The only issue in the appeal concerns the confiscation order. The appellant submits that a Crown Court has no power to make to make a confiscation order against a defendant following conviction for an offence if he or she receives an absolute or conditional discharge for that offence. The sentencing judge decided that the Crown Court has such a power. He made a confiscation order in the sum of £1500, which the appellant now appeals.

The appellant pleaded guilty to concealing criminal property contrary to section 327 of the Proceeds of Crime Act 2002 and was conditionally discharged for a period of two years pursuant to section 12 of the Powers of Criminal Courts (Sentencing) Act 2000 (“the 2000 Act”). On 19 July 2007 he was made subject to a confiscation order in the sum of £1,500.00 pursuant to section 6 of the Proceeds of Crime Act 2002 (“the 2002 Act”). He was ordered to pay within 3 months or to serve three months’ imprisonment in default.

Having given leave to appeal and heard argument, we asked counsel to lodge an agreed note of the history of sections 12 and 14 of the 2000 Act within 28 days. In fact Mr Knowles for the respondent shouldered the not inconsiderable burden of preparing the note and we are very grateful to him. The note sets out in great detail the history of sections 12 and 14, a history with which Mr Butcher agrees. For various understandable reasons the note did not reach the court until November.

Section 12 of the 2000 Act, as amended, provides:

It will be noted that sub-section (7) does not include a reference to confiscation orders, although by the year 2000 there had, since 1986, been provision for making confiscation orders.

Section 14 of the 2000 Act provides:

Section 6(1) of the 2002 Act, as amended, provides:

The second condition can be ignored for present purposes. The first condition is set out in sub-section (2), which provides:

In so far as section 2(b) is concerned, section 3 of the 2000 Act gives a magistrates’ court the jurisdiction to commit for sentence “where on the summary trial of an offence triable either way a person aged 18 or over is convicted of the offence.” Section 4 of the 2000 Act provides for committal for sentence on indication of a guilty plea to offence triable either way. The section envisages the magistrates’ court proceeding as if section 9(1) of the Magistrates' Courts Act 1980 were complied with and as if he had pleaded guilty under it and the court had convicted him of the offence. Section 6 of the 2000 Act gives further power to commit to the Crown Court for sentence a person convicted of a summary offence. Section 5 of the 2000 Act provides that where an offender is committed by a magistrates' court for sentence under section 3 or 4 above, the Crown Court shall inquire into the circumstances of the case and may deal with the offender in any way in which it could deal with him if he had just been convicted of the offence on indictment before the court.

In so far as section 2 (c) is concerned, section 70 gives the magistrates’ court the power to commit the defendant to the Crown Court with a view to a confiscation order being made and, if it does so, the Crown Court will also sentence the defendant (see section 71). The power to commit arises, by virtue of section 70(1) if—

Sub-section (5) of section 6 of the 2002 Act provides:

Section 13 provides:

Section 14 of the 2002 Act provides:

As we have seen, section 6 of the 2002 Act requires the Crown Court to make a confiscation order (the other requirements being satisfied) if the defendant is convicted of an offence in proceedings before the Crown Court or has been committed to the Crown Court for sentence or committed to the Crown Court with a view to a confiscation order being made. In the latter two cases the defendant will have been convicted or is treated as having been convicted.

We take the history of the power to grant an absolute or conditional discharge from the respondent’s post appeal hearing written submissions, being a history with which, as we have said, Mr Butcher agrees.

As Mr Knowles points out:

As Mr Knowles also points out, in addition to these statutory powers, the courts also had the ancient power to bind over convicted persons to come up for judgment and to bind over any person to keep the peace, powers which they still have (see Archbold, 2009, paras. 5-118 and following).

