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OUTER HOUSE, COURT OF SESSION 2008 CSOH5 |
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P861/05 |
OPINION OF LORD PENROSE in the Petition of SCOTTISH MINISTERS For a Recovery Order in terms of section 266 of the Proceeds of Crime Act 2002 Petitioners; against MARIE BUCHANAN AND OTHERS Respondents: ________________ |
Petitioners: Cullen, Q.C.; Heaney, Civil Recovery Unit
Respondent: Marie Buchanan; Party
George Buchanan (Interested Party)
Preliminary
[1] In The Scottish Ministers v George McGuffie and Others [2006] CSIH 54 the nature of the proceedings under the Proceeds of Crime Act 2002 ("the 2002 Act") and in particular the character of the orders that the court may pronounce, have been authoritatively resolved. At paragraph [31] of the Opinion of the Court, Lord Osborne quoted the terms of section 244(1), which authorises proceedings against any person thought by the recovery authority to hold recoverable property, and said:
"In our opinion, this provision reinforces the view that we have formed ... that recovery proceedings are concerned with the recovery of property unlawfully obtained, not the infliction of a penalty. It is apparent from section 244 (1) that Parliament contemplated that proceedings might be brought against 'any person who the authority thinks holds recoverable property', regardless of whether that person had any responsibility for the obtaining of the property through unlawful conduct. That view is reinforced by the provisions of section 305 of the Act which provides for the tracing of property. That section contemplates, in subsection (3) that: 'the property may be followed into the hands of the person who obtains it...'. In other words, the recovery proceedings must be seen as proceedings in rem, the purpose of which is the recovery of property obtained through unlawful conduct, for the benefit of the public. It is plain from these provisions that the wrongdoer who may have unlawfully obtained the property in the first place is treated no differently, and in particular, no more harshly than any other person into whose hands the property may have come, even if that person be entirely guiltless."
[2] In the course of the protracted procedure in this case the respondents and Mr George Buchanan have on occasion been represented and on other occasions have appeared without legal representation. At the proof heard in October and November 2007 they did not have the benefit of representation but were accompanied by Mr James Macdonald as a friend to whom Mr Buchanan turned for assistance as required. Mr Macdonald's qualification to give relevant and competent advice on a case such as the present was not disclosed. It became clear that Mr Buchanan and Mrs Buchanan lacked the knowledge and experience required to present their cases properly. It is not surprising in these circumstances that there was a measure of confusion from time to time as to the issues properly to be resolved at this stage of the case.
[3] On
10 March 2006, following preliminary proof, it was held that the petitioners
had established on a balance of probabilities that from 1987 at the latest Mr
George Buchanan had been concerned in the supplying of controlled drugs
contrary to section 4(3)(b) of the Misuse of Drugs Act 1971, and that he had
been a significant player in the illicit drugs trade over the whole period on
which the petitioners relied in seeking a recovery order in terms of section
266 of the 2002 Act. That issue is closed so far as the proceedings now before
the court are concerned. The second issue that is closed is the contention that
the application of the material provisions of the 2002 Act breached the
respondents' Convention Rights. On
[4] The next issue that can be disposed of in the light of Scottish Ministers v McGuffie is the concern of Mrs Marie Buchanan, Ms Lisa Marie Buchanan and Mr Liam Buchanan that their personal integrity was challenged by the allegation that they held recoverable property. As Lord Osborne's opinion makes clear, recoverable property may be made the subject of an order in rem against persons who are personally entirely guiltless of any unlawful conduct. The only unlawful conduct that has been established in this case is conduct of Mr George Buchanan. Moreover, in cross examination Ms Rivers stated that in dealing with Mrs Buchanan's assets she made no allegation of unlawful conduct on Mrs Buchanan's part. Her evidence was based on Mr Buchanan's unlawful conduct and on tracing transactions with funds obtained from that conduct. In response to each of Lisa Marie Buchanan and Liam Buchanan's questions in cross examination, Ms Rivers agreed that she had neither written to them nor sought to interview them. She explained to Liam Buchanan that no asset held by him was relevant to her work. Similarly she told Lisa Marie Buchanan that she had had no reason to question her. These answers underlined the absence of any allegation of unlawful conduct by either of Mr Buchanan's children in the proceedings as they have developed before the court.
