R (Carter) v Ipswich Magistrates' Court
Issue: Whether Magistrates had been entitled to refuse to make an order under the Police (Property) Act 1897 for the return of money on the grounds that the money had been intended to be used in payment for a contract killing
Court and Reference: Administrative Court, CO/2517/2001
Neutral Citation:  EWHC 332 (Admin)
Judge: Maurice Kay J
Date: 8 February 2002
Facts: C and his wife stood trial for soliciting to commit murder. C's wife had paid £10,000 to an undercover police officer who was posing as a hired assassin. The money had come from their joint bank account. C was acquitted; his wife was convicted. After the trial C applied for an order under s. 1 Police (Property) Act 1897 for the return of the money. His wife had disclaimed any interest in it. The Justices found that the money belonged to C but, because it had been intended to bring about the death of a human being, they exercised their discretion to make
|R (Carter) v Ipswich Magistrates' Court (Admin. Ct.)
no order for the return of the money to C. C challenged this decision by way of judicial review.
Decision: The application was allowed and an order made for the payment of the money to C. There could have been no complaint if the Magistrates had declined jurisdiction. However, where the prosecution has been concluded without a confiscation order, the police had no lawful right to retain the money: to allow retention of the money would amount to expropriation by a public body without statutory authority. If statutory provisions for civil confiscation are inadequate, it is for Parliament to strengthen them. Consequently, the magistrates were wrong to take into account the fact which conditioned their decision: in light of their factual findings, the discretion under the statute was exercisable in only one way.
Appearances: N Paul (instructed by Adams Harrison) for C; N Ainley (instructed by Winckworth Sherwood) for the NCS as interested party
1. I now give reasons for the decision which I announced late in the day yesterday afternoon.
2. The claimant was tried on a charge of soliciting to commit murder. On 2 August 1999 he was acquitted by a jury at Norwich Crown Court. His wife had stood trial with him on the same charge. In the course of the trial it was accepted by the claimant that his wife had handed £10,000 to an undercover police officer who was posing as a hired assassin. The money had come from a bank account in respect of which the claimant and his wife were the joint account holders. The claimant's wife was convicted and sentenced to 5 years' imprisonment. At the conclusion of the trial the prosecution applied to the trial judge for an order under s. 43 of the Powers of Criminal Courts Act 1973 in respect of the £10,000. However, the trial judge declined to make such an order.
3. The claimant then applied to the Magistrates' court under s. 1 of the Police (Property) Act 1897. A hearing took place at Ipswich Magistrates' Court on 23 March 2000. There is before me an affidavit of MAG Osborne, who was the Chairman of the Bench on that occasion. It is a very candid account of the Magistrates' reasoning. It includes the following passage:
"We were referred to a quantity of documents, which had been prepared by the respondent's solicitors, the majority of which have been filed with the claim.
7. The history of the matter was basically agreed by the parties.
8. We found as a fact that the £10,000 in question was money withdrawn from the joint account of Mr and Mrs Carter and that the proposed use of the money was to hire a person to commit murder.
9. We acknowledged that Mr Carter had been acquitted of soliciting to murder.
10. Mrs Carter was convicted and sentenced to 5 years' imprisonment.
11. We considered s. 1(1) of the Police Property Act 1897 and firstly considered our duty to ascertain the owner of the money. We made a finding that the money did come from the joint account of Mr and Mrs Carter at the relevant time.
12. We acknowledged that Mrs Carter had relinquished any right to have the money returned to her. We could therefore have made an order returning the money to Mr Carter.
13. We accepted that the Trial Judge at the Norwich Crown Court, Mr Justice Harrison had not allowed an application for forfeiture of the money by the Crown ...
14. Application had now been made for us to consider whether we should make an order or not.
15. We were not bound to make the order applied for. We were advised that the Act gave us a discretion in that, even if the owner of the money could be ascertained, the court "may ... make an order".
16. We considered carefully the facts that had been presented to us. The money had been intended to be used to bring about the death of a human being. For this reason, we exercised our discretion to make no order for the return of the money to Mr Carter as it did not seem right for us to make the order requested.
