M, R (on the application of)

For a certificate of inadequacy under section 17 of the Drug Trafficking Act 1994, the defendant must prove, on the balance of probabilities, what happened to the realisable property and why it is inadequate. The application cannot reopen issues determined at the confiscation hearing. Payments made for good consideration to preserve or realise property may be taken into account. Payments to criminal associates made in response to threats remain gifts where the defendant was not legally obliged to make them. Such payments therefore do not reduce the property available for the confiscation order.

The claimant had been convicted of drug trafficking and made subject to a confiscation order. He applied for a certificate of inadequacy under section 17 of the Drug Trafficking Act 1994, explaining payments made from the proceeds of selling property and the sale of a car. The issues included a reduction in the property’s sale value, payments to his father for mortgage and repair work, payments to former criminal associates allegedly made after threats, and the unexplained car proceeds.

1. The application succeeded only to the limited extent that the realisable property was inadequate by reason of the £6,000 paid to the claimant’s father and the shortfall in the property’s sale value. A certificate of inadequacy was accordingly justified in that small amount.
2. Section 17 required the court to be satisfied that the realisable property was inadequate for repayment of the amount remaining under the confiscation order. The claimant bore the burden of proving this on the balance of probabilities. A certificate application was not an appeal and could not be used to reargue matters determined at the confiscation hearing or remedy deficiencies in the evidence then presented.
3. The claimant had to provide a proper account of what had happened to the realisable property. Consistently with R v Walbrook and Glasgow [1994] Crim LR 612, vague and generalised assertions unsupported by evidence would rarely discharge that burden. The court nevertheless accepted the evidence about the threats and payments in the factual context, despite the absence of bank statements or similar documentation.
4. The £6,000 paid to the claimant’s father was not a gift within section 6(2). It was paid for good consideration, namely mortgage payments and necessary work which preserved the value and saleability of the property.
5. The £21,000 paid to criminal associates was legally a gift. Although the payments followed threats, the claimant was not legally obliged to make them. The court held, as a matter of policy and construction, that payments which ought not to have been made and could theoretically have been avoided by reporting the threats could not escape the statutory treatment of gifts. They could not therefore be taken into account in the certificate application.
6. The £7,500 received from the sale of the car had been conclusively dealt with at the confiscation hearing. No further explanation had been given, so that part of the application failed.

First-instance decision. The judgment records an application for a certificate of inadequacy under section 17 of the Drug Trafficking Act 1994; no appellate history is stated.