Ruddick v R.

This is an appeal against conviction and sentence.

On 30 June 2000 before HHJ Cartlidge and a jury, the appellant was convicted of one count of conspiracy to handle stolen vehicle parts. This was his second trial for this offence. The first trial had to be stopped after all the evidence had been given, because the appellant tried to nobble the first jury. On 13 April 2002, he was sentenced, after a late plea of guilty, to 3 years imprisonment for attempting to pervert the course of justice, to a fine of £25,000 and he was ordered to pay £14,000 towards the costs of the prosecution. The Judge, Potts J, indicated that he thought that if the appellant were convicted of the conspiracy offence at his second trial, a consecutive sentence would be appropriate. Thus it was that following his conviction after the second trial, HHJ Cartlidge sentenced the appellant to 3 ½ years imprisonment consecutive to the previous sentence of three years; he was also ordered to pay £104,000 towards the costs of the prosecution with two years imprisonment in default. At a later hearing, on 20 November 2002, HHJ Cartlidge made, effectively by consent, a Confiscation Order of £100,000 which was required to be paid within 6 months failing which a consecutive period of imprisonment was to be served of a further two years.

We shall deal, first, with the appeal against conviction. Although the appeal is with leave of the single judge, there are four grounds which Sir John Nutting QC, now instructed on the appellant’s behalf, would wish to argue. Of those grounds, 1 and 3 were the subject of the single judge’s permission, ground two was rejected by the single judge and ground four was never before him at all. It seems to us sensible to take all the four grounds, which are inter-related, and deal with them, whether technically the appellant is making an appeal with leave or is making an application for permission to appeal in relation to them.

A broad outline of the facts is sufficient for present purposes. The appellant was charged with two others: his long term partner, Debra Dixon, and the general manager of the car parts business, Mr Burnell. The appellant owned premises in Back Mailing Street, Walker, from which a spare car parts business was operated from 1993. The appellant acknowledged that he ran the business until 1996, but said that he had nothing to do with it from that year because he had rented out the part of the premises where the business was being carried on to Mr Burnell. The Appellant together with the co-accused Ms Dixon ran an ice cream business from another part of the premises. The car yard was visited by the police on 2 April 1998 and parts from a car stolen on 26 March that year were found in a plastic bag. Five motor engines were also taken away and the police were able to prove that these five came from stolen vehicles. The engine numbers had been removed and glass windows had been de-etched. A second search was made on 7 May 1998 when approximately 2,500 car parts were recovered and the prosecution proved that some of the parts had come from at least 23 stolen vehicles. Of the schedule of 25 stolen vehicles presented to the jury, the judge effectively directed the jury to ignore one, as the loser could not reasonably be expected to be able to identify his vehicle from any number of others of the same make; and in relation to another on the schedule the judge invited the jury to consider whether the evidence established that it was stolen. There was no issue about the others on that schedule.

Each of the defendants was interviewed by the police. The Appellant maintained that he was a mere landlord of the premises; Mr Burnell effectively agreed that a number of car parts were “iffy” and that quite a lot were “bent”. He initially supported the Appellant’s story that he was a tenant, but later said that he was a paid employee of the Appellant’s and that it was the Appellant who owned the business. The defendant Dixon said she had no involvement in the vehicle parts business at all, and that the ice cream business was the Appellant’s and run by his staff.

There were two issues before the jury: were the premises being used knowingly and dishonestly for dealing in stolen second-hand car parts; if yes, was the Appellant involved in it. In relation to the first issue, the prosecution relied upon the link between many of the 2,500 parts with vehicles which they could prove had been stolen. They also relied upon the fact that engine numbers had been removed, which the prosecution asserted showed that the defendants must have known they had been stolen; similarly with the de-etching of the glass. The prosecution also relied upon what they maintained was a suspicious lack of documentation relating to the business. There was no cash book or ledger to show when parts were acquired and how much was paid for them. That was, according to the prosecution, necessary if a stolen car parts business was being run: items could not be traced to suppliers. The Crown also relied upon the fact that they found at the Appellant’s home a number of receipts which were false and the names and addresses were fictitious. But as the Judge pointed out in his summing up, the Appellant could not necessarily be blamed if vendors provided to him false information.

