Campbell v Bromley Magistrates' Court

This is an appeal, pursuant to permission granted by Hamblen LJ on 1 February 2017, [2017] EWCA Civ 208, from an order made by Goss J on 26 November 2015, [2015] EWHC 3424 (Admin), refusing the appellant permission to apply for judicial review of a decision of DJ(MC) Hunter sitting in Bromley Magistrates’ Court on 10 March 2015. The District Judge was hearing forfeiture proceedings against the appellant pursuant to section 298 of the Proceeds of Crime Act 2002.

Before proceeding any further it is convenient to set out the relevant provisions of the Act. I start with section 294 which, so far as material, provides as follows:

Section 295, so far as material, provides as follows:

Section 297, so far as material, provides as follows:

Section 298, so far as material, provides as follows:

There is no need for any detailed exegesis of these provisions. The statutory scheme is clear, moving through three stages: seizure (section 294), detention (section 295) and forfeiture (section 298). Detention for more than 48 hours and forfeiture require judicial sanction on carefully defined criteria and subject, as might be expected, to appropriate procedural safeguards.

Two particular points need to be noted. First, that provided the court is satisfied of the matters specified in section 295(4) or section 298(2), as the case may be, there is no requirement that the basis of the seizure, detention and forfeiture remains the same throughout. Thus, subject to proof of the relevant “suspicion”, on the part of the constable, or of the relevant ground upon which the court is “satisfied”, cash can, for example, be seized on suspicion of having been stolen, can thereafter be detained by the constable on suspicion, or by the court on being satisfied, that is the proceeds of a VAT fraud, and can eventually be forfeited by the court on being satisfied that it has been laundered: consider, for example, the words “while its derivation is further investigated” in section 295(5)(a). The second point to be noted is that the effect of section 298(4) is, for example, that the power to order release under section 297 is no longer exercisable once the forfeiture proceedings are under way.

The litigation has been protracted, with various applications by the appellant to the Administrative Court, but so far as material for present purposes the facts can be very shortly stated. On 10 January 2014, a constable, in the course of executing at the appellant’s house a search warrant issued by DJ(MC) Fanning on 8 January 2014, seized a quantity of cash and arrested the appellant on suspicion of money laundering. On 17 February 2014, according to the police, a constable purported to re-seize the cash under section 294. Orders under section 295 were made by Bromley Magistrates’ Court on 19 February 2014 (for one month) and on 14 March 2014 (for three months). During the currency of the latter order, the police applied under section 298 for a forfeiture order. I need not go through the history of that application. Eventually it came before DJ(MC) Hunter on 10 March 2015.

Amongst other matters the appellant wished to challenge before the District Judge, was the legality of what had happened on 17 and 19 February 2014. I need not go into the details but he accused the police of having knowingly misled the court. The District Judge refused to embark upon that investigation. On 27 March 2015, he made an order for forfeiture in the sum of £7,770.

On 27 May 2015, the District Judge stated a Case on various matters raised by the appellant. The Case Stated identified, as an issue the appellant wished to challenge, the District Judge’s:

The one remaining issue, in relation to which Hamblen LJ granted permission to appeal, is, as set out in his order dated 1 February 2017,

The point before us is a short one. Reduced to essentials, the argument of Ms Anne Studd QC on behalf of the appellant is that if a challenge is raised to the lawfulness of either the original seizure or, as here, the subsequent detention of the cash, that matter must be determined as a preliminary issue by the court hearing the forfeiture proceedings. Mr Kennedy Talbot QC and Mr James Byrne, on behalf of the Commissioner of Police of the Metropolis, submit to the contrary. Ms Studd’s argument, they contend, is contrary both to the statutory scheme, if properly understood, and to the decision of Keith J in Secretary of State for the Home Department v Tuncel and another [2012] EWHC 402 (Admin), [2012] 1 WLR 3355.

