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England and Wales Court of Appeal (Criminal Division) Decisions |
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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Criminal Division) Decisions >> Forsyth, R v [1997] EWCA Crim 751 (17 March 1997) URL: http://www.bailii.org/ew/cases/EWCA/Crim/1997/751.html Cite as: [1997] 2 Cr App R 299, [1997] Crim LR 581, [1997] EWCA Crim 751, [1997] 2 Cr App Rep 299 |
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"Please pay £307,000 [the amount of £310,000 after deduction of your charges and commission] to Midland Bank, 5 Threadneedle Str., London EC2, to A.J. Bekhor & Co., Client settlement account no. 70021350 debiting against the sum paid in as per separate advice by order of E.M. Forsyth and Jason Davies."
"Why", he asked, "did she not ask herself or anybody else what was going on? She must have seen from the documents she signed when she collected the money that it came from PPI. Why hadn’t she asked Jason Davies what was going on? Would she not have checked with base that this really was in order and that she was required to do it?She had said that she had been told by Jason Davies that it was an urgent payment which had to be made to London but why did she not ask him further questions? It was inconceivable that she would not have demanded from her former employee Mr. Davies what was going on."The defence case was, in a word, that the appellant had no reason whatever to believe that Mr Nadir would dishonestly misappropriate money of PPI. He was extremely wealthy, had dividend income of some £12.4M. per year and earned director’s fees of nearly £300,000. As others who were directors of PPI had said, he was a person of the highest integrity in all his dealings and was an outstanding and visionary businessman. When asked about the extraordinary nature of the transaction, the appellant had said that when working for people like Mr Nadir and his family who were all international and involved in many aspects of business you get all sorts of extraordinary requests.She was first interviewed by the Serious Fraud Office about this transaction on 27th September 1994. She said:"I don't remember. Jason would recall this. This was just helping him move the ... He was with me and giving him access to my connection with the Midland to pay the money through. It was just purely an access situation I was giving him because he wanted to get the cash through to London. So I said he could put it through my connection with the Midland and I think this is why you have a reference here for me and my passport."She was then asked whether she was aware that it had anything to do with Gateway Finance and she said she was not. She was just facilitating the movement of the money.In evidence she enlarged on the events of the Tuesday (17th October) explaining that after collecting the cash from Warburg Soditic she had gone to Handelsfinanz, which she knew to be associated with the Midland Bank, and had showed them her passport and had given them her personal account number at Midland Bank at York so that they could make the necessary enquiries. She had then been driven back to the office by Jason Davies and had left the £400,000 in the office safe. The following day, having given time for the bank to make enquiries, she went with Jason Davies to Handelsfinanz and deposited £310,000, £3,000 of this sum being taken by the bank for commission and charges. She gave the bank the instructions they had recorded.Later in interview she said that she thought the money had to go through quickly though she did not know what the deal was. Asked if she knew whether it was for a share dealing transaction, she said:"I can't remember. It might. I mean to me it wouldn’t have surprised me if it was one of Jason’s clients and I was just helping him to get the money through. I mean I was only doing a favour, nothing more than that."To a question whether she had asked Jason Davies the reason for the transaction, she answered:"I'm sure Jason gave me a reason, quite a good reason at the time, but I don't remember what it was."She was then shown the document she had signed when she had withdrawn the money from Warburg Soditic in Geneva. This document showing that the source of the money was PPI was to form a cornerstone of the prosecution case against her. It was alleged she must have known that the funds were stolen funds because they were not being used for PPI’s purposes by being paid to A.J. Bekhor & Co. Her evidence at trial was:"I vaguely remember Jason Davies contacted Handelsfinanz Bank. They had received the reference for me and it was all right to transfer the money. Jason Davies put the money in his briefcase and we went to the bank. Jason Davies gave the details of Bekhor’s bank account in London and I think he spelled it out. I signed as account holder and that was it. I knew nothing more than that it was to settle one of Jason Davies’ share dealings at Bekhor. I cannot remember anything more about the transaction."She had had to sign the transfer instruction and added Jason Davies’ name because the bank would be looking to him rather than to her. She said that she would assume that this was a payment for Tristan shares and when asked directly by the judge whose money she thought she was paying into Handelsfinanz Bank she said:"I thought it was Asil Nadir’s money I was paying into Handelsfinanz Bank."She was told by Jason Davies that she was to take the balance of £88,000 back to England in a briefcase which she did. It was ultimately used to pay for livestock for Baggrave Farm. Of this transaction the judge told the jury:"You will have to ask what did Elizabeth Forsyth think was going on? What was her state of knowledge or belief as to the origins of this money? Whose money did she believe she was handling in Switzerland? Was she in ignorance of the fact that the document which she had signed and of which she took a copy described the money as coming from PPI? If you are sure that she must have seen and did see that, why did she make no enquiries about it? The defendant said there may have been many reasons for it being described as PPI account money. You will have to consider those reasons."She had earlier stated in the course of her evidence that she knew Mr. Nadir very well and respected his business acumen. She had no reason to doubt his integrity or his honesty. He was connected with people of power, he was very generous and his mother Mrs Nadir Senior was very hardworking. Asil Nadir’s income was apparently of the order of £12.7M. per year and she had no reason to suspect that he would need to be dishonest.Evidence was given at the trial about the way PPI carried on business by transferring sterling to Unipac in London in exchange for deposits made in Turkish lira which Unipac could use for its business in northern Cyprus.The evidence showed that, as recorded in the books of account, on 14th October 1989 an equivalent sum to £400,000 in Turkish lira was deposited at the Industrial