Balint v Municipal Court In Prague, Czech Republic

This judgment is in four parts, namely:

This is an appeal against an order for extradition to the Czech Republic. There are two issues in this appeal. The first issue is whether the alleged offence is sufficiently described in the European arrest warrant. The second issue is whether the conduct described would constitute an offence in the United Kingdom, in other words whether the requirement of dual criminality is satisfied.

In this judgment I shall refer to the Extradition Act 2003 as “the 2003 Act”. Part 1 of the 2003 Act relates to extradition to category one territories, i.e. members of the EU. Part 2 of the 2003 Act relates to extradition to other territories, referred to as category 2 territories.

I shall refer to a European Arrest Warrant issued under part 1 of the 2003 Act as “a Part 1 warrant”. I shall refer to an arrest warrant issued under Part 2 of the 2003 Act as “a Part 2 warrant”. Part 1 warrants fall into two categories, namely “accusation warrants” and “conviction warrants”. Accusation warrants relate to warrants for the arrest of persons accused of committing offences. Conviction warrants relate to the arrest of persons who have been convicted and sentenced for offences.

Section 2 of the 2003 Act sets out the requirements with which all Part 1 warrants must comply. Section 2(3) and 2(4) set out the requirements which are specific to accusation warrants. These sub-sections provide as follows:

“(3)

The statement is one that –

(a)

the person in respect of whom the Part 1 warrant is issued is accused in the category 1 territory of the commission of an offence specified in the warrant, and

(b)

the Part 1 warrant is issued with a view to his arrest and extradition to the category 1 territory for the purpose of being prosecuted for the offence.

(4)

The information is –

(a)

particulars of the person’s identity;

(b)

particulars of any other warrant issued in the category 1 territory for the person’s arrest in respect of the offence;

(c)

particulars of the circumstances in which the person is alleged to have committed the offence, including the conduct alleged to constitute the offence, the time and place at which he is alleged to have committed the offence and any provision of the law of the category 1 territory under which the conduct is alleged to constitute an offence;

(d)

particulars of the sentence which may be imposed under the law of the category 1 territory in respect of the offence if the person is convicted of it.”

Section 64 of the 2003 Act sets out certain requirements which the conduct described in an accusation warrant must meet. Section 64(3) provides as follows:

“(a)

the conduct occurs in the category 1 territory;

(b)

the conduct would constitute an offence under the law of the relevant part of the United Kingdom if it occurred in that part of the United Kingdom;

(c)

the conduct is punishable under the law of the category 1 territory with imprisonment or another form of detention for a term of twelve months or a greater punishment (however it is described in the law).”

It should be noted that section 65 of the 2003 Act imposes similar requirements in respect of conviction warrants as section 64 imposes in respect of accusation warrants.

Section 64(3) sets out the dual criminality requirement in respect of accusation warrants. Section 65(3) sets out the dual criminality requirement in respect of conviction warrants. It should be noted that there is a similar dual criminality requirement in respect of Part 2 warrants: see section 137(2) of the 2003 Act.

Having identified the statutory provisions which are relevant to the present appeal, I must now turn to the facts.

On the 12^th April 2010 the Municipal Court in Prague issued a European Arrest Warrant requesting that the appellant be arrested and surrendered to that court for trial. I shall refer to this European Arrest Warrant as “the warrant”. The offence which it was alleged that the appellant had committed was embezzlement, pursuant to paragraphs 1 and 5(a) of section 206 of the Czech Criminal Code.