17. In doing so, we believe we were acting reasonably and properly within the terms of the statute."
4. In this application for judicial review that decision is challenged by the claimant.
5. Section 1(1) of the 1897 Act as amended provides:
"Where any property has come into the possession of the police in connection with their investigation of a suspected offence ... a court of summary jurisdiction may, on application either by an officer of police or by a claimant of the property, make an order for the delivery of the property to the person appearing to the ... court to be the owner thereof, or, if the owner cannot be ascertained, make such order with respect to the property as to the ... court may seem meet."
6. So far as the jurisdiction of the magistrates is concerned, issues do sometimes arise as to whether a particular application should be processed in that jurisdiction if it raises, for example, particular matters of complexity. In that regard the words of Lord Widgery CJ in Raymond Lyons & Co Ltd v Metropolitan Police Commissioner  QB 321 at 326 bear repetition. He said:
|R (Carter) v Ipswich Magistrates' Court (Admin. Ct.)
"It has been said over and over again that the latter summary procedure is not to be used in difficult cases involving tricky questions of title or large sums of money. It is much better that the civil court should handle disputes of that kind. What is intended both in regard to compensation orders and orders under the Police (Property) Act 1897 in my judgment is that in straightforward, simple cases where there is no difficulty of law and the matter is clear, the justices should be able to make a decision without involving the expense of civil proceedings. But I would actively discourage them from attempting to use the procedure of the Act of 1897 in cases which involve a real issue of law or any real difficulty in determining whether a particular person is or is not the owner."
7. In the present case, if the Magistrates had declined to become involved in the present dispute, no-one could have complained. However, they did not so decline. They heard the application and made appropriate findings of fact. It is clear that upon those factual findings the claimant "appeared to the court to be the owner" of the £10,000, Mrs Carter having disclaimed all interest in the money. There was before the Magistrates, and is before me, a document evidencing that disclaimer. Having reached that stage, the Magistrates then had to exercise their discretion arising from the words "may ... make an order". It is clear from the affidavit of Mr Osborne that they decided not to make an order in the claimant's favour for one reason and one reason only. I repeat the words of the affidavit:
"The money had been intended to be used to bring about the death of a human being. For this reason [emphasis added], we exercised our discretion to make no order for the return of the money to Mr Carter as it did not seem right for us to make the order requested."
8. Although the section is drafted in the language of discretion, it is common ground that the discretion has to be exercised lawfully. So far as that is concerned, it is necessary to consider the recent decision of the Court of Appeal in Webb v Chief Constable of Merseyside Police  QB 427. It seems that this authority, which was decided on 26 November 1999, was not before the Magistrates when they made their decision. I read the headnote, it is in the following terms:
"Three plaintiffs in 2 actions brought proceedings for the return of money lawfully seized by the police on suspicion that it constituted the proceeds of drug trafficking. Two of the three plaintiffs were not convicted of drug trafficking offences and the third was convicted of possession but no drug trafficking inquiry was undertaken. The Chief Constable nevertheless sought to rely in the civil proceedings on evidence that the money did proceed from drug trafficking. In the first action, the assistant recorder found on the balance of probabilities that the sum claimed was the proceeds of trafficking and held that the plaintiff could not seek to recover property obtained by illegality. The plaintiff appealed. In the second action, the judge ruled as a preliminary issue that, even if the money was the proceeds of trafficking, the plaintiffs were entitled to repayment if they could establish title without relying on the illegality. The Chief Constable appealed.
On the appeals - Held, allowing the first appeal and remitting the second for the judge to make findings of fact as to the plaintiff's title, that where the police had lawfully seized money from suspected drug dealers they were not entitled to retain it once their statutory power to do so was exhausted; that, even where it was established on the balance of probability in civil proceedings that the money was the proceeds of drug trafficking, public policy was no defence to the plaintiffs' claims since the plaintiffs could rely on their right to possession as against the police; that the police had no statutory power to retain the money where the person entitled to its possession was not convicted of a drug trafficking offence; and that, in the absence of evidence that anyone else was entitled to the money, the person from whom it was seized was entitled to possession."
