Lexploria

AS TO THE ADMISSIBILITY OF

Application No. 18465/91

by AIR CANADA

against the United Kingdom

The European Commission of Human Rights sitting in private on

1 April 1993, the following members being present:

MM. C.A. NØRGAARD, President

J.A. FROWEIN

S. TRECHSEL

F. ERMACORA

E. BUSUTTIL

G. JÖRUNDSSON

A.S. GÖZÜBÜYÜK

A. WEITZEL

H. DANELIUS

Sir Basil HALL

MM. F. MARTINEZ

C.L. ROZAKIS

Mrs. J. LIDDY

MM. J.-C. GEUS

M.P. PELLONPÄÄ

B. MARXER

Mr. H.C. KRÜGER, Secretary to the Commission

Having regard to Article 25 of the Convention for the Protection

of Human Rights and Fundamental Freedoms;

Having regard to the application introduced on 2 May 1991 by

Air Canada against the United Kingdom and registered on 8 July 1991

under file No. 18465/91;

Having regard to the report provided for in Rule 47 of the Rules

of Procedure of the Commission;

Having regard to:

- the observations submitted by the respondent Government on

25 March 1992 and the observations in reply submitted by the

applicant company on 22 May 1992;

- the further observations submitted by the Government on

15 July 1992 and the applicant company's reply of

16 September 1992;

- the parties' further observations, submitted by the respondent

Government on 22 January and by the applicant company on

26 January 1993;

- the hearing held on 1 April 1993;

Having deliberated;

Decides as follows:

THE FACTS

The applicant is a corporation incorporated under Canadian law.

It is a registered overseas company in the United Kingdom with a

registered office in Hounslow, Middlesex. It is represented before the

Commission by Messrs Neil McGilchrist and David Johnston, solicitors,

of Messrs. Beaumont and Son, Solicitors, London.

The facts of the case, as submitted by the parties, may be

summarised as follows:

A Tristar aeroplane, owned and operated by the applicant company,

landed at London Heathrow Airport on 26 April 1987 where it discharged

cargo including a container which, when opened, was found to contain

331 kgs of cannabis resin, of a "street value" of about £800,000. The

aeroplane was on a regular scheduled flight starting in Singapore and

travelling to Toronto, landing en route at Bombay and Heathrow. It

carried both fare-paying passengers and cargo. Subsequently the

aircraft made further international flights which included return

visits to the United Kingdom. On one of these subsequent visits which

occurred on Friday 1 May 1987, a bank holiday, representatives of the

Commissioners of Customs and Excise ("the Commissioners") seized the

aircraft as liable to forfeiture under Section 141 (1) of the Customs

and Excise Management Act 1979 ("the 1979 Act"). Later on the same

day, acting under powers contained in Section 139 (5) and para. 16 of

Schedule 3 of the 1979 Act, the aircraft was delivered back to the

applicant company on payment by the latter of £50,000. On 20 May 1987

the applicant company's solicitors gave notice of a claim challenging

the Commissioners' assertion that the aircraft was liable to

forfeiture. Accordingly, the Commissioners initiated condemnation

proceedings as required by para. 6 of Schedule 3 to the 1979 Act.

On the hearing of a preliminary issue, it was accepted that the

importation of cannabis resin was prohibited under Section 31 of the

Misuse of Drugs Act 1971 and that the cannabis was liable to forfeiture

by virtue of Section 49 (1)(b) of that Act. It was also accepted that

after landing on 26 April 1987 the aircraft had made several scheduled

international flights including flights into the United Kingdom before

it was seized on 1 May 1987.

The following questions were formulated for the trial of the

preliminary issue:

"(1) Whether the facts (a) that cannabis resin was found in

container ULD 6075AC and (b) that that container had been

carried by Aircraft on Flight AC 859 on 26 April 1987 alone

constitute 'use of aircraft for the carriage of a thing

liable to forfeiture' within the meaning of Section 141

(1)(a) of the Customs and Excise Management Act 1979 such

as to justify its subsequent seizure on 1 May 1987.