The issue
[5] The only live issue at this stage is whether the petitioners have proved on a balance of probabilities that certain assets are recoverable property in terms of the 2002 Act in respect of which the court must make a recovery order. Section 266 is uncompromising in its terms. In particular, it provides:
"(1) If in proceedings under this Chapter the court is satisfied that any property is recoverable, the court must make a recovery order".
This
provision is qualified in a limited range of circumstances. In particular sub-section (3) provides:-
"(a) any provision in respect of any recoverable property if each of the conditions in subsection... (5) is met and it would not be just and equitable to do so."
Sub-section (3) (a) has not been relied on at any stage in these proceedings. None of the respondents has contended that any recoverable property held by him or her should be excluded from recovery in terms of that sub-section.
[6] On
(a) Heritable property:
127 Gilberstoun
33/2 Loaning
Crescent
(b) Sums in bank and other accounts held by Mrs Marie Buchanan:
Lloyds TSB Account 78245553;
Lloyds TSB Account 06028543;
Lloyds TSB Account 73532868;
Lloyds TSB Account 74381653;
Royal Bank of
Royal Bank of
Co-operative Insurance Society ISA/PEP Account 75236950; and
(c) Sums in bank and other accounts held by Liam Buchanan:
Co-operative Insurance Society policy number 75557959;
Royal Bank of
Royal Bank of
Bank of
(d) Sums in bank held by Lisa Marie Buchanan beneficially:
Bank of
(e) Sums in bank held by Lisa Marie Buchanan as trustee for Lewis Buchanan:
Halifax plc Account 02006039.
(f) Cash sums seized from 127 Gilberstoun:
(g) Four motor cars and three associated private registration numbers:
Range Rover registration number DDD 74
Mercedes registration number SO52 HSV
Ford Focus registration number M20 LLL
Mini Cooper registration number L14 YAM.
In addition the petition seeks an order in respect of a standard security granted by Mrs Buchanan as associated property in terms of section 245 of the 2002 Act.
The Petitioners' case:
general
[7] The petitioners rely on two reports prepared by Ms Rivers, the interim administrator appointed by the court, and her staff and on Ms Rivers' oral evidence. Mrs Marie Buchanan and Mr George Buchanan gave evidence on behalf of the respondents. The two reports contain narrative of the investigators' findings on the evidence recovered by them and discussion of the bases on which recovery of the assets is sought. Different issues arise in relation to the different classes of assets involved. But there is a common thread that runs through the whole exercise, namely that the whole Buchanan family can properly be treated as a unit in analysing the financial transactions that underlie the petitioners' claims. This approach, characterised as a "global" approach, affects the analysis and presentation of data relating to the various individuals' bank and other deposit accounts in particular, but has a bearing on the treatment of other classes of asset also.
[8] The
approach of courts to the evidence of officers appointed by the court with
investigative powers has been discussed in a number of cases. I was referred to
The Director of the Recovery Agency and
Olupitan [2007] EWHC 162 (QB) and The
Director of the Recovery Agency v
[9] The status and evidential worth of the reports of receivers appointed under the equivalent English rules were considered by Mr Justice King in The Director of the Recovery Agency v Jackson and Smith. He set out his approach as follows:
"25. The status and evidential worth of the Receiver's report and the annexes of material relied on by her has been a matter of some controversy. It was the submission of the Claimant that (1) the Receiver's report is intended to enjoy a special status; (2) it can be inferred that when the court appoints an interim receiver it expects to derive substantial assistance from her findings and that it can be anticipated that her report will constitute extremely compelling evidence; (3) the Receiver's report should operate as the starting point in any consideration of the facts by the court and it is for both parties to identify matters in the report which they dispute.
26. In support of these propositions the Claimant relied upon the Explanatory Note to section 255 of the Act (the section requiring that the order oblige the Receiver to report her findings to the court and to any person who may otherwise (be) affected by it), at paragraph 326 of the Notes, explaining that 'the report may comprise a comprehensive account of the nature and origins of, and interests in, the property in question. It will be capable of being used as a basis to establish agreed facts and to identify disputed matters that will fall to be resolved at the final hearing.'
