Developments in the Law: 2016
Useful Cases and Materials
THE PSYCHOACTIVE SUBSTANCES ACT 2016
This is a measure that received Royal Assent on the 28th January 2016″ [link]. The PSA 2016 came into force on the 26th May 2016: [link]. The Act is problematic on a number of levels, not least in terms of proving “psychoactive effect” for the purposes of the principal criminal offences enacted under the Act.
OTHER STATUTORY REFORMS
- R v Guraj  UKSC 65 [transcript]. The decision of the Court of Appeal (Criminal Division) in R v Guraj  EWCA Crim 305 was reversed by the Supreme Court. Insofar as the decision in the Court of Appeal raised the question of when a postponement or other procedural error will have the effect of invalidating confiscation proceedings in the absence of the availability of POCA s.14(11), the Supreme Court stated:
“31. What, then, is the answer to the question: “If section 14(11) is unavailable, when does a procedural error prevent the making of a confiscation order, or invalidate such an order if it is made?” Consistently with Soneji and with the dominant purpose of POCA that confiscation is the duty of the court, to which a significant priority is to be given, the answer is not that every procedural defect does so. The correct analysis is not that a procedural defect deprives the court of jurisdiction, which would indeed mean that every defect had the same consequence. Rather, it is that a failure to honour the procedure set down by the statute raises the very real possibility that it will be unfair to make an order, although the jurisdiction to do so remains, and that unless the court is satisfied that no substantial unfairness will ensue, an order ought not to be made. This is not to deprive section 14(12) of effect; it remains effective to remove the peremptory bar of section 14(11) upon quashing confiscation orders on grounds only of procedural defect connected with postponement. Where section 14(11) applies, no such defect can alone justify quashing. Resulting unfairness, on the other hand, may, but such unfairness cannot be inferred merely from the procedural breach. Where section 14(11) does not apply, a procedural defect, not limited to postponement, will have the effect of making it wrong to make a confiscation order if unfairness to the defendant would thereby ensue. If, however, the defect gives rise to no unfairness, or to none that cannot be cured, there can be no obstacle to the making of the order, and this is what the duty of the court under POCA requires. The present case is one where no unfairness can be or is suggested; cure does not arise. If it were to arise, in another case, it is possible that there might be ways in which a potential unfairness could be cured. They might include, for example, determining in accordance with R v Waya  UKSC 51;  1 AC 294, that the confiscation order must be adjusted to achieve proportionality. In a few instances, it might be possible to vary an inadvertently imposed sentence within the 56 days permitted by section 155 of the Powers of Criminal Courts (Sentencing) Act 2000. In others, the correct outcome may be that it is the forfeiture order which ought to be quashed, by way of appeal, rather than the confiscation order; priority for the latter is after all built into POCA. Each case, however, must depend on its own facts.” [Per Lord Hughes JSC, with whom the remainder of the Justices agreed.]
The Supreme Court observed that the instant case did not involve any exceeding of the statutory permitted period of two years (for which see POCA 2002, s.14(3)-(5)), and that there are “inconsistent expressions of view in decisions of the Court of Appeal on the effect of exceeding the permitted period” (at ). Accordingly, the Court found it “unnecessary to say more than that it must be especially likely that unfairness will ensue if it is exceeded without there being exceptional circumstances” (per Lord Hughes JSC (at )).
- R v Jogee and another  UKSC 8;  UKPC 7 [transcript]. COMMENT: This is a decision of immense importance. There will doubtless be numerous commentaries and subsequent judicial decisions, that discuss the judgment. At para.90 of the judgment, the Court said “If the crime requires a particular intent, D2 must intend (it may be conditionally) to assist D1 to act with such intent”. Many practitioners have been quick to assume that this means that the intention of the alleged accessory and the principal offender must be aligned (i.e. that they share the same intention). It is submitted that this may be shown to be incorrect. The Justices did not overrule or disapprove, in any way, of the decision in National Coal Board v Gamble  1 QB 11. In that case, Devlin J said, “If one man deliberately sells to another a gun to be used for murdering a third, he may be indifferent whether the third man lives or dies and interested only in the cash profit to be made out of the sale, but he can still be an aider and abettor”.