Bank of Kibris Ltd. in northern Cyprus for the benefit of Unipac, that the rate of exchange at which the transaction took place would have resulted in a profit to Unipac and that this was evidenced by a paying-in slip and an entry in the cash books. It was said to represent an amount due to Mr. Nadir on contra-account and that £400,000 was paid from PPI and recorded in the Unipac inter-company account. The purpose of this evidence was to question the prosecution assertion that the £400,000 had not been disbursed on behalf of or for the benefit of PPI or Unipac, one of its subsidiaries. It was part of a complex secondary banking transaction which it was apparently accepted was not unlawful.The Grounds of AppealThe appellant contends that her convictions are unsafe because the judge before the trial refused her application to stay the proceedings on grounds of abuse of process; further during the trial he wrongly rejected submissions of law made on her behalf and finally made two significant errors in his directions to the jury.1. Abuse of ProcessAt the outset of the trial Mr Robertson Q.C. who appeared for the appellant submitted that to continue the prosecution was an abuse of the criminal process. There were four cumulative factors: the delay; prejudicial publicity; the absence of Mr Nadir and the abandonment of proceedings against persons accused of greater criminal involvement with him on the admitted ground that they could not be fairly tried in his absence. That the collapse of PPI created immense publicity, including adverse publicity reflecting upon the appellant described in one article as “Asil Nadir’s henchwoman”, was beyond doubt. The reporting was florid, at times inaccurate and, had it been more recent, could well have prejudiced the appellant’s right to a fair trial.Delay in itself does not amount to abuse of process. It was not suggested that the prosecution had been guilty of improper delay. Mr Robertson Q.C. relied most strongly upon statements made by counsel then instructed to prosecute the indictment against Mr Asil Nadir and Mr. John Turner who was the group chief accountant of PPI. The indictment against Mr Nadir contained sixteen counts of theft described as specimen counts. There were three specimen counts against Mr. Turner stated to be representative of offences of false accounting committed by him.The case against Mr. Turner was that he had procured misleading entries to be made in books of account and had created false accounting records, had concealed instructions and the true nature of payments, that he was acting dishonestly and was responsible for the “roundabout” way in which the transactions authorised by Mr Nadir were dealt with. Mr Turner had been interviewed and had maintained throughout that he too believed his relationship with Mr Nadir was entirely honest.When Mr Nadir fled the jurisdiction, counsel for Mr Turner made representations to the Serious Fraud Office (SFO) that it would be unfair to try Mr Turner in the absence of Mr Nadir. The SFO apparently accepted that it would be unfair and decided to withdraw the charges against him stating publicly as one of the reasons that it would be unfair to try him in the absence of Mr Nadir. Not unnaturally Mr Robertson suggested that it was equally unfair to try the appellant in the absence of Mr Nadir. Answering this ground of appeal, Mr Calvert-Smith attempted to point out differences between the two cases but we confess he did not convince us of their significance. On its face it seems a strange decision to press home the prosecution against one who appears to have been involved at short notice in assisting in an isolated transaction on the fringe of an immense misuse of company funds and at the same time to release from all criminal responsibility the group chief accountant alleged to have been more closely, extensively and frequently involved. The decision to do so is the prerogative of the SFO and does not in our judgment itself amount to an abuse of process. It is not for us to say whether such a choice accords with ordinary notions of even handedness, or is likely to enhance the public perception of the fairness of a prosecuting authority.In the course of the trial, submissions were made on the appellant’s behalf which have given rise to grounds of appeal.2. Was the judge wrong to reject the defence application for witnesses in Northern Cyprus to be allowed to give evidence by T.V. link?The prosecution had applied for two witnesses in Switzerland to give evidence in this manner and had been granted permission though, in the event, the witnesses did not attend at the studio to give evidence. The defence wished to call evidence from Mr Nadir who is presently understood to be in northern Cyprus, a place from which he cannot be extradited. The defence also desired to obtain evidence by this means from Mrs Saffiye Nadir and from other witnesses to prove the entries in Unipac’s books and the underlying secondary banking transactions. In short that they were real transactions of benefit to Unipac and so to PPI. The defence wished to call Mr Serin of Industrial Bank of Kibris Ltd. and Mr Huddam of Central Bank of Turkey to explain in what size notes the sum of 1,468,000 Turkish lira (equivalent to £400,000) recorded on a paying in slip given by the bank, but whose validity was challenged by the prosecution, would have been made and the significance of the way it was entered on the slip. The defence application was made under sec. 32 of the Criminal Justice Act 1988 which provides that the court may give leave for the evidence to be given in this way if the witness is outside the United Kingdom. By sub-section (3) it is provided that if the witness gives evidence on oath he shall be deemed for the purposes of the Perjury Act 1911 to have given evidence in the proceedings. Thus if he deliberately lies when giving evidence by video link he is liable to prosecution in England under the Perjury Act 1911. The judge ruled that he had no jurisdiction to permit the link because the witnesses could not be extradited from northern Cyprus to stand trial for perjury and hence the ultimate sanction of imprisonment would never be available. In giving this reason for rejecting the application the judge plainly fell into error. The “ultimate sanction” would not be available in many foreign countries, yet Parliament did not limit the places outside the United Kingdom where the procedure was to be available.He also rejected the application in the case of Mr Nadir on the ground that he was a fugitive from justice in this country and that he ought not to be allowed to give evidence from the country to which he had fled.For the prosecution Mr Calvert-Smith conceded that the judge was in error in the view which he took of the provisions of sub-section (3) of the Act but urged the court to say that, if it reviewed the exercise of the judge’s discretion, it should conclude that the application would not have succeeded. As we are allowing the appeal on other grounds, it is unnecessary for us to decide