27. Reliance was also put upon the comment by the
authors of Smith and Owen on Assets
Recovery at paragraph 5.48 to the effect that the wide investigative
functions of the interim receiver, extending beyond any power vested in or duty
placed upon receivers in any other field, amount to a duty to investigate the
circumstances of the case on behalf of the court, independent of the parties,
and are more akin to the function of a reporting judge in civil law
jurisdictions. Smith and Owen
suggests that 'this independent
investigative function, leading to a report which, though not determinative of
the proceedings, is likely to be considered extremely compelling evidence,
gives such proceedings a far more inquisitive character than is traditional in
this jurisdiction'.
28. My attention was also drawn to the approach
of the High Court of Justice in Northern Ireland in ARA v Fleming [2007] NIQB16
at paragraph 19 of its judgment when considering an application for
permission to fund the instruction of a forensic accountant to challenge the
findings of an interim receiver. The court in advocating caution in the
incurring of additional forensic expenditure, emphasised the unique
investigative powers of the receiver under the Act, together with the statutory
framework under which although the receiver is appointed on the application of
the Director of the Assets Recovery Agency, the appointment is by the court,
and it is the court who at all times supervises the receiver and can give
directions as to the exercise of the receiver's functions on application my any
party affected, and once an interim receiving order has been made the
Director is deemed no longer to be carrying on a civil recovery function. (my
emphasis).
29. It is obviously clear from this legislative framework and these statutory provisions governing the appointment of the Receiver and her investigative and reporting functions under the supervision of the court rather than the Director, that the Receiver is not an agent of any of the parties. In my judgment she is akin to an officer of the court and is reporting and giving evidence to the court in that capacity independent of the parties. It is further obviously right that the Receiver's report should be used in advance of the final hearing as a means by which to establish such facts as can be agreed between the parties and to identify the matters in dispute in need of resolution by the court. Further in principle I am prepared to accept that the Receiver's findings as to recoverable property should be given considerable persuasive weight by the court and to that extent her report enjoys special status.
30. However this said, I also agree with the Respondent's submissions that the Receiver's findings of recoverable property are not binding on the court, that it is the primary evidential material underlying her findings and said by her to justify them, which is of crucial importance together with any additional evidence called before the court, and that it is the duty of the court in determining any area of dispute between the parties carefully to scrutinise and weigh that evidence in order to determine whether the claim to recoverable property is made out. I intend to approach the dispute in this case in this way. The statutory provisions referred to do not alter either the burden or standard of proof which is upon the Claimant to establish the existence of recoverable property on the balance of probabilities by cogent evidence. The findings of the Receiver do not in themselves reverse the burden of proof so as to put any onus on the respondent to disprove her findings, and I did not understand the Claimant to submit to the contrary."
[10] The background of legislative and guidance material referred to
in this passage is different from the provisions applicable in
[11] At paragraphs 110 to 114 Mr Justice King discussed the nexus that had to be established between the unlawful conduct alleged and the property sought to be recovered, following The Director of the Recovery Agency v Green [2005] EWHC 3168 (Admin) and Olupitan. He rejected the submission that it was sufficient to establish a lifestyle inconsistent with the identified income of the person, but said that the court was entitled to look at the totality of the evidence and the whole picture which emerges. He went on to say:
"116. I equally reject the submission made on behalf of the Respondent that I am not entitled to take a global approach to the issue of proof that the property in issue is recoverable within the meaning of the Act. The question is whether the Respondent obtained the property through the unlawful conduct alleged or whether the property in the Respondent's hands is representative of property so obtained. The test is whether it is more probable than not that such is the case. It is as was said in Olupitan the whole picture painted by the totality of the evidence which has to be balanced. I see nothing wrong in the court ultimately concluding that any significant asset of the Respondent has been obtained by or represents the proceeds of his criminal conduct as particularised ........ , if the court is satisfied on the evidence that this is more probable than not. I do not consider it essential that the court considers each property transaction on an item by item basis in the sense that the Claimant has an obligation to show some particular unlawful actions by the Respondent at some particular time which enabled the particular transaction."
It is in this passage that the justification for a "global" approach was found. At paragraph 118 Mr Justice King said that a common sense approach was to be adopted to the respondent's position.
