Padda v R.

Under section 22 of the Proceeds of Crime Act 2002, a court reconsidering the available amount retains a broad statutory discretion to substitute an amount which it considers just, subject to the statutory cap. It may take account of all relevant circumstances, including elapsed time, the impact of payment and rehabilitation. Legitimately acquired after-acquired assets may nevertheless be used to satisfy the outstanding benefit from criminal conduct. The policy of recovering criminal benefit remains highly important. The proportionality protection under Article 1 of the First Protocol does not replace the express section 22 discretion. An appeal against the resulting confiscation order is determined by whether it was wrong in principle or manifestly excessive, not by the Wednesbury standard.

The appellant had pleaded guilty in 2006 to eight drug-supply offences. A confiscation order based on his then available assets was made and satisfied. After his release from custody, he obtained employment and established a car-hire business.

In 2012 the Crown obtained a restraint order and sought a reconsideration of the available amount under section 22 of the Proceeds of Crime Act 2002. In February 2013, His Honour Judge Barrie treated specified bank accounts, an interest in a former matrimonial home and a vehicle as personal assets. He made a further confiscation order for £74,652.02.

The appellant appealed, contending that the judge had insufficiently considered the passage of time, the legitimate source of the later assets, rehabilitation, human-rights considerations and the evidence concerning the house deposit. The central issue was what was just when varying the order under section 22.

1. Appeal dismissed. The judge’s order was neither wrong in principle nor manifestly excessive.

2. Section 22(3) of the Proceeds of Crime Act 2002 required a new calculation by reference to the position at the time of reconsideration. Where that calculation exceeded the relevant amount, section 22(4) permitted the court to substitute an amount which it believed to be just, provided it did not exceed the established criminal benefit.

3. The word just preserved a real and broad discretion. In deciding the justice of a further order, the court could consider the unpaid criminal benefit, the additional available assets, elapsed time, the effect of payment on the defendant, and any other relevant circumstance. It also had to give substantial weight to Parliament’s policy of recovering the proceeds of crime.

4. The court approved the approach in In re Peacock [2012] UKSC 5. Legitimately acquired after-acquired assets could be used towards the unsatisfied criminal benefit. Their legitimate source and an offender’s commendable rehabilitation were relevant to the discretionary assessment, but did not themselves answer the application.

5. R v Waya [2012] UKSC 51 concerned the proportionality constraint arising under Article 1 of the First Protocol. That constraint did not recreate a general discretion which the statutory confiscation regime had removed. Section 22 was different because it expressly required a just order. An order properly assessed as just would be highly unlikely to be disproportionate.

6. The elapsed period of about six and a half years was relevant, but its weight depended on the facts. The judge had considered it, the legitimate business, and the appellant’s circumstances. He was entitled to reject the evidence that the house deposit had not been a gift and to treat half of the equity as the appellant’s available asset.

7. The parties had wrongly treated Wednesbury unreasonableness as the appellate standard. Under the criminal appeal route, the question was whether the confiscation order was wrong in principle or manifestly excessive.

• Court of Appeal (Criminal Division) — dismissed the appeal in [2013] EWCA Crim 2330, upholding the further confiscation order.
• Shrewsbury Crown Court — His Honour Judge Barrie made a revised confiscation order of £74,652.02 under section 22 of the Proceeds of Crime Act 2002 in February 2013.
• Shrewsbury Crown Court — following the 2006 convictions, an earlier confiscation order based on the appellant’s then available assets was made and satisfied.