POCA UPDATE WINTER/SPRING 2014
5. Enforcement
Should interest be considered when sentences in default of payment are
activated?
R (on the application of Gibson) v Secretary of State for Justice [2013] EWHC 2481 (Admin)
4th September 2013
This case deals with a narrow point regarding the reduction given to sentences activated in
default of payment. The High Court’s judgment was informed by the regime under the
Proceeds of Crime Act 2002. The appellant had been imprisoned for 25 years for drug
trafficking and was subsequently found to have benefitted from this criminal enterprise in the
sum of £5.5 million. He was ordered to serve six years in default of payment. By the time
enforcement proceedings commenced in 2007 the total owed, including interest, amounted
to £8.1 million.
The appellant was eventually ordered to serve his default sentence, less a reduction of 7
days resulting from a payment made into court. The court had reached this reduction on the
basis of the £8.1 million owed at the time. It was the decision to use a figure of £8.1 million
rather than £5.5 million that was judicially reviewed by the appellant. What was therefore in
issue was the meaning of the words “at the time the period of detention was imposed” in the
Magistrates’ Courts Act 1980, section 79(2). Section 79(2) had originally been drafted to deal
with non-payment of fines, costs and other summary penalties and not with confiscation
orders. The regime under POCA 2002 could not have been contemplated at the time section
79(2) was drafted but it was nonetheless made clear that the term “at the time the period of
detention was imposed” meant when the default sentence was activated and not when it was
originally set. The court had therefore been correct to reduce the appellant’s sentence with a
view to the total owed including interest.
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Castillo principles applied in assessment of the default term
R v Owolabi (Gbolahan Anthony) [2013] EWCA Crim 1438
17th July 2013
The appellant appealed against a default term of imprisonment of 30 months’ imposed after
conviction for fraud involving the cloning of credit cards. He had committed many similar
offences in the past and was ordered to pay a confiscation order in the sum of £56,000. He
was ordered to pay this sum within a six month period but failed to repay any of the monies
and was subsequently ordered to serve the default term. It was agreed by the parties that
under section 139 of the Powers of Criminal Courts (Sentencing) Act 2000, the maximum
period of imprisonment for a fine exceeding £50,000 was two years; the appeal was to be
allowed. It was argued by counsel on behalf of the appellant that as his confiscation order
was only just above this threshold, and that he had belatedly started to make repayments,
his default term of imprisonment should be low.
The Court of Appeal applied the principles in R v Castillo (German) [2011] EWCA Crim
3173, [2012] 2 Cr. App. R. (S.) 36. The court should not be influenced by the overall totality
of the sentence passed for the crime and should have regard to the maximum amount of a
confiscation order within the band and the maximum default term within the band. The court
had to have regard to proportionality. The purpose of the default term was to secure
satisfaction of the confiscation order and so deprive the criminal of the proceeds of his crime.
Therefore the demands of proportionality were much weaker than where the court was
punishing the offender. Having considered these factors it was decided that the appropriate
period of imprisonment in default was one of 21 months’ imprisonment.
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It was open to the Crown Court at the enforcement stage to treat a gift
as tainted property notwithstanding the court had not made an explicit
finding to that effect when the confiscation order was originally made
R (on the application of Heron) v Serious Organised Crime Agency [2013] EWCA Civ 1106
22nd July 2013
The appellant appealed against a decision refusing permission to seek judicial review of the
decision of the Crown Court at the enforcement stage of proceedings to treat a gift (namely a
property) to her (a third party to the original confiscation order) as a tainted gift.
It was found that there had been particular reasons that the judge had not made a specific
ruling on this point when the original confiscation order was made. Firstly, the entire
argument at the first stage had centred on a bridging-loan made by the defendant to the
appellant which the defendant had funded through criminal activity, and that loan had not
been the defendant’s property at the date of the confiscation order. The defendant had
agreed to the disputed property constituting part of his realisable assets and it would have
been duplicative to find tainted gifts as well as proceed on the basis that the loan was a
benefit. All of the facts relied upon by the court to establish the property was a tainted gift at
the enforcement stage had been found by the judge at the original hearing and no prejudice
was caused to the appellant by concluding the judge had in effect found when the original
order was made that there were tainted gifts. No evidence had since been produced to
demonstrate the property was not a tainted gift and in all those circumstances the appeal
failed. The facts relied upon for the finding had been established when the original order was
made.
Quinton Newcomb Barnaby Hone Jacob Edwards Simon Walters
Chambers of Michael Hubbard Q.C. and Karim Khail Q.C.
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