Beyond the boundaries of time – Haden, Luxton and section 14 of POCA.

Grace Khaile considers the Court of Appeal’s latest judgments on delay in confiscation proceedings. The two-year limit in section 14(5) of the Proceeds of Crime Act after conviction for the determination of confiscation proceedings appears to be no more than notional.  

On 16^th April 2024 the Court of Appeal handed down its judgment in R v Haden, Smith, Blair & Rohelsaar and Mann [2024] EWCA Crim 344 and R v Luxton [2024] EWCA Crim 340, allowing five appeals. Four of the appeals were considered in the main judgment and the fifth appeal was considered in a separate judgment as it included three further separate issues for the Court to consider.

Background Facts

The appeals from the Crown Court in each case were lodged by the Crown against refusals by judges to make confiscation orders against respondents because of a failure to complete the proceedings within the permitted time provided by s14 of the Proceeds of Crime Act 2002. The cases were unrelated to each other but were considered together for judgment as they referred to the same core issue. Each had different factual issues, summarised below.

R v Mark Haden

The defendant pleaded guilty to possession of a controlled drug of class A with intent to supply contrary to s5(3) of the Misuse of Drugs Act 1971 on 13^th May 2021 and was committed to the Crown Court for sentence. He was sentenced on 28^th July 2021 and the court decided to proceed under s6 of the 2002 Act and set a timetable. Despite attempts to get the matter listed before the end of the permitted period (12^th May 2023), the prosecution was unable to do so due to listing issues. The matter was listed on 27^th June 2023 where an application to extend the permitted period was made and the judge refused to extend the postponement period saying that he was not satisfied that issues with listing the matter constituted exceptional circumstances. The Court of Appeal found that the judge was wrong to find there were no exceptional circumstances as the prosecution had repeatedly asked the court to do what was required but the court failed to act.

R v Chadley Smith

 On 18^th February 2020, Mr Smith pleaded guilty (on a basis) to conspiracy to produce a controlled drug of class B, Cannabis, contrary to s1 (1) of the Criminal Law Act 1977. The prosecution made an application to postpone the relevant time periods for a confiscation order which was refused by the judge.

R v Jason Blair and Piret Rohelsaar

On 8^th September 2020, in the Crown Court at Cardiff, Mr Blair pleaded guilty to producing a controlled drug of Class B, namely cannabis, contrary to s4(2)(a) of the Misuse of Drugs Act 1971. Ms Rohelsaar pleaded guilty to permitting premises to be used for the production of a controlled drug, namely cannabis, contrary to s8 of the Misuse Drugs Act 1971. On 7^th January 2022 Mr Blair was sentenced to 22 months’ imprisonment suspended for 24 months and Ms Rohelsaar to a 12-month community order. On 1^st December 2022 the judge refused to make confiscation orders in both cases. At the hearing the judge refused to postpone confiscation proceedings in Mr Blair’s case as the application was made outside the two-year permitted period. In respect of Ms Rohelsaar, confiscation proceedings had been withdrawn after Blair asserted a particular property was his, but reinstated when he changed his position and asserted that she had an interest in the property. The postponement application was made in time, but the judge focused on the time which had elapsed between the service of Mr Blair’s s17 notice (July) in which the change of position was notified, and a hearing in December where the prosecution informed the court that it intended to reinstate the confiscation proceedings against Ms Rohelsaar. The judge said that “this plainly held up proceedings considerably” and that there were exceptional circumstances for the postponement application not to be granted (although he did not identify what they were).

R v Jake Mann, Kerry Long, Christopher Cartwright, Stephen Tootell, spencer Watkins & James Will

The judge at the Crown Court refused to extend the permitted period for the making a confiscation order. The case involving 12 defendants was heavily delayed by the fallout from the Covid-19 backlog, and the confiscation proceedings concerned six defendants who pleaded guilty. The confiscation proceedings were not commenced until after the expiry of the two-year period from the guilty pleas, although just prior to sentence.

