Department of Work and Pensions v Kole- Emmanuel

On an application for a certificate of inadequacy relating to a confiscation order, the applicant bears the burden of proving, on the balance of probabilities, that the realisable property is inadequate to meet the outstanding sum. Evidence of unexplained or hidden assets may make that burden impossible to discharge. Bankruptcy, or a short official receiver’s report based on unverified assertions, does not determine the issue and cannot operate as a proxy for the required evidence. The court may refuse an adjournment where the applicant has had previous opportunities to present evidence and the application has no apparent merit.

A confiscation order had been made against Phillip Kole-Emmanuel under section 71 of the Criminal Justice Act 1988 following benefit fraud. The realisable amount was agreed at £452,416.69. After non-payment and imprisonment in default, an earlier application for a certificate of inadequacy was dismissed by Coulson J.

The defendant made a further application, relying principally on his bankruptcy and an official receiver’s report valuing his net assets at £400. The Department opposed the application, pointing to evidence of substantial unexplained assets, including money passing through a Lloyds TSB account. The central issues were whether the evidence discharged the burden of proof and whether the application should be adjourned for further investigation.

1. The application for a certificate of inadequacy was dismissed. The applicant was ordered to pay the respondent’s costs pursuant to a summary bill.
2. The burden lay firmly on the applicant to prove, on the balance of probabilities, that his realisable property was inadequate to satisfy the confiscation order. The court relied on O'Donoghue (James Keith), Re [2004] EWCA Civ 1800 and the principles collected in F & Anor, Re [2009] EWHC 2512 (Admin).
3. Where the defendant’s realisable property includes unidentified assets, it may be impossible to establish that the property is inadequate to meet the outstanding amount. The court applied the observation in Telli v Revenue and Customs Prosecutions Office [2007] EWCA Civ 1385.
4. Bankruptcy proceedings could not be used as a proxy for determining whether the burden had been discharged. A brief official receiver’s report, based on the defendant’s assertions and lacking an explanation of what had changed since the confiscation order, was insufficient, particularly in the face of evidence of substantial unexplained assets.
5. An adjournment was unjustified. The defendant had made repeated applications and had already had opportunities to provide evidence. The application therefore had to be determined on its merits, on which there was no real evidence capable of discharging the burden.

The judgment records earlier enforcement proceedings and a previous application for a certificate of inadequacy, dismissed by Coulson J on 27 May 2010. No appellate history of the present decision is stated.