Nawaz & Anor, R v

MR JUSTICE NICOL: On 15th May 2008 Mohammed Nawaz was convicted of attempting to acquire criminal property (count 5 on the indictment). Zukria Noreen was convicted of acquiring criminal property contrary to section 329(1)(a) of the Proceeds of Crime Act 2002 (count 9).

Previously on 23rd July 2007 Nawaz had pleaded guilty to another offence of acquiring criminal property (count 13). On 18th July 2008 His Honour Judge Eades at Stafford Crown Court sentenced both Nawaz and Noreen to 26 weeks' imprisonment suspended for 18 months. Additionally Nawaz was required to carry out 150 hours of unpaid work. Noreen was subject to a supervision requirement for 18 months.

Both Nawaz and Noreen now apply for leave to appeal against their convictions. In order to do so they also apply for an extension of time for appealing: in the case of Nawaz, 1 year and 2 months; in the case of Noreen, 1 year and 7 months. Nawaz must overcome the additional hurdle that on count 13 he pleaded guilty. These applications have been referred to the Full Court by the Registrar.

The Crown's case was that each of the applicants obtained mortgage advances by giving false particulars on their application forms. In both cases they acted through the agency of a broker called Urfan Akhtar. He was charged on the same indictment and pleaded guilty to various other offences under the Proceeds of Crime Act. He was sentenced to 22 months' imprisonment concurrently on each of four counts.

Another of Akhtar's clients who was also alleged to have acquired criminal property by submitting false details to a mortgage lender was Rahila Kausar. She was also convicted and also sentenced to 26 weeks' imprisonment, suspended for 18 months with a 18-month supervision requirement.

On facts such as these the natural and obvious charge to bring against Nawaz, Noreen and Kausar would have been, it might be thought, one of obtaining or attempting to obtain a money transfer by deception. When these events took place in 2005, that would have been a charge under the Theft Act 1968 (section 15A). Now it would be under the Fraud Act 2006. The problems which have arisen are because the prosecution chose instead to proceed under the Proceeds of Crime Act.

On 22nd April 2009 the full court granted Kausar permission to appeal against conviction (see [2009] EWCA Crim 922). Permission was given on a number of grounds. However, when the appeal was heard on 30th July 2009 it was necessary for the court to deal with only one (see [2009] EWCA Crim 2242). The charge of "acquiring criminal property" is defined in section 329 of the 2002 Act. Section 329(2)(c) provides that a person does not commit the offence if "he acquired or used or had possession of the property for adequate consideration...". Section 329(3)(a) then says:

In Kausar this court held the term "consideration" was to be given the meaning which it usually has in contract law. Once the issue of whether adequate consideration has been given for the property was in issue, it was for the Crown to prove that adequate consideration had not been given. The transaction into which Kausar had entered led to her acquiring the mortgage funds. However, on the face of the mortgage deed, the lender received in return a charge over the property which was the security for the loan and also Kausar's personal promise to repay the loan. In those circumstances, the court concluded she should never have been charged with acquiring criminal property and her conviction was quashed.

Leading counsel for Kausar was Mr Farrell QC, very shortly after his success in her case, he was instructed to advise Nawaz. He considered that the point which had attracted the court in her case could equally be invoked by Nawaz. Consequently on this and other grounds the notice of appeal was lodged on 10th August 2009.

Very properly the Crown wrote to the other defendants in this case, drawing attention to the result of Kauser's appeal. Somewhat later, in early January 2010, solicitors on behalf of Noreen also lodged a notice of appeal. Mr Farrell has now been instructed on her behalf as well.

For the Crown, Mr Morse accepts that he cannot show any material difference between Kauser's case and Nawaz's conviction on count 5. As for count 13, to which Nawaz had pleaded guilty, Mr Morse accepts that it would be wrong to seek to distinguish the decision in Kausar. Count 13 was a charge of attempt. In that case there was no completed transaction and therefore no consideration ever passed to the putative lender. However, Mr Morse realistically accepts that it would not be right to uphold the conviction for an attempt in circumstances where there would have been no offence under section 329 if the attempt had been successful. Mr Morse likewise sees no material difference between the circumstances of Noreen's case and that of Kausar.

Consequently Mr Morse, on behalf of the Crown, concedes that leave to appeal should be granted and that the two convictions in relation to Nawaz and the one conviction in relation to Noreen should be quashed. We agree. Accordingly we extend time for lodging the notices of appeal. We grant leave and we quash the convictions of both appellants.

We add, finally, that the course which we have taken means that it has not been necessary for us to deal with the other grounds of appeal which Mr Farrell sought to advance. Prompted in part by the court which gave leave to appeal to Kausar. It may be necessary on some other occasion to resolve the question of whether property can be "criminal property" for the purposes of section 329, only after some other criminal offence has been committed, or whether there can occur simultaneously the predicate offence which gives property its criminal character and also the acquisition of the same property that constitutes the offence under section 329.

LORD JUSTICE HOOPER: Mr Farrell, you had the consideration argument when you first appeared before me. I had not seen what a good argument it was, so I was nodding a bit too. I gave you another argument.

MR FARRELL: You gave us three other arguments.

LORD JUSTICE HOOPER: Did I?

MR FARRELL: Then you reserved the case to yourself and unfortunately to our dismay we found ourselves in front of a different constitution.

My Lord, can I please make an application under section 16 of the Prosecution of Offences Act 1985 to cover pre legal aid costs?

LORD JUSTICE HOOPER: A defendant's cost order?

MR FARRELL: To be taxed in both defendants' cases.

LORD JUSTICE HOOPER: Yes.

MR FARRELL: Thank you my Lord.