Theobald v Nottingham Magistrates' Court

Monday, 7th July 2003

1. LORD JUSTICE ROSE: We grant permission on this renewed application and we treat the hearing as the substantive hearing.

2. Mr J Henriques will give the first judgment.

3. MR JUSTICE HENRIQUES: This is the hearing of an application for judicial review of the decision of District Judge Zara, sitting at Nottingham Magistrates' Court on 11th October of last year.

4. By way of amended grounds, the following complaints are made:

5. (i) The District Judge wrongly found as a matter of law that the claimant's interview under caution was not a confession within the meaning of section 76 of the Police and Criminal Evidence Act 1984.

6. (ii) The District Judge found that a representation made by a solicitor to a client is not anything said or done within the meaning of section 76.

7. Alternatively, 2(b), the District Judge was perverse in finding that there was not anything said or done within the meaning of section 76 so as to render the confession unreliable.

8. (iii) The District Judge wrongly rejected the defence submission that, since he ruled that the claimant's interview under caution was not a confession, it followed that the interview was inadmissible hearsay, when relied upon by the Crown as to the truth of its contents.

9. (iv) The District Judge's conclusion that no promise was made by Her Majesty's Commissioners of Customs and Excise is perverse.

10. This case has suffered a checkered career. The claimant is charged with a fraud against HM Customs and Excise relating to payment of Value Added Tax on mobile phones. Phones were invoiced, free of Value Added Tax, to Spanish companies by an English company. The Spanish company then supplied the phones to a United Kingdom company, or companies, who in turn supplied the phones to a company called European Cellular Trading PLC, of which the claimant, a chartered accountant of good character, was Financial Director.

11. This company paid the original United Kingdom supplying company and the invoice did not include Value Added Tax. That company reclaimed the Value Added Tax it had been charged by its own suppliers, who failed to account for that Value Added Tax to HM Customs and Excise. They disappeared.

12. The claimant is one of eight people charged. Seven co-defendants were committed to the Crown Court without contest. The claimant contested his committal initially in December 2001, when he was in fact committed to the Crown Court. On 25th July 2002, this court quashed the committal for procedural irregularity, the District Judge having read the papers and taken into account evidence not tendered in the presence of the accused. On 3rd September 2002, the Crown Court at Birmingham quashed the indictment resulting from the irregular committal.

13. On 24th September 2002, fresh committal proceedings commenced and, on 9th October, submissions were made relating to disclosure of documents. The District Judge indicated that he had no jurisdiction to order disclosure.

14. In the light of that decision, a further application for permission was made to this court, heard by Hale LJ and Moses J on 6th March 2003, resulting in the application being adjourned.

15. Certain guidance was given by Moses J, who gave the first judgment. He qualified his judgment by emphasising that it was a permission hearing only, but indicated that the first question for the District Judge was whether he was going to hear the abuse argument.

16. He was to be guided by the principles in Bennett [1994] 1 AC 42, but nevertheless had jurisdiction to entertain the abuse argument.

17. Moses J disagreed with Stanley Burnton J, who had, on refusing permission, indicated that the abuse argument should be heard in the Crown Court.

18. Moses J said:

"It is strongly arguable, to put it no higher, that this is an issue entirely appropriate for a district judge depending, as it does, upon factual issues as to what the defendant was told or not told . . . In deciding that issue he will have to decide whether on any application for disclosure any documents that have not yet been disclosed should be disclosed".

19. Accordingly, those permission proceedings were adjourned.

20. The committal proceedings recommenced on 30th April 2003 and rulings were made by District Judge Zara, dated 1st May 2003 and 30th May 2003. He dealt with the abuse argument, having heard evidence on oath from Customs officers Brand, Norcliffe and Stone, and, on the applicant's side, the applicant, his mother and two partners in the firm of solicitors, Tarlo Lyons, who represented the claimant.

21. In his judgment, he said:

"I cannot find that Customs and Excise did any more than give Mr Martin an impression that they might be prepared to consider using Mr Theobald as a prosecution witness".

22. The District Judge found as a fact that there was no promise not to prosecute Mr Theobald on 23rd April 1999.

23. Having also considered the meeting of 28th May, he found that there was not at any stage any promise, undertaking or representation that Mr Theobald would not be prosecuted.