(2) Whether it is a defence to the plaintiffs' [the

Commissioners'] claim in this action if the defendants [the

applicant company] establish that they did not know that

the aforesaid container contained cannabis resin and were

not reckless in failing so to discover.

(3) Whether it is a defence to the plaintiffs' claim in this

action if the defendants established that they could not with

reasonable diligence have discovered that cannabis had been

secreted and hidden or was being carried in the container nor

could they by the exercise of reasonable diligence have prevented

its being secreted and hidden in the container.

(4) Whether it is necessary for the plaintiffs to prove in

this action:

i. that the defendants knew or ought to have

known that cannabis resin was on board the

aircraft on 26 April 1987 and/or

ii. that the aircraft was on other than a

regular scheduled and legitimate flight."

Mr. Justice Tucker gave judgment on 7 November 1988 on the

preliminary issue. After considering the law and the authorities, he

concluded:

"I cannot think that the draughtsman of the 1979 Act had

the present situation in mind. I cannot believe that it

was the intention of Parliament that the innocent and bona

fide operator of an extremely valuable aircraft on an

international scheduled flight should be at risk of having

the aircraft forfeited if, unknown to him and without any

recklessness on his part, some evil-minded person smuggles

contraband or prohibited goods aboard the aircraft. It

cannot sensibly be said that in such circumstances the

aircraft "has been used for the carriage". What has been

used is no more than the opportunity afforded by the

availability of cargo space on an already scheduled flight

which was going to be made in any event."

Adopting the words of Lord Reid in the case of Warner v. the

Metropolitan Police Commissioner ([1969] 2 QB 256), he said:

"I refuse to believe that Parliament can ever have intended

such an oppressive result."

He determined the preliminary issues as follows:

"1. No. Those facts alone do not constitute "use of the

aircraft for the carriage of a thing liable to forfeiture."

2. Yes. It is a defence.

3. Yes. It is a defence.

4. It is necessary for the plaintiffs to prove in this

action:

(i) that the defendants knew or ought to have

known that cannabis resin was on board the

aircraft on 26 April 1987; or (but not and)

(ii) that the aircraft was on other than a

regular scheduled and legitimate flight."

The Commissioners appealed to the Court of Appeal, which gave its

judgment on 14 June 1990.

Lord Justice Purchas, giving the first judgment, described the

question in the appeal thus:

"Does the aircraft or other vehicle container, etc. become

liable to forfeiture without more merely because it is

established that it was used for the carriage of prohibited

goods; or is it necessary before the forfeiture provisions of

Section 141 (1) can be invoked to establish that there was some

degree of knowledge in the owner or user or proprietor of the

aircraft; or a reckless disregard in relation to what was being

carried on the aircraft?"

After summarising the arguments and considering the authorities,

he found:

"The wording of Section 141 is, in my view, clear and

unambiguous and does not permit of any implication or

construction so as to import an element equivalent to mens

rea [criminal intent] nor does it involve in any way any

person in the widest sense whether as user, proprietor or

owner but depends solely on "the thing" being used in the

commission of the offence which rendered the goods liable

to forfeiture. ... In my judgment the mitigating provisions

included in Section 152 and paragraph 16 of Schedule 3,

indicate clearly that Parliament intended to trust to the

Commissioners the exercise of these matters of discretion.

Apart from this the exercise of this discretion will be

readily open to review by the court under R.S.C. Order 53.

This is a remedy which has developed very considerably in

recent years and was not so available at the time when the

earlier authorities were decided. I would only comment

that there may well be a case to exclude inter-continental

or large passenger jet aeroplanes flying on scheduled

flights from Section 141 (1) in the same way as vessels

over a certain size have been excluded and to provide for

them in Section 142. ...

The expression 'which has been used for the carriage of the

thing so liable to forfeiture' is perfectly

straightforward. To attempt to distinguish in some way the

carriage of the article in question on a scheduled flight

as opposed to a specially commissioned flight raises a

totally illogical distinction and flies in the face of the

ordinary meaning of the words in the section."