whether on a review of all the relevant circumstances we would have held that the judge should have permitted evidence to be given by video link. In general, once it is shown that there is difficulty in obtaining the attendance of witnesses abroad whose evidence is relevant to the defence, we consider the court should lean in favour of permitting evidence to be given in this way though in particular cases there may be reasons to refuse it. Even if on reviewing the exercise of the judge’s discretion we had concluded that the application should have been allowed, we would also have had to consider whether the evidence denied to the appellant was so significant that her conviction was unsafe.3. Should the Judge have withdrawn the case from the Jury on the ground that they could not be satisfied that a Chose in Action had been stolen?At the close of the evidence for the prosecution the appellant submitted that the judge ought to withdraw the case from the jury on the technical but by no means unarguable ground that the prosecution had not established that a chose in action had been stolen. The argument depended on the arrangements made by PPI with its bankers for credit and overdraft facilities for its accounts in London. The account at Midland Bank, Threadneedle Street, was subject to an overdraft limit of £5M. on the accounts of all the group companies banking with the Midland. When the bank opened for business on 17th October 1989, PPI’s account was in debit to the extent of £7,155,926. If that was the state of the account when the £400,000 was transferred electronically to Warburg in London, the £400,000 would simply have increased the debt due from PPI to Midland Bank and, as it exceeded the amount of the overdraft limit, no cause of action could arise in favour of PPI against Midland Bank if the bank refused to make the payment. There was thus no chose in action in law. The point is covered by the well known case of R. v Kohn [1979] 69 CAR 395. But there was also evidence that PPI habitually placed very large sums on the overnight money markets to obtain interest and that these sums, together with the interest earned, would be credited back to PPI’s accounts at the opening of business the following day. The sums thus recredited to PPI’s account on 17th October 1989 totalled some £11.7M. Further, during the course of 17th October 1989 there was received into the account some £68.8M. raised by PPI by way of a rights issue.The bank statements of account and the records kept by the Treasury Department of PPI were inconclusive as to the state of the account when the transfer was actually executed. The judge held that there was sufficient evidence for the jury to decide that the transfer was made at a time when PPI had a right to expect its instructions to be met and consequently that it had a chose in action.In our view the judge’s decision was correct. There was evidence upon which the jury could find that at the time Mr Nadir gave instructions to transfer the £400,000 he appropriated a chose in action belonging to PPI.4. Was the Judge wrong to hold that there was evidence on which the Jury could conclude that the money disposed of by the Appellant represented the stolen Chose in Action?It was argued that the judge was wrong to reject a submission that there was no evidence on which the jury could conclude with the necessary degree of certainty that the £398,800 in cash collected by the appellant from Warburg Soditic in Geneva represented the proceeds of the chose in action stolen from PPI in London.Sec. 24(2) of the Theft Act 1968 provides:"For purposes of (the provisions of this Act relating to goods which have been stolen) references to stolen goods shall include, in addition to the goods originally stolen and parts of them (whether in their original state or not), -(a) any other goods which directly or indirectly represent or have at any time represented the stolen goods in the hands of the thief as being the proceeds of any disposal or realisation of the whole or part of the goods stolen or of goods so representing the stolen goods; and(b) any other goods which directly or indirectly represent or have at any time represented the stolen goods in the hands of a handler of the stolen goods or any part of them as being the proceeds of any disposal or realisation of the whole or part of the stolen goods handled by him or of goods so representing them.By sec. 34(1)b) goods, except insofar as the context otherwise requires include money and every other description of property ..."The appellant’s submission at trial was based upon the timing of the transfers via the CHAPS system. The transfer to the credit of the account of Warburg Soditic at S.G. Warburg in London was timed at 14.48 hrs.(15.48 Swiss time). Apart from the fact that it was in the afternoon, there was no evidence of the time at which the appellant collected from Warburg Soditic in Geneva the £398,800, and it could have been before the sum had been credited. Accordingly the jury could not be satisfied that the money collected by the appellant directly or indirectly represented the chose in action stolen from PPI in London. The prosecution submitted that the fax sent by Irsin Tatar at 08.24 hrs. that morning to Soditic Finance, and passed on to Warburg Soditic Zurich, had been endorsed by an employee of that bank with a statement that the Midland Bank had confirmed that the money had been credited to Warburg Soditic’s account in London. It would have been most unlikely that instructions would have been given to pay out the £400,000 in cash to the appellant in Geneva until some such confirmation had been obtained. The judge ruled that there was evidence on which a jury could find that the £398,800 collected by the appellant directly or indirectly represented the stolen chose in action.We agree with his ruling but we would also question the assumption that, when a credit or money is finally received, it cannot be said to represent a stolen credit or money unless it can be shown to have been credited or paid strictly in the order of the chain of banks or recipients through whose hands it is intended to pass. A sum may be credited out of order in well-founded anticipation of an imminent receipt which then follows. It seems to us at least arguable that in such a circumstance the resulting credit could still be regarded as directly or indirectly representing the original chose in action.On appeal the appellant’s argument was expanded in the light of the decision in Preddy [1996] 3 WLR 255. Mr Robertson argued that the proper analysis of the transactions was that on payment by Midland Bank to S.G. Warburg for the credit of the account of Warburg Soditic the chose in action of PPI against Midland Bank was extinguished, that a different chose in action was created by the credit made to the account of Warburg Soditic which was in turn extinguished when Warburg Soditic in Zurich opened the sundry account in the name of PPI creating a right in PPI to payment of the credit of £398,800 and thus a different chose