Gimbert v The Queen

This is an unusual case. It among other things involves a consideration of the interpretation of s. 4 (2) of the Theft Act 1968 and the circumstances whereby theft of land may properly be charged.

The difficulties that such a charge can give rise to – as illustrated by the fact that the present case has, with leave of the single judge, generated an appeal to this court – would tend to reinforce the view that, where land is involved, prosecutors would be well advised to seek to frame charges other than under the 1968 Act: for example, under the Fraud Act 2006. We will come on to explain the circumstances in which this particular count in question was framed as it was under the 1968 Act.

The outcome of this appeal has, in one sense, and subject to one point mentioned below, been academic. This is because the appellant (John Gimbert) was convicted, after a trial on some counts and a retrial on another, of various offences of theft and of conspiracy to defraud. His total sentence was 3 years and 6 months imprisonment. The sentence on the count which has generated this appeal was a concurrent sentence of 2 years imprisonment. There is no challenge to the conviction on the other counts or as to the overall sentence. Consequently, the appeal, if successful, could have no impact on the total sentence or on the fact that the appellant will in any event have lost his previous good character. Nevertheless, if the appellant’s arguments that the conviction cannot stand in law are correct then he is entitled to have that conviction quashed.

Also before this court has been a renewed application for leave to appeal against conviction, leave having been refused by the single judge, on the part of a co-accused, David Gimbert. The sole ground raised is that the Recorder at the retrial should have acceded to a submission of no case to answer made at the close of the prosecution case on the count of conspiracy to defraud which he faced.

Before us the appellant, John Gimbert (whom for purposes of clarity and without intending any disrespect we will style “John”), was represented by Ms Harris, who did not appear below. The applicant, David Gimbert (whom we will style “David”), was represented by Mr Gibbs. The Crown was represented by Mr Morse. Both Mr Morse and Mr Gibbs had appeared below.

At the end of the hearing the court announced its conclusion that the appeal would be allowed and the renewed application refused. We said that we would give our reasons in due course in writing. These are those reasons.

The facts, in summary, are these.

John has three children: David, William and Jayne (Page). John himself was the cousin of a woman called Janette Trim (“Janette”).

Janette had always required assistance with her daily living. While her parents were alive she lived with them and they cared for her. Her mother died in 1996 and her father then died in 2002. Before his death the father had executed a power of attorney in favour of John. By his will, Janette’s father had bequeathed his whole estate (aside from some minor items) to Janette. The estate was valued at around £181,000. The estate included the family home, 80 Malcolm Close in Stoke on Trent. Evidence adduced by the Crown was to the effect that the property was worth in the region of £85,000. John was the sole executor under the will.

Shortly before her father’s death Janette had been placed in a care home. Thereafter she resided in a residential care home. Expert evidence given at trial was to the effect that she had (and always has had) a pronounced learning disability. She had an assessed IQ of 57.

On 20 May 2003 an Enduring Power of Attorney was executed by Janette in favour of John, conferring general authority on him to act in relation to all her property and affairs. Solicitors had been instructed for this purpose; and the signatures both of Janette and of John were witnessed by a solicitor, Mr Raymond Basnett. Janette at this time also made a will in favour of John.

One typed section of the Enduring Power of Attorney relating to the attorney stated as follows:

“I understand that I have a duty to apply to the Court for registration of this form under the Enduring Powers of Attorney Act 1985 when the donor is becoming or has become mentally incapable.

I also understand my limited power to use the donor’s property to benefit persons other than the donor.”

The Enduring Power of Attorney in the event was at no stage registered under the then applicable provisions (the 1985 Act, we add, has subsequently been repealed and replaced). It was the prosecution case that at all relevant times Janette lacked the capacity to understand what was going on or freely to consent.

In September 2003 there was a meeting between John, David and Mr Basnett: it was not clear if Janette was also present. At all events, the upshot was that on 26 September 2003 John (in his capacity as personal representative of Janette’s late father) signed a form of Assent in respect of 80 Malcolm Close in favour of Janette. The form was signed both by John and by Janette, the signatures being separately witnessed.

Also on 26 September 2003 Janette signed a form of Transfer of 80 Malcolm Close in favour of David. David was aged 22 at the time. The stated consideration was £1. The form of Transfer was signed both by Janette and by David, separately witnessed. Registration at the Land Registry was thereafter effected, albeit the price there stated was subsequently put at £50,000.

In February 2004 the property was then transferred by David to William Gimbert for a stated consideration of £53,000. William was 19 at the time.

Thus on the face of it a property beneficially belonging to Janette had, in September 2003, been transferred away for (on the face of the Transfer) effectively no consideration paid to, or received by, her; and then had ended up in the name of John’s two sons successively, for a stated consideration on each occasion said to be well below true market value.