24. He went on to consider the tape recorded interview of the applicant. The defence case was that the interview amounted to a confession and was thus capable of exclusion pursuant to section 76 of the Police and Criminal Evidence Act.

25. The prosecution case was that it did not amount to a confession and could not therefore be excluded pursuant to section 76.

26. The District Judge found that it was not a confession, but stated in terms that if he was wrong in that regard, he would nevertheless have admitted the confession because, having heard Mr Theobald's evidence, he was satisfied that nothing had been said to him which was likely to render any confession unreliable.

27. In a judgment dated 30th May, the District Judge dealt with a further submission, namely that the interview, if not a confession, was not admissible in evidence on the grounds that it was inadmissible hearsay.

28. Against that tortuous background, this hearing now takes place.

29. The first question is whether the interview, dated 11th November 1998, was a confession. It appears in our bundles in core bundle 2, pages 1,795 to 1,933. Section 76(1) of the Police and Criminal Evidence Act 1984 provides that in any proceedings a confession made by an accused person may be given in evidence against him in so far as it is relevant to any matter in issue in the proceedings.

30. Section 82(1) provides that confession includes any statement wholly or partly adverse to the person who made it, whether made to a person in authority or not, and whether made in words or otherwise.

31. It follows that an interview not specifically admitting guilt, but admitting matters nevertheless relevant to any matter in issue, and adverse to the maker of the statement, is, for the purposes of section 76, a confession.

32. At pages 1,823 to 5 and 1,849 to 50, the applicant admitted that he knew that Neil Walker was behind the companies in due course became missing traders. At pages 1,826 to 9, he admitted that he knew of the purchase trail.

33. He admitted at page 1,832 that he was aware that the invoices from the missing traders were not a complete picture of the transactions and that he would check the paperwork on the deal, upon which he was being asked to sign the payment request.

34. The prosecution suggest this would, of commercial necessity, include the invoice from the missing trader and the contract letter with the original United Kingdom supplier. The applicant stated that, as Financial Director, he would have been concerned to ensure the overdraft facility at the bank was kept under constant review.

35. The prosecution, in their opening, had submitted that it was fair, from Mr Theobald's interview, that he appreciated that the missing traders were a commercial sham, in that they purported to reflect a legal relationship between the parties other than the one that actually existed.

36. The issue in these proceedings is the involvement, or otherwise, in this dishonest scheme by Mr Theobald. The several matters canvassed in interview are relevant to the claimant's knowledge and involvement in what was, beyond question, a dishonest scheme.

37. Accordingly, in my judgment, the interview is, for the purposes of section 76 of the Police and Criminal Evidence Act, a confession.

38. The District Judge was in error to conclude otherwise. R v Sat-Bhambra [1988] Crim App R 55 relates to purely exculpatory statements, as does Park [1994] 99 Cr App R 270. In those two cases, what was said by the defendant was said by the prosecution to be a lie and was not relied upon by the prosecution as representing the truth.

39. It is clear on the face of the present interview that whatever the intention may have been on the part of Mr Theobald, there are parts of the interview which can properly be relied upon as tending to prove guilt and they are relied upon by the prosecution as representing the truth. They are relevant to the guilt of the claimant.

40. The District Judge, however, considered the position in the event of his being wrong and he concluded that nothing had been said to him which was likely to render any confession unreliable. He had heard the applicant give evidence and concluded that he was aware of the risk of prosecution at the time of his interview.

41. He had already found in paragraph 12 of his judgment that there was not at any stage any promise, undertaking or representation that Mr Theobald would not be prosecuted.

42. What the District Judge did not specifically set out in his judgment were the three steps referred to by Lloyd LJ as he then was in the case of Barry [1992] 95 Cr App R 384.

43. In his judgment, Lloyd LJ specifically identified three steps that should be taken by a tribunal in determining whether or not to admit in evidence a confession.

44. The first step was to identify the things said or done.

45. The second step was then to ask whether what was said and done was likely in the circumstances to render unreliable a confession made in consequence. The test is objective.

46. Then comes the last step: have the prosecution proved beyond reasonable doubt that the confession was not obtained in consequence of the things said or done?