in action. In turn it was suggested this chose in action was extinguished when Irsin Tatar gave instructions to Warburg Soditic to transfer the funds to Geneva so that cash could be collected.The appellant argued that it was an essential requirement of sec. 24(2) of the Theft Act 1968 that the goods which an accused is charged with handling must at the time of handling or at some previous time have been in the hands of the thief or a handler and have represented the original stolen goods in the sense of being the proceeds direct or indirect of a sale or other realisation of the original goods. The appellant derived support for this submission from the 8th Report of the Criminal Law Revision Committee Cmmd 2977. The Committee stated in paragraph 138:"It may seem technical; but the effect will be that the goods which the accused is charged with handling must, at the time of the handling or at some previous time,(i) have been in the hands of the thief or of a handler, and(ii) have represented the original stolen goods in the sense of being the proceeds direct or indirect of a sale or other realisation of the original goods."This argument received further support from the more recent Report of the Law Commission, Law Com. No. 243 on Offences of Dishonesty, Money Transfers. The Commission thought that the opinion of this court in the Attorney General’s Reference (No. 4 of 1979) that a person who dishonestly accepts a transfer of stolen funds from another’s account into his or her own account is receiving stolen goods within the meaning of sec. 22(1) could not survive the reasoning in Preddy. It drew attention to the wording of sec. 24(2) of the 1968 Act that the extension given to the meaning of stolen goods to include other goods which directly or indirectly represent them only applies to goods which represent or have represented the stolen goods in the hands of the thief or of a handler of the stolen goods . In the case of stolen funds which are transferred from another account, this requirement is not satisfied. According to Preddy the funds obtained by the transferee have never been in the hands of the thief at all; and the transferee in whose hands they are cannot be regarded as a handler until it has first been determined that he has handled the stolen goods. But the question in the present case is whether the £398,800 could be said directly or indirectly to represent PPI’s right to receive that sum from the Midland Bank in the hands of the thief, i.e. Mr Nadir. It seems to us that the words “in the hands of” mean in the possession or under the control of the thief and there is no doubt from the documents that on the prosecution case Irsin Tatar on behalf of Mr Nadir was exercising control over property representing PPI’s right to the money when he gave instructions that it should be made available in the form of cash to be collected by the appellant. The question therefore is whether, assuming that the balance in the sundry account no. 35215-7000 with Warburg Soditic was in that sense in the hands of Mr Nadir, it represented directly or indirectly PPI’s chose in action against the Midland Bank. The first count of the indictment did not specifically identify this chose in action and alleged that the appellant had disposed of a chose in action represented by a credit of £307,000 in the hands of Handelsfinanz. It might, it seems, also have been argued that PPI had a right to repayment of the £400,000 when it was in the hands of Warburg Soditic and that by giving instructions that it was to be paid out in cash to the appellant there was an appropriation of that chose in action. Nevertheless, for the reason we have given, we consider that the balance of £400,000 from which cash was drawn and given to the appellant did indirectly represent PPI’s chose in action in the hands of Mr Nadir. The balance of £307,000, of which the appellant was charged with undertaking the disposal, represented directly or indirectly part of the £400,000, which by extension was stolen goods. We therefore reject this ground of appeal.5. Was the Offence charged in Count 1 committed in the Jurisdiction of the English Courts ?A further argument of substance which related only to Count 1 of the Indictment was that the conduct of the appellant in undertaking the disposal of the £307,000 took place and was completed in Switzerland and accordingly an English court had no jurisdiction to try the offence of handling. For some years there has been considerable disquiet that offences which consist of or include conduct and its result, e.g. obtaining by deception, are not regarded as having been committed within the jurisdiction of the English courts unless the result occurs here. The problem was the subject of a Report to Parliament by the Law Commission in April 1989 (Law Com. No. 180). The Commission recommended changes in the jurisdiction over offences of fraud and dishonesty with a foreign element, including offences under sec. 22 of the Theft Act 1988. Four years later in the Criminal Justice Act 1993 the recommendations were enacted but have not yet been brought into force. Until they are, we foresee continuing difficulties in this aspect of the law. The difficulty in this case arises from cases such as Treacy in which it was held that a person who under sec. 21(1) of the Theft Act made a demand with menaces contained in a letter committed the offence at the place where the letter was posted, not where it was received. Similarly a person who by sending a fax appropriated the rights of an owner to a chose in action committed the offence of theft where the fax was sent, see e.g. The Queen and the Governor of Brixton Prison Ex Parte Osman [1990] 1 WLR 277. Similar problems arose in deciding whether there was jurisdiction in England to try a conspiracy abroad or an attempt abroad to commit an offence in England because by sec. 1(4) of the Criminal Law Act 1977 the offence involved in the conspiracy, and by sec. 1(4) of the Criminal Attempts Act 1981 the offence attempted, has to be triable in England or Wales.The authorities were considered by Lord Griffiths in Llangsiriprasert v The United States [1991] 1 AC at page 225. Lord Griffiths drew attention to the broad general statement that English criminal law is local in its effect and that the common law does not concern itself with crimes committed abroad. He also drew attention to the fact that Parliament had enacted a number of exceptions to the general principle, particularly in respect of crimes which had been the subject of international convention. After reviewing the authorities on conspiracy entered into abroad to commit a crime in England, he concluded that there would be jurisdiction in England in respect of such an offence. Further, in the case of Wallis Duncan Smith [1996] 2 CAR 1 it was held that the offence of carrying on the business of a company with intent to defraud creditors in which the business had been carried on and the deception had taken place in London but money had been obtained in New York was triable in England. The