AS TO THE ADMISSIBILITY OF
Application no. 41087/98
by Steven PHILLIPS
against the United Kingdom
The European Court of Human Rights (Fourth Section), sitting on 30 November 2000 as a Chamber composed of
Mr G. Ress, President,
Mr A. Pastor Ridruejo,
Mr L. Caflisch,
Mr J. Makarczyk,
Sir Nicolas Bratza,
Mr V. Butkevych,
Mr J. Hedigan, judges,
and Mr V. Berger, Section Registrar,
Having regard to the above application introduced with the European Commission of Human Rights on 5 February 1998 and registered on 4 May 1998,
Having regard to Article 5 § 2 of Protocol No. 11 to the Convention, by which the competence to examine the application was transferred to the Court,
Having regard to the observations submitted by the respondent Government and the observations in reply submitted by the applicant,
Having deliberated, decides as follows:
A. The circumstances of the case
The applicant is a British national, born in 1964 and currently detained at HM Prison Parc, Bridgend, Mid Glamorgan. He is represented before the Court by Mr R. Wheatley, a barrister practising in London, instructed by Roger James, Clements and Panting, solicitors practising in Newport, Gwent.
On 27 June 1996, at Newport Crown Court, the applicant was convicted of being concerned in the importation in November 1995 of a large quantity of cannabis resin, contrary to section 170(2) of the Customs and Excise Management Act 1979. On 12 July 1996 he was sentenced to nine years’ imprisonment in respect of this offence. The applicant had previous convictions, but none in respect of a drugs-related offence.
An inquiry was then conducted into the applicant’s means, pursuant to section 2 of the Drug Trafficking Act 1994 (“the 1994 Act”: see below). The judge considered the written statement of a Customs and Excise-appointed drug financial investigation officer, the applicant’s written statement in response, and the further statement of the investigation officer, together with the oral evidence of the applicant and witnesses called on his behalf. Giving judgment on 24 December 1996 the judge observed:
“It is for the prosecution to establish, of course, on a balance of probabilities that he has benefited from drug trafficking, that is received any payment or reward in connection with drug trafficking. Here there is no direct evidence of that so the Crown invite me to make the assumptions required by section 4(3) of the Act, namely (a) that property held by him since his conviction, and property transferred to him since 18 November 1989, the appropriate date, was received as such a benefit; (b) that any expenditure of his since that date in 1989 was met out of payments received by him in connection with any drug trafficking carried on by him. I must do so unless either he shows on a balance of probabilities that the assumption is incorrect, or I am satisfied that there would be a serious risk of injustice to him if the assumption was made.”
Applying these assumptions the judge assessed the applicant to have received GBP 91,400 by way of the proceeds of drug trafficking over the preceding six years. In making this assessment the judge took into account inter alia the value (GBP 50,000) of a house purchased by the applicant in 1988. Contrary to the applicant’s submissions, the judge found that a purported sale of this house was a sham, that the money supposedly received in purchase of it was a drugs payment and that the house remained the applicant’s realisable property within the meaning of section 5 of the 1994 Act. A confiscation order of GBP 91,400 was imposed. If the applicant failed to pay this amount he was to serve an extra two years’ imprisonment, consecutive to the nine year term.
On 28 January 1997 the applicant was refused leave to appeal against conviction and sentence (including the imposition of the confiscation order). His application to renew leave to appeal against conviction and sentence was refused on 22 January 1998 after a full hearing before the Court of Appeal.
B. Relevant domestic law and practice
Section 2 of the 1994 Act provides that a Crown Court should make a confiscation order in respect of a defendant appearing before it for sentencing in respect of one or more drug trafficking offences, who the court finds to have received at any time any payment or other reward in connection with drug trafficking.
Under section 5 of the 1994 Act, the confiscation order should be set at a sum corresponding to the proceeds of drug trafficking assessed by the court to have been gained by the defendant, unless the court is satisfied that, at the time the confiscation order is made, only a lesser sum could be realised.
In determining whether and to what extent the defendant has benefited from drug trafficking, section 4 (2) and (3) of the 1994 Act require the court to assume that any property appearing to have been held by the defendant at any time since his conviction or during the period of six years before the date on which the criminal proceedings were commenced was received as a payment or reward in connection with drug trafficking, and that any expenditure incurred by him during the same period was paid for out of the proceeds of drug trafficking. This statutory assumption may be set aside by the defendant in relation to any particular property or expenditure if it is shown to be incorrect or if there would be a serious risk of injustice if it were applied (section 4(4)).
The required standard of proof applicable throughout the 1994 Act is that applied in civil proceedings, namely on the balance of probabilities (section 2(8)).
Provisions broadly similar to the above were previously included in the Drug Trafficking Offences Act 1986 (“the 1986 Act”: considered by the Court in its Welch v. the United Kingdom judgment of 9 February 1995, Series A no. 307-A).
The applicant complains under Article 6 § 2 of the Convention that the application of the statutory assumption under section 4(3) of the 1994 Act violated his right to be presumed innocent.
He complains under Article 7 of the Convention that property such as the house which he purchased in 1988, prior to the coming into force of the 1994 Act, should not have been taken into account by the court in making its assessment.
He complains under Article 1 of Protocol No. 1 that the statutory framework imposed by the 1994 Act for the confiscation of assets was not confined within reasonable limits.
Finally, he invokes Articles 5 and 8 of the Convention in complaining about the period of imprisonment to be served in default of payment of the compensation order.
1. The applicant alleges that the application of the assumption under section 4(2) and (3) of the 1994 Act constituted a breach of Article 6 § 2 of the Convention, which states:
“Everyone charged with a criminal offence shall be presumed innocent until proved guilty according to law.”
