Judgments - In The Matter of Clifford Norris and In The Matter of The Drug Trafficking Offences Act 1986 and In The Matter of An Application by Teresa Wendy Norris

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    21. Latham J accepted the argument of the Customs and Excise. He followed an earlier decision of Buxton J in In re K (unreported), 3 July 1995, that the Crown Court decision was conclusive and bound even unrepresented third parties who had had no opportunity to present contrary arguments. "It is not intended in enforcement proceedings ... to reopen findings made by the Crown Court as to whether property is realisable and the ownership of it." He applied a dictum in R v Robson (Stephen) (1990) 92 Cr App R 1,5:

    "It is a striking and extraordinary consequence of the Drug Trafficking Offences Act that in a case such as the present the court's powers are so draconian that it seems able to deprive the legal owner of property of some or all of his or her beneficial interest in it without he or she having any opportunity to present the arguments against such a conclusion."

Latham J also referred to the fact that Buxton J had rejected the right of a third party to challenge the enforcement proceedings on the ground that the defendant's only right was to appeal the confiscation order. Latham J, apparently with some regret, held that he should follow Buxton J and hold that she could not reopen the issue which was determined by the Crown Court. He gave her leave to appeal.

    22. In the Court of Appeal, the Customs and Excise did not seek to uphold the decisions of Buxton and Latham JJ in so far as they said that the High Court had no jurisdiction in any circumstances to reopen the findings of the Crown Court on the application of a third party: [2000] 1 WLR 1094, 1098G The Court of Appeal considered that this concession was rightly made and the judgment of Buxton J could not be supported. I agree with the Court of Appeal on this point. The argument on the construction of the Act having been abandoned, the Customs and Excise based their case on a different submission that there was a spectrum of possible situations and the relevant consideration was abuse of process. Counsel submitted that Mrs Norris fell on the wrong side of the line.

    "The wife's interests were identical to those of the defendant at the hearing in the Crown Court where the wife had the opportunity to give her evidence and have her case argued by counsel. The fact that she was not formally a party to the proceedings or represented is unimportant." (p. 1099)

    He relied upon Hunter v Chief Constable of the West Midlands Police [1982] AC 529 and Ashmore v British Coal Corporation [1990] 2 QB 338. Tuckey LJ accepted this argument. He considered that "if the third party has had a fair opportunity to put his or her case at the earlier hearing there is nothing unfair" in preventing him or her relitigating an issue which had been decided in proceedings to which he or she was not a party. Referring to s.11(8) he said:

    "The requirement will obviously be satisfied if having been given notice of the application a third party chooses not to appear. If the third party does appear, he or she is entitled to make representations including a request to reopen issues decided by the Crown Court. But the subsection does not require the court to accede to such a request. It may do so if, for example, it is persuaded that there is fresh evidence which entirely changes the aspect of the case or that the Crown Court's decision was wrong in law." (pp. 1100-1)

Tuckey LJ distinguished this from the situation where the third party has had a "fair opportunity to put his or her case to the Crown Court and is asking to relitigate issues decided in the Crown Court on the same or substantially the same evidence and submissions". He described this as an abuse of process.

    " I do not attach great importance to the fact that the third party is not a party to the criminal proceedings. Where the third party participates in the Crown Court hearing the likelihood is that he or she will be making common cause with the defendant. The typical case will be that of husband and wife. In such a case the third party's interests are fully represented through the defendant. True it is that the defendant has a right of appeal against any confiscation order which is made to the Criminal Division of the Court of Appeal and the third party does not. However, in practice, the defendant has little or no prospect of appealing against findings of fact made by the Crown Court."

Applying this reasoning to the facts of the case, he concluded that the interests of Mrs Norris were "adequately represented" by leading counsel for the defendant. She and the defendant were making common cause about their respective interests in the house. The evidence she gave in the Crown Court was substantially the same as that she wants to give in the High Court; she was disbelieved in the Crown Court. The Court of Appeal dismissed Mrs Norris's appeal from the order of Latham J refusing to entertain her case that she had an interest in 7 Berryfield Close.