The Probation of First Offenders Act 1887 introduced the concept of probation, albeit in a very different form to the concept of probation as known to us today. In the words of Mr Knowles:

Mr Knowles summarises the effect of this Act in the following way:

The Criminal Justice Act of 1948 repealed the 1907 Act. Section 3 provided that following conviction a probation order could be made “instead of sentencing” the offender. By virtue of section 7(1) where a court thought it was inexpedient to inflict punishment on a convicted offender but that a probation order was not appropriate it had power to make an order discharging him “absolutely, or, if the court thinks fit, discharging him subject to the condition that he commits no offence during such period, not exceeding twelve months from the date of the order, as may be specified”. In the words of Mr Knowles:

Section 12(1) provided that “a conviction of an offence for which an order is made ... discharging [the offender] absolutely or conditionally shall be deemed not to be a conviction for any purpose other than the purposes of the proceedings in which the order is made and of any subsequent proceedings which may be taken against the offender under the foregoing provisions”. The conviction was also to be “disregarded for the purposes of any enactment which imposes any disqualification or disability upon convicted persons, or authorises or requires the imposition of any such disqualification or disability” (section 12(2)).

In Taylor and another v. Saycell [1950] 2 All ER 887, Lord Goddard CJ, giving the judgment of the Divisional Court said, at page 889:

This part of the judgment is obiter because the case was sent back to quarter sessions below because the order of conditional discharge should not, on the facts of the case, have been made.

Lord Goddard did not refer to the words of section 12(1), which provided that the conviction was to be regarded as a conviction for the purposes of the proceedings in which the order is made. Mr Knowles casts doubt on the decision in Taylor. It is certainly arguable that section 12(2) was concerned with proceedings in the future in which the conviction might, but for section 12(2), be relevant. The reference to “convicted persons” in section 12(2) does tend to support that. Section 12(1), on the other hand, was concerned with the proceedings in which the order for absolute or conditional discharge is made and does not prevent an order of disqualification. However, even if Taylor is wrong on this point, that is not an end of the matter. As we shall show in a moment, punitive orders have been held to be inconsistent with the decision that it is inexpedient to inflict punishment.

In so far as section 12(2) is concerned Mr Knowles writes:

The position established by Lord Goddard in Taylor was eventually “reversed” by the Road Traffic Act 1972, section 102 which made provision for disqualification “notwithstanding anything in section 12(2) of the Criminal Justice Act 1948”. Similar provision is now to be found in section 46 of the Road Traffic Offenders Act 1988, which provides as amended by a number of Acts including the 2000 Act:

The Powers of Criminal Courts Act 1973 repealed the 1948 Act but made provision for probation orders and orders for conditional and absolute discharge similar (in the present context) to that made by the 1948 Act. Section 2 was in similar terms to section 7 of the 1948 Act and section 13 was in similar terms to section 12 of the 1948 Act. Section 12(4) of the 1973 Act provided that a court discharging and offender absolutely or conditionally may order him to pay costs and compensation.

In Savage (1983) 5 Cr. App. R. (S.) 216, the Court quashed a deprivation order made against a defendant who had been conditionally discharged. The Court said:

A similar conclusion (albeit without reference to Savage) was reached in Young (1990-1991) 12 Cr App R (S) 262, in so far as orders for disqualification under the Companies Directors Disqualification Act 1986 were concerned. Brooke J, as he then was, said:

The Court in Savage and Young thus held that the making of punitive orders was inconsistent with the decision that it was inexpedient to inflict punishment. As we shall see, the legislation was later amended in 1998 to permit such orders.

But assuming Savage and Young still to be good law, it follows that no punitive order may be made except those listed in what is now section 12(7) and in any enactment which expressly or impliedly provides for the making of a punitive order notwithstanding what is now section 12(7).

The respondent referred us to R v Secretary of State for the Home Department, ex parte Thornton [1986] 2 All ER 641 where the Court of Appeal held that a police officer for the purposes of disciplinary proceedings had been “found guilty by a court of law of a criminal offence” following a plea of guilty to an offence of wasting police time, albeit that he was subsequently conditionally discharged by the court before which he had pleaded guilty. Reference was made to cases in which it had been said that the word "conviction" was equivocal, sometimes being used as meaning the verdict of the jury and at other times being used in a more strictly legal sense for the sentence of the court. We do not think that this case helps to resolve the issue in this appeal.

The provisions of the 1973 Act dealing with absolute and conditional discharges were replaced by the Criminal Justice Act 1991. A new section 1A was inserted into the 1973 Act. Sub-section (1) provided:

By virtue of the new section 1C and subject to a number of exceptions a conviction of an offence for which an order is made discharging the offender absolutely or conditionally was deemed not to be a conviction for any purpose other than the purposes of the proceedings in which the order is made and of any subsequent proceedings which may be taken against the offender under the following provisions of this Act. By now there were a number of statutory provisions which specifically authorised the imposition of orders even though an offender had been absolutely or conditionally discharged.