[12] I agree with these views, as I understand them. However, it is important to have regard to the formulation of those views, especially in the last sentence quoted. In the case of an individual who holds a number of items of potentially recoverable property, and who has been shown to have engaged in unlawful conduct of a kind likely to have generated disposable funds, it is highly likely to be sufficient to ask whether that individual's legitimate resources as a whole were sufficient to explain his possession of the totality of the targeted property. In many, if not most cases, the application of funds available from legitimate sources and the application of funds from unlawful conduct would have been confused: the application of any particular sum would be a casual matter depending on the total funds available at any given time and the individual's personal choices as to distribution of those sums. It would be unnecessary to engage in a detailed analysis of each transaction as at the date it occurred and to show that at that time and in the circumstances obtaining it was more likely than not that the particular item was obtained by or represented property obtained by particular unlawful conduct. The two cases principally relied on demonstrate that.
[13] In this case, on the "global" approach adopted by the interim administrator, the individual characteristics of transactions in motor vehicles and heritable property have been described. There are issues that arise in relation to the application of the tracing provisions of the 2002 Act to these assets. However, in relation to the bank accounts of the respondents, Mrs Stewart, who is Mrs Buchanan's mother, and Mr Buchanan, the financial analysis produced in the interim administrator's reports, relying on the view that the Buchanan family can properly be treated as a single unit, aggregates the movements on all bank accounts, in whomsoever vested, for purposes of analysis notwithstanding that assets held by them as individuals are sought to be recovered. This aspect of the interim administrator's "global" approach raises a question whether the methodology is fundamentally flawed, either as a matter of general approach or in the circumstances of this case.
[14] The issue did not arise in these terms in either of the two cases principally relied on. In Olupitan there were cash credits to bank accounts in name of Mr Olupitan and in the name of his partner Ms Makinde. Mr Justice Langley dealt with the sums credited to Mr Olupitan's accounts between paragraphs 41 and 47. At paragraph 47 he concluded that Mr Olupitan's explanation of the source of the credits was not acceptable. At paragraphs 53 to 58 he dealt separately with the source of the credits to Ms Makinde's accounts. The Claimant's position was that there was no legitimate source of funds for the very significant amounts of cash lodgements and unexplained credits in the accounts of either of the respondents. There was nothing to distinguish one respondent from the other.
[15] The conclusion arrived at in paragraph 67 of Mr Justice Langley's opinion shows the factual basis on which he proceeded:
"Mr Krolick submitted ... that the Director had failed to put before the court evidence from which the court could properly conclude that any particular unlawful conduct by Mr Olupitan at any particular time producing any particular property had occurred. But, having in mind the gravity of the conclusion, the Director has fully satisfied me on a balance of probabilities that Mr Olupitan is a dishonest man who has employed dishonesty to obtain or seek to obtain property (the mortgage fraud and his conviction for conspiracy) and to seek to secure an immigration status to which he knew and knows he was not entitled. The Director has also satisfied me that Mr Olupitan has had no significant legitimate source of income whilst living in this country and has lied again and again in his evidence about the sources of the money (in particular cash) which undoubtedly came into his bank accounts. On that basis and all the evidence, I conclude that any significant asset of Mr Olupitan was obtained by or was the proceeds of his dishonest acquisitive criminal conduct and is recoverable property."
The language in that passage was reflected in paragraph 116 of Mr Justice King's opinion in Jackson and Smith. The decision on the facts was that the whole assets were recoverable because there was no legitimate source of funds available for their acquisition. In any case in which the position is absolute in that sense a global approach is likely to be satisfactory. If there are no legitimate funds available at all, distinguishing individual assets would be without point.