It is convenient to start with Tuncel. The magistrates’ court, having decided that the case fell within section 298(2), ordered forfeiture. The defendant appealed to the Crown Court. His Honour Judge Oliver ruled that, before an order of forfeiture could be made under section 298, the court had to be satisfied that, at the time when it was seized, there had been reasonable grounds for suspecting that the cash had been obtained through, or was for use in, unlawful conduct; in other words, that the initial seizure was lawful. Since he could not be so satisfied, the judge ruled that the defendants had no case to answer. On the Home Secretary’s appeal by way of case stated, Keith J set aside the Crown Court’s order and remitted the case for further hearing.

Keith J’s reasoning is set out in paras 17-18 of his judgment:

I respectfully agree both with Keith J’s conclusion and with his reasoning.

There is, in my judgment, nothing in the decision of the Divisional Court (Gross LJ and Leggatt J) in R (Merida Oil Traders Ltd) v Central Criminal Court and others [2017] EWHC 747 (Admin) which ought to lead us to a different conclusion. The court was there concerned with section 295 (see para 68) and section 297 (see para 96), not with section 298. The judges cited Tuncel (see paras 54-55) without disapproval. Nor, in my judgment, does the judgment of the Lord Ordinary, Lord Clarke, in the Outer House of the Court of Session in Ho, Ho, Hing and Chin v Lord Advocate 2004 SC 1, upon which she relied, assist Ms Studd. The first question there was whether the sheriff, when exercising the court’s powers under section 297, had jurisdiction to consider the lawfulness of the seizure under section 294 or of the subsequent detention under section 295. Lord Clarke held (para 34) that the sheriff had no such jurisdiction: “all that the sheriff, in sec 297(1) proceedings, can have regard to is whether the conditions set out in section 295 continue to be met.” The second question was whether judicial review would, in appropriate circumstances, lie to challenge a decision of the sheriff under section 295. Lord Clarke held (paras 32, 36) that in principle it could. I respectfully agree with the Lord Ordinary, but the question before us is not as to the nature of the remedy available to a respondent who wishes to challenge a decision under section 295 or section 298, but whether, as a matter of substantive law, DJ(MC) Hunter was right in deciding as he did.

Reverting to section 298, I agree with Mr Talbot’s three central submissions: first, that the only question for consideration by the court when dealing with a forfeiture application is whether, as a matter of fact, the conditions in section 298(2) are satisfied; secondly, that the purpose of section 298(1) is merely to impose a temporal limit upon the ability of the constable to seek a forfeiture order; and, accordingly, thirdly, that section 298 does not require, as what Ms Studd calls ‘a gateway for forfeiture’, that the cash was properly detained under section 295. The point, at the end of the day, is as short and simple as this.

Ms Studd submitted that the effect of this was that, as she put it, a shutter comes down in relation to what has gone before. I do not agree. The central issue for the court when hearing a forfeiture application is whether the constable can establish the two factual matters set out in section 298(2). In relation to those factual matters, it is of course open to the respondent to mount any relevant challenge to the constable’s case, whether by cross-examination of the constable’s witnesses or by calling witnesses in his defence. If, in relation to those factual matters, it is relevant to his defence for the respondent to explore matters which arose in the earlier stages of the process, then of course he must be permitted to do so. And he is not to be stopped from doing so, always assuming it is relevant to the factual matters to be established under section 298(2), merely because it may, incidentally, involve allegations of illegality at either the seizure or detention stages. What, on the other hand, is impermissible, is an exploration of such matters not with a view to challenging the factual matters required to be established under section 298(2) but simply, as in the present case, with a view to challenging the legality of the earlier stages in the process.

In his judgment, Goss J explained why on this point he was refusing permission to apply for judicial review (para 37):

In my judgment, Goss J was correct to decide as he did and for the reasons he gave.

Accordingly, in my judgment, this appeal fails and must be dismissed.

After I had prepared the draft of this judgment, we received further written submissions direct from the appellant. In part they amounted to an attempt to widen the ambit of the appeal as defined by Hamblen LJ; in significant part they were, as a matter of law, irrelevant to anything we had to decide. Nothing in the appellant’s further submissions begins to persuade me to alter either my conclusions or my reasoning.”

I agree.