As Mr Knowles points out, the working of the 1991 Act was remarkably complex and led to difficulties: see R v Moore [1995] 16 Cr App R (S) 748.

The Crime and Disorder Act 1998 amended section 12(4) of the 1973 Act (as amended by the 1991 Act) so that it now read:

Section 12(4) of the 1973 Act had given the court, having discharged the defendant absolutely or conditionally, the power to order the offender to pay costs or compensation. The 1998 amendment gave the courts power, in the light of the decisions in Savage and Young, to make these other punitive orders. Although the power to make confiscation orders had first been granted in 1986 for drugs offences (Drug Trafficking Offences Act) and in 1988 for other offences (Criminal Justice Act 1988), no reference was made to confiscation orders, although the draftsman must have had Savage and Young in mind. It is also worth noting that section 83 of the Crime and Disorder Act provided for the making of confiscation orders on committal for sentence. Thus the draftsman was at the same time making amendments to the regime of confiscation orders.

The Powers of Criminal Courts (Sentencing) Act 2000 repealed the Powers of Criminal Courts Act 1973 and replaced it, in so far as relevant to this appeal, with the provisions which we have already set out. Section 12 of the 2000 Act remains relatively unchanged from its predecessor, section 1A. Section 12(4) of the 1973 Act is now to be found in an updated form in section 12(7) of the 2000 Act. Section 14 of the 2000 Act largely mirrors section 1C of the 1973 Act.

There a number of statutory provisions which provide that various orders may be made even though an order for an absolute or conditional discharge is being made. These provisions have been amended by the 2000 Act to reflect the fact that the regime for absolute and conditional discharges is now to be found in that Act. We have already looked at the relevant section in the Road Traffic Offenders Act.

Section 1 of the Licensed Premises (Exclusion of Certain Persons) Act 1980, as amended, provided:

The whole of that Act has now been repealed by the Violent Crime Reduction Act 2006 (Schedule 5) although (as we understand) the repeal has not yet been brought into force. Section 7(3) of the 2006 Act, not yet in force, provides that

A drinking banning order therefore cannot be made if the offender is discharged absolutely.

The Football (Disorder) Act 2000 repealed various provisions in the Football Spectators Act and inserted in that Act new sections 14 to 14J. Section 14A(5) provides that:

Under the Sexual Offences Act 2003 a person convicted of a relevant sexual offence and made the subject of a conditional discharge order is subject to a notification requirement for three years (see Longworth [2006] UKHL 1; [2006] 2 Cr. App. R. (S.) 62, below in which the relevant provisions are considered).

Having set out the relevant provisions and their legislative history, we turn to the issue which we have to resolve: does a Crown Court have the power to make a confiscation order against a defendant following conviction for an offence if he or she receives an absolute or conditional discharge for that offence.

We make two preliminary points. It follows from section 14(1)(a) of the 2002 Act that a Court may proceed to make a confiscation order before passing sentence. Mr Knowles submits that this provides a strong argument in support of the proposition that, under the 2002 Act, an order of absolute or conditional discharge would not prevent the making of a confiscation order. If it did, then a confiscation order made before sentence was passed would (presumably) have to be quashed if, subsequently, an order of absolute or conditional discharge was made and yet there is no express power to do that. On the other hand it is not likely to be very often that the Crown Court will be contemplating a conditional or absolute discharge and a confiscation order.

There is another pointer towards the correctness of the respondent’s submissions (albeit not relied on in argument before us). Section 28 of the 2002 Act requires the court to proceed under section 6 in circumstances where a defendant absconds having neither been acquitted nor convicted.

If the 2002 Act is read on its own then there can be no doubt that the court has jurisdiction to make a confiscation order. The first condition (para. 8 above) which triggers a requirement to proceed under section 2 has clearly been satisfied. The appellant has been convicted.

Turning then to section 14 of the 2000 Act, sub-section (6) does not help the respondent. Sub-section (6) provides:

No provision of the 2002 Act is, in our view, an “enactment that excludes the effect of sub-section (1) or (3) above for particular purposes”.

