Director of Public Prosecutions v Gohill & Walsh

In an appeal by way of case stated, deliberate falsification of a company record to enable equipment to be borrowed without charge was conduct which no reasonable bench could find honest by the ordinary standards of reasonable and honest people. The issue of dishonesty had to be separated into two questions: whether the conduct was objectively dishonest, and whether the defendants knew that ordinary people would regard it as dishonest. The first question was answered against the defendants. The court could not decide the second question on the stated case, particularly where credibility issues arose. The case therefore had to be remitted for fresh consideration by a new bench.

The defendants, a manager and assistant manager of a plant-hire outlet, were prosecuted for theft and false accounting. They allowed customers to take equipment without charge, altered the company computer records to conceal the transactions, and sometimes accepted small payments from customers. The magistrates accepted that the defendants believed the payments were personal tips and acquitted them, finding that dishonesty had not been proved by the ordinary standards of reasonable and honest people.

The Director of Public Prosecutions appealed by way of case stated. The central issues were whether the magistrates’ conclusion on objective dishonesty was perverse and whether this court could determine that the defendants themselves realised that their conduct was dishonest.

1. The appeal was allowed. The question in the stated case had to be divided into two questions under R v Ghosh [1982] QB 1053: first, whether the conduct was dishonest by the ordinary standards of reasonable and honest people; and secondly, whether each defendant must have realised that it was dishonest by those standards.

2. Applying the stringent approach to perversity identified in Bracegirdle v Oxley [1947] KB 349, it was impossible to justify a finding that reasonable and honest people would not regard deliberate falsification of a company record as dishonest. The alteration enabled customers to borrow equipment without charge from a business whose purpose was to hire equipment for payment, and contravened the company’s procedures.

3. The issue concerning customer payments was distinct. A tip given in addition to the proper hire charge would not necessarily be dishonest. A payment made specifically because the hire charge had not been levied raised a separate question. The magistrates were entitled to assess the reliability and context of the defendants’ admissions in interview, but their conclusion on objective dishonesty could not withstand the perversity threshold.

4. The court could not determine the subjective limb of the Ghosh test on the stated case. The evidence and submissions did not permit the court to conclude that the defendants themselves must have realised that ordinary people would regard their conduct as dishonest.

5. The matter was remitted to a new bench of justices to reconsider the charges afresh.

• High Court (Administrative Court): allowed the appeal by way of case stated against the magistrates’ acquittals and remitted the charges to a new bench of justices for fresh consideration.