POCA restraint order can be varied for civil fees: UKSC
A restraint order under the Proceeds of Crime Act 2002 ("POCA") can be varied to cover reasonable legal expenses in respect of civil proceedings founded on the same or similar allegations or facts as those giving rise to the making of the restraint order, the UK Supreme Court held today.
Five Justices unanimously dismissed an appeal by the Crown Prosecution Service against a Court of Appeal ruling that s 41(4) of POCA, which prevents a variation for legal expenses that "relate to an offence" which gave rise to the restraint order, did not prevent the variation requested in this case.
The order was sought by Andrew Luckhurst, a former professional cricketer and footballer, who was charged with offences of fraud and theft relating to his alleged involvement in a Ponzi scheme, for which his assets were subject to a restraint order. Separately, he faced civil proceedings brought by investors in the alleged Ponzi scheme. He applied for the variation so that he could pay £3,000 for legal representation in respect of the civil proceedings.
The judge at first instance found that such a variation was not permitted by s 41(4) as the civil proceedings did "relate to" the offence giving rise to the restraint order. The Court of Appeal reversed this ruling.
Dismissing the CPS’s appeal, Lord Burrows, with whom Lord Hodge, Lord Kitchin, Lord Hamblen and Lord Stephens agreed, said the correct modern approach to statutory interpretation was that the court was concerned to identify the meaning of the words used by Parliament; in so doing, the context and purpose of the provision or provisions were important.
On a natural reading of the words in their context, legal expenses in civil proceedings did not "relate to" a criminal offence. Any attempt to link legal expenses in civil proceedings to a criminal offence required reading into the statute a test which was not found in the words of the statute itself. He therefore agreed with the reasoning of the Court of Appeal that the CPS’s preferred interpretation put a strain on the words of the statute and would present a judge with real practical difficulties when applying the provision.
The purpose behind the relevant provisions was to balance the goal of enabling the confiscation of proceeds of crime with the need to ensure that the alleged criminal could apply for a variation of the restraint order to meet certain types of expenses. Allowing a variation to cover reasonable legal expenses incurred in relation to civil proceedings did not contradict this policy, as it remained for the courts to follow the "legislative steer" contained in POCA to strike the correct balance in ensuring the expenses were reasonable and not excessive. Therefore, the natural meaning of the words in the light of their context and purpose indicated that legal expenses incurred in respect of civil proceedings were not subject to a blanket prohibition, but rather that a variation to a restraint order to cover such expenses was controlled by the courts’ discretion in the same way as other permissible variations, such as living expenses.