There are many cases where D1 and D2 do share the same intention – but not always. It is submitted that the UKSC was principally concerned with stressing that the alleged accessory must have an intention to “aid, abet” (etc) the principal offender. If, for example, D2 sells a car to D1, knowing that D1 will use it to commit burglary, D2’s acutal intention is to make the sale. Does R v Jogee really decide that D2 is therefore not guitly of aiding D1 to commit burglary? We will see.
- Boyle Transport (Northern Ireland) Ltd v R  EWCA Crim 19 [transcript]. The Court of Appeal (Criminal Division) reviewed earlier decisions concerning the circumstances in which the property of a corporate entity can be held to be that of a natural person. The Court said that it may be that Crown Courts will wish to take into account a number of general propositions (summarised below) “although they are not put forward by us as an exhaustive list of relevant considerations – in any confiscation case where an issue of lifting or piercing the corporate veil is raised” (per Davis LJ):
(1) The test is not simply one of “justice”. So vague an approach would be unprincipled and would give rise to great uncertainty and inconsistency in decision making. 
(2) A Crown Court is required in each case to assess the “reality of the matter”. That is central. But that cannot be permitted by itself to confer a licence on a court to depart from established principles relating to the separate legal status of a limited company. Were it otherwise, courts would simply be circumventing the prohibition on deciding issues relating to the corporate veil through invoking the notion of “justice” by resorting to a different label, namely the “reality of the matter.” That is not in itself permissible. 
(3) It is essential to bear in mind the principle that the confiscation process under the 2002 Act is not of itself aimed at punishment. On the contrary, it is aimed at recovery of benefit: to ensure that criminals do not retain for themselves their ill-gotten gains. Appropriate punishment for the criminality will have been addressed by the sentence. That punishment is not thereafter to be, as it were, topped up by the confiscation process. 
(4) The principles relating to the doctrine of piercing the corporate veil, in the confiscation context, are the same (albeit fact and context specific) as in the civil courts. The judgments in Prest v Petrodel Resources Limited  2 AC 415 were of general application [at 91]. The Crown Court has no inherent jurisdiction of its own and the 2002 Act contains no provision purporting to sanction a departure from ordinary principles of company law. Accordingly a proper adherence to principles of company law, as enjoined by this court in Seager and Blatch  EWCA Crim 1303 and as accepted in Sale  EWCA Crim 1306, is to be taken as confirmed as applicable in confiscation proceedings. [at 92] Crown Courts in confiscation cases should treat with a degree of circumspection, when an issue of lifting or piercing the corporate veil has been raised, tempting invitations to adopt a “robust” or “broad brush” approach and tempting invitations to avoid being distracted by “niceties”.  In the Crown Courts, as in many other courts, the phrase “piercing” the corporate veil had been used broadly without focusing precisely on the two concepts of concealment and evasion as have now been identified by Lord Sumption in Prest. 
(5) Regard should be had to the nature and extent of the criminality involved (noting King (Scott)  EWCA Crim 621 which is informative, albeit not a case concerning the doctrine of lifting or piercing the corporate veil). 
(6) Even where a company is solely owned and solely controlled by the (criminal) defendant that does not of itself always necessitate a conclusion in a confiscation case that it is an alter ego company, whose turnover and assets are to be equated with being property of the defendant himself.  The Court had concerns that the emphasis given in Sale to the fact that the defendant was sole director and shareholder, may be used to achieve a conclusion in other confiscation proceedings that may not necessarily be merited and which would not be consistent with the approach in Seager and Blatch.  The decision in McDowell  EWCA Crim 173 is to be regarded as made on the facts of that case. It is not to be taken as an invitation to criminal courts in confiscation cases under the 2002 Act, to regard sole ownership and control of a company as necessarily and always sufficient of itself to justify treating the company as an alter ego of the defendant. 
(7) All such decisions in the context of confiscation proceedings must be geared to the facts and circumstances of the particular case.