Joint Committee On Human Rights Appendices to the Minutes of Evidence

Memorandum from the Home Office


  1.  This memorandum is submitted by the Home Office in response to the letter from the Commons Clerk of the Joint Committee on Human Rights to Diane Caddle of the Home Office dated 27 November 2001, requesting answers to a number of questions in relation to the Proceeds of Crime Bill.

Statutory assumptions, fair trial and the presumption of innocence

  The Committee's provisional view is that the requirement to make the assumptions does not engage the right to be presumed innocent until proved guilty under Article 6(2) of the ECHR. The Committee also provisionally considers that the requirement is not intrinsically incompatible with the right to a fair hearing under Article 6(1), as long as the court does not make assumptions for which there is no supporting evidence, and makes due allowance for situations in which it would be impracticable for the defendant to satisfy the burden of proof which the legislation places on him or her. However, the Committee considers that there may be advantages in terms of legal certainty, if the statutory assumptions were to be drafted in a way that incorporated those considerations expressly in the duties of the courts under the legislation. It invites the Home Office to respond to this view.

  1. The Department agrees with the Committee's provisional conclusion that Article 6(2) of the ECHR is not engaged in relation to the application of the assumptions[9].

  3.  The existing safeguards in the Bill are sufficient to ensure that the assumptions procedure is compatible with Article 6(1). These are that the defendant may rebut the assumptions on the balance of probabilities and that the court is prohibited from making an assumption in respect of particular property if there would be a serious risk of injustice if that assumption were made. The two issues raised by the Committee may be relevant to the application of these safeguards but this will depend on the facts of the particular case. In any event, there will always be evidence supporting the assumptions, namely the fact that the defendant has been convicted of an offence that is indicative of a criminal lifestyle.

  4.  The Committee refers to paragraphs 90 and 96 of the judgement in Benjafield. Lord Woolf said:

      "90.  The jurisprudence of the Court of Human Rights makes clear that it is the application of the statutory provisions to the facts in a particular case which will be critical to the court's determination as to whether article 6 has been contravened. The courts have been given the responsibility of not making orders if there is a serious risk of injustice. The courts will be astute to avoid injustice. In performing their responsibility, the courts will be mindful of the structure of the legislation. This does not require any direct connection between an offence of which a defendant has been convicted and the resources of the defendant which are to be confiscated. However, the scale of the offending actually proved may be significant in the court determining whether it is safe to make the confiscation order. The court should be alert to make allowances for situations which make it impractical for a defendant to satisfy the burden of proof which the legislation places upon him . . .

      "96.  The number of convictions is all-important in determining the punishment of a defendant. Under the legislation, the object of confiscation is not punishment but the forfeiture of an illicit profit. Clearly, the greater the number of convictions, the greater the likelihood of benefit, but the statutory minimum of convictions is all that is required for the confiscation process to be put in motion. In the course of that process the court can take into account the number of offences proved because they are probative either of the likelihood of the defendant having benefited or not benefited from his offences."

  5.  Lord Woolf was detailing the manner in which the "serious risk of injustice" test operates to ensure that the assumptions are not applied in a case in which it would breach Article 6. The safeguards identified by Lord Woolf and raised by the Committee are encompassed within that test, rather than additional to, that test. Lord Woolf raises two issues that might be relevant to the question of whether there would be a serious risk of injustice if the assumptions were applied. First, the scale of the offending and the number of offences committed might be relevant. Secondly, the fact that it was impractical for the defendant to discharge the burden of proof might be relevant. However, Lord Woolf did not at any point say that the "serious risk of injustice" test was insufficient to meet these concerns. He approved the application of the assumptions with the safeguards that are contained both in the existing legislation and in the Bill.

  6.  Both of the issues raised by Lord Woolf might well fall within the wider question of whether injustice would be done to the defendant by applying the assumptions. However, whether this is the case will depend significantly on the circumstances of each case. It is for this reason that the broader formulation of "serious risk of injustice" is better than trying to make explicit provision for this sort of case. Any attempt to formulate concrete exceptions would inevitably involve excluding some cases that should be included and vice versa. In addition, there may be other instances in which applying the assumptions would give rise to a serious risk of injustice. Therefore, it is better to allow the courts to develop case law and guidelines that will operate more flexibly.

