Law reports

CRIMINAL

Application for telecommunications company to produce special procedure material - application notice warning company to preserve information pending court hearing - interception of e-mails for that purpose lawful

R (NTL Group Ltd) v Crown Court at Ipswich: QBD (Lord Woolf CJ and Mr Justice Curtis): 22 July 2002

The claimant, a telecommunications company, stored e-mails from an Internet service provider on its computer system.

They were automatically deleted within an hour of being read by the recipient.

The police served on the claimant notice of an application, under section 9 of and schedule1 to the Police and Criminal Evidence Act 1984, for an order for the production of special procedure material in the form of e-mail information relating to a specified e-mail address.

The notice warned that, under paragraph 11 of schedule 1, the claimant must not destroy or dispose of that material without leave until the application was dismissed or abandoned or any order made had been complied with.

The claimant contended that any order could not apply to information in the system prior to the order being made because the only way in which it could have preserved the information pending the court hearing would have been by transferring the e-mails concerned to a different address, which would have involved committing the offence under section 1 of the Regulation of Investigatory Powers Act 2000 of unlawfully intercepting a communication in the course of its transmission.

The judge rejected that argument and made the order sought.

The claimant sought judicial review.

Anthony Hudson (instructed by Charles Russell) for the claimant; Rupert Overbury (instructed by County Solicitor, Suffolk County Council, Ipswich) for the Suffolk Constabulary.

Held, refusing judicial review, that in view of section 2(7)(8) of the 2000 Act the claimant would commit an offence if, without lawful authority, it transferred e-mails to another address so that they could be available subsequently if the court made an order under section 9 of the 1984 Act; but that it was implicit in paragraph 11 of schedule1, when read with section 9, that a body subject to an application under section 9 had the power to take action necessary to preserve e-mails within the system until such time as the court decided whether to make the order; and that, accordingly, the claimant would have lawful authority for the purposes of section 1(5)(c) of the 2000 Act, and no offence under section 1 would be committed, if it acted in accordance with paragraph 11 of schedule 1 of the 1984 Act when served with an application under section 9.

(WLR)

Sentencing - magistrates' court committing convicted defendant to Crown Court for sentence on offences committed before 1998 - Crown Court having jurisdiction to make confiscation order

R v Pope: HL (Lord Nicholls of Birkenhead, Lord Browne-Wilkinson, Lord Hobhouse of Woodborough, Lord Millett and Lord Scott of Foscote): 20 June 2002

The magistrates' court committed the defendant, pursuant to section 38 of the Magistrates' Courts Act 1980, to the Crown Court for sentence, following his pleas of guilty to 17 offences, committed between 1993 and 1997, of procuring the execution of a valuable security by deception.

contrary to section 20(2) of the Theft Act 1968.

The Crown Court sentenced him to a term of imprisonment and also made a confiscation order pursuant to section 71 of the Criminal Justice Act 1988.

He appealed against the confiscation order.

The Court of Appeal (Criminal Division) allowed the appeal on the ground that the Crown Court had no jurisdiction to make the confiscation order on a committal for sentence from a magistrates' court in respect of offences committed before 30 September 1998.

The Crown appealed.

Victor Temple QC and Kennedy Talbot (instructed by the Crown Prosecution Service) for the Crown; Jeffrey Pegden QC and Geoffrey Birch (instructed by Brignalls, Balderston & Warren, Stevenage) for the defendant.

Held, allowing the appeal, section 42 of the Powers of Criminal Courts Act 1973 had throughout given the Crown Court the requisite power on a committal for sentence and the supposed lacuna in the powers of the Crown Court to make confiscation orders under section 71 of the 1988 Act as amended by section 83 of the Crime and Disorder Act 1998 did not exist even for the short period between 1995 and 30 September 1998.

(WLR)

Innocent possession of controlled drugs - circumstances in which statutory defence available - burying drugs in ground not constituting taking steps to destroy drugs

R v Murphy: CA (Lord Justice Longmore, Mr Justice Wright and Judge Hyam): 18 June 2002

Arriving by car as a visitor to a prison, the defendant discovered cannabis wrapped in tin-foil in the glove compartment of the car.

At once he opened the door, dug a hole in the gravel and buried the package there.

