Proceeds of Crime Bill

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Mr. Stinchcombe: The Minister's explanation has helped me considerably. I now have a much better understanding of the clause's meaning, and indeed, it means what it says.

Mr. Ainsworth: Wow. At that, I had better sit down, after asking the hon. Member for Beaconsfield to withdraw the amendment.

Mr. Grieve: I compliment the Minister on the clarity of his exposition of the purposes of clause 247. He satisfied the hon. Member for Wellingborough and I can assure him that on that one, he also satisfied me. Moreover, I shall not press amendment No. 381 relating to the bona fide purchaser. The debate was helpful in producing clarity, but I am not completely reassured. I take the Minister's point about the origin being in a proprietary claim, but as he acknowledged, one of the features of the legislation is that the assets in question were never necessarily the property of another person that had been unlawfully taken. The category of unlawful assets is much wider—an asset is unlawful because of its origins, and because it has been tainted with criminality.

11 am

I suppose that, philosophically, I have an old principle of English law in mind whereby a person is entitled to possession of what he has unless somebody else can raise a better claim to it, or it is the proceeds of crime, or, more specifically, a criminal acquisition. Departing from that, under an administrative law framework, throws up anomalies between the old established rule, which is valuable and touches on the liberty of the individual, and the convenience of the state in seizing assets that it concludes are the proceeds of unlawful conduct.

That is why I was anxious about the position of the bona fide purchaser as a theoretical individual. Even with the protections offered by the Minister, once one starts to suggest that the bona fide purchaser is a person who has unlawfully acquired assets, an interesting and worrying theoretical dimension is introduced in relation to the nature of property and private property rights. I noticed with interest that whoever drafted the legislation was sufficiently worried to make a specific statement about the impact of the European convention on human rights. When we come to the relevant part of the Bill, the Minister will see that it raises interesting issues in connection with private property rights. Of course, the ECHR originated from English legal principles, before it was exported to Strasbourg and subsequently repatriated—some Committee members may know that its repatriation was not wholly unwelcome to me.

I accept, however, that the Bill contains protection for the bona fide purchaser. I am grateful to Committee members for having borne with me during this wide-ranging discussion, and I hope that it will colour some of the debate on subsequent clauses. Therefore, without having such an extensive debate, we can keep in mind the potential tension and conflict between the two principles when considering later amendments. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Chairman, being of the opinion that the principle of the clause and any matters arising thereon had been adequately discussed in the course of debate on the amendments proposed thereto, forthwith put the Question, pursuant to Standing Orders Nos. 68 and 89, That the clause stand part of the Bill.

Question agreed to.

Clause 247 ordered to stand part of the Bill.

Clause 248

Proceedings for recovery orders in England

and Wales or Northern Ireland

Mr. Grieve: I beg to move amendment No. 382, in page 146, line 7, at end insert—

    '(1A) All proceedings for a recovery order in the High Court shall take place in chambers.'.

The Chairman: With this it will be convenient to take amendment No. 383, in clause 249, page 146, line 21, at end insert—

    '(1A) All proceedings for a recovery order in the Court of Session shall take place in chambers.'.

Mr. Grieve: We now move on from general principles to the mechanisms of civil recovery. Those are set out briefly in clause 248 in relation to England and Wales, and in clause 249 for recovery orders in Scotland. Perhaps not surprisingly, not a huge amount is said about those proceedings. That raises immediately a point that I made on Second Reading about the potentially damaging nature of the proceedings for an individual's reputation. Amendments Nos. 382 and 383 state that all proceedings for a recovery order in the High Court and the Court of Session shall take place in chambers. The proceedings would therefore not take place in public.

I shall outline briefly the pros and cons of a public—as opposed to a private—hearing. A key essential of our legal system is that justice should not only be done, it should be seen to be done. Thus the general rule is that litigation, whether civil or criminal, should take place in public. The public should have access to it. They should have the opportunity of hearing what is going on and of forming their own views about the case. Secret cases may create anxieties about unfairness, and that would be a serious issue.