9. It is apparent that the case was in the form of a civil action commenced in the county court rather than an application to the magistrates pursuant to the 1897 Act. However, it is also apparent that the same principles must apply. In the course of his judgment May LJ said at p439E-G:
"Where, as in the Webb case, there is to be no prosecution, or where, as in the Porter case, prosecutions have been finally concluded without confiscation orders being made, the money is no longer required as evidence or for forensic examination ... in these cases the police are not in truth retaining the money in order to establish another lawful owner. They are retaining the money because they say it would be against public policy to return it where, in the Webb case, it has been established to be the proceeds of drug trafficking or where, in the Porter case, they wish to set about establishing that.
Section 1 of the Police (Property) Act 1897 applies to any property which has come into the possession of the police in connection with their investigation of a suspected offence. A police officer or a claimant of the property may apply to a court of summary jurisdiction. The magistrate or court may make an order for the delivery of the property to the person appearing to be its owner or, if the owner cannot be ascertained, may make such order with respect to the property as may seem meet. It is agreed that these provisions do not prevent civil court proceedings of the kind taken in these cases. The section does not give the
|R (Carter) v Ipswich Magistrates' Court (Admin. Ct.)
police any permanent entitlement to retain the property.
The position therefore is that in each of these cases the police lawfully seized the money which is claimed, but their statutory power to retain it is exhausted."
10. And later, at p446E-447A, his Lordship said:
"In my judgment, the court should not extend the law in the way suggested. Although from the Chief Constable's perspective the money is the proceeds of crime, from another perspective the court should not, in my view, countenance expropriation by a public authority of money or property belonging to an individual for which there is no statutory authority. There is statutory machinery for the prosecution of those who deal in drugs and for the confiscation upon conviction of the proceeds of their drug dealing. There is statutory machinery for the confiscation upon conviction of the proceeds of other serious crime. There is statutory machinery for the forfeiture of the cash proceeds of drug trafficking which are being imported into or exported from the United Kingdom. There is no statutory power to confiscate the proceeds of drug dealing within the United Kingdom where the person entitled to possession of the money is not convicted of a drug trafficking offence. I recognise that there may be circumstances where for a variety of reasons a prosecution may not take place. But that does not, in my view, justify expropriation by means of a defence to a civil claim for return of money which has been seized from persons who are not convicted. It is one thing to prosecute to conviction and to take positive steps authorised by statute to confiscate the proceeds of crime from the convicted defendant. It is quite another to resist the claim of an innocent person by asserting some or all of the ingredients of what might have been a prosecution; or to effect confiscation in this way from a convicted person against whom statutory confiscation machinery has not been used. Innocent claimants would, I am sure, be deterred from pursuing entirely proper claims for the return of money or property to which they were entitled. I can foresee quite unacceptable possible consequences of the development of the law for which the Chief Constable contends in these cases. If statutory provisions for civil confiscation are inadequate, it is for Parliament to strengthen them after proper consideration of all the implications."
11. Applying those principles to the present case, in my judgment, it becomes clear that on the findings of fact the police have no right to retain the money. Mrs Carter has no rights in relation to it in view of the disclaimer, the genuineness of which has not been controverted. It is not suggested that there may be some as yet unidentified third party who might be able to establish an interest in the £10,000. On all the evidence, the only person who has a claim to it is the present claimant.
12. In view of Webb, the Magistrates were not entitled to take into account the very matter, and the sole matter, which conditioned their decision; nor were they entitled to do whatever they thought just by reference to the second limb of s. 1(1), which only applies when "the owner cannot be ascertained". In all the circumstances, having made the appropriate factual findings, the discretion was, in truth, exercisable in only one way. That being the case, I shall allow the application for judicial review, I shall quash the decision of the Magistrates, and I shall substitute in its place an order that the police pay the money out to the claimant.
13. At the end of the hearing yesterday, following the announcement of my decision, I heard some provisional applications on costs. It was not possible for them to be concluded. I have arranged with the parties that any such applications may be enlarged by way of written submission.