The description of the offence alleged was set out in box (e) of the warrant. The English translation of box (e) reads as follows:

“As an agent/secretary of the company Family Frost, spol, s.r.o, (from 29.6.2000 until 5. 12. 2005), IC identification number: 45275769, having the seat at 150 00 Prah 5, Zubatého 11, with the intent to appropriate the entrusted funds, he drew financial funds from the bank account of the Family Frost, spol, s.r.o. number 872343561/0100 CZK with the Komercni Banka a.s. bank, having the seat at 114 07 Praha 1, Na Prikopé 33, on 29.8.2000 by means of a payment card no. 4917 0100 0057 8446 or by payments in cash withdrawn from the account by means of ATMS in different locations in the Czech Republic, Slovakia, the Federal Republic of Germany, Hungary, Croatia, Slovenia, Latvia, Russia, Turkey, Poland, Spain, France, Belgium, Netherlands, Switzerland and other so far unspecified countries, including the members of the European Union amount of 3,257, - CZK from the bank account of the Family Frost, spol. s.r.o. number 872343561/0100 with the bank Komercni Banka a.s., registration number 453 17 054, having the seat at 114 07 Praha 1, Na Prikopé 33 between 8.8.2000 and 24.10.2000 he withdrew from ATM machines using card number 4917 0100 0057 8446 the cash amount of CZK 218,500. -, from the bank account of the Family Frost, spol s.r.o 272309730297/0100 with the Komercni Banka a.s. bank, IC identification number: 45317054, having the seat at 114 07 Prah 1, Na Prikopé 33. Between 25.10.2000 and 7.12.2005 he withdrew the amount of CZK 4, 512,590. - in cash from ATMs by means of cash withdrawals from ATMs using a payment card number 4917 0100 0057 8446 (until 20.10.2004), using payment card no. 4917 0156 3784 7759 (since 21.10.2004), later he returned to the employer the amounts of CZK 1,525, 976, - and CZK 764, 426.31, the amount of CZK 628,085, - was paid by assignment of a claim, and the amount of CZK 381,800.50 was used for already commenced payments in cash, by which he caused damage in the total amount of CZK 1,434.058, –, which he covered by concluding credit contracts despite the fact that, according to the company policies, he was not authorized to conclude such contracts. As a consequence, he caused damage Family Frost, spol. s.r.o in the total amount of CZK to the 6,885,992.82.”

The appellant, who is resident in this jurisdiction, was duly arrested pursuant to the warrant. He was brought before District Judge Evans at the City of Westminster Magistrates Court.

The appellant raised two defences to the extradition proceedings. His first defence was that the warrant did not comply with the requirements of section 2 of the 2003 Act, in particular section 2(4)(c). His second defence was that the offence specified did not satisfy the requirements of dual criminality under section 64(3)(b) of the 2003 Act.

During the course of the hearing the appellant requested that his interpreter should re-translate the last part of box (e) of the warrant, as he asserted that the word for “cover” had been mistranslated. The interpreter translated that word as “conceal”.

The district judge concluded that the offence was described with sufficient detail and clarity in box (e) of the warrant, in order to satisfy the requirements of section 2(4)(c) of the Act. He also concluded that dishonesty could be inferred from the language used, even though the word “dishonest” was not actually used in the description of the offence. He went on to conclude that the offence described would be a crime under English Law, namely theft of a chose in action.

Having reached those conclusions, the district judge went on to order that the appellant be extradited to the Czech Republic.

The appellant is aggrieved by the decision of District Judge Evans. Accordingly he appeals to the High Court, advancing the same two contentions that he deployed in the Magistrates Court. The appellant did at one point raise a third ground of appeal, but that is no longer pursued.

In the present appeal, therefore, I must focus upon the offence described in the warrant and upon whether that description satisfies the requirements of the 2003 Act. Before undertaking that exercise, however, I must first review the law.

In Office of the King’s Prosecutor, Brussels v Cando Armas and another [2005] UKHL 67; [2006] 2 AC 1 the House of Lords upheld an order for the defendant’s extradition to Belgium. The House noted that, in order to be valid, a Part 1 warrant had to contain the statements and the particulars required by section 2 of the 2003 Act. The House held, however, that it was unnecessary that all the conduct complained of should have occurred in the category 1 territory to which the defendant was being extradited: see paragraph 17 of the speech of Lord Bingham, with whom all other members of the Judicial Committee agreed. Lord Hope (with whom Lord Scott, Baroness Hale and Lord Carswell agreed) elaborated on this aspect at paragraph 40 as follows:

