AA & SA, R v

Contempt proceedings should ordinarily be determined swiftly, even where related criminal proceedings are pending. A court may stay or adjourn them only exceptionally, where continuing creates a real risk of serious prejudice capable of causing injustice. The court must compare the issues, the parties’ known cases and any evidence the alleged contemnor may wish to give. A person’s settled denial of involvement, coupled with no intention to give evidence, may defeat a claimed risk of prejudice. Sentencing for deliberate breach of an asset-restraint order normally has punitive and coercive purposes. A substantial immediate custodial sentence may be justified where deliberate and calculated dealings put very large sums beyond the reach of the authorities and there is no effort to repatriate them.

AA and SA appealed against their convictions for contempt of court and concurrent sentences of 18 months’ imprisonment imposed by HHJ Karsten QC in the Crown Court at Blackfriars.

Restraint orders made under the Proceeds of Crime Act 2002 prohibited dealings with the assets of companies controlled by the appellants and required disclosure and repatriation of assets. Following alternative service, new overseas bank accounts were opened and substantial sums were transferred through them to other companies.

AA challenged the refusal to adjourn the contempt proceedings pending related criminal proceedings, the finding that he knew the orders’ terms, and the finding that he participated in the transfers. SA contended that delay and the risk of prejudice to his criminal trial made the contempt proceedings an abuse of process. Both challenged sentence.

1. The appeals against conviction and sentence were dismissed. The court upheld the findings that both appellants knew the restraint orders’ terms, were responsible for the relevant transfers and had breached the orders.

2. Contempt proceedings are separate from related criminal proceedings and should generally be resolved swiftly. The court has power to stay or adjourn contempt proceedings pending a criminal trial, but only exceptionally where there is a real risk of serious prejudice capable of causing injustice. The judge must assess the likely issues in each proceeding, the prosecution and defence cases as then known, and the evidence the alleged contemnor may wish to give.

3. The judge correctly refused an adjournment. AA had consistently said that he would not give oral evidence. Both appellants’ position was that they had no involvement in the transfers. They therefore had no need to disclose an account of those transactions that might prejudice the later criminal trial. The judge’s additional reasoning about the chronology of the money-laundering allegation was unnecessary, but the first two grounds were sufficient.

4. The judge was entitled to infer, to the criminal standard, that AA and SA opened the new accounts and carried out the transfers. That independent finding supported the inference that both knew the precise terms of the restraint orders. The challenge based on possible fabrication of emails and the absence of computer hard-drive checks did not undermine the conclusion.

5. The delay before the committal applications caused no significant prejudice. SA also failed to show that the contempt hearing deprived him of a fair opportunity to answer the allegations. The abuse-of-process ground therefore failed.

6. Following R v Adewunmi [2008] EWCA Crim 71, committal for breach of an asset-restraint order normally has punitive and coercive elements. These breaches were more serious than those considered there: they involved far larger sums, deliberate and calculated steps to place the funds beyond the British authorities’ reach, and no attempt at repatriation. Sentences of 18 months’ imprisonment were neither wrong in principle nor manifestly excessive.

• Court of Appeal (Criminal Division) Dismissed both appellants’ appeals against conviction for contempt and against sentences of 18 months’ imprisonment: [2010] EWCA Crim 2805.
• Crown Court at Blackfriars HHJ Karsten QC found both appellants guilty of contempt for breaches of restraint orders and imposed sentences of 18 months’ imprisonment.