However, it is also a well-established principle of our law that some proceedings should not take place in public. The classic example is the family division, when children are affected. To ensure that the children are protected, such proceedings are held in chambers. For the same reason, and more significantly, in a divorce case ancillary relief proceedings in respect of family finances are held in private, in chambers. I have considered various administrative tribunals and my understanding is that in the usual course of events, an appeal to the Inland Revenue commissioners, for example, would take place in private. Clearly, however, the situation might be different if the case subsequently went to the Court of Appeal.

I have an anxiety about the nature of the proceedings for civil recovery. Civil recovery, as the Minister has explained, is likely to take place when a person has never been convicted of an offence that would bring him within the confiscation mechanism. Such a person may enjoy, perhaps wrongly, a high reputation in society. He may be a wealthy man; he may make donations to charity and have an established status. Whether he is such a person or someone with a lower public profile, it has always been a central principle that people's private finances should not be exposed to public gaze without good and sufficient reason. One such reason is that when an individual brings an action against another person, it is often inevitable that matters of a personal nature may be exposed in the course of proceedings. However, a judge usually has mechanisms to ensure that any highly confidential material is not exposed to public gaze when a person can demonstrate that—although he is prepared to make it available to the court and to the other side—he would be seriously damaged by its public revelation.

As matters stand, unless subsequent rules were made to govern the proceedings, they would be held in open court. I am sure the Minister will agree that it is likely, when the first recovery order is brought—possibly against a Mr. Big—that there will be the type of knee-jerk feeding frenzy with which we are familiar in high-profile litigation. That would be interesting to a fairly prurient public, in terms not only of the outcome, but of finding out about the assets of others. I have an anxiety about that.

Mr. Carmichael: Amendment No. 382 states:

    ''All proceedings for a recovery order in the High Court shall take place in chambers''.

Amendment no. 383 makes the same point with regard to the Court of Session. Does the hon. Gentleman agree that the drafting would have been better if the word ''shall'' had been replaced by the word ''may''?

Mr. Grieve: That is a good point. I considered whether I should use that word—or whether I should insert some qualifying subsections, because this can be approached in a variety of ways. If the Committee expressed a wish that the word ''may'' rather than ''must'' or ''shall'' should be used, I would not complain. However, I felt that there was no harm in being emphatic, because that can stimulate debate, and because I am mindful of the fact that it is unusual for a Minister to stand up and say that he accepts an amendment in its present form. I have never known that to happen. Ministers usually have to check matters with their officials, and the amendment has to be redrafted to conform with the thrust of the legislation.

My emphatic drafting also helped me to develop my argument. The Minister has explained that in certain categories—although it will not be possible to be specific about them until the end of the proceedings—we will be dealing with entirely innocent people who have to hand over assets, and the court might also decide that certain individuals were right to contest a case, because they were entitled to establish why the assets that they believed to be innocently held were, in fact, illegitimately acquired by someone else—and that they were, therefore, the proceeds of unlawful conduct.

Mr. Field: My hon. Friend has referred to the feeding frenzy of press coverage that prosecutions of high-profile Mr. Bigs might generate. Does he agree that that might be one of the Government's motivations, and that negative consequences might flow from it?

Mr. Grieve: The Minister has made it clear that the Government intend the legislation to have a deterrent effect. The prospect of a Mr. Big being taken through such a civil procedure—with the attendant publicity, and the possible revelations about his lifestyle and other things—might act as a powerful form of deterrence, by highlighting the reach of the state, and its power to grab people and expose their lives to public gaze. In fairness to the Minister, I do not think that that was discussed when the Bill was drafted—I think that it was overlooked.

However, the Minister might agree that it is noteworthy that during our proceedings, the hon.—and, I think, learned—Member for Redcar has commented on the public nature of those proceedings. I think that she remarked on that last Tuesday—although I cannot be sure of the date, as I have not yet received the relevant copy of Hansard. Other hon. Members have also touched on the subject.

The reverse of what I said before is also true. To argue against my amendment, I admit that an individual might demand a public hearing, because he wanted to shame the director by exposing the folly of his course of action to public gaze.

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