Section 46 of the Road Traffic Offenders Act 1988, section 14A of the Football Spectators Act 2000 and section 1 of the Licensed Premises (Exclusion of Certain Persons) Act 1980 are such enactments.

Section 46 of the Road Traffic Offenders Act 1988 provides, as we have seen, that “notwithstanding anything in section 14(3) of the Powers of Criminal Courts (Sentencing) Act 2000 ... a court in England and Wales which on convicting a person of an offence involving obligatory or discretionary disqualification makes ... an order discharging him absolutely or conditionally” may or must disqualify/endorse. The reference to section 14(3) must have been included because of Taylor, in which the Court decided, albeit obiter, that what is now section 14(3) prevented the imposition of an order of disqualification. It follows from the reference to section 14(3) in section 46 of the Road Traffic Offenders Act that the draftsman was “accepting” Lord Goddard’s interpretation of what is now section 14(3), namely that it prevented the imposition of any disqualification or disability in the proceedings for the offence for which the conditional discharge had been granted, subject to any contrary enactment.

When drafting the amendments to the Road Traffic Offenders Act it was not apparently thought necessary to add a reference to section 12 as well as section 14(3) to deal with disqualification because section 12(4) had been amended to give the court power to impose a disqualification. It is perhaps surprising that it was not thought necessary to add a reference to section 12 so as to make it clear that the court had power to endorse a licence notwithstanding the decisions in Savage and Young that no punitive order could be made, such an order being inconsistent with a decision that it was inexpedient to inflict punishment upon the offender.

Section 14A of the Football Spectators Act provides that a banning order may be made in spite of anything in sections 12 and 14 of the 2000 Act. A banning order is being seen as punitive and, not being within section 12(4), it (presumably) needs to be made clear that section 12 (as interpreted in Savage and Young) does not prevent the imposition of a banning order. Section 14 (presumably) needs to be referred to in case it be thought that a banning order is a form of disqualification or disability.

Turning then to section 14(1), it provides, as we have seen:

Mr Knowles submits that the appellant’s conviction is a conviction for the purposes of the proceedings in which the order is made.

Mr Butcher submits that it is not. He relies on Longworth, a decision which HH Judge Lyon in the instant case distinguished. Lord Mance gave the leading speech with which the other members of the Committee agreed.

In Longworth the appellant had pleaded guilty to counts of making indecent photographs of children, contrary to s.1(1)(a) of the Protection of Children Act 1978 and of possessing indecent photographs of children, contrary to s.160(1) of the Criminal Justice Act 1988, for which the judge imposed conditional discharges under section 12 of the 2000 Act. The judge also made orders under the Sex Offenders Act 1997 that Longworth be subject to the notifying provisions for five years. That order was made under the Sex Offenders Act 1997. The trigger to enable such an order to be made under that Act was (under section1 1(1) (a) of the Act) that “(the offender) is convicted of a sexual offence to which this Part applies.”

The point of law of general public importance was:

The House held that the judge had no power “to determine whether any and what notification requirements arose under the 1997 Act consequent upon the orders of conditional discharge which he made” because “if there was any requirement to notify under section 1 of the Sex Offenders Act 1997 in consequence of the appellant’s convictions in the proceedings under the 1978 and 1988 Acts, it arose independently of anything provided in those Acts and of any order which was or could be made by the court in the proceedings or on the convictions under those Acts; and further that the only statutory sanction for failure to register was to be found in s.3 of the 1997 Act” (paragraph 14).

Lord Mance said (paragraph 20):

Lord Mance continued:

This is an important passage and the fact that the focus of the phrase “the purposes of the proceedings” is said to be narrow, seems to help the appellant. But on a closer analysis we do not think it does.

By virtue of section 14(1), a conviction for an offence for which the offender receives an absolute or conditional discharge “shall be deemed not to be a conviction for any purposes other than the purposes of the proceedings in which the order is made ... .” Lord Mance tells us that the “purposes of the proceedings” are to determine whether he is guilty and what punishment is appropriate. The sub-section only comes into play after the decision has been made to discharge the offender absolutely or conditionally because it is thought to be inexpedient to inflict punishment. The draftsman must be including the words “the purposes of the proceedings in which the order is made” to make it clear that certain associated punitive orders may be made against a person who has been absolutely or conditionally discharged. The draftsman needed to do this because, as we have seen, section 12(7) permits the court to disqualify a person who has been absolutely or conditionally discharged and to make compensation orders, deprivation orders and restitution orders, all or some of which are clearly “punishment”.

