What do you mean “It doesn’t Apply”? – Procedure, delay and the case of Guraj

Balancing the rigidity of law with the flexibility necessary to achieve its aims is difficult. In the fraught area of confiscation it is also expensive. The Supreme Court case of R v Guraj [2016] UKSC 65 addressed the issue of when a technicality can frustrate a confiscation order and has produced some interesting guidance on the wider approach to be taken in this field.

The case raised a simple point – Proceeds of Crime Act (‘POCA’), s 14(11) states that ‘A confiscation order must not be quashed only on the ground that there was a defect or omission in the procedure connected with the application for or the granting of a postponement’. s 14(12) disapplies section 14(11) where the court has already made certain orders (broadly, those affecting the financial position of the defendant such as a fine). Mr Guraj’s lawyers had argued successfully in the Court of Appeal that if s 14(12) applied (i.e. one of the orders it mentioned had been made prior to confiscation) then a confiscation order must necessarily be invalid because the Court’s jurisdiction had been lost.

Two cases on related issues reached the House of Lords a decade ago. In both R v Soneju [2005] UKHL 49 and R v Knights [2005] UKHL 50, the House of Lords was concerned with a breach of the then applicable six-month time limit for making a confiscation order. In both cases the court resolved the issue by ruling that delay will only invalidate an order if there is unfairness to the defendant. Having analysed these decisions, the Court in Guraj also pointed out that the postponement provisions in POCA were clearly concerned with the relationship of confiscation to sentence [15]. The Court’s view was that this mitigated very strongly against allowing technical loopholes to frustrate otherwise valid orders.

Given all this, it was very unlikely that the court was ever going to agree with Mr Guraj that postponement related procedural errors could, without more, necessitate the quashing of orders often worth many thousands of pounds. To so hold would have been to allow convicted criminals to retain the benefits of their crimes as the result of a technicality. Moreover, the respondent’s original argument was couched in terms of removing the jurisdiction of the court. Such rigid bars are rarely embraced by English courts, largely because they can lead to absurdity. Even counsel for Mr Guraj “shrank” from such an “absolutist” position [30].

The Court was therefore firm in its conclusion that confiscation orders were not invalid merely because they were affected by a procedural error to which 14(11) did not apply (though they might still be invalid for other reasons).

Strictly speaking, that was enough to dispose of the appeal. However, the Court used this case as an opportunity to give important guidance on how procedural defects in the area of confiscation were to be addressed. Soneji and Knights were re-affirmed – it would be wrong to make a confiscation order if it would result in unfairness to the defendant. Importantly, however, the Court concluded that this principle was not limited to cases where there had been a procedural breach. The result is that, in any future case raising an argument under s 14(11), the focus will shift away from technical breaches of complex legislation to a more principled basis.

Such an approach, as well as being more flexible, is much more likely to appeal to the public than one based on navigating arid and technical legislation. Both lawyers and non-lawyers are familiar with the concept of unfairness, the latter cannot be expected to have delved into POCA. In times when public trust in the judiciary is insecure, this is no small thing.

However, the Court also seeks to protect defendants from excessive delay. A confiscation order was only imposed upon Mr Guraj 728 days after his conviction. The breach of the (then) six-month time limit had been the procedural defect complained of in both Soneji and Knights. Whilst noting that it will often be in the interests of defendants to delay [37], the Court firmly stated that unfairness was “especially likely” to ensue if the two year POCA “permitted period” was breached [34].

Of equal importance is the Court’s invitation to judges to adjust confiscation orders in cases where there has been a procedural defect. As an example of such adjustment, the court pointed to the judgment of the House of Lords in R v Waya [2012] UKSC 51. That case concerned a defendant who had obtained a mortgage by making false statements. The Supreme Court – in order to achieve proportionality – reduced the sum of the confiscation order to better reflect the benefit he had obtained as a result of the deception (calculated to be the increase of the market value of the property).

However, the Court in Guraj gave no details to how Waya could be applied to a case exhibiting the kind of procedural delay before it. It would probably have been unwise for the Court to embark on such an exercise, which would in any event have been obiter. Nevertheless, the possibilities are intriguing. How might a procedural defect render a confiscation order disproportionate? Would reductions in the sum of a confiscation order be on a sliding scale – a greater period of delay resulting in a greater reduction in the sum of the order? Would the possibility of making a reduced confiscation order mean that the unfairness caused by long delays could be cured by making an order for only a fraction of the total amount that might otherwise have constituted the order? Future cases dealing with these issues will be of great interest.

Overall, the Court has used this case to shift confiscation proceedings away from a focus on technicalities and towards the more broad and principled approach common in other areas of the criminal law. The judgment seeks to strike a balance not only between the rights of defendants and those of the prosecution, but also between consistency and flexibility.

This article was originally published here.