47. Mr Sutton submits that it is inherent in the four lines of the District Judge's judgment at paragraph 17 that in fact those three steps were taken. What the District Judge said was:

"I would still have admitted it because, having heard Mr Theobald's evidence, I was satisfied that he was aware of the risk of prosecution at the time of his interview and that nothing had been said to him which was likely to render any confession unreliable".

48. Mr Lewis submits that, having regard to the nature of the evidence available to him, the District Judge plainly had not carried out the three steps, as identified by Lloyd LJ in section 76.

49. For my part, having concluded that the interview is a confession, I consider it desirable that the District Judge should in fact set out his findings pursuant to each of those three steps. It may well be that the conclusion is exactly the same. That is a matter for the District Judge and not for us. On the material available to him, I am not able to say that his findings are perverse.

50. In determining what was said or done, it is, of course, necessary to consider what was said by officers acting on behalf of HM Customs and Excise to solicitors acting on behalf of Mr Theobald.

51. Turning to the second ground, namely that the District Judge found a representation made by a solicitor to his client is not anything said or done within the meaning of section 76 of the Police and Criminal Evidence Act so as to render the confession unreliable, I am unable to see in the judgment of the District Judge any such finding.

52. If a solicitor faithfully transmits a threat or promise to his client, then of course those words are capable of being something said or done for the purposes of section 76(2)(b). In the present case, the District Judge found as a fact that there was not at any stage any promise, undertaking or representation that Mr Theobald would not be prosecuted. That finding was, of course, made during the stage of the proceedings when he was considering the abuse of process argument and at a time when the burden was upon the defendant, Mr Theobald, in those proceedings.

53. It is, of course, a matter for the District Judge to consider likewise in relation to section 76, when the burden is, of course, upon the prosecution to establish matters relied upon by them to the criminal standard.

54. Further, the District Judge found that, on 28th May, it was clear that the applicant was still potentially a suspect who might be prosecuted. That finding was made in relation to the section 76 argument.

55. Since at no point in either of his two judgments did the District Judge make the finding alleged, it seems to me that no order pursuant to this ground ought to be made. Indeed, that ground must necessarily fail.

56. As to ground 3, namely that the District Judge wrongly rejected the defence submission that since he had ruled that the defendant's interview under caution is not a confession, it follows that the interview is inadmissible hearsay, does not arise for our consideration, having regard to my conclusion that the interview of 28th May was a confession for the purposes of section 76. Having reached that conclusion, no question of inadmissible hearsay can arise.

57. Finally, it is contended that the District Judge's finding of fact that no promise was made was perverse. The District Judge heard evidence from Mr Brand, Mr Norcliffe and Mr Stone of Customs and Excise, and from Mr Martin and Mr Phillips of Tarlo Lyons, from the applicant and from the applicant's mother. Attendance notes of the meetings of 23rd April 1999 and 28th May were put in evidence. We have been referred to several excerpts from the transcript of evidence.

58. The District Judge reached the conclusion that no promise had been made, having had regard to several excerpts from that evidence. He will, of course, have to revisit that evidence, both the passages relied upon by the Crown, and the passages relied upon by Mr Lewis, on behalf of Mr Theobald, to determine whether or not he should admit the confession.

59. However, within the context of the abuse argument, I, for my part, am entirely satisfied that none of his findings could properly be described as perverse and, accordingly, that ground must fail.

60. I would, accordingly, make the following orders: firstly, an order quashing the decision of the District Judge finding that the claimant's interview under caution was not a confession for the purposes of section 76 of the 1984 Act; secondly, I would grant a declaration that the claimant's interview under caution is a confession for the purposes of section 76 of the 1984 Act. I would direct that the District Judge should then consider the admissibility of the confession, in accordance with the principles set out in Barry.

61. Finally, I would direct that the full committal hearing recommences on 15th July 2003.

62. LORD JUSTICE ROSE: I agree.

63. MR LEWIS: My Lord, I raise the question of costs.

64. I note at the end of my learned friend's skeleton argument, he asked for his costs in this matter and before Hale LJ and Mr Justice Moses. That issue was raised. We asked for costs and my learned friend said no order for costs. So that is a final decision. So it only falls on your Lordships to decide what order for costs should be made today.

65. We do say that it was right to bring this application because we hope now the committal will be on a proper footing, and in those circumstances, we should have a proportion of our costs because your Lordships have not been with me on ground 4 and 2(b).