[16] In Jackson and Smith the police recovered cash, jewellery and other valuables from the home of Mr Jackson and his partner Ms Smith in the course of one search, and later recovered large amounts of cash and jewellery from other premises connected with Mr Jackson, including safety deposit boxes at Selfridges. Mr Jackson and Ms Smith stood trial together on indictment. They were acquitted on the directions of the trial judge. In the civil recovery proceedings both were respondents. However, Ms Smith as second respondent took no part in the proceedings before Mr Justice King, and the whole case proceeded on the basis that Mr Jackson alone had an interest in the outcome. He claimed that the targeted assets had been obtained from the proceeds of legitimate business activities. The decision on the evidence before the court was that "whatever limited trading there may have been in any particular field, that cannot have been the source of the means whereby the Respondent was able over the years to acquire the assets he has which are the subject of this claim.." (paragraph 136)
The "black hole" analysis:
bank accounts
[17] There was no suggestion in Jackson and Smith that individual differences between the two respondents could be overcome by aggregating their financial positions. The issue simply did not arise in the form it arises in this case. The issue in the present case arises from the so-called "black hole" analysis set out in the reports and spoken to in evidence by Ms Rivers, and prepared by her and her staff. The position is best illustrated by reference to the analysis of bank transactions. The schedule of transactions sets out for each fiscal year within the relevant period a single figure for bank lodgements. The figures have been derived by aggregating the bank lodgements in all of the individual accounts listed. Adjustments have then been made to reflect identified cash and other transactions, without ascribing them to any individual account or person, and totals for each year brought out. Against those totals the schedule has set the funds identified as having accrued to each individual from sources accepted to have been legitimate, and a balance of unexplained accrual of value has been brought out for the family as a whole. In a case involving a single individual, viewed in isolation, that approach may in my view be unobjectionable in principle, as I have already said. Indeed it may result in affording a higher value of credit for legitimate income than would result on full analysis of the lodgements since it gives full credit for the whole verified income without identifying the lodgement in bank of the income received. It does not follow that one may aggregate the data referable to a series of individuals and ignore their separate interests as the petitioners have done.
[18] Examination of the primary information lying behind the analysis indicates that the issue is material and that the aggregation of the transactions of members of the family unit has had the effect of transferring debits and credits among the individual accounts in a way that distorts the picture. In the case of Liam Buchanan's bank accounts, Ms Rivers prepared an analysis from which one can derive the lodgements attributed to him in the three bank accounts already identified. The black hole statement identifies the income from legitimate sources that was accepted in his case at the proof. Applying Ms Rivers' methodology to him as an individual, the result is as follows:
|
Year |
Lodgements |
Income |
Difference |
|
1997-98 HBOS 02120932 (excluding opening balance) |
109.19 |
0 |
[109.19] |
|
1998-99 HBOS 02120932 |
180.87 |
0 |
[180.87] |
|
1999-00 HBOS 02120932 |
429.25 |
0 |
[429.25] |
|
2000-1 HBOS 02120932 RBS 00636583 |
517.74 1,778.47 |
0 |
[2296.21] |
|
2001-2 HBOS 02120932 RBS 00636583 |
0.70 1,737.51 |
3154.54 |
1416.33 |
|
2002-3 HBOS 02120932 RBS 00636583 RBS 00697647 |
0.50 1,522.70 3,011.08 |
6237.03 |
1702.75 |
|
2003-4 HBOS 02120932 |
1602.06 |
9129.55 |
7527.49 |
|
2004-5 HBOS 02120932 |
1148.11 |
4735.77 |
3587.66 |
There were lodgements in the first four years that were not covered by identified income. But, applying the methodology adopted in relation to the family group to Liam Buchanan, the total lodgements in his bank accounts were more than amply covered by his verified legitimate income, by a margin of some £11,200. In the final revised black hole analysis his excess income reduces the family's black hole. But the recovery order sought by the petitioners would vest his bank balances in the trustee in circumstances in which, viewed as an individual according to the methodology adopted, there would not be, in his case, any black hole to justify the inference on which the petitioners depend, namely, that his bank accounts represent property obtained by unlawful conduct.
