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Lord Goodhart: I rise to speak because the noble and learned Lord, Lord Lloyd of Berwick, said that he sought our support for the Motion but we were unable to give it. I believe that I should therefore explain why that was so.
First, the noble and learned Lord's reference to the remarks of the noble and learned Lord, Lord Templeman, about forks and spades brought back some extremely painful memories. The remarks were made by him in a case in which I appeared for the respondent in the Appellate Committee of your Lordships' House and unfortunately the appeal was allowed. Hearing those remarks again brought back unhappy memories.
The noble and learned Lord, Lord Lloyd, gave three grounds for why the clause should not be allowed to stand. His comments were far-reaching because his real objection was not merely to the clause but effectively to the whole of the part of the Bill, as he made clear. It is therefore by far the most fundamental and important amendment with which we have had to deal. The noble and learned Lord made three points. First, that Clause 248 was incompatible with the European Convention on Human Rights or the Human Rights Act. Secondly, that it might give rise to injustice. Thirdly, he doubted whether it would be cost-effective in practice. The third of those reasons is perhaps the least important and we on these Benches would be prepared to give the Government the benefit of the doubt about it.
I believe that Clause 248 may well be incompatible with the Human Rights Act in so far as it operates retrospectively as discussed in the previous debate. However, in future there will undoubtedly be many cases brought for a civil recovery order in which on no footing can an element of retrospectivity arise because the unlawful conduct complained about occurred after the enactment of the Bill.
In such cases, I find it difficult to see any fundamental incompatibility between Clause 248 and the Human Rights Act. A civil recovery order may well be justified where, for example, a criminal has assets which are within the jurisdiction but he has either gone to ground and disappeared; or he may have gone to some other country from which he cannot be extradited; or he may have died and cannot on any footing be prosecuted. A civil recovery order may also be useful where recovery is sought from a person into whose hands the property has passed and where that person is not the wrong-doer. Therefore, I regard the incompatibility as being partial rather than complete.
As regards the ground that Clause 248 might give rise to cases of injustice, there is undoubtedly a risk. That is perhaps best dealt with by pressing various amendments to this part of the Bill which would reduce the risks of injustice. That may be done by, for example, re-examining the standard of proof necessary in order to activate Clause 248. The question of injustice may be assisted if we narrow the circumstances in which an interim recovery order may be obtained, which is a potential injustice.
While I have to some extent considerable overlap of agreement with the noble and learned Lord, Lord Lloyd, it does not go so far as to justify a root and branch objection to what would in effect be the whole of Part 5 of the Bill.
Lord Kingsland: I thank the noble and learned Lord, Lord Lloyd, for what I am sure the Committee will agree was a remarkable intervention. I wholly endorse the analysis made by the noble Lord, Lord Goodhart, with respect to the first of the noble and learned Lord's points. As regards retrospectivity, I believe it highly likely that Clause 248 contravenes the European Convention.
As regards subsequent Acts following the passage of the Bill, serious questions remain about compatibility with Article 6. The reason that I felt, at least at this stage of the proceedings, that I was unable to support the noble and learned Lord, Lord Lloyd, was that, at the end of the day, compatibility is a matter for the courts. Given the fact that we, on the Opposition Benches, broadly support the Government's policy in Part 5 of the Bill, at this stage we have taken the view that, although we would prefer the Government to make the appropriate amendments now, on balance it is better to leave matters to the courts at a later stage.
However, that judgment has now been tempered by the perspicacious analysis of the noble and learned Lord, Lord Lloyd of Berwick, with regard to his second head—the issue of grave injustice. The noble and learned Lord is surely right in saying that the effect of Part 5 will be to deny individuals, who have not previously been convicted of a criminal offence, their cardinal right under English law, which is their right to trial by jury. I found that point quite telling. I shall be reflecting on it between now and Report stage and will look afresh at any further intervention that the noble and learned Lord, Lord Lloyd, may like to make as regards Clause 248 when the time comes.
7 p.m.
Lord Goldsmith: Notwithstanding that ultimately the noble and learned Lord's proposition is not supported at this stage—I note what the noble Lord, Lord Kingsland, said—by either of the two opposition parties, it is obviously right that the careful analysis which the noble and learned Lord put forward should be addressed properly. I thank him for that. I shall seek to address it head on. Indeed, we have had a discussion about this already for which I am grateful to him
Before turning to the three points that he makes, I would like to emphasise one or two aspects which run through what I want to say. It is clear from what has already been said on this Bill here and in another place that it is the Government's view, supported until now by the other parties, that Part 5 of the Bill is needed to fill an important gap in the law. Without it and civil recovery, however well meaning and whatever innovative ideas one has about the criminal law the process cannot otherwise be achieved.
