Information Note on the Court’s case-law 43

June 2002

Butler v. the United Kingdom (dec.) - 41661/98

Decision 27.6.2002 [Section III]

Article 1 of Protocol No. 1

Article 1 para. 2 of Protocol No. 1

Control of the use of property

Forfeiture of sum of money on the basis of legal presumption that it was intended for use in drug trafficking: inadmissible

Article 6

Criminal proceedings

Article 6-1

Civil rights and obl igations

Forfeiture order allegedly amounting to a criminal charge: inadmissible

The applicant, a heavy gambler on horses, often held large sums of money in cash for the purpose of gambling. He stated that he has never been convicted of any drug-related offences. Having ascertained that he could avoid tax on off-course betting by gambl ing offshore as a non-resident, he decided to buy an apartment in Spain and arranged to meet a lawyer there in September 1996. As he was nervous about taking the money himself, he entrusted 240,000 pounds sterling (GBP) to his partner’s brother, H., who ha ppened to be going to Spain for a holiday. He stated that he needed part of the sum to buy an apartment there and the rest for a race meeting in Paris where he intended to go afterwards. In June 1996 the customs authorities stopped H. at Portsmouth and fou nd the money in the boot of his car. H. explained to the officers that the sum belonged to the applicant who wanted to purchase an apartment in southern Spain. An order for the detention of his money was granted by a Magistrates’ Court on 19 September 1996 pursuant to the Drug Trafficking Act 1994 (the “1994 Act”). The applicant contacted the customs authorities to reclaim the money in October 1996. In February 1997 the customs authorities made an application under the 1994 Act for the forfeiture of GBP 239 ,010 seized from the applicant on the grounds that it was believed that the money was directly or indirectly the proceeds of drug trafficking and/or was intended for use in drug trafficking. In June 1997 the Magistrates’ Court made an order for the confisc ation of the sum. The applicant’s appeal was unsuccessful, the forfeiture order being upheld by the Crown Court. The court noted that the money was contaminated to a limited extent by cannabinoids and that it included a large proportion of Scottish notes w hich are typically used by drug-traffickers to finance drug deals conducted abroad. Moreover, the south coast of Spain was known as the source of a large number of consignments of drugs destined for the United Kingdom. In view of the circumstantial evidenc e, the Crown Court found the explanations given by the applicant and H. unsatisfactory and held that it was more probable than not that the money would have been used for drug-trafficking. The Government stated that the applicant failed to produce evidence to substantiate his claim that he had made substantial winnings on cash bets since 1994.

Inadmissible under Article 6 § 2: Government’s preliminary objection – The Government argued that the applicant had failed to exhaust available remedies, namely an ap peal to the High Court by way of case stated and/or an application for judicial review. The essence of the applicant’s complaint was that the relevant domestic law does not treat forfeiture proceedings as involving the determination of a criminal charge wi th the consequence that the procedural guarantees of Article 6, and notably the presumption of innocence, did not cover the proceedings. The remedies mentioned by the Government may have afforded him the opportunity to contest the decision to forfeit his m oney on the ground that it was against the weight of the evidence or tainted with illegality. However, it was not established that they would have afforded him any prospects of success. In the event of case stated or judicial review proceedings, it was unl ikely that the High Court would contest the facts as found by the Crown Court or its assessment of the evidence. Further, the applicant stated that the Crown Court proceedings did not disclose any error of law or that the decisions taken were in any way ul tra vires such as to warrant an application to the High Court by way of judicial review proceedings. Finally, and more decisively, the High Court, either in case stated or judicial review proceedings, would not have entertained a challenge by the applicant to the evidentiary scheme of the 1994 Act. Therefore, the Government’s preliminary objection was rejected.

As to the applicability of Article 6 under its criminal heading, no criminal charges were ever brought against the applicant. The forfeiture order w as a preventive measure and could not be compared to a criminal sanction since it was designed to take out of circulation money which was presumed to be bound up with the international trade in illicit drugs. The proceedings which led to the making of the order did not involve the determination of a criminal charge. As to the applicant’s reliance on the Phillips v. the United Kingdom judgment of 5 July 2001, the circumstances of the present case differed from it. In the Phillips case, the impugned confiscat ion order followed on from the applicant’s prosecution, trial and ultimate conviction on charges of importing an illegal drug. It was found to be analogous to a sentencing procedure and to that extent attracted the applicability of Article 6. In that case, weight was attached to the fact that the purpose of the confiscation order was not the conviction or acquittal of the applicant and that the making of the confiscation order had no implications for his criminal record. These considerations were also relev ant in the present case for concluding that Article 6 did not apply under its criminal head to the forfeiture proceedings. Further support for this conclusion could be found in the Air Canada and AGOSI v. the United Kingdom judgments: incompatible ratione materiae .

Inadmissible under Article 1 of Protocol No. 1: The seizure and forfeiture of the applicant’s money amounted to an interference with the peaceful enjoyment of his possessions. Although the applicant was permanently deprived of his money following the forfeiture order, the impugned interference fell to be considered from the standpoint of the State’s right to enforce such laws to control the use of property in accordance with the general interest. The forfeiture was effected pursuant to and in comp liance with the provisions of the relevant sections of the 1994 Act and was thus in accordance with the domestic law. In assessing whether a fair balance was struck between the general interest of the community in the eradication of drug trafficking and th e protection of the applicant’s right to peaceful enjoyment of possessions, due weight had to be given to the wide margin of appreciation which the respondent State enjoyed in formulating and implementing policy measures in relation to drug trafficking. Th e powers vested in the customs’ authorities were confined by the terms of the 1994 Act and their exercise was subject to judicial supervision. As to the applicant’s argument that, unlike the custom’s authorities, he was required at all times during the for feiture proceedings to bear the burden of proof, it is not incompatible with the requirement of a fair hearing to shift the burden of proof to the defence in criminal proceedings. Nor is the fairness of a trial vitiated on account of the prosecution’s reli ance on presumptions of fact or law which operate to the detriment of the accused, provided such presumptions are confined within reasonable limits which take into account the importance of what is at stake and maintain the rights of the defence. These con siderations had a fortiori to be applied to the forfeiture proceedings in the instant case, proceedings which did not involve the determination of a “criminal charge” against the applicant. In order to make out their case for the forfeiture of the applicant’s money, the customs’ au thorities relied on forensic and circumstantial evidence, the reliability of which the applicant, assisted by counsel, was able to dispute at oral hearings before the Magistrates’ Court and the Crown Court. It was open to the applicant to adduce evidence i n order to satisfy the domestic courts of the legitimacy of the purpose of his visit to Spain, the reasons for taking such a large sum of money out of the country in the boot of a car and the source of the money. The domestic courts weighed the evidence be fore them, assessed it carefully and based the forfeiture order on that evidence. They refrained from any automatic reliance on presumptions created in the relevant provisions of the 1994 Act and did not apply them in a manner incompatible with the require ments of a fair hearing. Therefore, the manner in which the applicant’s money was forfeited did not amount to a disproportionate interference with his property rights or failure to strike a fair balance between respect for his rights under Article 1 of Pro tocol No. 1 and the general interest of the community: manifestly ill-founded.

© Council of Europe/European Court of Human Rights This summary by the Registry does not bind the Court.

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