66. LORD JUSTICE ROSE: Do you have a representation order, or are you privately funded?

67. MR LEWIS: We are privately paid, my Lord.

68. MR JUSTICE HENRIQUES: On the other hand, the confession was admitted in evidence.

69. MR LEWIS: I am sorry, my Lord?

70. MR JUSTICE HENRIQUES: The interview was admitted.

71. MR LEWIS: My Lord, it was.

72. MR JUSTICE HENRIQUES: Albeit for the wrong reason, and it is still going in.

73. MR LEWIS: Would your Lordships like me to suggest a percentage we would be asking for, to see, if your Lordships were in favour of granting costs?

74. LORD JUSTICE ROSE: By all means. Make any suggestion you wish.

75. MR LEWIS: A third, my Lord?

76. LORD JUSTICE ROSE: Thank you.

77. Mr Sutton.

78. MR SUTTON: We would clearly oppose any such application.

79. The effect of your Lordship's ruling is that the matter proceeds as it would have proceeded in any event. What has happened is the court has indicated its disagreement with the first obvious finding that the District Judge made, but in view of what he gave as an alternative decision and an alternative ruling, and in view of the fact that in any event matters will proceed in the way they would have done, indeed with the opportunity in any event for my learned friend to raise matters during the course of the committal, effectively he has achieved nothing with this hearing.

80. We would submit that, in those circumstances, whilst it can be said -- no disrespect to the court -- but in the circumstances, the Crown have simply offered, as it were, an explanation of what the learned Magistrates and Judge did.

81. May I put it another way? Unless there is deemed to be some sort of blame on the part of the prosecution, and I accept that I raised the matter so far as the question of confession is concerned, but unless there is thought to be some question of blame so far as the prosecution is concerned, and it is the third time we have been here because the Magistrates and the District Judge seems to have been in error -- it is not, in our respectful submission, for the interested party to bear the cost in these matters.

82. The interested party, of course, has his interest that in fact the court is properly alerted to what took place, but the overall effect is that the proceedings will still continue. They remain untarnished so far as the committal is concerned, and in fact our position here has simply been to assist the court and argue the point.

83. So we would, with great respect, say that an application even for a third of costs would be wrong.

84. We would also, of course, pray in aid that our attendance here has in fact resulted in a positive finding, as it were, in the interests of the interested party. So we would submit that no order for costs should be made.

85. LORD JUSTICE ROSE: Thank you.

86. Anything else, Mr Lewis?

87. LORD JUSTICE ROSE: We shall make no order as to costs.

88. MR SUTTON: My Lord, might I mention just one matter, which may or may not be a matter to deal with. We are concerned -- the prosecution, that is that -- if at all possible, the trial commences with the remaining defendants in the end of September. It may be possible to postpone it by a matter of weeks, should it take place and if the committal takes place, and it is still possible that Mr Theobald should be amongst those defendants.

89. What we have done at the moment is simply to address a letter to the Birmingham Crown Court, asking whether they would consider an application to postpone the commencement of the trial to the second week of October on the basis that, if there are criticisms to be made of the committal, if it takes place, there will then be time on the application to this court in relation to that.

90. One says that optimistically, but at least it gives some time.

91. I wonder whether your Lordships would be inclined, to indicate if it would be possible, if there any -- there are a lot of "ifs" here -- if the committal does take place and in fact it is to be in any way sought to review that committal, that it might be expedited before a Division of this Court in the first two weeks of October?

92. LORD JUSTICE ROSE: I think there are so many "ifs" in that sentence, Mr Sutton, that the answer is no.

93. Speaking entirely for myself, I fully understand the desire of the prosecution to get on in relation to all defendants who are committed.

94. MR SUTTON: Yes.

95. LORD JUSTICE ROSE: But I do not think it would be proper to make any other order at this stage, even if we had jurisdiction to do so.

96. MR SUTTON: I am not sure, but I thought it right to mention it because there has been a trial of some of them so far, and we are now in the second trial, and the public expense is a matter to be considered. So I thought it should be mentioned before your Lordships.

97. LORD JUSTICE ROSE: Yes. I am sure Mr Lewis will take a note that you are anxious that things be expedited.