  7.  In addition, any express reference to circumstances in which it is impractical to discharge the burden of proof could create a loophole in the legislation. Defendants who have obtained property unlawfully routinely attempt to persuade the court that they previously had evidence that they held the property lawfully but are now unable to produce that evidence. Defendants use a variety of innovative and detailed excuses for this inability. It should be for the court, having seen the defendant give evidence, to judge the truth of such explanations. Putting an exception on the face of the Bill could make the courts feel that such arguments should be accepted more often than they would otherwise have done.

  8.  In any event, Lord Woolf did not go so far as to say that there should be an evidential link between the offence of which the defendant has been convicted and the proceeds to be confiscated. It would be impossible to introduce any sort of evidential threshold that did not have the effect of rendering the assumptions practically ineffective. Lifestyle criminals are adept at destroying evidential links between proceeds and crimes. The point that Lord Woolf was making was that there might be a serious risk of injustice if certain individuals convicted of minor offences were treated as lifestyle criminals.

Compatibility of the confiscation order regime with the right to the enjoyment of property

  The Committee seeks a further explanation of the grounds on which Ministers are satisfied that the requirement of proportionality is likely to be met, in all cases not involving drug trafficking, in which a court would have a duty to make a confiscation order after applying the statutory assumptions under the procedures proposed in the Bill.

  9.  There are four ways in which offences other than drug trafficking might trigger the assumptions under the Bill. The first is similar to current provision in Criminal Justice Act 1988 (the 1988 Act) in that it relates to a course of criminal conduct. The second is if the defendant commits an offence over a period of six months or more. The third is if the defendant is convicted of a money laundering offence. The fourth is if the defendant is convicted of an offence specified in regulations. In each case, the offence or offences triggering the assumptions are indicative of organised or consistent criminality (or will be so in the case of offences specified in regulations)—this is explained in further detail below—and give rise to a presumption that the defendant is funding his lifestyle through crime. In the light of this, and taking into consideration the public interest in preventing criminals from retaining the proceeds of crime and the safeguards referred to above (namely the chance to rebut the assumptions and the serious risk of injustice exception), it is clear that the assumptions are proportionate.

Course of criminal conduct

  10.  Clause 75(2)(d) of the Bill provides that the assumptions are triggered where a person is convicted of four acquisitive offences in the same proceedings or one acquisitive offence in the current proceedings and two others on separate occasions in the six years preceding institution of the current proceedings.

  11.  It is reasonable to assume that a repeat acquisitive offender is living off the proceeds of crime. An offender who has been convicted of acquisitive offences on several occasions is likely to have committed a number of other offences which have not come to light and to be using the proceeds to fund his lifestyle.

  12.  The application of the provisions on repeat offending in Part 6 of the 1988 Act was approved by the Court of Appeal in the case of Rezvi which was heard with Benjafield. Rezvi was a case concerning a defendant convicted of two counts of theft. At paragraph 43, Lord Woolf said:

    "Both in the case of repeat offenders and drug traffickers, it is very much in the public interest that they are not able to profit from their crimes. If offenders are likely to lose their ill-gotten benefits, this in itself will be a significant deterrent to the commission of further offences."

Offences committed over a period of six months or more

  13.  Under clause 75(2)(e) of the Bill the assumptions are triggered where a defendant commits an offence lasting for a period of six months or more. An example might be a conspiracy or a continuous fraud such as cheating the public revenue over a period of six months or longer. The rationale behind including an offence continuing for more than six months is the same as for the course of criminal conduct which has been approved by the Court of Appeal in Benjafield and Rezvi. An offence committed over a period of time, like repeat offending, gives rise to a presumption that the defendant is living off the proceeds of crime. A defendant is unlikely to engage in criminal activity for such a long period without seeking to gain substantially. In addition, an offence committed over such a long period necessarily entails a significant element of organisation.