In a nutshell, the prosecution case was to be that John had taken dishonest advantage of his status as Janette’s attorney, she throughout having no capacity to understand the position; he had not acted in her interests but had in effect stolen her property for the benefit of himself or his family members. The theft charges in due course brought, it may be added, related not only to 80 Malcolm Close but also to sums of money in the form of credit balances at the bank held for Janette which John caused to be paid out on various occasions. For example, £101,000 was, amongst other transactions, paid out by John to his daughter Jayne to enable her to buy a house.

When arrested and interviewed, John denied any dishonesty. He said that any money taken would have been paid back. He also said that he wanted to conceal Janette’s assets from the care home as otherwise they would have to be used for her care costs. He was to say that he had valued 80 Malcolm Close at £50,000 (which he would have repaid) and had also subsequently paid £105,000 back into Janette’s accounts in 2009. He further was to say that Janette had understood and agreed to what was being done.

So far as David was concerned, he was to say that he had not acted dishonestly and had had no intention of defrauding Janette. He had relied upon his father (who he knew had a power of attorney) and it was his father who had persuaded him to take ownership of the property. He left all arrangements to his father.

After the transfer to him was made, David said, he realised that the property needed more repair works than he was prepared to undertake. He then transferred it to his brother William, on his father’s suggestion and at his father’s suggested price. He then bought another property. He said that he had not thought that Janette’s assets had been put at risk and he did not believe that there was dishonesty. He had relied throughout on his father’s assurances.

The indictment contained a number of counts.

Count 1 was a count of conspiracy to defraud at common law. The named defendants to that count were John, David, William Gimbert, Jayne Page and Raymond Basnett. (The proceedings against Jayne Page, we add, were not subsequently pursued on the grounds of her serious ill-health.) The particularised agreement was that the accused between 14 November 2002 and 5 October 2004 agreed to defraud Janette of property inherited by her from her father.

The defendants to Count 2 were John and Mr Basnett. The offence was charged as Theft under s. 1 (1) of the 1968 Act. The Particulars of the Offence stated as follows:

“John David Gimbert on or about 26^th day of September 2003 stole property belonging to Janette Trim that is to say a house at 80 Malcolm Close, Baddeley Green, Stoke on Trent, value about £85,000.

Raymond George Basnett aided and abetted John David Gimbert to commit the same offence.”

Counts 3 and 6, rather strikingly, respectively charged David and William Gimbert with handling stolen goods contrary to s. 22 of the Theft Act 1968. The “goods” were stated to be 80 Malcolm Close.

There were various other counts: including, in the case of John, counts (counts 8, 9 and 10) of theft of various credit balances belonging to Janette and, in the case of Jayne Page, a count of handling a credit balance in respect of the £101,000.

At the conclusion of the first trial, John was convicted on Counts 2, 8, 9 and 10 (theft). The jury could not agree on Count 1 in his case or in the case of David. The jury were also not able to agree on the other counts which David faced. Mr Basnett and William Gimbert were acquitted on all the counts which they faced.

The retrial, before a Recorder, was solely on Count 1 (conspiracy to defraud) as against John and David. The other outstanding counts were not pursued. Both were convicted. John was subsequently sentenced on all matters to a total sentence of 3 years 6 months. David was sentenced to a suspended term of imprisonment. It was a consequence of David’s conviction that his career as a police officer was necessarily ended.

The point raised on the appeal, which relates solely to Count 2, is a short one. It is said on behalf of John that the facts of this case gave rise in law to no offence of theft. Here the subject of the alleged theft was land: 80 Malcolm Close. And, by virtue of s. 4 (2) of the 1968 Act, land generally does not constitute “property” for the purposes of s. 1 (1) of the 1968 Act. There are, it is acknowledged, some exceptions provided in s. 4 (2); but, it is said, none of those exceptions applied here.

Section 1 (1) of the Theft Act 1968 provides as follows:

“A person is guilty of theft if he dishonestly appropriates property belonging to another with the intention of permanently depriving the other of it; and "thief" and "steal" shall be construed accordingly.”

“Property” is defined in s. 4. That section, in the relevant respects, provides as follows:

“4.

(1) "Property" includes money and all other property, real or personal, including things in action and other intangible property.

(2)

A person cannot steal land, or things forming part of land and severed from it by him or by his directions, except in the following cases, that is to say-

(a)

when he is a trustee or personal representative, or is authorised by power of attorney, or as liquidator of a company, or otherwise, to sell or dispose of land belonging to another, and he appropriates the land or anything forming part of it by dealing with it in breach of the confidence reposed in him; or

(b)

when he is not in possession of the land and appropriates anything forming part of the land by severing it or causing it to be severed, or after it has been severed; or

(c)

when, being in possession of the land under a tenancy, he appropriates the whole or part of any fixture or structure let to be used with the land.

