Birmingham City Council v Ram

In confiscation proceedings involving a criminal lifestyle, the statutory assumptions under Proceeds of Crime Act 2002 section 10 must be made unless the defendant shows, on the balance of probabilities, that an assumption is incorrect or would create a serious risk of injustice. Accepted evidence of lawful trading may rebut the assumptions. The court may assess the absence of evidence of further criminality as part of the whole evidential picture without reversing the burden of proof.

A defendant’s lies do not automatically prevent rebuttal. A judge need decide the essential disputed issues and give reasons for the conclusions reached. An appellate court will not interfere with evaluative factual findings unless they are clearly wrong, particularly where the judge heard the relevant witness.

The respondent pleaded guilty to three offences concerning counterfeit clothing under Trademarks Act 1994 section 92(1)(c). Following sentence, Birmingham Crown Court began confiscation proceedings under the Proceeds of Crime Act 2002.

It was common ground that the respondent had a criminal lifestyle. The statutory assumptions therefore applied unless rebutted. Although the judge made adverse findings about the respondent’s candour, he accepted evidence from an independent accountant that the textile business was substantially and lawfully trading. He found that the respondent had obtained no benefit beyond the value of the goods seized, £1,334.54.

The prosecution appealed, contending that the judge had misapplied the assumptions, failed to make necessary findings or give adequate reasons, and reached conclusions contrary to the evidence.

1. Appeal dismissed. The Crown Court’s confiscation order of £1,334.54 remained in force.

2. Because the respondent had a criminal lifestyle, Proceeds of Crime Act 2002 section 10 required the statutory assumptions to be made unless he showed that an assumption was incorrect or that making it would create a serious risk of injustice. The judge correctly treated accepted evidence of lawful trading as capable of rebutting those assumptions.

3. The judge did not reverse the burden of proof. His references to the lack of evidence of embroidery or further criminality did not place an obligation on the prosecution to disprove lawful trading. They were relevant features when evaluating, as a whole, the evidence which the respondent relied on to rebut the assumptions.

4. The respondent’s lies and evasions made him an unsatisfactory witness, but they did not automatically make rebuttal impossible. Nor was there an estoppel preventing the judge from finding that the respondent had supplied information to a bank while exaggerating his means.

5. The judge was not required to resolve every conflict in the evidence. He had to decide the essential issue—whether the business had been lawfully conducted during the relevant period—and give reasons. His reliance on the accountant’s evidence, including the sample of major suppliers, was open to him. The Court of Appeal was not persuaded that his resulting findings were clearly wrong.

• Court of Appeal (Criminal Division) The prosecution’s appeal from the confiscation order was dismissed.
• Birmingham Crown Court HHJ Everard held that the statutory assumptions had been rebutted and made a confiscation order for £1,334.54.
• Birmingham Magistrates’ Court The respondent pleaded guilty to three trademark offences and was committed to the Crown Court for sentence.