“I would construe the word “conduct” in sections 65(2)(a) and 65(3)(a) of the 2003 Act in the light of these authorities. The conduct must occur “in” the category 1 territory if the condition which is set out in these paragraphs is to be satisfied. But a purposive meaning must be given to the word “conduct” in this context. It would impose a wholly artificial restriction on the extradition process if it were to be taken as meaning that all the conduct which resulted in the offence must have taken place exclusively within the category 1 territory. Actings elsewhere will be sufficient to constitute conduct in that territory so long as their intended effect was to bring about harm within that territory. It would be immaterial to a request for extradition to Belgium, for example, that the actings which had a harmful effect were all in France or in Germany.”

In About Fofana, Moise Belise v Deputy Prosecutor Thubin Tribunal de Grande Instance de Meaux, France [2006] EWHC 744 (Admin) this court gave guidance about the degree of particularity required in a European Arrest Warrant. Auld LJ, with whom Sullivan J agreed, said this at paragraph 39:

“Providing that the description in a warrant of the facts relied upon as constituting an extradition offence identifies such an offence and when and where it is alleged to have been committed, it is not, in my view, necessary or appropriate to subject it to requirements of specificity accorded to particulars of, or sometimes required of, a count in an indictment or an allegation in a civil pleading in this country. Allowance should be made for the fact that the description, probably more often than not, was set out in a language other than English, requiring translation for use in this country, and that traditions of criminal “pleading” vary considerably from one jurisdiction to another.”

In Von Der Pahlen v The Government of Austria [2006] EWHC 1672 (Admin) the warrant accused the defendant of frauds, which were described in fairly general terms. The victims were not identified. Nor were the number and size of the fraudulent payments indicated. This court allowed the defendant’s appeal against an order for extradition. Dyson LJ, with whom Walker J agreed, said that the introductory word “particulars” in section 2(4)(c) indicated that a broad omnibus description of the alleged criminal conduct would not suffice. Dyson LJ did not attempt to prescribe what degree of particularity was required. However, he concluded that the warrant in the instant case did not go far enough: see paragraphs 21 and 22 of the judgment.

In Sidlauskaite v The Prosecutor General’s Office of the Republic of Lithuania [2006] EWHC 3486 (Admin) the warrant alleged that the defendant had “misappropriated” property. Richards LJ (with whom Owen J agreed) noted that under Lithuanian law the offence of “misappropriation” carried a maximum sentence of three years imprisonment. He concluded that, although the word “dishonesty” was not in the warrant, nevertheless, when read in context, the offence alleged against the defendant must be the dishonest taking of property. Accordingly this court upheld the order for extradition.

In Ektor v National Public Prosecutor of Holland [2007] EWHC 3106 (Admin) this court held that a European Arrest Warrant must describe when and where the offence occurred and what involvement the defendant had in the matter. Cranston J, with whom Richards LJ agreed, then added:

“7…As with any European instrument, these requirements must be read in the light of its objectives. A balance must be struck between, in this case, the need on the one hand for an adequate description to inform the person, and on the other the object of simplifying extradition procedures. The person sought by the warrant needs to know what offence he is said to have committed and to have an idea of the nature and extent of the allegations against him in relation to that offence. The amount of detail may turn on the nature of the offence. Where dual criminality is involved, the detail must also be sufficient to enable the transposition exercise to take place.”

In Zak v Regional Court of Bydgoszcz Poland [2008] EWHC 470 (Admin) this court upheld an order for extradition in respect of a defendant who was accused of receiving stolen property. Richards LJ (with whom Swift J agreed) rejected the submission that the requesting authority had to specify the relevant mens rea of the English offence. He concluded that it was sufficient if the mens rea of the corresponding English offence could be inferred from the conduct set out in the warrant and any further information.

