convention.

The inflammatory word for me occurs three times in subsections (3), (4) and (5); that is, the word "must". Members of the Committee will be familiar with spending half an hour discussing the merits of "may" or "shall"; but "must" should generate perhaps a greater length of time. I am not sure that I have ever seen it before. I cannot support the amendment therefore on the grounds of the terminology used.

Lord Kingsland: I am grateful to the noble Earl for drawing my attention to that point. Were the amendment to be redrafted on Report to contain the word "shall" rather than "must", would the noble Earl's intervention be different?

The Earl of Mar and Kellie: I am certain that I would be able to read the amendment in a more calm frame of mind for me to make a decision about it.

Lord Goldsmith: A difficulty exists in addition to that referred to by the noble Earl; that is, that the proposed amendment breaches yet a further convention. It puts upon Scottish Ministers the obligation to give instructions or guidance to the Lord Advocate on criminal matters. That would be inappropriate.

The practical answer is that Scottish Ministers have already published draft guidance on this matter. The draft guidance has been placed in the Library of your Lordships' House. A copy was made available to the Scottish Parliament for the purpose of the Sewel Motion by which that Parliament agreed to Westminster legislating on devolved matters. The guidance sets out the key principles which will govern the operation in Scotland under the powers contained in Parts 3, 5 and 6. I am sure that the noble Lord, Lord Kingsland, read it and had no difficulty with its content.

Therefore, given that that guidance will be published in final form after the Bill receives Royal Assent by the Scottish Ministers and copies placed in the Scottish Parliament, the only question is whether it is right that it should appear on the face of the Bill. For the reasons given by the noble Earl, but also because we regard it as unnecessary in circumstances where Scottish Ministers have provided eminently satisfactory draft guidance which will be published, we oppose the amendment. I ask the noble Lord to withdraw it.

Lord Kingsland: I am grateful to the Minister. When he responded to a testing and apposite intervention by the noble and learned Lord, Lord Hope of Craighead, about half an hour ago, he disclaimed any knowledge

13 May 2002 : Column 65

whatever of Scottish law or procedure. He has clearly spent the past half-hour on the Bench most productively—because in response to me he demonstrated the most extraordinary and intimate knowledge of the workings of both the Scottish legal system and the Scottish constitution.

Lord Goldsmith: If the noble Lord will forgive me, the position is exactly the same in England. I would not accept any Minister giving me instructions as Attorney-General in relation to my prosecution functions. In that respect there is commonality between the two systems of law.

Lord Kingsland: In any event, I am sure that the Scottish Law Society will pay close attention to these proceedings in Hansard, and no doubt between now and Report will express a view as to whether or not this matter should be pursued further. Meanwhile, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

On Question, Whether Clause 248 shall stand part of the Bill?

6.30 p.m.

Lord Lloyd of Berwick: At Second Reading I had hoped to galvanise the Opposition Front Benches to mounting an all-out attack on Part 5 of the Bill. That has not happened. Therefore I am left to take up the cudgel still alone.

It is true that some useful amendments have been tabled, some of which have already been debated—two in particular—and they are extremely important. But in my view those amendments are doing no more than chipping at the edges of the problem. The defects in Part 5 are too deep-seated to be dealt with in that somewhat piecemeal way.

Part 5 is objectionable on three different grounds. When I refer to Part 5, I am really referring to Chapters 1 and 2, not Chapter 3, and I shall not be drawn into the question already discussed by the noble Lord, Lord Goodhart, and my noble and learned friend Lord Hope of Craighead of whether there may or may not be some overlap between the civil recovery order and the forfeiture of cash under Chapter 3. The three reasons why I regard Part 5 as objectionable are: first, that it is incompatible with the Human Rights Act 1998; secondly, that the net is cast so wide that it is likely to give rise to cases of grave injustice; and, thirdly, that I doubt whether it will ever be cost-effective in practice and may even prove to be unworkable—like so much of recent criminal legislation, I regret to have to say.

I shall take the three points in turn. I start with the example of a respondent whose unlawful conduct is in issue—in other words, a respondent who is himself alleged to have obtained property through his own drug dealing, racketeering or whatever offence is in question. In such a case, I suggest that a recovery order under Part 5 would in every respect be equivalent to a confiscation order under Part 2, even though he would not have been convicted of any offence in a criminal

13 May 2002 : Column 66

court. Instead, he would be found guilty of the offence in question by a civil court on a mere balance of probabilities. For unless he has been found guilty of unlawful conduct, the recovery procedure under Part 5 will not get off the ground. I hope that when he replies, the noble and learned Lord the Attorney-General will accept my argument at least to that point.