Money laundering

  14.  As to money laundering, the rationale is the same as for drug trafficking offences. Those who are convicted of money laundering offences have obtained large sums through criminal conduct and are laundering those sums in order to be able to use them to fund a criminal lifestyle. Money laundering is a key component of serious and organised crime and as such is indicative that the person who is committing the offence is living off the proceeds of crime. It is often part of a larger pattern of cross-border crime carried out by criminals who operate in an international context. It is consistently identified by NCIS as a major threat in its risk assessments. Money laundering does great harm to society by enabling criminals to retain the proceeds of crime and, therefore, making crime more attractive. It is a serious offence which carries a maximum sentence of fourteen years' imprisonment.

Other specified offences

  15.  Further offences which trigger the assumptions may be specified in regulations under clause 75(2)(d). However, these regulations will be subject to scrutiny by the court. If the mandatory application of the assumptions in relation to those offences is found to be a breach of Article 1, Protocol 1, the courts will have the power to quash the regulations as a result of the Human Rights Act 1998. In addition, the Secretary of State who makes the regulations is a public authority for the purposes of section 6 of the Human Rights Act 1998 and is required to act compatibly with the Convention rights in making the regulations.

  16.  A list of the type of conduct which is likely to be specified has been circulated to the Standing Committee considering the Bill. It is clear from this list that the type of offences to be specified will be "lifestyle crimes", giving rise to a presumption that the offender is engaged in persistent and organised criminality. For example, the list includes people trafficking, arms trafficking and pimping.

Protecting the interests of members of a defendant's family in the family home

  The Committee seeks an explanation as to why no similar express provision [to clause 101, which applies to Scotland] is made in respect of England and Wales or Northern Ireland

  17.  The provision on the family home in clause 101 reflects existing provision in Scottish legislation[10] that was inserted as a result of a recommendation from the Scottish Law Commission. When the Bill was being prepared, the Department accepted that it was desirable to retain this provision in respect of Scotland where it had worked well and was understood by legal practitioners. However, the provision is not necessary in order to safeguard the rights and interests of members of the defendant's family. With this in mind, the Department decided not to introduce a provision for which there was no historical equivalent in England and Wales.

  18.  The Department accepts that the compulsory sale of the defendant's family home by a receiver will interfere with the other family members' right to respect for their home and may interfere with their right to respect for their family life. However, any such interference furthers the aim of preventing crime and disorder in accordance with Article 8.2 and the interference is proportionate.

  19.  Where a family member is convicted of a criminal offence, this can have many adverse implications for other innocent members of the family. If the principal breadwinner is imprisoned, the family may be unable to meet mortgage repayments and may lose the family home as a result. However, the public interest in preventing and detecting crime outweighs the loss suffered by the family. The Department can see no reason why confiscation procedures should be treated any differently.

  20.  There is a strong public interest in recovering the proceeds of crime. Even where it cannot be shown that the family home was, itself, obtained from the proceeds of crime, the receiver may sell it because this is necessary in order to satisfy the confiscation order made against the defendant. The need to ensure that criminals do not retain the benefit of their offending outweighs the interests of innocent family members in staying in their home. The family members will not be prevented from living together elsewhere and, if left without funds, will be able to claim state benefits. Therefore, the family will not be prevented from having a family home. They will simply be unable to live in the particular family home which it is necessary to sell in order to meet the confiscation order.

  21.  Where a spouse or child has a beneficial interest in a property, this will be protected by the obligations of the receiver and the court under clause 69(3)(a) to allow third parties to retain their interest. If the spouse or child wishes to make a payment in order to extinguish the defendant's interest and remain in the family home, this is possible under clause 49(6), 51(6) or 53(6). In addition, 49(8), 51(8) and 53(8) contain an obligation for the court to allow third parties to make representations before it gives the receiver power to deal with property in which they have an interest. Clause 54(4) and 56(4) contain similar provision in relation to the distribution of remaining assets amongst third parties. These safeguards are sufficient to ensure that interference with the home, in so far as it constitutes a property right, is proportionate.