only feature of carrying on the business of the company with intent to defraud creditors which occurred abroad was the transfer of funds to the bank’s New York account and consequently the substance of the offence was committed in England. In the judgment Lord Justice Rose drew attention to the added sophistication of the way in which offences involving fraud are committed, to the frequency with which fraud is perpetrated across national boundaries and to the many complex issues which would be likely to be faced by juries if jurisdiction depended upon where the last act of the crime took place. The Law Commission had drawn attention to the same features.It was submitted by Mr Calvert Smith that these more recent decisions show that courts have moved away from the old notions of territorial jurisdiction and are prepared to assume jurisdiction if any significant part of the offence occurs in England and Wales, and he submitted that the significant part of the appellant’s offence in count 1 was the sending of the sum of £307,000 to London.He further submitted that the goods in question were stolen in England apparently with the express purpose that they should be sent back to England. The fact that the goods changed their character several times in the course of their journey was beside the point. The actions of the appellant were of a continuing nature. When she took the cash to Handelsfinanz in Geneva and handed it over with instructions given jointly with Jason Davies to remit the money for the credit of A.J. Bekhor & Co. in London, she there created a chose in action in her name as the account holder and was entitled to the return of the money if it was not sent. There was no evidence of the precise relationship between Handelsfinanz and Midland Bank or of their interbank or other accounting procedures but the appellant plainly intended that, in place of the cash she had paid in to Handelsfinanz, the account of A.J. Bekhor & Co. in London should receive an equivalent credit for the benefit of Gateway. Relying on the decision in this court in Wallis Duncan Smith (supra), Mr Calvert Smith argued that the actions of the appellant produced the result of realisation in London and accordingly the court had jurisdiction.The offences of handling created by sec. 22 of the Theft Act may often consist of conduct which has a continuing effect, for example disposing or assisting in the disposal of stolen property. In Wallis Duncan Smith (supra) the business of the company had been carried on in London and it was only the result which occurred in New York. The case of the appellant is the reverse. Her actions or conduct were carried out in Switzerland and it was there that her last action which could be said to amount to undertaking or assisting in the removal, disposal or realisation of the goods occurred. Whilst it seems difficult in principle to distinguish her actions from the actions of the defendant in Treacy and In Re Osman or of the defendant in Harden [1963] 1 QB 8, it is we think important to analyse the nature of the handling of the property charged against the appellant. It was “disposing of or assisting in the disposal or the realisation” of the stolen chose in action. We take that to mean moving the property from one place to another or converting it from one form into another. Usually the conversion will be into money or its equivalent and in the present case it was to discharge a debt due to A.J. Bekhor & Co. in London. But neither disposal nor realisation was complete until the result of the appellant’s instructions had occurred.In Ex Parte Osman (supra), Lord Lloyd, then Lloyd L.J., did not rule out the possibility that the place where the telex in that case was received might also be regarded as the place where the theft occurred if the courts adopted the view that a crime could have a dual location. If the receipt of the credit in the bank account of A.J. Bekhor & Co. can properly be regarded as part of the disposal or realisation of the goods, there was a disposal or realisation in England and the fact that the appellant was physically in Switzerland is certainly no more significant in determining where the disposal or realisation took place than the receipt of the credit by A.J. Bekhor & Co. in England. We think the position not dissimilar to the actions of the applicant in R. v. Governor of Brixton Prison Ex Parte Levin [1996] 3 WLR 657 who, when in St. Petersburg, gave instructions to a computer in the United States and whose actions the Divisional Court held to amount to appropriation where the instructions were received by the computer.Although in one sense it could be said that the appellant undertook or assisted in the disposal or realisation of the goods in Switzerland, we think that the disposal or realisation can properly be regarded as having continued until the money arrived in the account of A.J. Bekhor & Co. in England as she intended. Consequently we conclude that the court did have jurisdiction to try the appellant on Count 1.We would add that it would save a good deal of expensive and elaborate argument on questions of jurisdiction if the recommendations of the Law Commission now in Part I of the Criminal Justice Act 1993 were brought into operation without further delay.6. The Judge’s direction on “knowing or believing” that the money was stolen.The judge based his direction on the case of R. v. Hall [1985] 81 CAR 260 at page 264. The judge said:"Knowing or believing are words of ordinary usage in the English language. A person may be said to know the money is stolen when she is told by someone with first hand knowledge, such as the thief, that such is the case. Belief of course is something short of knowledge. It may be said to be the state of mind of a person who says to himself “I cannot say I know for certain that this money is stolen, but there can be no other reasonable conclusion in the light of all the circumstances, in the light of all that I have heard and seen".Either of these two states of mind is enough to establish guilt. It is sufficient to constitute belief even if the defendant says to herself: “Despite all that I have heard I refuse to believe what my brain tells me is obvious”. You cannot shut your eyes to the obvious. But what is not enough to establish guilt is mere suspicion, i.e.: “I suspect that this money may be stolen but it may be on the other hand that it is not.” This state of mind does not fall within the words 'knowing or believing'".The judge had this direction typed out and given to each member of the jury. The appellant objected and urged that the jury should simply be directed in the words of the section without further elaboration and particularly without the gloss suggested.The appellant criticised this direction. The prosecution had to prove that the appellant actually knew or actually believed that the money she handled in Geneva was stolen. The words “knowing” or “believing” cover the state of mind of those who are subjectively sure of the unlawful provenance of the goods. Whilst an