 For purposes of this subsection "land" does not include incorporeal hereditaments; "tenancy" means a tenancy for years or any less period and includes an agreement for such a tenancy, but a person who after the end of a tenancy remains in possession as statutory tenant or otherwise is to be treated as having possession under the tenancy: and "let" shall be construed accordingly.”

It may be noted that whilst “property” is so defined as to include “real property” in s. 4 (1), “land”, by s. 4 (2), is excluded from being the subject of theft save in the circumstances there specified. For this purpose, “land” is differentiated from “real property” in that it does not include incorporeal hereditaments. (That, interestingly, connotes that an incorporeal hereditament may be the subject of theft: albeit we imagine that in practice such a charge, in modern times, would be unlikely to eventuate.) But we need not dwell on that differentiation. It was expressly (and rightly) accepted before us that 80 Malcolm Close was to be regarded as “land”. The house erected on the site is treated as annexed to and affixed to it so as to be part of the land.

That being so, no count of theft as formulated in Count 2 could be sustainable in law unless the case falls within one of the exceptions set out in s. 4 (2) (a), (b) or (c). Mr Morse on behalf of the Crown accepted that. His argument before us was, as it had been below, that the appellant was within such an exception by reason of the power of attorney held by John and by reason of the fact that confidence was thereby reposed to him. It was acknowledged that, on the Crown’s own case, the Enduring Power of Attorney was (by reason of Janette’s asserted incapacity and the lack of registration pursuant to the Enduring Powers of Attorney Act 1985) null and void. But it sufficed, it was said, that John had acted as though he were her attorney and a fiduciary and in the belief that he was her attorney. It is said that it would be paradoxical that what could be criminal if the power of attorney were valid would not be criminal if the power of attorney were invalid.

The trial judge had accepted that argument in rejecting a prior application to dismiss this particular charge against John. That approach was also reflected in the legal instructions which he in due course gave to the jury when summing up. He said on this aspect:

“Ordinarily, a person cannot steal land… however a personal representative or a person who is authorised by power of attorney can steal land by selling or disposing of land… [on the prosecution case] there is no valid power of attorney. If there was no enduring power of attorney then John Gimbert was not acting under it but assumed the rights under it. If the power of attorney was never valid if John Gimbert was purporting to act under [its] authority he should be taken to have been acting as [if] the authority of the power of attorney which he signed was valid.”

Mr Morse says that this was a correct legal direction. Ms Harris says that it was not.

This appeal must be allowed.

We asked Mr Morse why Count 2 had been included on the indictment at all, given that John had (with others) been charged with the conspiracy to defraud under Count 1. His answer was to the effect that this was a tactical decision: since the conspiracy alleged in Count 1 was a closed conspiracy, there were concerns that John might escape criminal liability altogether with regard to 80 Malcolm Close if the other alleged conspirators were all acquitted (a concern that, as it happens, can no longer arise given David’s conviction and our rejection of David’s renewed application).

To the extent that it was also said that the theft count in Count 2 bolstered the handling counts against David and William Gimbert in counts 3 and 6, that is hardly impressive: the more so when it is seen that “goods” is so defined in s. 34 (2) (b) of the 1968 Act as to exclude land.

Be that as it may, the Crown’s argument – and, with respect, the judge’s conclusion – suffers, in our judgment, from insuperable difficulties.

On the prosecution case and evidence, Janette was mentally incapacitated at all relevant times in 2003 (and, indeed, earlier). It follows, as is accepted, that on the prosecution case the Enduring Power of Attorney, which she purported to sign but without capacity, was null and of no effect. To the extent that that might have been capable of rectification by an appropriate application to court that never happened: the Enduring Power of Attorney was never registered.

There is an anterior difficulty in the way of the Crown’s case. One might have anticipated that the argument was necessarily at least predicated on the Transfer of 26 September 2003 having been executed by John purporting to act as Janette’s attorney. But it was not. The Transfer, as the facts show, was signed on that date by Janette herself: and it is that Transfer which was relied upon as the act of appropriation for the purposes of theft. Thus the fact that John had (ostensibly) a power of attorney at the time of the Transfer had in one sense no direct causal relevance to its actual execution: just because it was Janette herself who executed it and because the Enduring Power of Attorney was not utilised for that purpose.