As to the second issue, the prosecution relied upon extensive observations kept on the premises by the police. Those observations continued over a period of 114 days when films of activities at the yard were made. The court was shown a compilation made relating to 91 days filming. During those days, the Appellant was seen visiting the premises 447 times amounting to about 160 hours of attendance at Back Mailing Street premises. The Judge cautioned the jury to be careful about the suggestion that the police were able to deduce from their observations that the Appellant appeared to be in charge of Mr Burnell: the compilation did not show it. They also relied upon a visit made by undercover officers on 11 August 1997. The officers gave slightly differing accounts of their visit but they agreed that the Appellant was responsible for giving them a price for a particular engine. There were other visits, when the Appellant was not present but Mr Burnell was. During one of them, Mr Burnell said that the boss was away and that he was the only one there. The officers bought parts which were paid for in cash without any receipt. There were several other statements of a similar sort which tended to implicate the Appellant but which were not made in his presence.

Thirdly, there was evidence that the Appellant had paid a fine imposed by HM Customs & Excise in relation to the use of ‘red diesel’ in two of the ice cream vans. Finally the prosecution called an expert witness who had examined a typewriter ribbon found in the Appellant’s home. This showed that the ‘lease’ which the Appellant produced to show that the premises were let to Mr Burnell was made in September 1998, after the Appellant’s arrest. Finally the Prosecution relied upon an occasion when a vendor had been selling a van for potential use in the ice cream business and the Appellants had said, meaning Mr Burnell, “I’ll send my mechanic along”.

None of the defendants elected to give evidence.

The grounds of appeal are four in number. Sir John Nutting said that they should be looked at together rather than in isolation. When taken together they showed that the conviction could properly be described as unsafe.

The grounds, and we summarise them, are these:

After the evidence had been concluded, it was clear that parts of the case heavily relied upon by the prosecution in opening, were of no real significance, and despite the Judge’s directions their prejudicial effect tainted the conviction. In relation to this ground, the lack of engine numbers and the de-etching of glass, the absence of or damage to door locks and the rough cutting of engine hoses were not suspicious as the prosecution alleged but were part and parcel of an honest trade in second-hand parts. This was confirmed by witnesses called by the prosecution: namely a man who ran one of the largest auto salvage yards in the north east, a Mr Gee; a Mr Mason who ran City Road Garage a long established vehicle repairer and MOT tester, a representative from an insurance company; and a Mr Littlewood who ran a large vehicle dismantling company. The weight of this evidence showed that it was relatively common for engine numbers to be removed before a car was dismantled, so that the engine when fitted in another vehicle would not carry the ‘wrong’ number. The evidence showed that the obliteration of an engine number was not suspicious to those who worked in the trade. In order to prevent criminals from transferring the identity of a scrapped vehicle to a stolen vehicle many salvage companies de-etched the glass. The removal of door locks was not unusual or suspicious and the rough cutting of the engine hose was simply a function of time and cost and not suspicious.

The same situation applied to other evidence relied upon by the prosecution, namely the observations, the false receipts found at the Appellant’s home, the red diesel and the purchase of the ice cream van. None of this evidence lived up to the prosecution’s expectations and its significance was over stated in the prosecution’s opening statement. The observations added almost nothing to the case as the Appellant had a legitimate reason, the ice cream business, to be on the premises without being involved in the car parts business. There was a danger that the jury might have speculated in a prejudicial manner about the observations and why they were being carried out over such a long period and no direction to a jury could have cured the inevitable suspicion which such evidence must have created. As to the false receipts, the judge was forced to direct the jury to ignore this as it was obvious that some vendors might choose to give a false name and address and there were other receipts where true names and addresses had been given. As to the red diesel, this was prejudicial and irrelevant. The Judge dismissed it in trenchant terms but nonetheless its prejudicial effect could not be surmounted and it tainted the conviction. As to the purchase of the van and the remark about sending “my mechanic”, the Judge rightly invited the jury to disregard this evidence as having no real probative value. In the light of the change in emphasis of the prosecution case it was essential the Judge should take particular care to direct the jury as to the evidence which was admissible and relevant.