But the next step is that if a recovery order under Part 5 is in those circumstances the equivalent of a confiscation order—I suggest that no other view is possible—it is clear that the confiscation order would be a penalty under Article 7 of the convention. If it is a penalty, it is equally clear that the penalty is intended to be retrospective, as the Attorney-General accepted in reply to an amendment tabled by the noble Lord, Lord Kingsland.

The Attorney-General referred to the limitation period of 12 years in Clause 290. The Committee will notice that 12 years is distinct from the normal period of limitation of six years. That in itself is a strong indication—among many others—that we are here discussing criminal sanctions, not civil reparations. The Attorney-General also drew attention to the fact that the Government do not intend to make retrospective conduct unlawful. Well, thank goodness that they do not, but that is not the question. The question is not whether conduct is made unlawful retrospectively, but whether the penalty is retrospectively made greater than it would otherwise have been.

If all that is so, it follows that the first retrospective recovery order made against a respondent whose own unlawful conduct is in issue will be bound to be challenged in the European Court of Human Rights under Article 7 and the challenge is bound to succeed. I am sorry to sound so definite when the noble Lord, Lord Kingsland, talked about the balance of probabilities and the noble Lord, Lord Goodhart, spoke in a somewhat hesitant manner, but it seems to be as definite as that. I look forward to hearing from the Attorney-General why that is not so.

At that point, I might simply say, "Quod erat demonstrandum", and sit down, but I think that I should try to anticipate some of the further arguments that the Attorney-General may advance and deal with those that he has already advanced. At Second Reading, he referred to three recent decisions: one of the Judicial Committee of the Privy Council; one of the House of Lords; and one of the European Court. I should have thought that he would by now have accepted that those cases do not help his argument. As the noble Lord, Lord Goodhart, said, they do not bear even a superficial similarity to what we are discussing. They were solely concerned with the scope of Article 6(2) of the convention on a case in which the defendant had already been charged with and convicted of the offence. I am at present concerned not with Article 6(2) but with Article 7. The three cases to which the Attorney-General referred simply do not touch on the question of Article 7.

At Second Reading, the noble and learned Lord also referred to an Irish case, which I have considered, but again, it does not help. The question there was whether

13 May 2002 : Column 67

a civil recovery procedure was or was not unconstitutional. The question of whether it would have been caught by Article 7 of the convention simply did not arise for the good reason that the European Convention is not incorporated into Irish law. It was purely a question of Irish domestic law whether the procedure was constitutional or not.

Why, then, am I so confident that a confiscation order is a penalty within the meaning of Article 7? Simply because that very point was decided by the European Court in the case of Welch. It was argued in that case on behalf of Her Majesty's Government that the purpose of the confiscation regime was preventive and reparative, not punitive. Those are the very arguments advanced by the Home Office in its memorandum of January 2002. At Second Reading, I was on the point of describing that argument as rubbish. Happily, I refrained in time. Instead, it may be less offensive if I say that that argument was unanimously rejected by the court in Strasbourg. In those circumstances, I am somewhat surprised to find it being raised yet again.

It cannot be said that the Welch case was wrongly decided. There may be an attempt to distinguish it on the grounds that it was concerned with a confiscation order—as, clearly, it was—not with a recovery order. However, that misses the point. Everybody agrees that the European Court of Human Rights considers what a piece of legislation does, not what it is called. Otherwise, it would be all too easy for a state to get round convention rights.

I am reminded of an observation made, I think, by the noble and learned Lord, Lord Templeman, in a different context. He said that if we design an agricultural implement for digging and it has a handle and four or five prongs, we have designed a fork. We can call it a spade, if we like, but it remains, in fact and in law, a fork. Likewise, if we design a piece of legislation with the object of depriving a man of some or all of his possessions, after he has been found guilty of unlawful conduct under Part 5, we can describe that as a recovery order, but the European Court will call our bluff and will call it what it is—a confiscation order by another name.

Part 5 is incompatible with the convention rights. It is not good enough for the noble and learned Lord the Attorney-General to say that, although it may be incompatible, he is prepared to take a risk and see what happens.

In raising my second objection, I must say something about the requirements of justice. In the other place, the Minister made much of the major criminal figures—400 in all—who had become untouchable by criminal prosecution and who organised and financed criminal activity without committing particular crimes. The noble and learned Lord referred to the same 400 major criminal figures. If that is the case, it is time that we changed the substantive criminal law, as we did in the Terrorism Act 2000. Under that Act, organising, financing and

13 May 2002 : Column 68

directing a terrorist organisation is a substantive offence. Why should not we do the same in other branches of the criminal law?