In any event, the argument, in our judgment, fails at a wider level, given the wording of s. 4 (2). John was not acting as an expressly appointed trustee in relation to the Transfer to David (it was not suggested that he was acting as a constructive trustee, either) nor was he acting as a personal representative in relation to the Transfer to David. The only exception ever relied on by the Crown thus was by reference to his status as (purported) attorney. The relevant exception applies, however, where a person “is authorised by power of attorney”. But here, because the Enduring Power of Attorney was (on the Crown’s own case) null and void, John was not authorised by power of attorney: as is conceded. Mr Morse’s arguments – and the judge’s prior refusal to dismiss and his subsequent direction to the jury - thus connote writing in words to the sub-section which simply are not there. Mr Morse would read the sub-section as though it read “is (or purportedly is) authorised” or “is (or believes himself to be) authorised”. (Presumably such implied additional words would likewise then need to apply also at least to liquidators under s. 4 (2) (a).) But we can see, particularly in the context of a criminal statute, no sufficient justification for writing in such words.

Mr Morse submitted that a broad, purposive approach permitting the extended interpretation which he advocated was appropriate. Otherwise, he said, injustice could result and persons who as purported attorneys engage in dishonesty of this kind relating to land might escape any criminal sanction. We reject that argument for a broad, purposive interpretation. We think that (where no conspiracy to defraud is involved) most cases of this general nature are in any event likely on their facts to fall within the ambit of the Fraud Act 2006: whether as involving fraud by misrepresentation or as involving fraud by abuse of position (which appears to have a wide and undefined ambit for the purposes of the Fraud Act 2006) or both. The position may perhaps, we accept, have been rather less clear for cases antedating the Fraud Act 2006 – and of course the 1968 Act itself came into effect long before then. But even if there were to be (we strongly suspect, very rare) cases of dishonesty relating to dispositions of land which could not attract some criminal charge other than theft then one is left to reflect that in any event it is not every case of exploitative, unscrupulous or manipulative conduct which necessarily is or should be required to attract a criminal sanction. At all events, in our judgment there is, overall, no sufficient basis for distorting or expanding the express terms of s. 4 (2).

We should record that the court also had raised with counsel the issue of appropriation. What was the actus reus in this regard, so far as John was concerned, given that the particularised matter relied on was the Transfer which had, in point of fact, been executed not by John but by Janette herself?

Mr Morse informed us that the prosecution had not in this case sought to base itself on any prior fraudulent misrepresentations made by John. He explained that the prosecution had put forward the act of appropriation as being the Transfer itself by reference to the majority decision of the House of Lords in the case of Hinks [2001] 2 AC 241. This whole area is, however, fraught with difficulty: see the discussion (in the context of theft of a chose in action) in the recent case of Darroux [2018] EWCA Crim 1009, [2018] 2 Cr. App. R 21. Given that we have decided that this appeal in any event fails for the reasons given above we think that it would serve no useful purpose for this court to enter into an (obiter) discussion of the issue of appropriation in this case.

We therefore have allowed the appeal, for the reasons now given. We quash the conviction on Count 2.

We can take the renewed application altogether more shortly.

At the retrial, Mr Gibbs had made a submission of no case to answer arguing that, as against David, the prosecution evidence gave rise to no sufficient case of dishonesty whereby a reasonable jury, properly directed, could properly convict. He made clear to us that he cannot say that the Recorder adopted an erroneous approach in law or failed to have regard to relevant evidence or had regard to irrelevant evidence or anything like that. His blunt submission was that the ruling was irrational: the only proper course was for the Recorder to have acceded to the submission of no case.

We cannot possibly agree. The Recorder had referred to the Galbraith principles. He had reminded himself of Welham v Director of Public Prosecutions [1961] AC 103 and other such cases. He had thoroughly reviewed the evidence. It was accepted before him, as before us, that there was evidence of an agreement. The Recorder’s succinct conclusion was as follows:

“The bare fact of a transfer by Janette Trim to David Gimbert at a nominal sum that completely ignored the market value of the asset or even the value that John Gimbert put on it must, as a matter of common-sense, have involved a risk that Janette Trim’s rights or interests in that part of her inheritance were put at risk or prejudice. Whether or not the defendants were acting dishonestly is eminently a matter for the jury to decide, but in my judgment there is evidence to go before the jury both of the existence of the agreement and of the intent or intention that Janette Trim should be defrauded in the sense that her rights or interests in the part of her inheritance as represented by 80 Malcolm Close should be put at risk or prejudiced.”

There is no proper basis for this court interfering with such a conclusion. In truth, given the circumstances, the transaction in question cried out for an explanation. Whether the explanation then given by David in his evidence was to be rejected, applying the criminal standard, was a matter for the jury.

We therefore have rejected the renewed application on behalf of David.

The appeal by John against conviction on count 2 is allowed. That conviction is quashed. The renewed application for leave to appeal against conviction on the part of David is refused.