Shabir, R. v

LORD JUSTICE THOMAS: There is before the court an appeal relating to a point under the Proceeds of Crime Act 2002. There is also an application for leave to appeal in relation to conviction.

It is not necessary to set out the matter in a great deal of detail but in essence it is as follows.

The facts

The appellant was a pharmacist in Leeds. In the course of his business the appellant dispensed prescriptions to the public. To reimburse him for this there is a well recognised procedure: he submits a form called FP34C that certifies each month that (1) the drugs in the schedule were in fact dispensed and (2) that the number of prescriptions in respect of which there was and there was not a payment was correctly identified.

The prosecution case was that the forms were inaccurate in that (1) a number of forms had been submitted in which the drugs or appliances had not been supplied and (2) there were a number of forms on which charges had been paid by the public which had been misclaimed as free prescriptions. Although it is not precisely clear what was agreed at the trial as to the extent of the course of conduct and the number of matters that were involved (and we shall return to that in a moment) it was the Crown's case that this was dishonest. The appellant's case was that he was busy and this was carelessness.

He was charged with false accounting and obtaining a money transfer by deception on a number of different occasions.

The case came on for trial before HHJ Hunt and a jury in the Leeds Crown Court in July 2005. Evidence was called as to the errors and how they occurred. The jury plainly disbelieved the appellant and convicted him on a number of counts.

He was sentenced to a term of imprisonment of nine months on each of the counts on which he was convicted, each sentence being concurrent to the other. There were then confiscation proceedings on 9th January 2006 and an order was made under the Proceeds of Crime Act 2002 for the confiscation to be in the sum of £212,464.17, with a period in default of two years imprisonment.

An application was made for leave to appeal against conviction out of time and also against the confiscation order. The full court granted the application in respect of the confiscation proceedings but referred the question of the application in respect of conviction to the court considering the appeal.

The application for leave to appeal against conviction

As a result of very helpful work by Mr Crowson, appearing in this case below on behalf of the Crown, it is clear that there had been an understandable misapprehension by counsel now instructed on behalf of the appellant which had led him to seek leave to appeal in respect of conviction. He has told us today that he does not intend to pursue that particular point but asks for the right to apply to this court on a subsequent occasion if another point which troubles him does give rise to grounds that can properly be put before the court. We would emphasise, of course, that that would be yet a further application to be considered by a future court, if such a matter is raised, on its merits. We need say no more about that.

The issue on confiscation

The confiscation issue in this case raises a stark issue. The learned judge, in the course of his sentencing remarks, made it clear that he was sentencing on the basis that the financial gain made was £464. He passed a custodial sentence, and rightly so, because this pharmacist, as he put it, had to go to prison because of the seriousness of his criminality; professional men and women are trusted to account for their expenditure on the basis of absolute faith. To an organisation such as the National Health Service, the integrity of pharmacists, in the high volume claimed in drugs supply where there is every opportunity for fraud and deception, cannot be stressed too much.

It is very necessary that when approaching the confiscation proceedings there is clarity as to the factual basis upon which the court is to proceed. The judge was asked to rule, in the course of a short hearing, whether the benefit under the Proceeds of Crime Act was the full amount of the payments that had been received on the claim forms on which there were the false entries or whether it was the modest sum of £464. On the former basis, the sum involved was just over £179,000. The judge was referred to two or three cases.

The Judge’s Decision

He told the parties that his view was that the benefit was the full amount of what had been transferred, namely the £179,000, giving, very shortly, the reason that he considered that the money would not have been paid at all had it not been for the dishonest representation. He asked the parties if they wanted a judgment and they said no.

Further solicitors and counsel were instructed because the size of the confiscation order obviously had very serious implications for the appellant and they sought leave to come to this court.

It is very, very unfortunate that a case should come to this court on a point such as this with no judgment from the judge and no findings of fact. It is perhaps again necessary to point out that, where confiscation proceedings involve very substantial sums of money, particularly where there are assets from which they can be realised, it is of great importance that the judge approaches this matter carefully and analytically and sets out the facts he finds so that this court, if an appeal is made, can proceed to deal with the matter. It may be that this case is an object lesson for showing that actually it is necessary to give such a judgment in most cases because there is always the risk that an appeal will be made to this court because even an agreement between counsel in a particular case, it seems to us, cannot rule out the prospect in a criminal matter that the matter will not come to this court.

The basis of the judge's decision was a statement from a Heather Wells, who said the following:

The appellant’s arguments

The argument that was sought to be made by the appellant was that, if one looked at this matter realistically and in accordance with the statutory provisions, the only benefit that it could be said the appellant had obtained was the sum of £464. It was accepted by the Pricing Authority that they were bound to pay for goods generally supplied and that, if there was a dishonest error in a particular form, that did not mean, or did not have the consequence, that the whole of the money claimed in that form was a benefit falling within section 76(4) or a pecuniary advantage falling within section 76(5).

The difficulty that we have faced today is that neither counsel who was before us was at the trial. We have been unable to ascertain from the very few papers in front of us how the sum of £464 came to be agreed and for what purpose. It seems to us that there may be two (or more) possibilities: (1) that the figure of £464 was agreed for the purposes of the Crown showing that there had been dishonesty in respect of certain invoices where they could actually prove that there were particular instances either of drugs not being supplied or paid prescriptions being claimed as unpaid prescriptions; (2) alternatively, it could be that, with the assistance of the Pricing Authority, a complete audit could have been done and it was clear at the end of the day, on a proper examination of the documents, the appellant could show that he had supplied drugs and given correct figures so that the amount to which he was entitled was roughly £178,500.

