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	England and Wales Court of Appeal (Criminal Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Criminal Division) Decisions >> Lemmon, R. v [1991] EWCA Crim 1 (02 May 1991) URL: http://www.bailii.org/ew/cases/EWCA/Crim/1991/1.html Cite as: [1991] Crim LR 791, [1991] EWCA Crim 1, (1992) 13 Cr App R (S) 66, 13 Cr App R (S) 66

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IN THE COURT OF APPEAL
CRIMINAL DIVISION

		Royal Courts of Justice,
		Date: 2 May 1991.

MR. JUSTICE WATERHOUSE

1. This appeal against sentence, by leave of the single judge, raises short points about the making of a confiscation order under the Drug Trafficking Offences Act 1986, and the propriety of an order in respect of the costs of the prosecution.
2. The circumstances are that on August 3, 1990, in the Crown Court at Guildford, the appellant pleaded guilty to two drugs offences. The first was of conspiracy to supply cannabis resin, for which he received a sentence of 18 months' imprisonment. The second offence was possession of cannabis resin, in respect of which no separate penalty was imposed. However, exercising his powers under the Act of 1986, the sentencing judge made a confiscation order in the sum of £5,535, to be paid on or before August 3, 1991, with a provision that the appellant should serve six months' imprisonment in default of payment. The appellant was ordered also to contribute £200 towards the costs of the prosecution, and there were additional directions about the destruction of the drugs and drug trafficking equipment.
3. To complete the picture it is necessary to say that there was a co-defendant, who pleaded guilty to the conspiracy and to a separate offence of possession of cannabis resin. He was regarded as a junior partner, and he received a sentence of nine months' imprisonment for his role in the conspiracy. There was no separate penalty for the possession of cannabis resin. In his case the confiscation order was in a sum of £287, payable by August 10, 1990, with 14 days' imprisonment in default of payment. The costs order was the same as that in respect of this appellant.
4. In view of the limited issues in the appeal it is unnecessary to go into any great detail about the underlying facts of the case. It is sufficient to say that the appellant was arrested outside his home address in Camberley on March 9, 1990. It appeared on investigation that he had on him 893 milligrams of cannabis resin and a rolled cigarette. When he was interviewed he made full admissions about his activities at a factory in supplying various employees with cannabis resin, using the co-defendant as his agent. He named his supplier and said that he would buy two ounces for between £160 and £180, cut it into small quantities and then resell it for £200 to about four people at the factory.
5. The co-defendant was arrested on the same date. He was found to be in possession of 103 milligrams of cannabis resin in a plant pot at his home, and he showed police officers a further amount of 693 milligrams hidden under a carpet. His wallet contained £1200 and he made full admissions about buying the drug from the appellant and taking orders from others for him, usually from the same people each week.
6. On the date of the hearing before the court below the appellant and his advisers were served with a document in which was set out an assessment of his means. The document contained, as Appendix A, an assessment of the cash that he had derived from the supply of drugs and, as Appendix B, an assessment of his realisable assets. As far as the assessment of his cash received from drug supplying is concerned, no criticism has been made of the figures placed before the court below. The calculation was based upon a period of 41 weeks: the total money received for a weekly amount of one and a half ounces over that period was said to be 41 X £135, giving a total of £5,535.
7. Criticism on behalf of the appellant in this Court has been directed at the assessment of the realisable assets of the appellant. It must be said that it is unlikely that, at the time of the hearing before the court below, the sentencing judge had had the advantage of seeing a full report of the judgment delivered by Lord Lane C.J. in Dickens on April 11, 1990, now reported in (1990) 12 CrAppR (S) 191.
8. The difficulty facing the court below, and, in particular, the appellant, was that the figures put as the value of his realisable assets were unknown to the appellant until the day of the hearing. The core of the assessment was a valuation of the house, formerly a council house, which he owned jointly with his wife. The gross value of that house was put at £76,000 on the basis of a statement made by the appellant in May 1989 in support of an application for a bank loan and the appellant was not given any opportunity effectively to challenge that figure, despite the lapse of time and the circumstances in which he had put forward the figure.
9. When the learned judge came to make his calculation of the amount of the confiscation order he accepted the figures set out in Appendix B. The calculation proceeded, therefore, on the following basis. The purchase price of the council house on December 19, 1988 was shown as £53,000 less the beneficial discount of £19,080, giving an actual purchase price of £33,920. More importantly, the value of the house at the date of the hearing was put at £76,000 (its suggested value in May 1989, 15 months earlier). The information before the court was that if the house was sold before the 19th December 1990, that is, before the lapse of two years from the date of purchase, a repayment to the council would have to be made of £12,720, although the repayment to the council would be halved if the property was sold in the following year. Thus, the realisable value of the house was assessed at £63,280 at the date of the hearing.
10. The judge had before him details also of mortgage loans amounting to £50,035.61 as at April 1990. The equity in the property was therefore calculated to be £13,244.39, making the value of the appellant's half share £6,622.20. It is clear that the judge accepted that assessment and, on that footing, felt able to make a confiscation order equivalent to the total amount of cash derived by the appellant from the supply of cannabis resin, together with the costs order of £200.
11. In proceeding on the basis of current values the court correctly followed the mode of assessment set out in section 5 of the Drug Trafficking Offences Act 1986. In particular subsection (3) of that section provides: "For the purposes of sections 3 and 4 of this Act the amount that might be realised at the time a confiscation order is made against the defendant is-(a) the total of the values at that time of all the realisable property held by the defendant, less (b) where there are obligations having priority at that time, the total amounts payable in pursuance of such obligations...." (See also subs. (4).)
12. In the event it was put to the court that the valuation of £76,000 was too high bearing in mind the recession in the property market and the depressed state of house sales. It was suggested that, without a contemporary valuation, the house ought not to be valued at more than £69,000, which was put as an informal figure. Indeed, a professional valuation obtained immediately after the hearing disclosed that a proper valuation as at that date would only be £65,000. It was submitted further that the valuation given by the appellant himself in support of an application for a bank loan was too insecure a basis in any event on which to value the property many months later.
13. This Court has now been provided with a professional valuation made on April 26, 1991 which suggests that the realisable value of the house is £61,000, if it were to be sold today. It is clear, therefore, that due to the unfortunate timing in the court below and the absence of a real opportunity for the court to be provided with accurate up-to-date figures, the judge unwittingly proceeded on the basis of an inflated valuation of the appellant's house. It is obvious that a court must be provided with accurate contemporary information if a fair order is to be made. If a confiscation order is based upon an erroneous and over-optimistic valuation, then injustice and hardship are likely to result. A court must also have in mind that estimation of the values of real property is not a wholly precise science and that some safety margin for possible error must be allowed.
14. Looking now at the reality of the appellant's financial position, as this Court must, on the basis of correct figures at the date of the hearing, that is August 3, 1990, we are satisfied that it would have been quite unsafe to assess the value of the house owned jointly by the appellant and his wife at more than £65,000. Applying the deductions presented to the judge below, but deducting also a sensible sum in respect of the anticipated costs of the sale of the house, which we put at £2,000, the residual equity in the house was no more than about £245. Such a net equity is much less than would be sufficient to provide a margin for error in the calculation and it would not, in our judgment, justify the making of a confiscation order. Nor, in our view, would it justify the making of a costs order in a case in which the appellant was sentenced to immediate imprisonment and had no other known realisable assets.
15. In the light of the information before this Court, therefore, the appeal must be allowed to the extent that the confiscation order must be quashed, and also the order against this appellant in respect of the costs of the prosecution.