Town and country planning – Enforcement notice – Offence – Appellant failing to comply with requirements of enforcement notice – Appellant pleading guilty to offence under section 179 of Town and Country Planning Act 1990 – Sentencing judge imposing maximum fine – Appellant appealing – Whether judge erring in withholding credit for guilty plea – Whether rental income obtained under lawful tenancy agreements or criminal conduct in breaching enforcement notice – Appeal allowed in part
The appellant purchased a house at 39 Vartry Road, London N15 for £340,000. The appellant was granted planning permission to convert the property into three self-contained flats, comprising one three-bedroom flat on the ground floor and basement and two two-bedroom flats on the first and second floors. A condition required the development to be carried out in complete accordance with the plans submitted to and approved by the local planning authority.
The appellant subsequently chose, without any authorisation, to convert the property into twelve self-contained flats. The local authority issued an enforcement notice requiring the appellant to cease using the property as self-contained flats. The defendant failed to comply with that notice and was charged with an offence contrary to section 179 of the Town and Country Planning Act 1990. Proceedings were commenced by summons in the magistrates’ court stating that the appellant had been in breach of the enforcement notice for 53 months and gained a financial benefit from non-compliance in the sum of approximately £508,800.
The appellant pleaded guilty and the magistrates committed the matter to the Crown Court because the prosecutor proposed to seek a confiscation order. In the confiscation proceedings, the amount of benefit was agreed at £527,887·55 and a confiscation order made in that sum. Pursuant to section 70 and 71 of the Proceeds of Crime Act 2002, the amount of the fine had to be capped at the level available to the magistrates’ court, which was £20,000. The recorder said that, but for the cap, he would have imposed a fine of £50,000, discounted by one third to take account of the defendant’s guilty plea; but in the circumstances the fine would be £20,000.
The appellant appealed against the level of fine on the ground that credit for the appellant’s plea of guilty should not have been withheld. He also appealed against the confiscation order contending that the true source of obtaining the rents lay in the lawful tenancy contracts between the appellant and the individual tenants. Thus, the rents did not derive from the ongoing breach of the enforcement notice. Further, as the appellant had planning permission for three flats, the benefit figure should at all events be reduced pro-rata to reflect that.
Held: The appeal was allowed in part.
(1) It was wrong in principle, or otherwise excessive, to withhold credit for the guilty plea simply because the recorder had himself taken the view that, absent the technical jurisdictional point, he would have imposed a fine, before credit for plea, of £50,000. The fact was that there was available to the recorder a power to impose a maximum fine of £20,000. But the appellant had pleaded guilty so he was entitled in principle to credit for that plea, involving the appropriate discount from the maximum fine available. Accordingly, the amount of the fine would be reduced to the sum of £13,333 to reflect the one third credit due to the appellant for his guilty plea.
(2) For statutory offences, the availability of a confiscation order depended on the terms of the statute or regulations creating the offence, read with the terms of the Proceeds of Crime Act 2002 and set in the context of the facts of the case. It was the wording of the statute in question that mattered. In the present case, receipt of the rents by the appellant was not, for confiscation purposes, to be regarded simply as attributable to lawful tenancy contracts, as the appellant argued. Rather, his receipt of the rents derived from his prohibited conduct in ceasing to desist from his use of the property for twelve self-contained flats, contrary to the requirements of the enforcement notice. His conduct was criminal conduct and the rents were obtained as a result of or in connection with such conduct; and so were benefit for the purposes of section 76 of the 2002 Act. The court hoped that this would be the last time an argument of this kind was advanced on this basis in confiscation proceedings, in the context of section 179 of the 1990 Act: Sumal and Sons (Properties) Ltd [2012] EWCA Crim 1840, [2013] 1 WLR 2078 considered.
(3) It was clear how the present case was to be categorised. The entire activity of letting out the twelve flats and receiving rents therefrom involved, and was inherently founded on, the criminally unlawful failure to comply with the requirements of the enforcement notice. The recorder was, in such circumstances, unquestionably justified in assessing benefit by reference to the gross rents received. A proportionate order was capable of having the effect of requiring a defendant to pay over the whole sum which he had obtained by crime without enabling him to set off expenses. The benefit in the present case was properly adjudged to be the total value of the rents obtained, not the appellant’s net profit after deduction of expenses and outgoings. The recorder was accordingly justified in concluding that such a confiscation order was proportionate.
(4) There had been raised before the recorder the proposition that at least benefit should be limited so as to reflect the fact that, under the 2007 planning permission, the appellant could lawfully have converted the property into three self-contained flats. However, the fact that the appellant could have done things differently had he chosen to do so was nothing to the point. It was a general principle in confiscation proceedings that where a person obtained a benefit as a result of or in connection with his criminal conduct the benefit ordinarily was to be assessed as the full amount constituting that benefit, not the excess over any benefit which otherwise might lawfully have been obtained. The lack of substance or merit in the point was also reinforced in the present case by the fact that the 2007 planning permission had in any event altogether ceased to have effect by reason of non-compliance with its conditions: Evangelou [2019] EWCA Crim 1414 considered.
Marc Glover (assigned by the Waller Pollin Goldstein) appeared for the appellant; Joshua Normanton (instructed by Haringey London Borough Council) appeared for the Crown.
Eileen O’Grady, barrister