The right to legal representation in civil recovery proceedings under the Bill

  In the light of the need to secure compatibility with Article 6 of the ECHR, the Committee seeks an explanation from the Home Office as to why clause 255(4) is thought to be appropriate.

  22.  The Committee's comments on the issue of legal representation are prefaced by the statement that the Committee has provisionally formed the view that civil recovery actions under Part 5 of the Bill might fall to be regarded as involving a "criminal charge" for the purposes of Article 6 of the ECHR, in view of the autonomous meaning given to that term by the European Court of Human Rights.

  23.  The Department does not agree with the Committee's provisional conclusion, and in view of the importance of the Article 6 classification of civil recovery proceedings, both for the issue of legal representation and for the issue of retrospectivity (question 5), as well as for other issues, the grounds for the Department's view that civil recovery proceedings are to be classified as civil for the purposes of Article 6 are set out below.

  24.  In considering this issue, it is important to bear in mind the purpose of civil recovery, namely to establish as a matter of civil law that there is no right to enjoy property that derives from unlawful conduct. This applies irrespective of who committed the conduct; the focus is on the property, not the person.

Article 6 classification

  25.  The starting point in determining whether proceedings are to be classified as civil or criminal for the purposes of Article 6 is the threefold test set out by the European Court of Human Rights in Engel v The Netherlands (1976) 1 EHRR 647, namely:

    (i)  classification as a matter of domestic law;

    (ii)  nature of the offence;

    (iii)  nature and severity of the penalty.

Classification as a matter of domestic law

  26.  Civil recovery proceedings will undoubtedly be classified as civil as a matter of domestic law. The Bill specifically states that civil recovery proceedings are civil proceedings (clause 245(1)).

Nature of the offence

  27.  The allegation made in civil recovery proceedings that a person holds property which is or represents property obtained through unlawful conduct is not an allegation that he has committed an offence. An allegation made in civil recovery proceedings does not have any of the hallmarks of a criminal charge: it does not lead to a conviction; it cannot lead to a term of imprisonment or any other sentence imposed by a criminal court; the respondent to civil recovery proceedings will never be arrested, detained at police station or be subject to bail or custody of any kind.

  28.  Although "unlawful conduct" is defined by reference to the criminal law (see clause 246 of the Bill), this does not mean that an allegation that a person holds recoverable property (ie property derived from unlawful conduct) amounts to an implicit allegation that he has committed an offence such that the proceedings are criminal for the purposes of Article 6. Civil recovery proceedings may be brought against any person who holds recoverable property, whether that person is the person who committed the unlawful conduct or not. This will include an "innocent" holder of recoverable property, for example, a person who has inherited it and neither has any knowledge of its origins nor has played any part in the unlawful conduct which generated it.

  29.  Even where the evidence is that the holder of recoverable property himself committed the unlawful conduct which generated the property, this does not in itself mean that the proceedings are criminal for the purposes of Article 6. There are many types of civil proceedings which involve allegations that conduct has been committed which constitutes a criminal offence, for example, civil fraud proceedings[11].

Nature and severity of the penalty

  30.  The recovery of property in civil recovery proceedings is preventative and reparative in nature, not punitive.

  31.  The civil recovery scheme is designed to prevent crime by taking out of circulation property which has been generated by unlawful conduct and which may well be used to fund future crime. It also prevents crime by particularly targeting those crimes motivated by gain, thereby removing the incentive for their commission. It is to be noted that the overall aim of the Director of the Assets Recovery Agency, who brings civil recovery proceedings in England and Wales and Northern Ireland, is to exercise his functions in the way which he considers is best calculated to contribute to the reduction of crime (clause 2(1) of the Bill). Thus, the overall purpose of the legislation is to reduce crime, and the civil recovery scheme is a crucial aspect of the legislation.

  32.  As well as being intended to prevent and reduce crime, the civil recovery scheme is reparative in nature. The civil recovery scheme has been constructed around the principle that the enforcement authority (defined at clause 310 of the Bill) has a right to recover property obtained through unlawful conduct, acting on behalf of society, because of the damage caused to society by the generation and enjoyment of that property. Its right is akin to the right of a victim to recover in civil proceedings property which the victim has been deprived of by unlawful conduct: just as the person who holds the victim's property has no beneficial right to that property, so the respondent who holds property obtained through unlawful conduct has no right to the property he is holding as against the enforcement authority.

