Property — Crime – Appellant applying for confiscation order following respondent’s drug conviction — Respondent having interest in property held on trust for him and others as beneficial tenants in common — Respondent unable to sell property without agreement of co-owners or court order — Whether respondent’s beneficial interest having value forming part of amount available for confiscation – Appeal allowed
The respondent was convicted of possessing cocaine with intent to supply and was held to have benefited from his criminal conduct in the sum of £83,958.46. The appellant prosecution applied for a confiscation order. It was agreed that, in respect of a house that he owned jointly with his partner, £6,128.14 should be included in the amount available for confiscation within section 9 of the Proceeds of Crime Act 2002.
The appellant took the view that that amount should also include 25% of the market value of a leasehold flat in which the respondent held, under a declaration of trust, a 25% interest as a tenant in common. Although the market value of the property was around £240,000, the judge accepted the respondent’s argument that, by virtue of section 79(3) of the 2002 Act, his beneficial interest had no value. Since it was only a part-interest, it could not be sold unless the other tenants in common agreed. The appellant appealed.
Held: The appeal was allowed.
Although section 79(3) referred to “the market value of his interest” in the property, section 84(2)(a) provided that “property is held by a person if he holds an interest in it”. The respondent’s submission involved an unexplained and irrational difference between the provisions of the 2002 Act as to the value of assets for the purposes of calculating the available amount and the provisions for the enforcement of confiscation orders. Parliament could not have intended the result for which the respondent contended.
Section 79(3) was not as clear as earlier legislation and the 2002 Act made no substantive changes. However, it was limited to the valuation of property; it did not extend to the realisation of property, so that it did not have to be assumed that a beneficial interest in property had to be sold separately from the property.
For the purposes of making a confiscation order, the correct basis on that to proceed was to take into account the due proportion of the proceeds which the respondent would receive on the sale of the property. The court had to proceed on the basis that he could obtain an order under the Trusts of Land and Appointment of Trustees Act 1996 for sale of the property as a whole. In any event the possibility that the respondent would not be able to obtain such an order did not affect or diminish the market value of the property, and the same applied to the market value of a beneficial interest in the property.
Martin Evans (instructed by the Crown Prosecution Service, Proceeds of Crime Unit, Organised Crime Division) appeared for the appellant; Howard Godfrey QC and Adam Budworth (instructed by Lound Mulrenan Jefferies) appeared for the respondent.
Eileen O’Grady, barrister