accused’s belief that goods are stolen may be inferred by the jury from all the circumstances of the transaction, the word “belief” does not import an objective test nor is belief the same as “shutting one’s eyes to the obvious”. The judge’s direction blurred the distinction between actual belief and evidence from which it may be inferred by indicating that it could be constituted:(a) By unreasonable uncertainty and(b) By a refusal to believe the obvious.Further, by contrasting these states with “mere” suspicion, the direction suggested that real or weighty suspicion may be enough to constitute belief. Belief is not to be equated with suspicion or even great suspicion and the jury may have been left with the impression that it was. That impression could have been reinforced when, towards the end of the summing-up, the judge returned to the subject after reminding the jury that the appellant had said in evidence that she did not know the money was stolen or believe it to be, nor did she suspect it was stolen. Commenting on these answers the judge said:"What the prosecution have to prove on this aspect is at the time she handled the money or the chose in action the defendant either knew or believed that it was stolen but mere suspicion would not be enough."It is beyond question that even great suspicion is not to be equated with belief. Ever since the judgment of Lord Widgery CJ in Atwal v Massey [1971] 56 CAR 6, references to suspicion in exegesis of the word “believing” in sec. 22 of the Theft Act have given rise to difficulty. In that case Lord Widgery emphasised that the question was a subjective one and he posed it in these terms:"... was the appellant aware of the theft or did he believe the goods to be stolen or did he, suspecting the goods to be stolen, deliberately shut his eyes to the consequences?"But as Lord Justice James said in Griffiths [1974] 60 CAR 14:"There is a danger in the adoption of the passage cited from the judgment in Atwal v Massey as the direction to the jury unless great care is taken to avoid confusion between the mental element of knowledge or belief and the approach by which a jury may arrive at the conclusion as to knowledge or belief. To direct the jury that the offence is committed if the defendant, suspecting the goods were stolen, deliberately shut his eyes to the circumstances as an alternative to knowing or believing the goods were stolen is a misdirection. To direct the jury that, in common sense and in law, they may find that the defendant knew or believed the goods to be stolen because he deliberately closed his eyes to the circumstances is a perfectly proper direction."Lord Justice James thus stressed the difference between evidence from which a jury might infer belief and their being directed that shutting the eyes to circumstances of suspicion is equivalent to belief. In Moys [1984] 79 CAR at page 72 this court had to consider a direction which included the passage:"Thirdly, the prosecution has to satisfy you so that you are sure that at the time the horse came into his possession the defendant knew or believed that it was stolen. “Believed” in that sense means that he suspected very strongly that it was stolen and shut his eyes to that possibility altogether ..."The court held this to be a misdirection. The judge had told the jury that suspicion coupled with a deliberate shutting of eyes was not merely an alternative but was equivalent to belief. That was incorrect and a material misdirection. Lord Lane, after reviewing the cases referred to in Griffiths and the case of Grainge [1973] 59 CAR 3 said at page 76 that mistakes in this branch of the law were frequent and suggested a direction in these terms:"The question is a subjective one and it must be proved that the defendant was aware of the theft or that he believed the goods to be stolen. Suspicion that they were stolen, even coupled with the fact that he shut his eyes to the circumstances, is not enough, although these matters may be taken into account by the jury when deciding whether or not the necessary knowledge or belief existed."Old concepts, however, tend to recur. In Hall [1985] 81 CAR 260, Boreham J. giving the judgement of the court over which Lord Lane presided said after dealing with knowledge:"Belief, of course, is something short of knowledge. It may be said to be the state of mind of a person who says to himself: “I cannot say I know for certain that these goods are stolen, but there can be no other reasonable conclusion in the light of all the circumstances, in the light of all that I have heard and seen.” Either of those two states of mind is enough to satisfy the words of the statute. The second is enough (that is, belief) even if the defendant says to himself: “Despite all that I have seen and all that I have heard, I refuse to believe what my brain tells me is obvious”. What is not enough, of course, is mere suspicion. “I suspect that these goods may be stolen, but it may be on the other hand that they are not”. That state of mind, of course, does not fall within the words 'knowing or believing'".In subsequent cases ( Harris [1987] 84 CAR 75 and Toor [1987] 85 CAR 116) the appellant complained of a failure by the judge to follow the judgment in Hall but as Lawton L.J. said at page 79 in Harris (supra):"It may well be that in many cases, depending on how the case for the Crown is conducted, it is necessary to give the kind of direction to which Boreham J. referred in Hall; but we doubt whether it is necessary is every case."It is a trite observation that every summing-up should be tailored to the circumstances of the particular case the jury have to decide. It seems to us it was incumbent on the judge to do so in this case. The judge devoted a long passage in his summing-up to the many questions put to the appellant when she was interviewed asking her why she had not enquired where the £400,000 had come from and what she imagined was the purpose of the transaction in which she had taken part. These questions were clearly aimed at highlighting circumstances of suspicion which should have put her on enquiry. In essence the appellant’s defence was that she completely trusted Mr Nadir and having regard to his immense wealth and enormous income it did not occur to her to question this particular transaction. She had on one previous occasion been asked to handle a sum of £200,000 though not in these circumstances. Colloquially it might be said that her state of mind was “I could not believe that somebody like Mr Asil Nadir would need to steal money or would involve me in a dishonest transaction”. We think that in such a case it was a mistake to embark on an attempt to give examples of particular states of mind which might be regarded as equivalent to belief. The ordinary meaning of belief is the mental acceptance of a fact as true or existing. In the context of this case it meant that the appellant had in fact accepted that the money she was asked to handle had been stolen. We doubt whether a jury unversed in legal dialectics would be likely to