  33.  The enforcement authority's right to recover in civil recovery proceedings therefore resembles the proprietary remedy which is available to a victim in civil proceedings. The Director may "follow" the property (clause 302) or he may "trace" it (clause 303), and there are provisions for dealing with the situation where recoverable property becomes mixed with legitimate property (clause 304). These are concepts which are derived from equity, and would apply to a victim pursuing a proprietary remedy. The defences to the enforcement authority's right to recover are also akin to the defences that would apply where a victim was pursuing a proprietary remedy—for example, the defence of being a bona fide purchaser for value without notice (clause 306), and the defence of bona fide change of position (clause 267(3)(a)). The original unlawful conduct may generate a considerable number of different items of property, all of which are potentially recoverable, either as the original property obtained through unlawful conduct, or as property which represents that property. But, in relation to any unlawful conduct, the Director may only recover sufficient property to satisfy his right to recover the original property obtained through unlawful conduct (clause 277). This puts the Director in the same position as the victim: the victim may have a number of options as to which property to pursue in order to make good his loss, but the courts would not allow him to benefit from his misfortune by acquiring more property as a result of bringing civil proceedings than he was originally deprived of.

  34.  Thus the civil recovery scheme has as its aims prevention and reparation rather than punishment. The fact that the scheme imposes a detriment on the respondent, namely the loss of his property, cannot turn a scheme which is reparative and preventative in nature into a punitive scheme[12]. The fact that the loss of property may operate to severe effect in certain circumstances does not alter this conclusion[13].

  35.  The civil recovery scheme can be distinguished from the confiscation scheme which was at issue in the case of Welch v the United Kingdom (judgment of 9th February 1995, A.307)[14]. There, it was held that, although a confiscation order pursued aims of prevention and reparation, it was nonetheless punitive and as such constituted a criminal penalty for the purposes of Article 7. Case-law on the meaning of a penalty under Article 7, although not directly on point, is highly relevant to the third limb of the Engel test. The crucial differences between the confiscation scheme and the civil recovery scheme are as follows. Confiscation follows conviction for a criminal offence and is part of the sentencing process. The civil recovery scheme has no relationship with criminal proceedings. A confiscation order focuses on the defendant's benefit from his criminal conduct. Whether or not the defendant still has that benefit at the time that the confiscation order is made is irrelevant: in fixing the sum to be paid under the confiscation order, all the defendant's property may be taken into account, including property whose origin is legitimate. A civil recovery order focuses on property and its history; it does not focus on the conduct of any individual. If the person who holds the property disposes of it without receiving any property in return (for example, he dissipates it, or he gives it away), then no proceedings can be brought against that person. There is no right to recover legitimate property in place of the recoverable property which has been disposed of.

  36.  For all these reasons, the Department disagrees with the Committee's provisional view about classification, and considers that the civil recovery scheme is to be classified as civil for the purposes of Article 6.

Legal representation

  37.  Since the Department believes that the civil recovery scheme is to be classified as civil for the purposes of Article 6, it does not consider that Article 6(2) and (3) have any relevance to civil recovery proceedings. However, Article 6(1) applies since, as the Committee says, the recovery of assets involves a determination of the respondent's civil rights and obligations. Since the right to a fair trial under Article 6(1) includes a right of access to a court, the Department agrees that provision must be made to ensure that legal representation is available for civil recovery proceedings to cover the situation where the respondent does not have any assets to pay for such representation other than those which are subject to an interim receiving order.

  38.  However, the Department is not aware of any ECHR case-law which suggests that where civil proceedings concern disputed assets, legal representation must be provided by means of access to those assets, rather than by means of public funding. As far as the Department is concerned, as long as the respondent is assured of legal representation, its Article 6 obligations will be met. Whether legal representation is funded through the disputed assets, or by public funding, is therefore a matter of policy. The Department has chosen to fund the proceedings through public funding rather than by allowing the respondent to draw on the assets in order to preserve the assets. Civil recovery proceedings may be lengthy and very costly. If the respondent were allowed to draw on the assets, they might be unduly depleted by the time any recovery order came to be made. For these reasons, the Department considers clause 255(4) to be appropriate.