[19] There are other issues raised by the aggregation of Liam
Buchanan's overall transactions with the family as a whole. The exercise
effectively conceals the specific evidence relating to his affairs that is
disclosed otherwise in the interim administrator's reports. The balance on his
RBS bank account 00636583 was reduced to £915.31 on
[20] There were other means available to the petitioners to analyse
Liam Buchanan's accounts individually and, if thought appropriate in the
light of that analysis, to invite the court to draw inferences adverse to his
possession of funds. There were other occasional lump sum lodgements that might
have supported an adverse inference in the absence of an explanation, and, as
the interim administrator's main report notes, there was an inter-account
transfer of £3,000 on
[21] One bank account of Lisa Marie Buchanan has been targeted. It
had a balance at
[22] I have considered whether these conclusions undermine the interim administrator's methodology as a whole, but I have come to the conclusion that they do not in themselves lead to that result. On the approach adopted so far, the circumstances of each account holder would require to be considered individually. Thus, the criticism of the methodology already made would leave unaffected the targeting of Lisa Marie Buchanan's account for Lewis Buchanan. The child had no income relevant to the analysis. Nor would it affect Liam Buchanan's Insurance Society policy number 75557959. The premiums on that policy were paid by Mrs Marie Buchanan and were not franked by Liam Buchanan's own surplus income. Nor would the conclusions provide an answer to the interim administrator's approach to Mrs Marie Buchanan's bank accounts. As already indicated, the effect of the interim administrator's approach has been to credit against total lodgements (now almost entirely Mrs Buchanan's) the excess income of Liam and Lisa Marie Buchanan over the lodgements in their accounts. Since even without those credits there would be a large unexplained sum that required to be accounted for, on the interim administrator's approach, excluding the accounts of these individuals would merely aggravate the position so far as Mrs Marie Buchanan was concerned.
[23] In my opinion, there is no sound basis on the facts for treating the personal bank accounts of Liam Buchanan and Lisa Marie Buchanan as recoverable property. I should, however, say that in my opinion there are aspects of the exercise required by the statute that do not lend themselves to the kind of global approach adopted in this case, as a general rule. Subject to sections 306 and 307 of the 2002 Act, the classification of the several items of property as recoverable property depends crucially on proof that they are themselves property obtained through unlawful conduct, or property so obtained that is held by a person into whose hands it can be followed (section 304) or property which represents property so obtained, either in the hands of the original holder or in the hands of a person into whose hands it can be followed (section 305). Section 306 encompasses mixed property derived from a number of sources. Section 307 extends the scope of recovery to include profit.
[24] The orders sought in this case relate to the assets of a number of individuals. In the light of Scottish Ministers v McGuffie these orders are orders in rem. That the orders must be so framed reflects the requirement in section 266(2) of the 2002 Act that the recovery order must vest the recoverable property in the trustee for civil recovery. It is therefore the bank accounts held by the individual respondents that are targeted in the petition, along with the individual vehicles and other items of moveable property, and the individual heritable rights and interests of the registered proprietors. If a recovery order is to be made against a specific bank account, it must be demonstrated on a balance of probabilities that the balance on that account at the relevant date is or represents recoverable property (whether or not part of that proof relates also to other assets). In a case involving the banking of proceeds of dealing in controlled drugs, that exercise will necessarily involve the application of sections 304 to 307 of the 2002 Act. Cash seized in specie may, of course, previously have been circulated through a bank account as an aspect of a money laundering operation, but it is unlikely that that will emerge directly from an examination of bank statements unless the holder of the cash gives evidence to that effect. There may be situations in which particular lodgements can be shown to represent the proceeds of unlawful conduct, as where the sum is lodged and remains intact throughout the period of investigation or can be traced directly into another asset. However, in the more likely situation of an active bank account reflecting credits from a variety of sources, specific identification is unlikely. Section 306 applies in these circumstances, and regulates the treatment of mixed property where, inter alia, property is used "to increase funds held in a bank account". Interest on the account would be dealt with by section 307.
[25] Section 306 envisages the apportionment of a mixed fund, but provides little guidance on how the exercise of apportionment is to be carried out. It does not appear necessarily to apply any common law rule of tracing in bankruptcy or in trust law or banking law, though the adoption of one or other source might be an approach that would be appropriate. But it appears to me to be clear that there is no method of following through the scheme of the Act that would accommodate the aggregation of transactions on different accounts as a means of identifying individual items of recoverable property. Sections 304 to 310 prescribe a series of rules that impose limits on the extent to which property may be followed or traced through successive forms, either alone or commixed with other property, and through the hands of persons in succession, with provisions for the protection of persons who come to possess the target property bona fide in certain prescribed circumstances. It is not consistent with this scheme that a global approach, in the sense of the analysis in this case, can be adopted either to all of the individuals alleged to have in their possession items of recoverable property as a generality, or to all of the accounts of an individual which may have very different characteristics. If a global approach is appropriate at all, it must depend on the circumstances of the case, and must differ from account to account.
