Case No: 201105034 A3
Neutral Citation Number: [2012] EWCA Crim 728
IN THE COURT OF APPEAL (CRIMINAL DIVISION)
ON APPEAL FROM Crown Court at Luton
Her Honour Judge  Mensah
T20110273
Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 18/04/2012
Before :

LORD JUSTICE STANLEY BURNTON
MR JUSTICE CRANSTON
and
HS HONOUR JUDGE ROOK QC
(Sitting as a Judge of the Court of Appeal, Criminal Division)

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Between :

	Ben Stapylton	Appellant	
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	Regina	Respondent	

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Melanie Simpson (instructed by JSP Law) for the Appellant
James Boyd (instructed by CPS) for the Respondent

Hearing dates: 2 April 2012
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Judgment
Mr Justice Cranston: 
1.	On 18 July 2011, at the Crown Court at Luton, this 19 year old appellant pleaded guilty to dangerous driving, count 2 on the indictment. On 10 August 2011 H.H. Judge Mensah sentenced him to a suspended sentence order comprising 8 months detention, suspended for 12 months, with requirements of supervision and 100 hours unpaid work. He was also disqualified from driving for 14 months and ordered to take an extended test, and to pay a total of £8,100 compensation and £400 towards the prosecution costs at the rate of £100 a month. Count 1, aggravated vehicle taking, was left on the file in the usual terms. The single judge gave leave to appeal in relation to the compensation order. When the Full Court heard the matter on the 8 February they directed that the prosecution be invited to make representations because of important matters raised in relation to the compensation order, which recur in the magistrates’ courts and the Crown Court. 
2.	The facts, in brief, are that at about 11.40pm on 6 April 2011 two police officers were in an unmarked police traffic control vehicle. They observed a car travelling at speed. It was a Toyota motor car belonging to Ms Hole, who had left the car in a car park. The appellant knew her but it was not clear how he obtained the keys. In any event, the vehicle was driven in a dangerous manner until it finally left the road, knocked down a garden wall and ultimately embedded itself in the garage of a house. The car was worth £3,000 and needed to be replaced. According to Ms Hole’s witness statement she was insured, but there was no evidence about the type of insurance, and whether she had claimed, or intended to claim, under it. After the sentencing hearing the police have lost contact with her.     
3.	There was £5000 worth of damage to the garage. Mr and Mrs Hughes, who owned the garage, said that they had to pay £29 for parking permits and to the insurance company another £15 to leave their car parked on the road. In the statement before the judge, Mrs Hughes also said that she had made a successful claim against her insurance company for £5000 for repair of the garage, although this would not cover all the damage. After the sentencing hearing Mrs Hughes made a further statement explaining that the builder had charged £4750, confirming that the insurance company had paid out the £5000, naming the insurance company and giving details of her policy. 
4.	The appellant 5.	was of previous good character. A pre-sentence report dated 20 July 2011 explained that the appellant had previously worked as a warehouse operative but he lost his job as a result of the offence. Thus he was in receipt of job seekers allowance of £107 a fortnight.  Out of that he paid £75 a month in housekeeping and for his telephone, and £14 a month towards a debt of £1,000. 
6.	In the course of her sentencing remarks the judge said this: 
“The probation officer has suggested there should be 150 hours but I am going to say 100 hours of unpaid work. The reason why I am going to say 100 hours of unpaid work is because I am going to order you to pay back £8,500 in compensation and costs and that is made up as follows.  I see no reason why Mr and Mrs Hughes’s insurance company should be out of pocket for that amount of money so £5,000 to them – not to them, to their insurance company if the money has already been paid out - £100 compensation to them because they have incurred some costs and £29 in respect of parking permits and the like, £15 chasing matters up and the general inconvenience.  I do not see why you should not pay a bit more for the general inconvenience and that is why I set £100 to them personally for the general inconvenience, not to speak of the distress that they must be going through and no doubt relief that they were not caused any serious physical damage to themselves or anybody living in their house. In addition, £3,000 for whoever is replacing the car… and £400 as a contribution towards the prosecution costs.  I do not really see why you should not pay the whole amount but I am mindful of the fact that you are relatively young, that at the moment you do not have employment but that you will get employment or certainly can get employment”. 
7.	 As far as relevant section 130 of the Powers of Criminal Courts (Sentencing) Act 2000 provides:
“130. Compensation orders against convicted persons.”
(1) A court by or before which a person is convicted of an offence, instead of or in addition to dealing with him in any other way, may, on application or otherwise, make an order (in this Act referred to as a “compensation order”) requiring him— 
(a) to pay compensation for any personal injury, loss or damage resulting from that offence or any other offence which is taken into consideration by the court in determining sentence
…
but this is subject to the following provisions of this section and to section 131 below. 
…
(4) Compensation under subsection (1) above shall be of such amount as the court considers appropriate, having regard to any evidence and to any representations that are made by or on behalf of the accused or the prosecutor.
(5) In the case of an offence under the Theft Act 1968 or Fraud Act 2006, where the property in question is recovered, any damage to the property occurring while it was out of the owner's possession shall be treated for the purposes of subsection (1) above as having resulted from the offence, however and by whomever the damage was caused.