  39.  The Committee contrasts the approach to funding of legal representation under Part 5 of the Bill with that of Part 2. The effect of clause 42(3) and (4) is that assets which are subject to a restraint order may only be used for funding of legal representation before criminal proceedings begin. Once criminal proceedings begin, the defendant would be expected to use criminal public funding if he did not have any other assets. Criminal public funding is not available before the commencement of proceedings, and this is why access to the assets is permitted during this period. However, as was made clear during Commons Committee stage on Part 2 of the Bill, it is intended to bring forward an amendment to make civil public funding available before the commencement of criminal proceedings (see below). A further amendment will be brought forward to deny the defendant access to the assets during this period: the defendant will no longer need access to the assets since public funding will be available. Where Part 5 is concerned, civil public funding will be available throughout the period that an interim receiving order under Part 5 is in force and there is therefore no need to allow access to the assets which are subject to the order to fund legal representation.


  The Committee seeks a further explanation as to why Ministers believe that the retrospective operation of the proposed recovery order regime would be compatible with Article 7 of the ECHR.

  40.  The Department does not agree with the Committee that a recovery order is a criminal penalty for the purposes of Article 7. The Department would refer in this regard to everything said above in relation to Article 6 as regards why it considers that the civil recovery scheme is not punitive in nature.

  41.  Since the Department considers that Article 7 does not apply to civil recovery proceedings, it follows that the fact that the scheme applies retrospectively does not, in the Department's view, make it ECHR incompatible. It is accepted, however, that if the courts were to find that a civil recovery order amounted to a criminal penalty for the purposes of Article 7, clause 310(3), which makes the scheme retrospective, would be incompatible with Article 7.

  42.  The Committee suggests that the retrospective operation of the civil recovery scheme would be unlimited as to time. This is not in fact correct. Clause 287 provides for a limitation period of twelve years, which starts running when the original property was obtained through unlawful conduct.

Other representations relating to compliance with Convention rights, etc.

  The Committee also wishes to be informed of other representations the Home Office has received relating to the compatibility of provisions of the Bill as introduced with human rights obligations.

  43.  The Home Office placed in the Libraries of both Houses on 9 July 2001 the responses received to the draft Bill published in March 2001. The particular responses dealing specifically with the implications of the Bill for human rights obligations were those made by Justice, the Law Society of England & Wales, Dr Terence Palfrey (Law School, Leeds Metropolitan University) and Liberty. Copies of the responses from these bodies are attached to this Memorandum for ease of reference.[15] Some of the comments that were made have since been overtaken by changes that were made to the Bill, partly in response to the comments, prior to its Introduction into Parliament. Two examples, relating to civil recovery, are the insertion of the minimum financial threshold (clause 286) and the exclusion of cases where the unlawful conduct occurred more than 12 years before the commencement of proceedings (clause 287).


  The Committee would also be grateful for details of any undertakings given so far by Ministers to Parliament to consider, or bring forward, amendments to the Bill in relation to the above questions or related matters.

  44.  Mr George Foulkes, Minister of State, Scotland Office, agreed to examine the omission of a similar provision to that contained in clause 101 for Parts 2 and 4, and whether there should be a common position concerning protection for the family home within the UK (Hansard, Standing Committee B, 6 December 2001, column 522).

  45.  In relation to the availability of public funding for legal expenses where assets are subject to a restraint or interim receiving order, undertakings were given as follows. On clause 42 (restraint) Mr Bob Ainsworth, Parliamentary Under-Secretary of State, Home Office, said (Hansard, Standing Committee B, 29 November 2001, column 377):

    "If the money held under restraint is exhausted, it is unlikely that a case would remain that could deprive a defendant of his assets, and there would be no assets under restraint for him to contest. However, as a safeguard, we are arranging that in such circumstances the defendant could apply for civil legal aid prior to the institution of proceedings. The legislation does not at present provide for that, so we shall introduce an amendment to the Access to Justice Act 1999 in due course.