    23. My Lords, the reasoning and decision of the Court of Appeal depends upon the view which they took of the breadth of the principle of abuse of process and their assessment of what had occurred in the Crown Court. I consider that neither can be supported. Underlying their reasoning on both aspects was their failure fully to respect the view they had rightly taken of the legislation. Once the view taken by Buxton J was shown to be erroneous and the requirement of the High Court to hear the representations of interested parties recognised, the Court of Appeal should have given effect to the division of responsibility and function between the Crown Court exercising the criminal jurisdiction and the High Court exercising the civil jurisdiction. The criminal jurisdiction is concerned alone with what order to make under sections 1 to 4 of the Act. The procedure of the criminal court is solely concerned with the parties before it, the prosecution and the defendant. In some situations the Crown Court may also make compensation or restitution orders in favour of third parties who are given a right to apply (eg under sections 148 and 149 of the Powers of Criminal Courts (Sentencing) Act 2000), order property to be forfeited (eg vehicles used in the commission of the relevant crime) or to be returned to the loser (eg under the Theft Acts). But it is well established that these powers are only to be used where there is no disputed civil law right or similar issue which needs to be determined (eg s.148(5) of the Act of 2000). If there is such an issue, the proper course for the Crown Court to take is to leave the relevant person interested to pursue his or her civil remedy in the civil courts: R v Ferguson (1970) 54 Cr App R 410 and R v Calcutt (1985) 7 Cr App R (S) 385. The English system of criminal justice does not itself confer any civil jurisdiction upon the criminal courts and it takes a clear and express provision in a statute to achieve that result. The 1986 Act does not contain any such provision; indeed, as already explained, its clear intention is to preserve the distinction between the respective jurisdictions. The time and place for Mrs Norris to assert her civil law rights over 7 Berryfield Close was when the Customs and Excise attempted in the High Court to deprive her of her interest. It is at this stage that she becomes directly affected and has the right to invoke the remedies of the court in the defence of her civil law rights. In the criminal court she was a mere witness with no right of representation and no control of the proceedings and no right of appeal. It is relevant to observe that Lord Hoffmann remarked upon the same division of jurisdiction between the criminal and civil courts in Government of the United States of America v Montgomery [2001] HL1§22.

    24. It was wrong to say that her interests were identical with those of her husband. Indeed their proprietary interests were in principle opposed to each other. They were competing rights of property giving rights to one spouse against the other. It was in the interest of the defendant to put forward in the Crown Court the interest of his wife because he could use it to get a reduction in the confiscation order which was going to be made against him. But the wife's interests were not and are not the same as those of her husband. She wishes to preserve for herself and her children her right to live at Berryfield Close against her husband if necessary and against anyone claiming through him. The defendant also had an interest in mitigating the sentence of imprisonment which he was going to receive. The proceedings in the Crown Court were for the benefit of the defendant and the Customs and Excise, not Mrs Norris.

    25. These points are further reinforced by the reasons given by Judge Brown (which I have quoted in paragraph 10) and in particular by the parts I have italicised. Judge Brown placed the burden of proof upon the defendant to satisfy him that the amount that might be realised was less than the assessed proceeds: s.4(3). He treated himself as entitled to make presumptions against the defendant. He took into account the whole of the evidence which had been given in the course of the criminal trial. He discredited Mrs Norris as a witness because the defendant's counsel had elicited from her her belief in her husband's innocence. In the civil proceedings the starting point is that Mrs Norris is the registered freehold owner of the property and in occupation of it. Her apparent title has to be displaced by evidence. If she is considered to have only a partial interest, which she recognises is a possible view, the extent of that interest has still to be determined. No presumptions are to be made against her. The burden of proof is upon the Customs and Excise. The only case now being made against her is the claim to 7 Berryfield Close. In order to identify what are the beneficial interests in that property, it will be necessary to trace where possible the history of the contributions made to the sequence of properties which preceded the purchase of 7 Berryfield Close. It appears from the affidavit she has now sworn and the exhibits to it that at least some of the presumptions made by Judge Brown may be wrong and that his wholesale rejection of her evidence may have been unjustified. She has evidence to raise an arguable case that she has at least an interest in 7 Berryfield Close and it would appear that what happened in 1984 when Oakdene Road was sold and Prince Consort Drive purchased may arguably have involved a contribution from the defendant as low as £18,750 or 15 % of the purchase price of £120,000. The evidence admissible against her will be the evidence adduced in the High Court proceedings. Judge Brown was not engaged in an exercise of determining her rights in accordance with the civil law. Because of this, she was never given, nor was it intended that she should be given, the right in the Crown Court to place before Judge Brown, though counsel representing her and supported by the documentary and other evidence which she chose, her civil case. The issues to be determined in the Crown Court and in the High Court are related but are not the same. To adapt the language of Lord Diplock in the Hunter case [1982] AC 529, at 536 and 541, the question decided in the Crown Court was not on any view "identical" to that to be decided in the High Court nor was the Crown Court a "competent court" to decide against Mrs Norris what are her rights. Mrs Norris is not "misusing" the procedure of the High Court; she is making the proper use of the civil jurisdiction of the High Court to protect her proprietary rights as the 1986 Act contemplates that she should.