R v Bradley Luxton [2024] EWCA Crim 340

This was the fifth case in the series of prosecution appeals under s31 of the Proceeds of Crime Act 2002, and was the subject of a separate judgment. Judgment was given because it raised three further issues beyond issues in the main judgment. The defendant pleaded guilty to six counts of conspiracy to supply controlled drugs and he was given a total sentence of 16 years’ imprisonment on 6^th August 2021. Confiscation proceedings were indicated at sentence but at the contested hearing the prosecution withdrew their application as no record could be found of the prosecution making an application to extend the permitted period. The three supplementary issues were: whether the ‘slip rule’ (section 385 of the Sentencing Act 2020) could be used to rescind a decision not to make a confiscation order and whether an appeal lay from that decision; the effect of making a financial order in breach of section 15(2) on the jurisdiction of the Crown Court to proceed with confiscation; and whether the prosecution could appeal where they themselves had withdrawn the application for a confiscation order based on their own erroneous interpretation of Iqbal [2010] EWCA Crim 376.

Statutory Framework – The Proceeds of Crime Act 2002

S31(2) of the Act enables the Crown to appeal, with leave, against a decision of a Crown Court judge not to make a confiscation order. S32 notes that on appeal the Court of Appeal may confirm the decision or if it believes the decision was wrong it may either proceed under s6 or direct the Crown Court to proceed afresh under s6.

S6 is the basic section setting the framework for the making of an order, including considering whether the defendant has a criminal lifestyle and if he has benefited from his general criminal conduct and whether he has benefited from his particular criminal conduct. If the court deems that the defendant has benefited from a criminal lifestyle or conduct it must decide the available amount and make a confiscation order requiring him to pay the lower of the two figures, the recoverable amount.

S14 is the section setting out the timetable. The court may make a confiscation order under s6 before it sentences the defendant for the offence or postpone the proceedings for a specified period, which s14(5) sets out is 2 years starting from the date of conviction. A postponement or extension may be made on application by the defendant, the prosecutor or the court of its own motion (s14(7)).  If such an application to extend the period is made before the period ends, the application may be granted even after the period ends (s14(8)).

Court of Appeal judgment

The judgment was reached after the court applied the principles derived from the leading decision of the House of Lords (Soneji [2005] UKHL 49) and the subsequent decision of the Supreme Court in Guraj [2016] UKSC 65 to the construction of s6 and s14 of the Proceeds of Crime Act 2002. In the majority of the cases under appeal, counsel and/or the judge had been swayed by the Court of Appeal decision in Iqbal [2010] EWCA Crim 376, which was held to have been wrongly decided.

The court confirmed that if confiscation proceedings have not concluded before sentence, they may be started and postponed so that they conclude after sentence. The commencement and postponement of the proceedings must take place before the court is functus officio. A court becomes functus officio in a criminal case when sentence has been imposed and time for variation or recission of the sentence under s385 of the Sentencing Act 2020 has lapsed, which is 56 days from the imposition of the sentence. The Court held that the postponement provision under s14 of the 2002 Act enables the court to conduct confiscation proceedings after sentence for this reason.

The two-year period permitted by s14 limits the time between the point when the court comes under a statutory duty to proceed with making an order and the time when the confiscation proceedings are to be concluded. It is therefore irrelevant to focus on the point at which the duty to proceed arises. The judgment confirmed that the permitted period may be extended if there are exceptional circumstances so that it is longer than two years. The period can be extended whether the two-year period has elapsed and whether an application was made before or after its expiry and indeed where no application has ever been made. The judgment held that a broad view should be taken when considering what constitutes exceptional circumstances. Non-compliance with requirements of s14 may be relevant to what order the court considers it fair to make. In a few cases it may render the proceedings an abuse of process, but such cases are likely to be very rare.

It is clear from the judgment that the Court of Appeal has attempted to remove the possibility of  any arguments being pursued in the lower courts about confiscation proceedings being out of time, or extension periods not being permitted due to delays. The point of s14(5) seems to have been lost.