But it is important—and this is at the heart of the Government's approach—that the civil recovery process is focusing exclusively on the origin of property. It is to be a proprietary remedy, which attaches to the property. It will not be dependent on the person who holds the property having been convicted or, more to the point, having committed any offence. I illustrate that by some of the examples in which that will operate. It is not a form of prosecution. Its purpose is not to secure a conviction against any person and it cannot do so. The result of civil recovery cannot be, for example but most pointedly, a sentence of imprisonment on someone for committing serious crime. It is because civil recovery focuses on property rather than on conduct that it is properly, in the Government's view, a civil procedure. It is also why the points made by the noble and learned Lord, Lord Lloyd of Berwick, about the justice of the situation, in our judgment, are inapposite.
First, I want to emphasise, therefore, the hierarchy. The prosecution of offences will remain the priority in all cases. The noble and learned Lord suggested that the director—which I understood to be the director of the assets recovery agency—should prosecute. It is very important to note that the director will have no power to prosecute. The power to prosecute will be the power of the existing prosecution agencies in England and Scotland. It is clear from the hierarchy which has been identified that the prosecution of offences will remain the priority in all cases. That is not intended as a soft option. For example, it is made clear in the draft guidance that it would not be a proper exercise of the prosecutorial discretion—there are two tests for prosecution, the evidential and the public interest test—to say that in the public interest there is no need to prosecute because there is the alternative of civil recovery.
However, in what kinds of cases may civil recovery take place? One example would be where the law enforcement authority has carried out a criminal investigation and consulted the prosecuting authority and a decision not to institute criminal proceedings has been taken applying normal evidential and public interest criteria. I acknowledge that that would be such a case, but I emphasise that the decision not to prosecute would be taken without regard to whether civil recovery may be available.
But there are many other examples which do not even touch on the possibility that the respondent is actually himself or herself being accused of criminal conduct; where the person suspected of the unlawful conduct through which property was obtained is not available because that person is dead or abroad and there is no reasonable prospect of securing their extradition. That is even before any advice has been given to such people to leave the jurisdiction.
A related example would be if a person had been convicted of an offence abroad, for example, for drug-related crime, but had recoverable property in the United Kingdom. The important point is that law enforcement and prosecution authorities will ensure that the possibility of bringing criminal proceedings has been fully considered in every case.
The second point is that when the civil recovery process takes place it will be governed by the normal civil procedure rules. There will be court proceedings in the High Court and civil procedure rules will apply. In Northern Ireland it will be according to the rules of the Supreme Court and in Scotland, I understand—without fully understanding what it means—according to the petition rules of the Court of Session. We shall obviously look at the detail of the procedural scheme set out and the safeguards which apply.
There is one aspect I wish to return to. But this part of the Bill is aimed at the need to deal with the problem, the "corrosive effect", referred to by the noble Lord, Lord Kingsland, at Second Reading, of proceeds of crime and of depriving people of the working capital by which further crime, drug trafficking and more serious and organised events can take place.
I turn to the three points made by the noble and learned Lord. The first was that the Bill is incompatible. I am not going to take the point that the clause to which he refers also deals with cash forfeiture. That is not a feature of Part 5 of the Bill to which, I understand, the noble and learned Lord takes objection. Technically, his opposition to the clause standing part of the Bill would cut out that part of the Bill as well. I know that that is not his intention.
It is not the case that what I have been saying is that the Government believe that this may be incompatible. The Government's view is that it is not incompatible. I have been happy to accept that there is a degree of uncertainty. But that, as the noble Lord, Lord Kingsland, said, would be for the courts to determine. The Government would not be going into this matter unless they believed that it was compatible.
Therefore, I beg to differ fundamentally and strongly with the view of the noble and learned Lord that there will be a challenge which would be bound to succeed in Strasbourg. First, the jurisprudence to which I referred previously is, at the very lowest—to use the expression of the noble Lord, Lord Goodhart—at least superficially in point. However, we believe that it goes further. What is being said there, and, indeed, has been said by the courts in Strasbourg, in the Privy Council and in the Judicial Committee of this House, is that when there are proceedings after a conviction but which relate to the proceeds of conduct that has not been the subject of a conviction, that constitutes a civil procedure, not a criminal procedure. I emphasise the fact that that applies not just to the case where the confiscation is in relation to the proceeds of the crime for which there has been a conviction, but conduct for which there has not been a conviction.
Secondly, there is other jurisprudence. For example, there is a decision of the European Court in a case called Raimondi, in Italian law—the reference of which I shall, of course, give to the noble and learned Lord—which does not appear to be that dissimilar when dealing with Mafia situations; and which, again, is helpful. I also mention the case of Welch to which the noble and learned referred. This is not the occasion for
the full-blown debate as to compatibility that may well take place in court. However, I make the following suggestion to the noble and learned Lord.
The key question in the two cases mentioned was whether or not this was a criminal or a civil matter. That is a very important question, not just for Article 6 but also for Article 7 purposes. Moreover, the particular point in Welch was that there had in fact been a conviction, and what was being done was following as a penalty for that conviction. That is the area in which the criminal confiscation procedures—the forfeiture—differ in a way that puts them on one side of the line from the present case. There will be no conviction in those cases. Therefore, the reasoning in Welch that found it was a penalty for a conviction would simply not apply. I give way.
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