The Judge failed to direct the jury adequately strongly about the admissibility of evidence. During his summing-up the Judge had to be reminded by counsel that what Mr Burnell may have said during a visit by an undercover officer on an occasion when the Appellant was not present was not evidence against the Appellant. This direction should have been given before he summarized the evidence about these visits. There is no complaint about the way the Judge summarized their evidence. As a further example, it is clear that Mr Burnell was admitting in his police interviews that the business was dealing in stolen parts and he knew it; and his counsel had to accept in his submissions to the jury that Mr Burnell had no defence to a charge of handling stolen property. In these circumstances the Judge should have taken particular care to ensure that what Mr Burnell was saying to the police, and his admission to a charge of dishonestly handling stolen property, was not relied on as evidence against the Appellant. Only a direction in the strongest of terms could dissipate the potential prejudice caused by Mr Burnell’s various statements.

The Judge was wrong to rule that the prosecution was not obliged to call Mr Leslie Graham. This witness had given evidence for the Crown at the first trial and his evidence broadly helped the defence case. His name had been on the back of the indictment as a witness whom the prosecution were proposing to call, and his name had not been removed from that list before the second trial commenced. The prosecution had unsuccessfully attempted to avoid calling Mr Graham at the first trial; the trial judge having indicated that he thought that the prosecution should call him. He was a person who had a personal connection with the Appellant [the witness’ sister had had a relationship with the Appellant] and it was wrong that the prosecution should be able, in cross-examination, to seek to taint the value of the evidence by reference to the personal connection. The principle was clear: the prosecution should call the witness unless he was either incredible as a witness or incapable of giving truthful evidence.

Although this was the fourth ground, it was Sir John’s first point: the admission of the red diesel affair. He said that this evidence should never have been admitted. It was irrelevant and could only show that the Appellant ran the ice cream business. The fact that red diesel had been unlawfully used was purely prejudicial. There was no objection to the admission of this evidence. Counsel had agreed that the earlier rulings of the judge at the first trial should apply to the second trial. That included HHJ Orde’s ruling relating to the red diesel but it also included his rulings in relation to evidence from a computer found in the Appellant’s home which was damaging. Sir John submitted that whilst the prosecution should not seek to go behind a ruling made by the court on an earlier occasion, the defence should not be so constrained. By admitting this evidence the jury may have started to look at the other evidence through a false prism.

In our view, despite the cogency of the arguments, there is no merit in any of the grounds of appeal. We take the grounds in the order they are set out above, rather than in the order of Sir John’s submissions. It is not suggested that, as a result of the weakening of the case after it was opened, the trial should have been stopped or that a successful submission of no case to answer could have been made. In our view the Judge was conspicuously fair in the way he dealt with the evidence. He accepted some of the defence submissions as to the value of the evidence: thus, he dismissed the purchase of the van for use in the ice cream business in this way:

“Likewise I do not propose to mention again Mr Askew and his van. Do you remember the gentleman who was selling a van … which apparently would have been suitable for use in an ice-cream business. He said he was convinced that [the Appellant] who was negotiating the purchase of the van told him that he would send his mechanic along. It is not going to help you much though, is it, because it would appear the point of the purchase was to do with an ice cream van. If [the Appellant] did say “I’ll send my mechanic” it is really too much, is it not, to deduce from that that it means that [the Appellant] was the employer of Mr Burnell in the garage business. It is just the sort of thing, is it not, you might say if someone who you know is a mechanic and works there. Maybe it was said even possibly, I suppose, to impress. But not really of any significance, one would have thought in this case.”

Equally, the judge was dismissive of the red diesel incident.

“Likewise, members of the jury, I will not be mentioning again red diesel in an ice cream van. Do you remember, [the Appellant] had to negotiate the recovery of two ice cream vans which were running on red diesel. What that has to do with this case, one really wonders.”