In March 2008, some two weeks after the decision in Zak, the House of Lords delivered its decision in Norris v Government of the United States of America [2008] UKHL 16; [2008] 1 AC 920. This appeal concerned extradition to the USA, which is a category 2 territory. However, the guidance which the House of Lords gave in Norris as to the application of the dual criminality test is relevant to both Part 1 and Part 2 of the 2003 Act. The House of Lords held that in applying the dual criminality test, it was not necessary always to examine the legal ingredients of the foreign offence (potentially a complex process involving expert evidence). Instead it was necessary to consider the essence of the alleged acts and the substance of the criminality charged. In other words the court must focus on the conduct which is particularised by the requesting state and is not under a duty to compare the ingredients of the foreign offence alleged with the ingredients of the corresponding UK offence.

I see no inconsistency between the House of Lords’ decision in Norris and the earlier decisions of this court, which I have summarised above.

The next decision of this court which is of relevance to the present appeal is Luczak v District Court in Sieradz, Poland [2009] EWHC 2753 (Admin). The defendant in that case had defaulted on his obligation to pay VAT. The alleged offence was that the defendant had disposed of certain goods which an official (similar to a bailiff in England) was proposing to sell in order to meet the VAT debt. It was not clear from the description of the offence whether or not title in the goods had actually passed to the official when the defendant disposed of them. Keith J, following Norris, analysed the conduct set out in the European Arrest Warrant. Since it was unclear whether the defendant owned the property at the time of disposal, it was equally unclear whether the defendant’s conduct amounted to theft under English Law. Accordingly the judge allowed the defendant’s appeal against the order for extradition.

The final authority to which I should refer is Naczmanski v Regional Court in Wloclawek [2010] EWHC 2023 (Admin), in which this court upheld an order for extradition to Poland. Elias LJ (with whom Calvert-Smith J agreed) summarised the purpose of section 2(4) of the 2003 Act in this way at paragraph 17 of his judgment:

“… The principal function of providing this information is so that a defendant will have a clear understanding of why his extradition is being sought. Furthermore, from the court’s point of view, the information needs to be sufficiently detailed so that where the principle of double criminality comes into play, the court is in a position to be able to determine whether that principle is satisfied or not.”

From this review of authority I derive five propositions relevant to the present appeal:

With the benefit of this review of authority I must now turn to the present appeal.

The first issue to consider is whether box (e) of the warrant describes the appellant’s offending conduct with a reasonable degree of clarity and detail. The description of this conduct may be distilled into ten propositions, as Mr Robert Harland, counsel for the respondent, has demonstrated in his skeleton argument:

Mr Ellis Sareen, for the appellant, points out that not all the locations of the ATM machines used are identified. Indeed not all the countries are identified where the appellant is alleged to have made withdrawals. I see the force of this point. On the other hand, the effect of every withdrawal was felt in the same place, namely the company’s bank accounts at the Komercni Bank in Prague.

In my view, in the case of frauds committed through the use of computers it is generally not necessary, indeed it is often impossible, to specify the location of the computer terminal at which the offender was sitting when he keyed in the offending entries. The same principle should apply to ATM machines. If an offender makes wrongful withdrawals of cash from numerous ATM machines around the globe, but the effect is always felt at the same place, namely a bank account held in a category 1 territory, section 2 of the 2003 Act does not require the warrant to specify the location of every ATM machine which the offender used.

The present warrant makes it clear that over a period of 5 ½ years the appellant made wrongful withdrawals of cash from ATM machines in many different countries, but in every case these were charged to the same bank accounts in Prague. In my view that aspect of the description is sufficient.

Mr Sareen submits that the warrant in this case does not sufficiently identify the nature of the allegations or the extent of the allegations against the appellant.

I do not agree. The warrant alleges that over a period of 5 ½ years the appellant took for his own use funds belonging to the company. He was enabled to do this, because he occupied a position of trust as agent and secretary of the company. The appellant returned two thirds of the funds (3,300,287.81 CZK) to the company. The appellant retained the remainder (1,434,058 CZK) for his own benefit. There appears to be an arithmetical error of 1 CZK somewhere in the calculations, but that cannot remotely affect the validity of the warrant.