subject the direction they were given to the careful analysis required to differentiate the concepts of “not knowing for certain”, “there being no other reasonable conclusion” and “refusing to believe what my brain tells me is obvious”. This last concept appears to contain the paradox that it refers to a person whose mind does not in fact believe but whose brain sends him the message that it does. Whilst it is true that the direction as a whole is couched in subjective terms, we think it is open to misinterpretation. The appellant had said that she could not believe the money was stolen in spite of all the circumstances of suspicion suggested to her. Although it might have been obvious to others, it was not to her because of her trust and confidence in the integrity of Mr Nadir. We think the form of the directions may have left the jury with the impression that the appellant was guilty even though in her mind she could not accept that the goods were stolen. Thus the jury may have concluded that the appellant was guilty if they were satisfied that there were circumstances of great suspicion from which the only conclusion which could reasonably be drawn was that the goods were stolen but which the appellant because of her knowledge of and faith in Mr Nadir could not bring herself to believe so that her eyes had been closed to what was obvious. We doubt whether on a charge of handling it is necessary or helpful to attempt an exposition of the meaning of the word “belief” by equating it with different and less easily understood states of mind. Between suspicion and actual belief there may be a range of awareness. In the present case, to say that mere suspicion is not enough could have been taken by the jury to imply that great suspicion, coupled with an inability to believe that the money was stolen, was equivalent to belief which it plainly is not. If the judge thought that the jury might find difficulty with the concept of “belief”, it seems to us that he ought to have made it clear to them that they had to be satisfied that the appellant actually believed that the money was stolen. In our view the judge ought to have followed the guidance given in Moys (supra) which is clear and more readily understandable by a jury and avoids the potential for confusion inherent in a Hall direction.On this crucial issue the judge’s direction could have led the jury to find the appellant guilty without finding that she actually believed the money was stolen. Accordingly we think he misdirected them.7. The Question from the Jury.The jury had been deliberating a considerable time when they sent to the judge a written question. It was:"Could you please assist us on a legal point? The defence in its closing remarks claimed that the prosecution could have called Jason Davies to give evidence but chose not to. The defence did not call him either by choice or possibly for legal reasons. Our question is, is there a legal reason that could have prevented the defence calling him?"Until we read the transcripts of counsels’ closing addresses to the jury we were surprised that the jury should concern itself at all with the absence of Jason Davies as a witness. The prosecution had not disputed that the appellant had been sent to Geneva by Mr Nadir to prevent the sale of PPI shares if the London market fell; nor was it disputed that she was first told that she was required to collect the money from Warburg Soditic on Tuesday. As earlier stated, she was questioned whether she had asked Jason Davies the reason for the transfer. It does not seem to have been suggested that he had not been involved at all until in his closing address prosecuting counsel said:"Following orders from Jason Davies on a quite extraordinary transaction without checking with base, you are we suggest the boss. You are in overall control.Where is Mr Davies? He is in Spain at least some of the time. Certainly enough of the time to have been brought back from there if that were possible. Why is he not in the dock with Mrs Forsyth? The first answer to that is: you are here, you have been sworn to try Mrs Forsyth and not him, but we suggest further that it is not safe to start speculating about him and as to what he might say were he taxed with this same problem. What is apparent is that Mr Davies does not figure so far as this money is concerned. There is no evidence on any document that he had anything to do with it. The fact that Mrs Forsyth wrote his name on the Handelsfinanz document does not exactly prove much against Mr Davies. We simply do not know what he might say all this was about if he were asked about it as to who was the driving force and so on. Unwise to speculate, we suggest."We are frankly surprised by these remarks. It was not suggested that the appellant had become involved in the remittance of this money otherwise than through Jason Davies. The money was sent to London to pay for shares which he had bought on behalf of Gateway through A.J. Bekhor & Co. The instructions to settle the account were originally given by Rhone Finance on 9th October 1989.Jason Davies, Irsin Tatar and Mr. Nadir were all wanted for arrest and trial for this and other offences. He had apparently been circulated as wanted by the police, and the Crown Prosecution Service had confirmed that if he returned from Spain he would be arrested. We consider it unfortunate that the jury’s attention was thus focused on the absence of Jason Davies from the case and that it should have been hinted that he had had nothing to do with the transaction.Mr Robertson in his closing address countered this suggestion by pointing out that the Crown could have extradited him and if anyone knew or believed anything about the money it would have been Jason Davies "whose debt at Bekhor’s the money was going to pay".Regrettably the introduction of this issue had sown a seed in the minds of the jury which propagated in the course of their discussions and made them inquisitive about the absence of Jason Davies as a witness.In a passing remark in his summing-up the judge had told the jury not to speculate what he might have said and that they were not trying Jason Davies. Unless the prosecution had clearly challenged the appellant’s account of Jason Davies’ involvement, there was no need for her, even if he was available as a witness, to call him to support her account. It is clear that the prosecution did not make this case and were content to assert her guilt on the basis that she had become involved as she said but refrained from asking questions.In discussing the jury’s note with counsel, the judge got involved in a detailed discussion about the possibility of extradition from Spain, whether the defence could have extradited Jason Davies or could have issued a witness summons for him to attend and other aspects of legal hindrance to his being called to give evidence. During the discussions Mr Bogan, junior counsel, more than once urged the judge to give the jury a further direction warning them against speculating what Jason Davies might have said. We can