And later on in his summing-up the judge deals fully and fairly with the engine numbers, the de-etching of windows, the rough cutting of hoses and the door locks. But the evidence was not to be dismissed in its entirety because the witnesses who were in the trade said that there would be documentation to support the identification of an engine by the number even had it been changed after regrinding and reprocessing. No criticism has been made of any of the Judges summation of the evidence and this ground when taken on its own has no substance to it.

As to ground 2, it seems to us that the Judge’s directions as to admissibility of evidence were clear and quite sufficient. Between pages 10E and 12E the Judge explains with great care why what X says in an interview at which Y is not present is not evidence against Y. It is clear that the Judge anticipated that that direction, although related to interviews with the police, would be thought by the jury to encompass statements made by Mr Burnell in the Appellant’s absence during visits by undercover officers to the business. The Judge had started to summarise this part of the evidence shortly before lunch. In the jury’s absence, counsel mentioned this problem and after lunch the Judge immediately told the jury, in relation to what he had previously said about statements in interview, that

“…the same applies in relation to these events that happened with [the Appellant] not being there. You cannot use the material in that as evidence against [the Appellant] when it consists of conversation between either Ms Dixon or Mr Burnell.”

In our view that was quite sufficient. The suggestion made by Sir John that the direction was less forceful because it was made after the Judge had started to summarise the evidence about visits has no force. The timing was such that the jury cannot have started to consider their verdicts without being aware of what the Judge had said about admissibility.

Ground 3 is without merit. The witness, Mr Graham, had given evidence at the first trial and there was a transcript of what he had said. It was shown to HHJ Cartlidge. He concluded that there was some justification for the prosecution’s belief that part of the witness’ evidence was untruthful. In particular, he drew attention to the part where the witness suggested that when an engine number was changed no record would be kept on any bill. Having reached that conclusion, he was entitled to rule as he did. In any event, the witness was called by the defence and we cannot see that any harm was done, having regard to the fair summary of the evidence in relation to engine numbers.

As to the red diesel evidence, there were plainly forensic advantages for both sides in not seeking to re-open the decisions made by the previous trial judge. There is no principle of law which prevents either party to such an agreement seeking to resile from it if the interests of justice so require. The defence team in this case [Sir John did not represent the Appellant at the trial] must have judged that the admission of the red diesel evidence was not damaging to their client’s case and any attempt to open up HHJ Orde’s rulings would or might have unfortunate repercussions for their client. That was precisely the kind of judgment which experienced counsel are required to take in any trial of substance. In the event, no damage appears to have been done. The Judge dismissed it; no doubt the Jury followed his lead.

We have looked at the case against the Appellant and considered the grounds of appeal individually and together. It seems to us that the jury was well entitled to convict the appellant. There was strong evidence that a proportion of the car parts business comprised stolen property. There were no records kept which was suspicious at the very least. The Appellant was constantly at the premises, if not actually in the part of the building where the car parts were being traded from. The lease was significant; it might have been to bolster a defence which was true, but the Appellant elected not to give evidence, and it seems to us that a combination of this material, together with the visit by undercover officers in August was sufficient to justify a guilty verdict. None of us considers that the verdict of guilty is unsafe; on the contrary, we think a conviction was almost inevitable if the Appellant chose not to give evidence.

The appeal against conviction is, therefore, dismissed.

We turn to the appeal against sentence. In addition to the conviction for conspiracy, to which the appeal against conviction related, Mr Ruddick pleaded guilty, together with Ms Dixon and Mr and Mrs Burnell, to what may conveniently be called benefit fraud. The facts are these. The appellant claimed income support and a job seekers allowance when he was entitled to neither. He was relatively well off with an ever growing bank account which he held jointly with Ms Dixon and which had over £450,000 in it in 1997. The Judge imposed a sentence of one year’s imprisonment consecutive to the 6 ½ years already imposed in relation to the attempt tp pervert the course of justice and the conspiracy to handle stolen property. When refusing leave to appeal, the single judge said that the sentence of 12 months was “light” and fully took into account the sentence already imposed. The sentencing judge also ordered that the defendant pay £40,000 compensation and £7,500 towards the cost of the prosecution. When passing sentence the Judge said that had this been the only matter a sentence of between two and three years imprisonment would have been appropriate, but that he bore in mind the totality principle.