He was charged with being in possession of a class B controlled drug.

The Crown accepted much of the defendant's own account, in particular that he believed the drugs to be his father's, knew nothing of their presence in the car and feared being found in possession since he was at liberty on licence following a drug-related conviction.

The judge ruled before trial that the defendant could not rely on section 5(4)(a) of the Misuse of Drugs Act 1971 whereby it was a defence to prove that, knowing or suspecting it to be a controlled drug, he took possession of it for the purpose of preventing another from committing or continuing to commit an offence in connection with that drug and that 'as soon as possible after taking possession of it he took all such steps as were reasonably open to him to destroy the drug'.

He pleaded guilty but appealed against conviction.

Tom Boyd (assigned by the Registrar of Criminal Appeals) for the defendant; Stephen Ridley (instructed by the Crown Prosecution Service, Norwich) for the Crown.

Held, dismissing the appeal, that for the defence under section 5(4)(a) to apply it was not sufficient that in the end the forces of nature would have destroyed the buried drugs, and the defence envisaged that the act of destruction should be that of the defendant; and that, furthermore, the concept of 'destruction' was one which depended on a great deal more finality than had been displayed in the instant case.

DAMAGES

Loss of dependency claim on behalf of children following death of mother - father stepmother and mother's partner providing services to children - benefit of their voluntary services to be disregarded in assessing damages

Ath and another (Executors of the Estate of M, decd) v S: CA (Lords Justice Kennedy and Tuckey and Mr Justice Jackson): 11 June 2002

A divorced mother and her three young children were living with the mother's partner when the mother was killed in a car accident.

After the mother's death, the children were cared for and looked after by their father and stepmother and their mother's partner.

On a dependency claim under the Fatal Accidents Act 1976, the judge awarded a substantial sum representing the value and benefit of the services provided for the children by the three carers.

The defendant appealed.

Mark Strachan QC and Andrew Young (instructed by Lorenzo Zurbrugg) for the defendant; Howard Lederman (instructed by Stone Rowe Brewer, Richmond) for the claimants.

Held, allowing the appeal, that the support and benefit which the children enjoyed from their father, stepmother and mother's partner arose only as a result of the death of their mother and, pursuant to section 4 of the Fatal Accidents Act 1976, should be disregarded from the assessment of loss and calculation of damages.

EUROPEAN

Information alleging contraventions of European Community grading rules - 'any directly applicable community provisions' establishing marketing standards not including amendments to community regulations made after domestic statute enacted - offences unknown to law

Secretary of State for Environment, Food and Rural Affairs v ASDA Stores Ltd and another: QBD (Lord Justice Rose and Mr Justice Gibbs): 24 June 2001

Informations were laid against the defendant for breaches of a number of different European Community regulations concerning the laying down of quality standards for various items of fruit and vegetables.

The district judge, applying Mayne v Minister of Agriculture, Fisheries and Food [2001] EHLR 5, held that he had no jurisdiction to try the informations because the alleged offences were unknown to the law.

The Grading of Horticulture Produce (Amendment) Regulations 1973 (SI 1973/22), made pursuant to section 4 of and paragraph 4(1)(c) of schedule 4 to the European Communities Act 1972, modified the Agriculture and Horticulture Act 1964 to provide, in section 14, for criminal offences where there had been a failure to comply with 'community grading rules', which were defined by section 24 of the Act as 'any directly applicable community provisions' establishing standards of quality for fresh horticultural produce.

The secretary of state appealed.

Christopher Vajda QC (instructed by Legal Department, Department of the Environment, Food and Rural Affairs) for the secretary of state; Frederick Philpott (instructed by Gary McHale, Leeds) for the defendant.

Held, dismissing the appeal, that 'any directly applicable community provisions' in section 24 referred to community regulations in force when the 1973 regulations were made; that future amendments to community regulations did not impose criminal liability since the English legislation did not expressly take into account the possibility of future amendments; and that, accordingly, although the judge had been wrong to equate directives with regulations, he had been correct in holding that the offences were unknown to the law.