If we were still to have difficulty convicting those major criminals, because of problems with getting evidence together and putting it before the court, we should change our law of evidence. For example, we could make telephone intercepts admissible in criminal proceedings, as they should always have been. It is far better to do that than twist the civil law to make it do a job for which it was never intended.

What happens if we do all that and there is still not enough evidence to charge and convict those 400 major criminals before a jury, although there is just enough evidence to persuade a judge on a mere balance of probability? How would the Director of Public Prosecutions put his case? He would say, "I think that you have committed serious offences"—drug dealing, living off immoral earnings or whatever—"and are, therefore, guilty of unlawful conduct under Clause 249. Unfortunately, we cannot put you in prison, because the evidence is not strong enough. I can, however, take your goods instead. In your case, the judge will have no discretion, because he will be bound to make a recovery order under Clause 270". Surely, the defendant is entitled to reply, "I deny that I am guilty of any wrongdoing. You have got the wrong man. If you, representing the Crown, think otherwise, I am entitled to have that matter decided by a jury".

I ask the noble and learned Lord two questions. Does he accept that, in such a case, a person whose serious criminal conduct is in issue ought to be entitled to have the matter decided by a jury? Does he accept that the right to trial by jury is one of our ancient liberties—they were referred to earlier—but that it would seem to be overridden by Part 5, in so far as it applies to a respondent whose own criminal conduct is in issue?

My third objection is that there is a danger that Part 5 will, all too soon, become a dead letter. There may be one or two high-profile cases, but, as soon as the director begins to discover some of the pitfalls connected with Part 5—there are many—and has been taken to Strasbourg once or twice, he may take the view that his time and money would be better spent pursuing convicted offenders under Part 2. That is where his efforts should be concentrated.

It is fanciful to suppose that the 400 major criminals will stand around waiting for an interim receiving order to be served on them under Clause 254. If they are sophisticated enough to have become untouchable by the criminal law, will they not also be sufficiently sophisticated to get round the provisions of the civil law? They might take all their possessions to Ireland; I do not wish to suggest to them what they might do. There must be many ways in which those 400 criminals could avoid the effect of the civil procedure that is proposed. We will then have yet another piece of criminal legislation that looks good on paper but is useless in practice. We all remember a provision now incorporated into the Terrorism Act 2000 that was

13 May 2002 : Column 69

supposed to secure the conviction of the Omagh bombers. Not only has it not done that but it has done nothing, so far as I know.

The Proceeds of Crime Bill is an admirable and much needed Bill. However, the Government have gone a step too far in Part 5. It is incompatible with the Human Rights Act 1998, for the reasons that I have given. That was the view of the Joint Committee on Human Rights, as I read paragraphs 17 to 24 of its further report. I hope that the Minister will think again about whether he was justified in making the statement that appears on the face of the Bill.

6.45 p.m.

Lord Renton: The noble and learned Lord, Lord Lloyd of Berwick, has performed a valuable service, in drawing attention to some of the difficulties that will arise if Part 5 is allowed to stand as it is. My point is fairly brief, and I shall confine myself to Chapter 1 of Part 5. Until I retired from the Bar at the age of 66, roughly a third of my practice was in criminal law. I also spent eight years as a recorder and was sometimes engaged in other judicial criminal court work.

In addressing my main point, I invite the Committee to look at Clause 248(2). It states clearly that:

    "The powers conferred by this Part are exercisable in relation to any property (including cash) whether or not the proceedings have been brought for an offence in connection with the property".

Under English law, the offence must be proved beyond reasonable doubt but under Clause 249 there appears to be a strange mix-up in relation to the burden of proof. It is clear enough where there has been a conviction, but subsection (3) states:

    "The court of sheriff must decide on a balance of probabilities whether it is proved".

That is quite different from the normal burden of proof under our law in the United Kingdom in criminal cases. I therefore believe that we cannot allow Clause 249, with its variation in the burden of proof before there is liability.

We must also bear in mind that Clause 249(2) states:

    "Conduct which . . . occurs in a country outside the United Kingdom and is unlawful under the criminal law of that country . . . is also unlawful conduct".

That is, if the conduct occurred in a part of the United Kingdom, it would be unlawful under the criminal law of that part. I find that a confusing piece of drafting and we need to apply our minds to it.

I admire the Government's intention—and I believe it to be valid—of trying to enable property to be recovered which has been obtained by unlawful conduct. That is a sound proposition, but we must be careful to be consistent in the circumstances in which it is proved that conduct has been unlawful and therefore the circumstances in which the property can be recovered.

13 May 2002 : Column 70

Next Section Back to Table of Contents Lords Hansard Home Page