The aggravating features of the benefit fraud were, first, that it was committed over a long period of time [January 1991 to July 1998] and was systematic; second, there was a substantial amount of loss to the public purse; and third, the Appellant did not need the money and was motivated by greed rather than poverty.

The following table summarises the various sentences and orders imposed and made upon the Appellant:

On behalf of the Appellant, Sir John Nutting QC, made a number of submissions;

The starting point for our consideration is the decision of this Court in the case of R v Sekhon & Others [2002] EWCA 2954. That is, and was intended to be, an authoritative ruling on the correct approach to the consequences of a breach of the procedural requirements of the legislation, and section 72A in particular. It seems to us that all decisions of the court prior to Sekhon must be looked at again. We derive the following principles from that decision.

We apply these principles to the first ground of appeal. It seems to us clear from the evidence as to what was said on 30 June 2000 that the Appellant would have known perfectly well that the prosecution were seeking a forfeiture order but at a date to be fixed later. Counsel for the prosecution asked that the matter be adjourned “for further consideration”. She indicated that the defence should be given a reasonable opportunity to consider the statement of benefit which the prosecution contended for [in the sum of £536,000 odd]. Counsel then appearing for the Appellant said that the matter would have to be adjourned and that the defence team should be given 14 days to respond to the statement. The Judge is recorded as saying “Hm” in response to defence counsel’s request for 14 days within which to respond. Thus, submits Sir John, the Judge never made an order adjourning the forfeiture process, he simply, at most, agreed that the Appellant’s counsel should be given 14 days to prepare a response. Attractively as the argument was presented, we are not in the slightest persuaded by it. Two experienced barristers were asking the court to postpone the forfeiture proceedings until after the Appellant had had a chance to respond. The matter was left on that basis and came back before the Court later in the year, when no objection was taken to the court’s jurisdiction on the grounds asserted by Sir John. Had the point been taken before the Judge we have no doubt it would have been met with a dusty answer. Of course the sentencing process had been adjourned and was still on-going when the forfeiture order was made, as the Appellant must very well have known. We have already indicated that an adjournment to a date to be fixed is sufficient compliance with the statute. As to the suggestion that the judge made no determination because he simply accepted what counsel had agreed, we roundly reject it. The judge will have had the chance to pre-read written material; he was familiar with the facts; he was not obliged to disagree with counsel’s assessment; and the sum agreed by two experienced counsel seems reasonable. The court made a determination when it accepted that the benefit was £100,000.

As to the second ground, the first question is whether a financial order made before the forfeiture process was completed is null and void, or whether it simply is a potential ground of appeal. What did Parliament intend? The words of the statute are mandatory in form and the purpose of the statutory sequence of events is to ensure that a forfeiture order is made before the defendant’s assets are depleted by any other financial order made in the course of the sentencing process. And, to this extent we agree with the decision in Threapleton. But what did Parliament intend in the event of a Judge not following the correct sequence of events? In our view there is no reason to suppose that Parliament intended that a failure to follow the correct sequence would, of itself, render the orders he made ‘unlawful’ or a ‘nullity’. If, for example in this case, the Judge made no forfeiture order, because he was not satisfied that the Appellant had received any identifiable benefit from his crime, would the costs order, nonetheless, have been void? We cannot think that Parliament would have intended this consequence. Procedural requirements must not be allowed to wag the dog. But, a failure to follow the correct procedure enables the Appellant to argue before the Appeal Court that had the proper sequence been observed then the costs order which was prematurely made should be quashed, because, ex hypothesi, the Judge had failed to take into account when he made it the amount of the forfeiture order. In this case, the amount of the forfeiture order, £100,000, was substantial, and we can see the force of the argument that the costs order might have been less after the forfeiture order had been made. Had there been a forfeiture order for a relatively small or nominal amount, the force of the argument would be weakened. We shall return the size of the costs order after we have considered the other submissions on costs.