    26. The principles applied in the cases of Hunter and Ashmore do not apply. In Hunter the plaintiff was engaged in trying to relitigate in a civil court a factual issue which had already been decided against him in a criminal case in which he had been a party. It involved a collateral attack upon a decision in previous proceedings to which he had been a party, fully represented and with complete control over the evidence he wished to put before the court. The plaintiff had "had a full opportunity of contesting the decision in the court by which it was made": per Lord Diplock at p 541. The present case does not have those features. The Ashmore case is essentially a case of the marshalling of litigation. Where a civil court (or tribunal) is faced with an incident for which a defendant may be liable and which injured a large number of people or some situation where a large number of people similarly placed wish to make a contested claim against another, as was the case with the sex discrimination claim against the British Coal Board being made in the Ashmore case, the court, as a necessary part of the administration of justice, has to be prepared to make orders requiring the interested parties to come forward so that appropriate cases can be selected for trial and the parties can address the court upon whether their case raises any different issues from those selected. Each party has an opportunity to persuade the court that its case requires special treatment and should not follow the result of the selected cases. Any aggrieved party may seek to appeal such a procedural order. Where some interested party has been content not to intervene and awaits the outcome of the substantive trial, he must abide by the result, even if adverse, save possibly for seeking belatedly to intervene in order to support an appeal against the substantive decision. Simply to seek to relitigate the whole thing over again is an abuse of process and will not be allowed, as is more fully explained in the judgment of Stuart-Smith LJ in that case, [1990] 2 QB 338, at 345-355. These are illustrations of the principle of abuse of process. Any such abuse must involve something which amounts to a misuse of the litigational process. Clear cases of litigating without any honest belief in any basis for doing so or litigating without having any legitimate interest in the litigation are simple cases of abuse. Attempts to relitigate issues which have already been the subject of judicial decision may or may not amount to an abuse of process. Ordinarily such situations fall to be governed by the principle of estoppel per rem judicatem or of issue estoppel (admitted not to be applicable in the present case). It will be a rare case where the litigation of an issue which has not previously been decided between the same parties or their privies will amount to an abuse. As previously explained, the present case does not involve such relitigation nor is there evidence to support the more simple types of abuse. Your Lordships were also referred to the recent decision of the Court of Appeal in Gokal v Serious Fraud Office [2001] EWCA Civ 368, a case under the comparable provisions of the Proceeds of Crime Act 1995. The Court of Appeal distinguished between the position of the defendant who in the Crown Court, with the burden of proof resting upon him, could seek to satisfy that court that the amount which might be realised at the time the confiscation order is made would be less than the amount of benefit he had from the relevant offence or offences, who had a right of appeal and was thereafter bound by the outcome (§17) and the position of a third party such as Mrs Norris (§41). For the defendant to seek to reopen the decision by which he is bound was an abuse of process.

    27. A different procedural remedy might have been available to the Customs and Excise if the case had justified it. This is best illustrated by the Civil Procedure Rules, Part 24. If a party to litigation is pursuing a case with no real prospect of success, the court can recognise that situation and proceed to give judgment in accordance with the inevitable outcome of the litigation. If a case is patently and inevitably not going to succeed, the court is empowered to cut out the later formalities and proceed straight to judgment. A predecessor of Part 24, RSC O.14, followed a similar logic of adopting procedures which enable justice to be done without undue delay and expense. There are some similarities between these remedies and striking out for abuse of process but they are not the same. Before your Lordships, the Customs and Excise have urged your Lordships to dismiss this appeal since to fail to uphold the judgment of the Court of Appeal would be to create an inappropriate hindrance in the way of the enforcement of confiscation orders through the civil courts. But this is not so. If the third party is seeking to resist enforcement on grounds which can be seen to be bound to fail, then there is no reason why enforcement should be held up. If, on the other hand, there is something in the third party's defence in the civil proceedings, it should be determined in accordance with the normal civil procedures. In the present case, the Customs and Excise sought to treat the previous decision of the Crown Court as conclusive of any question which Mrs Norris might raise in the High Court. They did not at all enter upon the merits of what she was deposing to in her affidavit. The Customs and Excise were wrong in the stand that they had taken, as the had to concede in the Court of Appeal. But this does not mean that in other cases where the third party's case is manifestly without substance, summary procedures under Part 24 may not meet the needs of speedy justice.

    28. My Lords, I consider that the appeal should be allowed and that Mrs Norris be allowed to proceed with her defence to the claim which the Customs and Excise are making against her. The Customs and Excise must prove their case against her.

    29. Before concluding, I should add a number of footnotes. The Act of 1986 has been repealed and replaced by revised and more comprehensive legislation. It is not appropriate to discuss the current legislation but, although some aspects have been changed, like the requirement that the confiscation order should be made at the same time as the defendant is sentenced, and greater flexibility has been introduced, the treatment of third party rights and the role of the civil courts does not appear to have materially altered. The law and the criminal procedure in Scotland is not in all respects the same as that in England and Wales. Aspects of the Scottish law were considered in Advocate General for Scotland v McIntosh [2000] DRA 12. It would have been necessary to refer to this authority had the present appeal turned upon arguments under the Human Rights Act 1998. However although such arguments were addressed to your Lordships on this appeal, the appeal has been decided upon the consideration and application of well established principles of English law and the natural, and I believe, clear meaning of the 1986 Act. Had the position been different, it would have been necessary to consider whether the appeal should be allowed on the basis that Mrs Norris's rights under the Human Rights Act would have been infringed.

 
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