(6) A compensation order may only be made in respect of injury, loss or damage …which was due to an accident arising out of the presence of a motor vehicle on a road, if—
(a) it is in respect of damage which is treated by subsection (5) above as resulting from an offence under the Theft Act 1968 or Fraud Act 2006; or
(b) it is in respect of injury, loss or damage as respects which—
(i) the offender is uninsured in relation to the use of the vehicle; and
(ii) compensation is not payable under any arrangements to which the Secretary of State is a party.
8.	We heard helpful submissions by Ms Simpson, on behalf of the appellant, and Mr Boyd, appearing for the prosecution, on the import of this provision for the present appeal. One point we should immediately address is that raised by the single judge. In giving leave he queried whether the damage was due to an accident arising out of the presence of a motor vehicle on a road. We have had the benefit of being referred to Mayor v Oxford (1980) 2 Cr. App. R. (S.) 280, which disposes of that concern. There the counterpart to section 130 in the Powers of Criminal Courts Act 1973, s. 35 (3) was considered in a case where the vehicle ran off the road a distance before it hit a wall and damaged a house. The LCJ endorsed the decision in Redman v Taylor [1975] Crim LR 348 where Bridge J said: “Any accident resulting from such driving on a road as resulted in the vehicle running off the road and then colliding with some stationary object was clearly an accident which occurred ‘owing to the presence of a motor vehicle on a road’ within section 8 (2) notwithstanding that the vehicle was off the road before the impact occurred.”  
9.	It is common ground between Ms Simpson and Mr Boyd that the compensation order is defective as to the £3000 in respect of Ms Hole’s vehicle since evidence of the loss, and whether Ms Hole or her insurer had suffered it, were absent. It is also common ground that the £100 in respect of the Hughes cannot stand. Mrs Hughes’ subsequent statement made clear that the additional costs of £44 for the permits and parking were covered by the £5000, since the builder had charged less than that to repair the damage. As to the remaining £56, there was no evidence that the Hughes had suffered distress and a compensation order can only be made for injury, loss and damage, not general inconvenience. However, there is disagreement between Ms Simpson and Mr Boyd about whether the order is valid as to the £5000 ordered in favour of the Hughes’ insurance company for damage to the garage. 
10.	Mr Boyd’s starting point about the £5000 ordered to be paid to the insurance company is section 130(6). Although compensation is not generally speaking payable for injury, loss or damage due to an accident arising out of the presence of a motor vehicle on a road, the exception in section 130(6)(b) is in relation to uninsured offenders where compensation is not payable “under any arrangements to which the Secretary of State is a party”. That is a reference to the 1999 agreement which the Secretary of State has with the Motor Insurers’ Bureau (“MIB”). The MIB comprises insurers offering compulsory motor insurance in the United Kingdom. Those insurers pay a levy so that the MIB can compensate the victims of negligent uninsured and untraced motorists. 
11.	Mr Boyd refers to the agreement and to the exception in clause 6(1)(c)(ii), that the MIB does not have to pay claims for the benefit of a person (“the beneficiary”), other than the person suffering death, injury or other damage, pursuant to a right of subrogation or contractual or other right belonging to the beneficiary. The intention of that clause is obvious. The MIB, established and funded by insurers, is not designed to make payments to insurance companies which happen to have a right of subrogation in a particular case. Nonetheless, Mr Boyd contends that, applying the plain words of the section 130(6)(b) and the 1999 agreement, the judge was entitled to award compensation to the insurance company, subrogated as it was to Mr and Mrs Hughes: the damage to the garage was due to an accident arising out of the presence of a motor vehicle on a road, the appellant was uninsured, and compensation was not payable by the MIB since the case fell within clause 6(1)(c)(ii) of the agreement. 
12.	Since the first legislation enabling compensation to be awarded by the criminal courts was enacted, section 1(1) of the Criminal Justice Act 1972, the courts have laid down a number of principles about the making of compensation orders. First, the court has no jurisdiction to make an order where there are real issues as to whether those to benefit have suffered any, and if so, what loss: R v Horsham Justices ex p Richards [1985] 1 WLR 986, 993. Thus in R v Christopher Paul Watson (1990–91) 12 Cr. App. R. (S.) 508 no award was made in favour of insurers because there was no evidence as to the loss. Coupled with that is that because compensation orders are for straightforward cases: R v Donovan (1981) 3 Cr app R(S) 192, a court should not embark on a detailed inquiry as to the extent of any injury, loss or damage.  If the matter demands such attention it is better left for civil proceedings.   Further, compensation orders must not be made unless there is a realistic possibility of compliance (R v Webb (1979) 1 CR APP R (S) 16).  Orders should not be made if they will be protracted in effect, although much will turn on the nature of the offence and the offender: R v Olliver (1989) 1 Cr App R (S) 10.  
13.	In this case the judge overlooked such matters.  As to loss all she had was a statement by Mrs Hughes that her insurance company had paid £5000; it was only after the hearing that information was obtained about the cost of repair, the name of the insurance company and details of the policy.  Most importantly, the judge did not consider whether, given the appellant’s means, it was realistic to require him to pay such a large amount over such an extended period.  The order she made would have taken him many years to pay.  In all the circumstances this order cannot stand.  We allow the appeal and quash the order.