Greet, R v

For confiscation under Criminal Justice Act 1988 section 74, a defendant’s instigation of a third party’s transfer does not alone make that third party’s interest an indirect gift by the defendant. The court must identify the property actually gifted by the defendant.

Where a gifted interest contributes to the purchase of replacement property financed partly by borrowing, its traced value under section 74(8) is the proportion of the replacement property funded by the gift. It is not a proportion of the later net equity. The Crown Court retains its statutory discretion to take a gift into account, but the High Court ordinarily determines a third party’s civil interests at enforcement.

The appellant, a solicitor, was convicted at Bristol Crown Court of theft, making a false instrument and failing to keep proper accounting records. He sought an extension of time, permission to appeal against conviction on alleged fresh evidence concerning an employee’s thefts and accounting evidence, and bail.

He also appealed a confiscation order of £160,000 made under the Criminal Justice Act 1988. The order treated the whole equity in a former matrimonial home, transferred to his second wife and later represented in a new home, as a gift caught by section 74.

The central issues were whether the transfer included an indirect gift of the first wife’s share, how the appellant’s own gift should be valued after tracing into the new property, and whether it was appropriate to take that gift into account.

1. The court refused the extension of time and permission to appeal against conviction. The alleged fresh evidence was long delayed without reasonable explanation. The accounting material substantially repeated points available at trial and did not eliminate a substantial unexplained deficiency. The proposed evidence concerning Avery’s gambling and admissions could not be combined with the paper accounting exercise, would have created serious forensic difficulties, and did not answer the unchallenged evidence of client losses.
2. The confiscation appeal was allowed in part. The trial judge was entitled to find that the appellant’s own half-share in Pembroke Road was gifted to Ms Thompson. However, the first Mrs Greet intended to transfer her own apparently valueless interest directly to Ms Thompson so as to escape mortgage liability. The appellant’s role in procuring that transfer did not make her share an indirect gift by him under Criminal Justice Act 1988 section 74.
3. Payments made before or after the transfer were not consideration for it. Ms Thompson’s assumption of the mortgage obligations could in principle be consideration, but the transfer remained a gift at a significant undervalue. The later compromise with the trustee in bankruptcy could bear on value, appropriateness or discretion, but could not alter the fact that the appellant had originally made a gift.
4. Under section 74(8), the gift’s current value had to be assessed by asking what proportion of Chantry Road represented the gifted property. The £33,000 returned from the sale proceeds was to be attributed equally to the two former spouses’ interests. Half of the £55,000 equity invested in Chantry Road therefore represented the appellant’s gift. That sum was 11% of the purchase price, so the relevant value was 11% of Chantry Road’s value at the date of the order, not half of its later equity.
5. The court held that it remained appropriate under section 74(10) to take that gift into account and to make an order. In re Norris [2001] 1 WLR 1388 showed that the High Court is the proper forum at enforcement for a third party’s civil interests, but that did not remove the Crown Court’s statutory discretion. The £160,000 order was quashed and replaced by an order for £52,250. The court indicated that the default term should be reduced from 18 months to nine months, subject to further argument.

• Court of Appeal (Criminal Division) [2005] EWCA Crim 205: refused an extension of time and permission to appeal against conviction; allowed the confiscation appeal in part, quashing the £160,000 order and substituting £52,250.
• Bristol Crown Court: convicted the appellant on 12 December 2001 and sentenced him on 11 January 2002. On 12 November 2003 it made a confiscation order under the Criminal Justice Act 1988 for £160,000, with 18 months’ imprisonment in default.