[26] Further, the interim administrator has proceeded on the basis
that it is legitimate to take the whole transactions on a group of accounts
over the twelve years permitted, and aggregate the debits and credits without
regard to any actual movements on any of the accounts in the interval. As
applied to an individual account that may be one acceptable methodology in some
circumstances, and I have not heard argument to the effect that it could not
be. However, problems arise in this case if one examines the application of
that methodology. Mrs Buchanan's Lloyds TSB account number 74381653
demonstrates the nature of the problem. The account was stagnant after the end
of 2001-2002, accruing only small sums of interest. The black hole analysis
relied on shows that there was no recoverable property obtained up to and
including 1996-97. There was a balance on the account at the end of that period
of £451.70. After that date there were two transactions closely related in time
that appear clearly to be associated with each other. £540 was withdrawn on
[27] On the other hand, credits to Mrs Buchanan's Lloyds TSB account number 78245553 were for the most part in large amounts, and in round figures, from which an adverse inference might be drawn in the absence of acceptable evidence of an explanation. The details are set out in the appendix. In the event, the ultimate balance on the account was so small as to be practically immaterial, and that raises other issues relating to the tracing provisions of the Act. Section 305 deals with the situation in which original property comes to be represented by other property. But the provision has effect only when other property is obtained in place of the original property. Where a bank account is used simply to circulate cash funds, as it might be in a money laundering operation linked to dealing in controlled drugs, it is highly unlikely that there will be evidence of the obtaining of other property in place of sums withdrawn from the bank. If, in the final result, the cumulative effect of lodgements and withdrawals is that there is no material increase in the bank balance, it may be questionable whether the scheme of the Act is applicable. The same question arises in relation to Mrs Buchanan's Lloyds TSB account number 73532868, where the ultimate balance was £3.03. Since I heard no submissions on these issues it would be inappropriate to express any concluded view on this point.
[28] In respect of the Lloyds TSB Account 78245553, the interim administrator's main report, to which she spoke in evidence, states that she had not been able to identify the source of cash lodgements in this account amounting to £47,694.16. The full account analysis shows that the bulk of the lodgements occurred in 1998-9 (£10,115.76); 1999-00 (£16,800); 2000-1 (£4,831.66) and 2001-2 (£10,000). Large sums were withdrawn or transferred to other accounts over the same period. Sums of £21,400 and £3,200 were withdrawn in cash in 1999-2000 and 2000-2001 respectively, and transfers amounted to £22,235 over the period 1998-9 to 2002-3. The interim administrator's report stated that she had no information as to how Mrs Marie Buchanan acquired the large cash sums deposited, given the vouched legitimate income identified. Mrs Buchanan in evidence did not offer any explanation that focused on these sums. Mrs Buchanan's general evidence was that she had never received any money from Mr Buchanan, and that was corroborated by him. Leaving aside the credibility and reliability of that evidence, and its relevance to the issue, there is a basis in the financial analysis to which Ms Rivers spoke to support the inference drawn by the interim administrator that the small balance on this account may be recoverable property.
[29] Issues of greater difficulty arise in respect of the balance of £5,064.02 in Mrs Buchanan's Lloyds TSB Account 06028543. The petitioners seek recovery of the whole balance. The account was used by Mrs Buchanan for managing her day to day affairs as well as certain major transactions. The interim administrator's analysis of the account covers the period 1997-2005 during which Mrs Buchanan lodged a total of £71,130.58 in respect of wages and £10,381.58 in respect of Department of Works and Pensions payments identified by the interim administrator. Section 306 of the 2002 Act applies where recoverable property is mixed with other property. Sub-section (3) provides that recoverable property is mixed with other property if, for example, it is used to increase funds held in a bank account. Sub-section (2) provides that the portion of mixed property which is attributable to the recoverable property represents the property obtained through unlawful conduct. Since on any view the account was, at best for the petitioners, built in part by verified legitimate income and contributions representing property obtained through unlawful conduct can have contributed no more than a part of the build up of the final balance, this would appear to be a paradigm case for the application of section 306. The interim administrator has not applied the provision. The reason, once more, is that she has aggregated the transactions on all of the bank accounts, including all of Mrs Buchanan's accounts, and blurred the distinctions that necessarily arise if one seeks to trace the origins of the property the petitioners seek to recover. In my opinion this approach is not authorised by statute or authority.