PROFESSIONS

Wasted costs application against defendant's counsel in respect of fraud allegations in draft notice of appeal - counsel unable to rely on privileged material in resisting application - court not entitled to infer that counsel had no reasonably credible material to establish prima facie case of fraud

Medcalf v Mardell: HL (Lord Bingham of Cornhill, Lord Steyn, Lord Hoffmann, Lord Hobhouse of Woodborough and Lord Rodger of Earlsferry): 27 June 2002

Following the dismissal of a defendants' appeal, the claimant applied for a wasted costs order against the barristers who represented the defendants in the Court of Appeal.

The claimant sought to recover the costs of investigating and rebutting allegations of fraud and other improprieties which had been made in the draft amended notice of appeal on the ground that the barristers had acted in contravention of paragraph 606 of the code of conduct of the Bar of England and Wales in that they could not have had before them 'reasonably credible material' establishing a prima facie case of fraud.

In resisting the application the barristers were unable to refer to privileged and confidential material relating to their instructions because the defendants declined to waive privilege.

The Court of Appeal (see [2001] Gazette, 1 February, 36) held, by a majority, that the barristers could not have had before them sufficient material to justify the allegations, that their inability to reveal privileged or confidential material did not make the hearing unfair, and that, making every assumption favourable to the barristers on points where the court did not have evidence, it was just to make the order.

The barristers appealed.

Nicholas Davidson QC and Leigh Ann Mulcahy (instructed by Clyde & Co) for the barristers; Romie Tager QC and Edward Rowntree (instructed by Gordon Dadds) for the claimant.

Held, allowing the appeal, that at the preparatory stage the requirement of paragraph 606 was not that counsel should necessarily have before him evidence in an admissible form, but that he should have material of such a character as to lead responsible counsel to conclude that serious allegations could properly be based upon it; that when a lawyer against whom a wasted costs order was sought was at a grave disadvantage in defending himself because his client was unwilling to waive his privilege, and where there was room for doubt, the lawyer was entitled to the benefit of it; that it was only when, with all allowances made, a lawyer's conduct of proceedings was quite plainly unjustifiable that it could be appropriate to make a wasted costs order; that the court should not make an order unless, proceeding with extreme caution, it was satisfied that there was nothing the practitioner could say, if unconstrained, to resist the order, and that it was in all the circumstances fair to make the order; that the Court of Appeal had applied too stringent a test; and that, since the court did not know and could not be told whether the barristers had had any material before them which justified making the allegations, they should have the benefit of that doubt.

(WLR)

TAXATION

Corporation tax - group relief - restrictions on allowable losses

MEPC Holdings Ltd v Taylor (Inspector of Taxes): CA (Lords Justice Pill, Chadwick and Clarke): 20 June 2002

The taxpayer, an investment company within the charge to corporation tax, made profits for its 1994 accounting period of 300,000 and had charges on income of some 48.6 million.

In the same period it realised chargeable gains exceeding 6 million.

Unused allowable losses brought forward from earlier accounting periods amounted to 60.5 million.

Other companies in the group made claims for any losses eligible for surrender.

The revenue determined the amount available at 42.3 million.

The taxpayer appealed, claiming that on the proper construction of section 403 of the Income and Corporation Taxes Act 1988 the amount should be increased to 48.3 million, no deduction falling to be made in respect of the realised chargeable gains which were more than set off by the brought forward allowable losses.

The judge allowed an appeal by the Inland Revenue from a decision by special commissioners which had upheld the taxpayer's claim.

The taxpayer appealed.

David Goldberg QC and Barrie Atkin (instructed by Landwell (Solicitors) Ltd) for the taxpayer; Timothy Brennan QC (instructed by the Solicitor of Inland Revenue) for the revenue.

Held, dismissing the appeal, that section 403 of the 1988 Act described amounts eligible for surrender, subsection (8) providing that the surrendering company's profits were to be determined without regard to any deduction falling to be made in respect of losses or allowances of any other period; and that, on a true construction, that provision was not restricted to trading losses but prohibited any deduction from the taxpayer's chargeable gains being made for any of its earlier allowable losses.

The law reports are prepared by the reporters to the Incorporated Council of Law Reporting for England and Wales; telephone: 020 7242 6471; fax: 020 7831 5247; http://www.lawreports.co.ukWLR means that a report has been submitted for publication in the Weekly Law Reports