Lord Justice Balcombe and Sir David Croom-Johnson, agreeing with

Lord Justice Purchas, gave separate judgments.

The questions for consideration on the preliminary issue were

accordingly answered as follows:

1. Yes.

2. No.

3. No.

4. No.

Leave to appeal to the House of Lords was refused.

On 7 November 1990 the House of Lords also refused to grant leave

to appeal.

On 15 July 1992, in the course of the proceedings before the

Commission, the respondent Government submitted further observations

which included a list of nine matters which had given rise to concern

about Air Canada's procedures at Heathrow Airport. These matters

related to specific cases in which drugs had entered or were believed

to have entered the United Kingdom via Air Canada, and to

correspondence between Air Canada and the authorities involved.

Relevant domestic law and practice

Customs and Excise Management Act 1979

Section 139 (5)

"Subject to Sub-sections (3) and (4) and to Schedule 3 to

the Act any thing seized or detained under the Customs and

Excise Acts shall, pending the determination as to its

forfeiture or disposal, be dealt with and if condemned or

deemed to have been condemned or forfeited, shall be

disposed of in such manner as the Commissioners may

direct."

Section 141 (1)

"...where any thing has become liable to forfeiture under

the Customs and Excise Acts -

(a) any ship, aircraft, vehicle, animal,

container (including any article of passengers'

baggage) or other thing whatsoever which has

been used for the carriage, handling, deposit or

concealment of the thing so liable to

forfeiture, either at a time when it was so

liable or for the purposes of the commission of

the offence for which it later became so liable;

... shall also be liable to forfeiture."

Section 142 (1)

"Notwithstanding any other provision of the Customs and

Excise Acts 1979, a ship of 250 or more tons register shall

not be liable to forfeiture under or by virtue of any

provision of

the Customs and Excise Acts 1979, unless the offence in respect

of or in connection with which the forfeiture is claimed -

(a) was substantially the object of the voyage

during which the offence was committed; or

(b) was committed while the ship was under chase

by a vessel in the service of Her Majesty after

failing to bring to when properly summoned to do

so by that vessel."

Section 152

"The Commissioners may, as they see fit -

(a) stay, sist or compound any proceedings for

an offence or for the condemnation of any thing

as being forfeited under the Customs and Excise

Acts; or

(b) restore, subject to such conditions (if any)

as they think proper, any thing forfeited or

seized under those Acts; or

(c) after judgment mitigate or remit any

pecuniary penalty imposed under those Acts;

..."

Schedule 3, para. 6

"Where notice of claim in respect of any thing is duly given in

accordance with [paragraph 5] the Commissioners shall take

proceedings for the condemnation of that thing by the court, and

if the court finds that the thing was at the time of seizure

liable to forfeiture the court shall condemn it as forfeited."

Schedule 3, para. 16

"Where any thing has been seized as liable to forfeiture

the Commissioners may at any time if they see fit and

notwithstanding that the thing has not yet been condemned,

or is not yet deemed to have been condemned, as forfeited -

(a) deliver it up to any claimant upon his

paying to the Commissioners such sum as they

think proper, being a sum not exceeding that

which in their opinion represents the value of

the thing, including any duty or tax chargeable

thereon which has not been paid; ..."

Domestic Case-law

Judicial review proceedings in respect of decisions of the

Commissioners under Section 152 have been brought in two cases. In R.

v. Commissioners of Customs and Excise ex parte Haworth (judgment of

17 July 1985) the Commissioners had seized the applicant's yacht as

liable to forfeiture. He asked the Commissioners to exercise their

discretion under Section 152 and return the yacht. The High Court,

after considering correspondence between the applicant and the

authorities and describing the Commissioners' powers as "astonishing",

found that the Commissioners had not properly exercised their

discretion in that they had not given Mr. Haworth the opportunity to

reply to matters held against him. The decision did not affect the

seizure of his yacht.