The reason why we consider it important to understand the process is that this case raises two important points:

(1) What has to be proved?

First it is the Crown's contention that in a case of this kind (which is an example where the principles would apply to many types of common criminal cases) the Crown’s task, in line with the statutory provisions, is a simple one. For example, if someone “fiddles” his expenses by putting in a false claim for one out of a hundred items on a claim form (or someone claims additional overtime or a contractor claims for work he has not done in a very complicated bill) the Crown is not bound to prove the exact extent of the dishonesty and each and every transaction which was dishonest where the circumstances are that initially the property would not have been transferred or the benefit would not initially have accrued if the dishonesty had come to light. That is the simple argument the Crown make. The appellant, on the other hand, says that is not what the statute permits. The Crown must show precisely what was the benefit.

(2) Multiple counts and criminal lifestyle

The second issue this case raises is that, because of the way in which the indictment was drafted, there were a number of separate counts and the appellant was convicted on a number of those counts. Because of the separate number of convictions, the Crown have been able to rely upon the provisions of the Proceeds of Crime Act, which deem this appellant to have a criminal lifestyle provided the benefit is over the sum of £5,000. It is said by the appellant that if the Crown's argument is right on that particular point, then a very large number of people can, by the drafting an indictment in a particular way, be brought within the criminal lifestyle provisions and that in itself has significant implications for this kind of case.

Directions

It seems to us that it is very difficult for this court to determine the points that arise in this case without a clear understanding of the facts, which we simply do not have because there is no judgment and neither counsel were present when this matter was dealt with before the judge.

We therefore intend to direct that counsel for the Crown, with, hopefully, the agreement of counsel who now appears for the appellant, can set out in a statement precisely what it was that was agreed during the course of the trial in respect of the amounts to which the appellant would have been entitled. Was a complete audit done or was something done? Was the agreement made as referable only to the trial or were any reservations made in respect of the confiscation proceedings?

It seems to us that one of the considerations a court may wish to have in mind when it has the facts before it and is considering the statute, is whether this is a case where it is possible to show that this appellant is truly entitled to the full sum of £179,000 in the certificates (less the items where dishonesty can be proved) or if this is a case where it is impossible to carry out that task? It seems to us there would be considerable force in a submission, bearing in mind the numerous authorities on this legislation, that, as the object of the exercise is to take from criminals the proceeds of their criminality, quite simply that to put the Crown to showing each and every transaction which was dishonest, in a case of what one might colloquially call “fiddling”, would make the legislation unworkable. But obviously that would have, or could have potentially, very harsh consequences bearing in mind the very large number of cases when an application under the Proceeds of Crime Act could be made in such circumstances.

As far as the researches of counsel have gone, the points that have arisen in this case have not been the subject of argument in this court. We think it highly undesirable to try and reach a decision without a certainty as to the factual basis upon which we would proceed. It is most unfortunate this has happened, but it is an object lesson for future cases that judgments must be given in cases of this kind by the court at first instance.

There is also an application before us for a representation order to be extended to solicitors. We decline that application. It seems to us in the first instance it should be possible to find out precisely what was agreed in respect of the sum of £460 in the respects which we have attempted to indicate. If, of course, it transpires that the matter is more complex than at first sight it appears, then an application could always be made to the Registrar. We would not encourage such an application as we believe that it should be possible to resolve quickly what the factual situation is. We would also direct this matter must be listed at a time when Mr Crowson can attend with current counsel for the appellant so if the court has further questions, they can be raised at that time. We would also direct that the information as to the agreement of the sums, together with sufficient supporting documentation to enable the court to see precisely what happened, is provided in support at least two weeks prior to the hearing that should be fixed. It is simply unsatisfactory that the matter should proceed without the facts being clear.

I hope that makes it clear precisely what we want.

MR EVANS: Yes, it does. I started with housekeeping, can I conclude with housekeeping? I have handed in today three bundles. Would it be better if I took them back or left them with my Lord? The only reason I ask is that on a previous occasion I submitted bundles that are no longer with the court, as I understand it, and --

LORD JUSTICE THOMAS: I think you should have them back and you may wish to add further authority. How long will this take to come on? How long will this take to do these enquiries?

MS WATSON: Probably about four weeks, my Lord, I think, to give us time to retrieve whatever document he needs. It may be that he does not have all the documentation, bearing in mind the length of time since this happened, so I would ask for four weeks.

LORD JUSTICE THOMAS: Shall we say it is to be listed not before 15th April and you may need to revise your skeleton arguments. How long will it take? Two hours?

MR EVANS: The issues are now very stark and it may ultimately be very short, but two hours, yes.

LORD JUSTICE THOMAS: I think it is important. Could you both submit skeleton arguments sequentially seven days before the hearing? (pause) No, I think we ought to have the material first and the skeletons to follow because you obviously have to know what the agreed material is.

MR EVANS: Because it might be that I have no, or at any rate, not an attractive point and I need to be clear about that before --

LORD JUSTICE THOMAS: Now, what about any renewed application? If that is to be made it must be made to the court hearing this matter.

MR EVANS: My Lord, I am not expecting to make any.

LORD JUSTICE THOMAS: I have said what I intended to say. So in the result today, the renewed application for leave to appeal against conviction is refused, so that matter is now dead. The matter can proceed purely for the basis of the short but important point which has arisen on the confiscation.

Thank you.