Did the Judge err in the exercise of his discretion when he ordered the whole of the costs to be borne by one defendant? The statutory discretion given to a judge is to make such order as he considers just and reasonable. These are wide words. Because criminal costs orders are enforceable through the criminal process it is right that in principle a defendant should not ordered to pay any costs beyond his means, but apart from this, we can see no need to surround the discretion with restrictions or limitations. Where there are several defendants, as here, it might be just and reasonable to divide the costs between them all and make orders only against the ones who could afford to pay. But it might equally be sensible, where the defendants are jointly charged with a conspiracy, as here, to regard them all as jointly and severally responsible for the costs and make just one defendant pay the whole amount. In this case, the Appellant was the only one able to pay, apart possibly from Ms Dixon who may have had an interest in the bank account to which we have referred. But for the purposes of the costs’ order the Judge was entitled to regard the Appellant as the only available defendant against whom an order for costs should be made. On the jury’s verdict, the Appellant was running a crooked business through Mr Burnell his manager. The Appellant must have decided to fight a case when he knew he should have pleaded guilty. He had tried to pervert the result of the first trial, presumably because he realized he had no proper defence to the charge. Had he pleaded guilty, it is unlikely that there would have been a trial at all. In those circumstances, to make him pay all the costs cannot be said to have been either unjust or unreasonable. There is no system, at present, in the Crown Court for the taxation of the prosecutor’s costs. In our view, a Judge should be provided with sufficient information to enable him or her to see whether there have been any obvious extravagances during the trial process. It was not submitted to us that the costs order was excessive in itself.

We turn, therefore, to the amount of the costs order, having regard to the forfeiture order which was made at a later date. What would have been a just and reasonable order had the application for costs been made after the forfeiture hearing? It seems to us that, taking account of the size of the Appellant’s assets, the amount of the order was not manifestly excessive, even allowing for the forfeiture order, and the compensation order made in connection with the benefit fraud. Having chosen to contest the conspiracy case, the Appellant was responsible for the prosecution incurring substantial expense in bringing him to justice. As a defendant charged jointly with others, each exposed themselves to the risk of a costs order being made against them. He was the ringleader and cannot complain that he must pay the full cost. In those circumstances we are not prepared to quash the order made by HHJ Cartlidge, even though it was made out of sequence and did not take account of the forfeiture order he later made. But had we felt that the order made was excessive, we would have had no hesitation in exercising our powers under section 11(3) of the Criminal Appeal Act 1968 to make a new and lesser order. We disagree with the comment of the court in Threapleton that to do so “would be to condone the fact that the requirements of the 1988 Act were not complied with.” Whenever this court corrects an error made in the court below and exercises its powers under section 11(3) it could be said to be ‘condoning’ an error. But that is not the correct approach to section 11(3). That section is there to ensure that this court can properly do justice. The doing of justice is two sided. To deprive the prosecution of their costs order simply because of an error seems to us to be a one-sided approach to justice. In this case it is to be noted that none of the counsel who appeared in the court before HHJ Cartlidge ever suggested that he had acted outwith his powers.

Did the Judge err when he passed a sentence of two years in default of the payment of the costs? We conclude that he did not. Section 41 of the criminal Justice Act 1970, provides that a costs order made by the Crown Court “shall be treated, for the purposes of collection and enforcement, as if it had been adjudged to be paid on a conviction by a magistrates’ court”. The enforcement and collection process is entrusted to the magistrates’ court, but the crown court may take the view that the period of imprisonment in default that a magistrates’ court could impose is not sufficient and it may then specify a period of imprisonment not exceeding the period of imprisonment in default in relation to non-payment of a fine. A default sentence of two years was lawful, and, we think, entirely appropriate.

The final ground of appeal relates to the totality of the prison sentence. We are of the view that, on the basis of the material before the judges who made the orders, no criticism whatever could have been made of the terms of imprisonment imposed. But there is material before us which was not available in the court below because of which, and for no other reason, we are prepared to reduce Mr Ruddick’s sentence to 5½ years. To achieve this result we simply quash the sentence of 3½years imposed by HHJ Cartlidge and substitute a sentence of 1½ years, consecutively to the 3 years imposed on 13 April 2002 and the 12 months imposed on 18 December 2002 making 5½ years in total.