There was some debate at the hearing about the assertion near the end of box (e) that the appellant “covered” the loss which he caused to the company by “concluding credit contracts” without authority. I do not think that there is any ambiguity here. When read in context, “covered” clearly means “covered up” or “concealed”. Indeed this was confirmed at the magistrates’ court when the appellant requested his interpreter to re-translate that part of the warrant. The phrase “concluding credit contracts” is not ambiguous. It clearly means taking out loans upon which the company would have to pay interest. The final plea is also clear. It is alleged that these credit contracts or loans caused the company’s total loss to swell to 6,885,992.82 CZK.

I readily accept that an indictment for theft in this country would not be drafted in the same format which the warrant has used. On the other hand, the nature and extent of the allegations against the appellant are perfectly clear.

Let me now draw the threads together. I make reasonable allowance for the different methods of particularising criminal offences between one jurisdiction and another. I also make reasonable allowance for the fact that the warrant before the court is a translation from the Czech language into English. Having made those reasonable allowances, I am completely satisfied that the warrant describes the appellant’s alleged offending conduct with a reasonable degree of clarity and detail. This warrant satisfies the threshold test set out in section 2 of the 2003 Act.

I turn next to the requirement of dual criminality, as set out in section 64(3) of the 2003 Act. The principal issue here is whether or not the warrant alleges dishonesty.

Mr Sareen points out, correctly, that the warrant does not contain any express allegation of dishonesty. On the other hand, dishonesty can readily be inferred from the conduct which is alleged. Putting it bluntly, the warrant alleges that over a period of 5 ½ years the appellant used money which was entrusted to him as company secretary, to line his own pockets. The phrase “with intent to appropriate the entrusted funds” applies to the appellant’s conduct over the whole 5 ½ year period. This clearly alleges that the appellant intended to transform the monies entrusted to him into his own monies, which he could spend or deal with as he chose. Such conduct is clearly dishonest.

The fact that the appellant returned about two thirds of the money to the company does not detract from the dishonesty of the conduct as a whole. It is common experience in this jurisdiction, and presumably elsewhere, that employees who embezzle monies over lengthy periods take elaborate steps to cover their tracks. These elaborate steps normally involve paying back certain sums of money to conceal the mounting shortfall.

The offence alleged in the warrant is embezzlement contrary to section 206 of the Czech Criminal Code. Mr Sareen submits, on the authority of Norris, that it is not for this court to examine the elements of the Czech crime of embezzlement. Instead this court must concentrate on the conduct alleged in the warrant for the purpose of considering dual criminality. I accept these submissions.

Both counsel have made submissions about the effect of sections 138 and 206 of the Czech Criminal Code, the terms of which are set out in the warrant. Mindful, however, of Mr Sareen’s submission, I shall not follow counsel down this interesting byway.

Mr Harland submits that the conduct set out in the warrant would constitute the offence of theft in England. Mr Sareen submits that it would not, because the mens rea for theft is not alleged.

I have carefully considered the submissions of counsel on this issue and have come to the conclusion that Mr Harland is correct. For the reasons set out earlier, dishonesty is to be inferred from the conduct which is alleged. Also, in my view, one can properly infer from the conduct set out in the warrant that the appellant had an intention permanently to deprive the company of the money withdrawn from the company’s account. For this purpose, the phrase “intention permanently to deprive” must be understood in the sense set out in section 6 of the Theft Act 1968. The fact that a defendant hopes that he may one day be in a position to repay the money taken is not a defence to theft: see R v Fernandes [1996] 1 Cr App R 175.

Let me now bring matters to a conclusion. I am satisfied that if the conduct alleged had occurred in England or Wales, it would have constituted the offence of theft, as defined in the Theft Act 1968. Accordingly the dual criminality test set out in section 64(3) of the 2003 Act is satisfied.

In the result, therefore, I agree with the decision of the district judge. This appeal is dismissed and the order for extradition to the Czech Republic must stand.