The Government submit, first, that during the confiscation order procedure the applicant was not “charged with a criminal offence” within the meaning of Article 6 § 2, since the court was not required to determine guilt but only the extent to which property should be confiscated following his conviction of drug trafficking.
Alternatively, in the event that Article 6 § 2 is applicable, the Government rely on the principles outlined in the Court’s Salabiaku v. France judgment of 7 October 1988 (Series A no. 141-A) and argue that neither the assumption under section 4(3) of the 1994 Act nor its application in the present case contravene Article 6 § 2. Thus, the statutory assumption is rebuttable and the applicant was given the opportunity to challenge it at first instance and on appeal. Moreover, the burden remained on the prosecution to prove that the applicant had benefited from drug trafficking and the total amount of his benefit. In view of the secrecy in which drug trafficking transactions are usually conducted, the statutory rules assist the prosecutor in discharging this burden by providing that specific items of property shown to have been in the applicant’s possession during the relevant period can be assumed to represent the proceeds of drug trafficking unless proved otherwise. To the extent that the burden of proof was reversed, this was done within reasonable limits and in a manner consistent with the response of the international community to the scourge of drug trafficking. In particular, the Government refer to the United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances adopted in Vienna on 19 December 1988, Article 5 of which provides:
“1. Each Party shall adopt such measures as may be necessary to enable confiscation of:
(a) Proceeds of [drug trafficking] offences …
7. Each Party may consider ensuring that the onus of proof be reversed regarding the lawful origin of alleged proceeds or other property liable to confiscation, to the extent that such action is consistent with the principles of its domestic law and the nature of the judicial and other proceedings. …”
The applicant submits that the form and effect of the 1994 Act is punitive, as has already been decided by the Court in its Welch v. the United Kingdom judgment of 9 February 1995, Series A no. 307-A).
He points to the fact that he had no previous conviction for a drugs-related offence and that there was no evidence that he had engaged in drug trafficking before November 1995. The only basis upon which the judge found that the house and other property acquired prior to that date represented the proceeds of drug trafficking was through the operation of the mandatory statutory assumption. His case should, therefore, be distinguished from Salabiaku (cited above) which concerned a situation which arises frequently in many criminal law systems where the burden was initially on the prosecution to prove guilt and then shifted to the defence to refute or explain it.
Having examined this complaint the Court finds that it raises a serious question under Article 6 § 2 of such complexity that its determination should depend on an examination of the merits. This part of the application cannot, therefore, be regarded as manifestly ill-founded within the meaning of Article 35 § 3 of the Convention, and no other ground for declaring it inadmissible has been found.
2. The applicant also complains that property obtained by him prior to the coming into force of the Drug Trafficking Act 1994 (“the 1994 Act”) was taken into account by the court in assessing his assets for the purposes of the 1994 Act. He alleges a breach of Article 7 of the Convention, which provides:
“1. No one shall be held guilty of any criminal offence on account of any act or omission which did not constitute a criminal offence under national or international law at the time when it was committed. Nor shall a heavier penalty be imposed than the one that was applicable at the time the criminal offence was committed.
2. This article shall not prejudice the trial and punishment of any person for any act or omission which, at the time when it was committed, was criminal according to the general principles of law recognised by civilised nations.”
In its above-mentioned Welch judgment, the Court held that a confiscation order imposed under similar legislation, namely the Drug Trafficking Offences Act 1986, amounted to a “penalty” within the meaning of Article 7 § 1. Since the order against Mr Welch had been made following his conviction in respect of offences which had been committed before the coming into force of the 1986 Act, there had been a breach of Article 7.
In the present case, the “penalty”, that is, the confiscation order, was imposed in respect of an offence committed in November 1995, after the coming into force of the 1994 Act. At the time the applicant committed the offence, therefore, it was foreseeable that one of its possible consequences would be the imposition of a confiscation order under the 1994 Act.
It follows that this complaint is manifestly ill-founded within the meaning of Article 35 § 3 of the Convention.
3. The applicant further contends that the powers exercised by the court under the 1994 Act were unreasonably extensive, in breach of Article 1 of Protocol No. 1, which states:
“Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.
The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.”
The Court considers that the issues under Article 1 are closely linked to those under Article 6 § 2 and are of such complexity that their determination should depend on an examination of the merits. This part of the application cannot, therefore, be regarded as manifestly ill-founded within the meaning of Article 35 § 3 of the Convention, and no other ground for declaring it inadmissible has been established.
4. Finally, the applicant states that it is possible that he may not be able to pay the compensation order and that he may be compelled to serve the two years’ sentence of imprisonment in default. He contends that the conditions, rights and privileges of persons imprisoned in default of payment are as onerous as for those serving sentences of imprisonment in respect of serious criminal offences. In these circumstances, detention would, he alleges, violate his rights under Articles 5 and 8 of the Convention.
However, the question whether or not the applicant will be detained for this additional period is a matter of speculation and hypothesis. He cannot, therefore, at present claim to be the victim, within the meaning of Article 34, of any violation of the Convention arising from the sentence of imprisonment in default of payment of the compensation order. It follows that these complaints also are manifestly ill-founded within the meaning of Article 35 § 3 of the Convention.
For these reasons, the Court, unanimously,
Declares admissible, without prejudging the merits, the applicant’s complaints that the making of the confiscation order breached his rights to the presumption of innocence and to the peaceful enjoyment of his possessions;
Declares inadmissible the remainder of the application.
STEVEN PHILLIPS v. THE UNITED KINGDOM DECISION
STEVEN PHILLIPS v. THE UNITED KINGDOM DECISION