    "A person who holds a tainted gift and whose property is restrained will not be able to draw on a restrained asset or assets for his legal expenses, as that would lead to a variation of his restraint order. We intend that such a person should be eligible for civil legal aid under the normal rules, and we shall introduce an amendment to the 1999 Act to provide for that, too.

    "The court will continue to be able to release restrained assets to enable other third parties affected by a restraint order to contest it. In practice, other third parties rarely, if ever, make such applications, usually because the assets do not belong to them. However, if a third party wishes to make an application and the court is not prepared to release any frozen assets and the applicant has no other funds, we intend to make legal aid available under the usual conditions. Again, we shall introduce an amendment to the 1999 Act to provide for that."

  46.  On clause 255 (interim receiving orders), Mr Ainsworth said (Hansard, Standing Committee B, 18 December 2001, columns 748-9):

    "People who are not party to the proceedings may use assets that are not subject to an interim receiving order to pay for their legal expenses. If parties do not have sufficient means available to them to meet their legal expenses, they will be able to apply for public funding under the relevant scheme. Such funding will be made available to both respondents and third parties in civil recovery proceedings.

    "In order for an applicant to be granted public funding, they must satisfy both a means test and a merits test. Parties to civil recovery proceedings will need to meet the standard means test. However, the standard merits test will be relaxed to the extent necessary to ensure that everyone has access to legal funding who needs it, and who qualifies financially.

    "We believe that these arrangements will ensure that people are properly represented in civil recovery proceedings, without unnecessarily risking the dissipation of any property pending the decision of the court on whether it is recoverable."

  47.  The Home Office considers that this Memorandum answers the points raised in the Committee Clerk's letter. If the Committee requires anything further, please let the Department know.

7 January 2002

9   As found by the Privy Council in McIntosh v HM Advocate (5 February 2001) and the European Court of Human Rights in Phillips v the United Kingdom (5 July 2001). Back

10   Proceeds of Crime (Scotland) Act 1995. Back

11   In the case of R v Moore, Kerr and Haroon (judgment of 5 October 2001), which concerned the fitness to plead procedure under section 4A of the Criminal Procedure (Insanity) Act 1964, the Court of Appeal stated (paragraph 26) "although proceedings under section 4A involve the determination of facts which may constitute a criminal offence, this, in our judgment, is irrelevant. Civil and disciplinary proceedings often involve allegations that a person has committed acts which constitute a criminal offence. That does not transform such proceedings into criminal proceedings". Back

12   In Gough & Smith v Chief Constable of Derbyshire; Miller v Leeds Magistrates Court; Lilley v Director of Public Prosecutions (judgment of 13th July 2001), one of the issues was whether a football banning order amounted to a penalty within the meaning of Article 7 (Article 7 case-law is considered to be relevant to the third limb of the Engel test). The Divisional Court found that it did not, holding "it is not part at all of the purpose of any such order to inflict punishment. The fact that it imposes a detriment on its recipient no more demonstrates that it possesses a punitive element than in the case of a Mareva injunction. The purpose is to protect the public, here and abroad, from the evil of football violence and the threat of it" (paragraph 42(1) of the judgment). See also R (McCann) v Crown Court at Manchester [2001] 1 WLR 1084 and S v Miller (2001) 15 SLT 531. Back

13   As was said in Gough & Smith "it is clear from the Strasbourg jurisprudence, not least Welch itself, that severity alone cannot be decisive; and in my judgment the burdens or detriments involved cannot conceivably confer the status of penalty on the banning orders if otherwise they do not possess it" (paragraph 42(4)). Back

14   The civil recovery scheme is also clearly distinguishable from the civil regimes that were at issue in the cases of King v Walden (Inspector of Taxes) (judgment of 18 May 2001), Han & Yau and others v Commissioners for Customs and Excise (judgment of 3 July 2001) and International Transport Roth GmbH & Others v the Home Office (judgment of 5 December 2001). Back

15   Not printed. Back

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