In the Matter of Clifford Robert Norris and In the Matter of the Drug Trafficking Offences Act 1986 and In the Matter of an Application by Teresa Wendy Norris

Under the Drug Trafficking Offences Act 1986, the Crown Court assesses a convicted defendant’s realisable property solely to fix the amount of a monetary confiscation order. It does not determine a third party’s proprietary rights. Those rights must be adjudicated by the High Court during civil enforcement.

Section 11(8) requires a reasonable opportunity for an interested third party to make representations before the High Court exercises its realisation powers. Giving evidence in the earlier criminal proceedings does not, without more, make the assertion of those rights an abuse of process. Such an abuse will be rare where the issue was not previously decided between the same parties or their privies. A manifestly hopeless third-party claim may instead be determined summarily.

Mr Norris was convicted of drug trafficking. The Crown Court valued his realisable property as including the entire beneficial interest in the matrimonial home, although the registered owner, Mrs Norris, had appeared only as a witness. A confiscation order for £386,397 was made.

The High Court subsequently appointed a receiver under section 11 of the Drug Trafficking Offences Act 1986 and declared, on an ex parte application, that Mr Norris held the beneficial interest in the home. Mrs Norris applied to vary the order and relied upon documentary evidence supporting her own interest. Latham J dismissed her application as an abuse of process without determining its merits. The Court of Appeal dismissed her appeal: [2000] 1 WLR 1094.

The central issue was whether Mrs Norris’s participation as a witness in the Crown Court prevented her from asserting her proprietary rights in the civil enforcement proceedings.

1. Appeal allowed unanimously. Lord Hobhouse of Woodborough delivered the leading speech. Lord Hope of Craighead, Lord Browne-Wilkinson, Lord Clyde and Lord Hutton agreed with it and with the proposed disposition.

2. Per Lord Hobhouse and Lord Hope, the Drug Trafficking Offences Act 1986 divides responsibility between the Crown Court and the High Court. The Crown Court’s function under sections 1 to 4 is to make a monetary order against the convicted defendant. Its assessment of the defendant’s realisable property fixes the upper limit of that order. It neither confiscates particular property nor adjudicates the proprietary rights of third parties.

3. Per Lord Hobhouse and Lord Hope, third-party interests are determined during civil enforcement in the High Court. Section 11(8) requires the High Court to give persons holding an interest in relevant property a reasonable opportunity to make representations before exercising its realisation powers. Section 13(4) requires those powers to be exercised with a view to allowing an innocent third party to retain or recover the value of that party’s property. The contrary construction adopted in In re K could not be supported.

4. Per Lord Hobhouse, Mrs Norris was not bound by the Crown Court’s assessment. She was not a party, had no right to representation or appeal, and lacked control over the evidence and proceedings. Her proprietary interest was opposed in principle to her husband’s interest. The criminal and civil proceedings also involved different issues, evidential rules and burdens of proof. The principles in Hunter v Chief Constable of the West Midlands Police and Ashmore v British Coal Corporation were therefore distinguishable.

5. Per Lord Hobhouse, relitigation outside the rules of estoppel may amount to abuse of process, but this will be rare where the issue was not previously decided between the same parties or their privies. Abuse requires a misuse of the litigation process. Mrs Norris was instead using the jurisdiction which the statute provided for protection of her civil rights.

6. In the High Court, Mrs Norris’s registered title and occupation were the starting point. The Customs and Excise bore the burden of proving that her apparent title should be displaced. The criminal presumptions and the burden placed upon her husband did not determine her civil rights.

7. A third-party case which has no real prospect of success may be determined under Part 24 of the Civil Procedure Rules 1998. That remedy is distinct from striking out for abuse of process. Mrs Norris was permitted to continue her defence, and the Customs and Excise were required to prove their case against her.

1. House of Lords: Allowed Mrs Norris’s appeal unanimously: [2001] UKHL 34. She was permitted to defend the civil claim to the property, with the Customs and Excise bearing the burden of proving its case.
2. Court of Appeal: Dismissed Mrs Norris’s appeal, holding that her attempt to raise her beneficial interest after giving evidence in the Crown Court was an abuse of process: [2000] 1 WLR 1094.
3. High Court: Latham J dismissed Mrs Norris’s application to vary the receiver order without examining its merits. He held that reopening the Crown Court’s finding would be an abuse of process, but granted leave to appeal.
4. Crown Court at Lewes: Judge Brown made a confiscation order against Mr Norris for £386,397. For that purpose, he valued Mr Norris’s realisable property as including the full beneficial value of the matrimonial home.