understand counsel’s anxiety from the antithesis in the jury’s question of the defendant having chosen not to call Jason Davies and some legal reason which prevented her from doing so. It was the fact that Jason Davies was most unlikely voluntarily to give evidence in the appellant’s cause and there was no legal means by which she could secure his attendance. As the case had been presented to the jury there was no need for her to call him nor any obligation on her in law to do so. From the form of the jury’s question, it was obvious that there was a real risk that the jury might be taking the view that the defence had refrained from calling Jason Davies because they knew his evidence would not support the appellant.A question from the jury asking why a particular witness has not been called is not unusual and normally the judge answers such an enquiry by giving a direction that they must not speculate about the evidence such a witness might or might not have given, and that they must decide the case on the evidence they have heard. Where, as in this case, a defendant has no need to call the witness having regard to the issues raised, the judge explains this to the jury.Unfortunately the judge omitted to give the jury this conventional guidance. What he did was to refer only to some passages in Mr Robertson’s reply to prosecution’s closing address adding:"What Mr Robertson was referring to in those passages was the power to extradite Jason Davies from Spain where you have heard he is now living. It is not disputed that the prosecution have not sought to do so, to secure his return to the jurisdiction to be charged and face trial. That would be the purpose of extradition proceedings. Extradition would not therefore be an option available to the defence."He added:"However there is no property in a witness. It is open to either side to interview any witness. Mr Robertson was not referring to the question whether Jason Davies could have been called as a witness".By emphasising to the jury that there was no legal hindrance to the defence calling Jason Davies, and by suggesting in the latter part of his direction that it was open to her to do so without referring to the practical impossibility, the direction made it almost certain that the jury would decide that the defence had not called Jason Davies from choice. In the circumstances of this case, we consider that the judge should have warned the jury in strong terms against drawing any inference from the absence of Jason Davies as a witness. He should have told them that there was no obligation on the defendant to call him since the manner she had become involved in the disposal of the money had not been challenged. He should also have told them that they must decide the case on the evidence they had heard and not speculate what he might or might not have said had he given evidence.Without this direction we consider there is an is evident risk that the jury may have discounted the appellant’s account of how she came to be involved and from the absence of supporting testimony from Jason Davies have drawn conclusions unfavourable to her defence. In that case, they may have doubted her account of how he had involved her in the transfer of the money which the prosecution had not challenged and have inferred from this that she knew or believed the money to be stolen.ConclusionWe have now to consider whether in spite of the two misdirections of the jury the appellant’s conviction can still be regarded as safe. Undoubtedly the circumstances of the transaction in which the appellant took part raised great suspicion; the case against the appellant was really that from its very nature she must have known that she was dealing with money stolen from PPI. As against that, she said that it was within her experience that businessmen from the Middle East did deal in unconventional ways and that she had no reason to think that someone of Mr Nadir’s wealth and income would need to misappropriate £400,000 dishonestly. It is perhaps worth mentioning that in his closing address counsel for the prosecution said:"Mr Nadir had unlimited access to, as I have said, large, huge sums of someone else’s money, money which he considered in a sort of general way to be his in the sense that PPI was his company. He and his accomplice Mr Tatar, we suggest, thought no more of taking £400,000 to pay personal or other debts than the owner of a corner shop would think of taking £40 from the till as he shuts the shop on Friday night to tide him over the weekend."The essential issue for the jury was did the appellant believe that the money she was assisting to dispose of was stolen? We are not satisfied that had the jury been given an appropriate direction on the meaning of “knowing or believing” they would have been bound to find the appellant guilty. Equally we consider that the lack of a proper direction to the jury in answer to their question significantly undermines the safety of her conviction. Accordingly, for the reasons given, we consider the appellant's conviction unsafe and allow her appeal.- - - - - -LORD JUSTICE BELDAM: For the reasons given in the judgment we have handed down, the appeal will be allowed.As there were seven substantial grounds of appeal and the judgment extends to 50 pages, we think it may be helpful to point to the grounds on which we allowed the appeal. They were grounds 6 at page 37 and ground 7 at page 44. We considered that the Judge had misdirected the jury in two respects, and that the conviction was accordingly unsafe. We desire also to draw attention to the need to bring into force the provisions of Part I of the Criminal Justice Act 1993 which were recommended by the Law Commission as long ago as 1989. Public money continues to be spent in arguing questions which should have been put beyond argument some years ago.MR ROBERTSON: I appear with Mr Bogan for Mrs Forsyth and Miss Coen and Miss McGahey are here for the Crown. It remains only for me, my Lords, to ask for a defendant's costs order out of central funds.LORD JUSTICE BELDAM: Can I just ask you if you received the erratum in the judgment?MR ROBERTSON: Yes, I did.LORD JUSTICE BELDAM: I known those which were handed down this morning contained the erratum, but I was not sure whether those which were received on Friday did. A defendant's costs order for costs out of central funds?MR ROBERTSON: Here and below. That follows from section 16(4) of the Prosecution of Offenders Act 1981.LORD JUSTICE BELDAM: Are you asking for a particular sum?MR ROBERTSON: My Lord, in view of the sum what pernickety nature of toting up the mileage and the train tickets and so forth, I would ask that the matter be referred to the taxing authorities. I think that follows if it is out of central funds.LORD JUSTICE BELDAM: Yes. Have the Crown any observations?MISS COEN: No thank you, my Lord, no.LORD JUSTICE BELDAM: Yes, Mr Robertson, you may have your order for costs.MR ROBERTSON: I am most grateful. Thank you very much.- - - - - -
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