In R. v. Commissioners of Customs and Excise ex parte Tsahl

(judgment of 11 December 1989) the Commissioners had decided to return

diamonds which had been seized on payment of £228,190. The High Court

was prepared to interfere with the Commissioners' discretion only to

the extent of requiring the Commissioners to take as date of valuation

of the diamonds (for the purpose of determining the amount of the

payment for their return) the date of return rather than the date of

import.

COMPLAINTS

The applicant company considers that there is no proportionality

between the width of Section 141 of the 1979 Act as applied in the

present case and the aim sought to be pursued. They allege a violation

of Article 1 of Protocol No. 1 to the Convention in this respect.

The applicant company also alleges a violation of Article 6 of

the Convention. It refers to the dissenting opinion of Judge Pettiti

in the Agosi case (Eur. Court H.R., Agosi judgment of 24 October 1986,

Series A no. 108) according to which the applicant in that case was

"denied the opportunity both of proving its innocence in criminal

proceedings and of asserting its rights in civil proceedings".

PROCEEDINGS BEFORE THE COMMISSION

The application was introduced on 2 May 1991 and registered on

8 July 1991.

On 6 January 1992 the Commission decided to communicate the

application to the respondent Government and to request the parties to

submit their written observations on the admissibility and merits of

the application so far as it relates to Article 1 of Protocol No. 1 to

the Convention.

The Government submitted their observations on 25 March 1992 and

the applicant company submitted its observations in reply on

22 May 1992. On 15 July 1992 the Government submitted further

observations, to which the applicant replied on 16 September 1992.

On 7 December 1992 the Commission decided to invite the parties

to an oral hearing on the admissibility and merits of the case. It

also decided to request them to submit further written observations on

the admissibility and merits of the issues arising under Article 6 of

the Convention.

The respondent Government submitted their observations on 22

January 1993 and the applicant company submitted its observations on

26 January 1993.

At the hearing, which was held on 1 April 1993, the parties were

represented as follows:

For the Government

Mrs. A. F. GLOVER, Foreign and Commonwealth Office, Agent

Mr. D. PANNICK, Q.C., Counsel

Mrs. C. D. HUGILL, HM Customs and Excise, Adviser

Mr. I. WALTON, HM Customs and Excise, Adviser

For the Applicant

Mr. D. B. JOHNSTON, Solicitor, Messrs. Beaumont & Son

Mr. R. WEBB, Q.C., Counsel.

After the hearing the Commission deliberated and declared the

application admissible.

THE LAW

1. The applicant company alleges a violation of Article 1 of

Protocol No. 1 (P1-1) to the Convention which provides as follows:

"Every natural or legal person is entitled to the peaceful

enjoyment of his possessions. No one shall be deprived of

his possessions except in the public interest and subject

to the conditions provided for by law and by the general

principles of international law.

The preceding provisions shall not, however, in any way

impair the right of a State to enforce such laws as it

deems necessary to control the use of property in

accordance with the general interest or to secure the

payment of taxes or other contributions or penalties."

The Government consider that the applicant company, by not

applying to the High Court for judicial review of the decision of the

Commissioners of Customs and Excise ("the Commissioners") to return its

aircraft on payment of £50,000, has failed to exhaust domestic

remedies. In the alternative, the Government submit that the complaint

is manifestly ill-founded as various matters had given rise to

considerable concern about the procedures adopted by Air Canada and

that these matters, taken together with the possibility of an

application for leave to apply for judicial review, satisfy the

requirements of Article 1 of Protocol No. 1 (P1-1) that a fair balance

be struck between the conflicting interests in the case.

The applicant company submits that judicial review could not have

adequately remedied its complaints under Article 1 of Protocol No. 1

(P1-1) as judicial review is of limited scope; in particular it does

not include an examination of proportionality, it is a review rather

than a decision-taking process, and it is discretionary. It further

submits that a fair balance has not been struck between the demands of

the general interest and its own interests where, notwithstanding the

assumption on which the condemnation proceedings were based that there

was no fault by Air Canada, Air Canada was outwitted by a clever

smuggler and deprived of its aeroplane and £50,000.