It is now well established (albeit in the context of the European Convention of Human Rights) that confiscation proceedings fall to be treated as part of the process of sentencing and that a confiscation order is a penalty: see e.g. R. v Briggs-Price [2009] UKHL 19, paras. 30, 63, 112, 113, 115 and 134.

Given that Lord Mance had decided that the judge had no power “to determine whether any and what notification requirements arose under the 1997 Act consequent upon the orders of conditional discharge which he made”, it followed that the order requiring the appellant to make the required notification was not made “for the purposes of the proceedings”.

Lord Mance however also said in support of the conclusion that the order requiring the appellant to make the required notification was not made “for the purposes of the proceedings”, that the “duty to register and the statutory sanction for failure to register were both imposed independently by the 1997 Act itself ... ” (paragraph 22). Our problem with this passage is that the orders referred to in section 12(7) are also “imposed independently”, that is by statutes other than the statute creating the offence and yet the draftsman must have had them in mind when drafting section 14(1).

In our view the procedures under section 6 of the 2002 Act are within “the purposes of the proceedings in which the order is made”.

We turn briefly to section 14(3). On the assumption that sub-section (3) of section 14 applies to the proceedings in which the order of absolute or conditional discharge is made, a confiscation order is not a disqualification or disability.

Thus, in our view, there is nothing in section 14 of the 2000 Act which prevents a Crown Court judge from making both a confiscation order and an absolute or conditional discharge order.

The much more difficult issue is whether section 12 prevents a Crown Court judge from making a confiscation order and an absolute or conditional discharge order. Mr Butcher submits that a confiscation order is punishment and therefore it is not possible to make a confiscation order having found that it is inexpedient to inflict punishment. He submits that section 12(7) does not help the respondent in that it does not include confiscation orders, whilst including costs orders, disqualification orders, compensation orders, deprivation orders and restitution orders, some or all of which are punishment.

Section 12(7), as we have seen, provides:

As we have already noted (para. 37 above), the predecessor to this sub-section (or at least the large part of it) appears to have been included in the light of the decisions in Savage and Young.

There can be no doubt that confiscation orders constitute punishment. The regime under what is now the 2002 Act is aptly described as “Draconian”. The use of the offender’s realisable assets to recover any benefit (not merely profit), including benefits from criminal activity unassociated with the index offence with a maximum of ten years in default must constitute punishment. Thus applying these cases, the making of a confiscation order is inconsistent with a finding that it is inexpedient to inflict punishment.

A passage in the speech of Lord Mance in Longworth assists the appellant:

In section 12(7) is there is no reference to confiscation proceedings and in the 2002 Act there is no reference to absolute or conditionally discharges. What Lord Mance makes clear is that the legislature has had well in mind the need to make provision for the consequences of making orders of absolute and conditional discharge, sometimes distinguishing between them. As we have seen, the 2000 Act amended a number of other Acts to make reference to sections 12 and 14 of the 2000 Act. The absence of any reference to confiscation proceedings in section 12(7) is, in our view, telling.

The fact that the 2002 Act imposes a mandatory regime is obviously a powerful argument for saying that the court must proceed under section 6 even though the defendant is being absolutely or conditionally discharged. However, in the light of Savage and Young, section 12(7) and of the history of section 12(7), we have reached the conclusion that the Crown Court has no power to make to make a confiscation order against a defendant following conviction for an offence if he or she receives an absolute or conditional discharge for that offence. If Parliament had wanted to include confiscation orders within the 1973 predecessor to section 12 (see para. 37 above) or in the 2000 Act, it could easily have done so. We are mindful of the fact that the orders which had been made in Savage and Young were made under legislation which gave the power to make the order but did not require the making of an order, but we do not think that this affects the conclusion which we have reached.

Given that a confiscation order can, at least in theory, be made before passing sentence, it would obviously be prudent in those very rare cases where an absolute or conditional discharge is a possibility, to decide upon sentence first. We do not think that offends section 13 of the 2002 Act (see above, para. 12).

For these reasons the appeal is allowed and the confiscation order quashed.