With regard to the Government's contention that the applicant

company has not exhausted domestic remedies in connection with this

complaint, the Commission first notes that, by requiring the

Commissioners to institute condemnation proceedings and by pursuing

those proceedings to the Court of Appeal and the House of Lords, the

applicant company did everything possible to challenge the seizure as

such.

The Commission next notes that the applicant's complaints do not

relate to two separate incidents - one concerning the seizure and

subsequent forfeiture of aircraft and the other concerning the

requirement that they pay £50,000 for its return - but rather to the

events as a whole. It is clear from the two decided cases on Section

152 of the Customs and Excise Management Act 1979 (R. v. Commissioners

of Customs and Excise ex parte Haworth, judgment of 17 July 1985; R.

v. Commissioners of Customs and Excise ex parte Tsahl, judgment of 11

December 1989) that the courts would only deal with matter which would

be peripheral to the central issues in the present case. Thus in

Haworth, where the Commissioners appear not to have exercised their

Section 152 discretion, the High Court ordered the Commissioners to re-

consider whether to exercise that discretion: the courts did not take

any decision on the merits of the case at all. In Tsahl, which

concerned the return of forfeited diamonds for a fixed proportion of

their value, the High Court was only prepared to intervene to the

extent of taking a different date of valuation. It is apparent from

the general tenor of both these judgments, at least in cases involving

the exercise of the Commissioners' discretion under Section 152 of the

Customs and Excise Management Act, that the courts accept that the

Commissioners have a remarkably wide discretion in deciding whether and

on what conditions to restore things forfeited. Even if, as in the

Haworth case, the applicant company could have founded an application

for judicial review on a procedural error, the effect would only have

been to have required the Commissioners to reconsider the exercise of

their discretion. Judicial review would not have provided any remedy

for the seizure and detention of the aircraft, in respect of which the

applicants had exhausted the domestic remedies in the condemnation

proceedings. The applicants do not complain simply of the imposition

of a condition for return of the aircraft. Their complaint embraces

the seizure, detention and return on conditions.

For all these reasons the Commission finds that it cannot be said

that the applicant company has failed to exhaust domestic remedies in

respect of its complaint under Article 1 of Protocol No. 1 (P1-1) to

the Convention. This finding does not prejudice any argument under

Article 1 of Protocol No. 1 (P1-1) that the procedural requirements of

that provision were met by the availability of judicial review.

As to the remaining issues under this complaint, the Commission

finds that serious issues of fact and law are raised which can only be

resolved by an examination of the merits. The complaint cannot

therefore

be declared manifestly ill-founded within the meaning of Article 27

para. 2 (Art. 27-2) of the Convention. No other grounds for

inadmissibility have been established.

2. The applicant company, referring to the dissenting opinion of

Judge Pettiti in Agosi (Eur. Court H.R., Agosi judgment of 24 October

1986, Series A no. 108, p. 26), also alleges a violation of Article 6

(Art. 6) of the Convention.

The respondent Government regard any statutory "interferences"

with property under Sections 141 (1) and 152 of the Customs and Excise

Management Act 1979 as matters which do not determine civil rights or

obligations or criminal charges within the meaning of Article 6 para.

1 (Art. 6-1) of the Convention, and contend that the provision

therefore does not apply. They consider that the condemnation

proceedings in any event complied fully with Article 6 (Art. 6) of the

Convention, and that, as the applicant company did not apply for

judicial review of the requirement to pay £50,000 for return of its

aircraft, it may not make hypothetical complaints about any such

proceedings.

The Commission finds that this complaint, too, raises serious

issues of fact and law which can only be resolved by an examination of

the merits. It cannot therefore declare it manifestly ill-founded

within the meaning of Article 27 para. 2 (Art. 27-2) of the Convention.

No other grounds for inadmissibility have been established.

For these reasons, the Commission by a majority

DECLARES THE APPLICATION ADMISSIBLE

without prejudging the merits of the case.

Secretary to the Commission President of the Commission

(H. C. KRÜGER) (C. A. NØRGAARD)

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AIR CANADA v. THE UNITED KINGDOM

AIR CANADA v. THE UNITED KINGDOM

LEXI