[30] There are two other problems associated with this account. Two
sums amounting to £63,211.15 were lodged in 1998-99. One sum of £45,000 was
lodged on
[31] I shall refer to these transactions in heritable property in detail. In relation to tracing funds, the treatment of the £45,000 is illustrative. I am of opinion that, in terms of section 305 of the 2002 Act, the £45,000 passing through account number 78245553 came to be represented by the interest in the heritable property purchased. In my view the same sum cannot be taken into account simultaneously in characterising two assets for the purposes of the Act. If a sum comes to be represented by an interest in another asset, it must be analysed out of the source account. This, in my view is an additional factor that undermines the methodology adopted in this case to the analysis of the bank accounts as a whole. The interim administrator's main report does not address this issue in any way. In relation to Lloyds TSB account 78245553 it states:
"This account is on the name of (Mrs Buchanan). I have not been able to identify the source of cash lodgements totalling £47,694.16.
Payments from this account consist of £25,600 of cash withdrawals, and £22,235.00 of account transfers.
I have no information as to how (Mrs Buchanan) acquired such large cash deposits into the account, as compared to the legitimate income that I have identified. In the absence of any evidence to the contrary, I conclude that the funds would appear to arise from unlawful conduct and are therefore recoverable."
There is no evidence of the application of the tracing provisions to the account, yet on any view the bald statement in the report requires to be modified. The balance on the account is small, and in isolation immaterial. But it seems to me that having failed to give effect to the negative aspects of the tracing rules the petitioners have failed to provide any analysis of the primary evidence that would show that this and the other bank accounts are recoverable property. In addition to this, the credits to the account include £31,250 of money transferred from other accounts that are sought to be recovered, and £2,595 transferred out to such accounts. In the course of her evidence the interim administrator accepted that there had been double counting in respect of these sums and made an adjustment to her report.
[32] While it is clear that an adjustment was required to avoid double counting, I consider that the approach adopted exposes another aspect of the flaw in the overall methodology. The interim administrator's adjustment has the effect of reducing the aggregate of all lodgements. It therefore avoided following the scheme of the Act which would have required tracing the property into the fund credited. This is not simply a matter of accounting technique. Where funds are moved from a mixed fund, they carry forward the character they had in the source account at the material time. If the sum transferred was mixed, an apportionment would be required and only the tainted portion would enter the account credited as tainted funds. This can be illustrated in the case of Mrs Buchanan's Dunfermline Building Society Account 991734330 on which there was a balance of £3,000. The documentary evidence includes information about that account. The balance is not included in the property for which a recovery order is sought. The sum was lodged in June 2004. A cheque was drawn on Mrs Buchanan's Lloyds TSB account number 73532868 to make the lodgement. It appears that the reason for not including this sum was the interim administrator's concern to avoid double counting. However, the transaction illustrates the error of approach. In failing to trace the sum to the asset which came finally to represent it, the source account has been treated as continuing to include the sum, and the potentially recoverable property has not been claimed, a clear demonstration of the consequences of departing from the statutory scheme.
[33] Applying section 306 to Mrs Buchanan's Lloyds TSB account 06028543,
as in my opinion one must, the result is that a portion only of the balance on
this account could be recoverable property in any event. It seems to me to be
impossible to characterise the small opening balance at
[34] Mrs Buchanan's Royal Bank of Scotland Account 00655243,
ultimate balance £1,992.80, is in the same position so far as details of
operations on the account are available in evidence. The interim
administrator's partial analysis of the account down to
|
|
2001-2 |
2002-3 |
2003-4 |
Total |
|
Opening balance |
|
|
|
|
|
Cash and cheques |
2,929.99 |
|
|
2,929.99 |
|
Wages |
1,800.00 |
9,564.00 |
150.00 |
11,514.00 |
|
Bank Interest |
53.82 |
18.62 |
0.23 |
72.67 |
|
Other |
1,002.38 |
0.09 |
0.09 |
1,007.94 |
|
|
5,786.19 |
9,588.09 |
150.32 |
15,524.60 |
|
Payments |
1,500.31 |
11,968.13 |
500.63 |
13,969.07 |
|
Account transfer |
|
1000.00 |
|
|
|
|
1,500.31 |
12,968.13 |
500.63 |
14,969.07 |
|
|
|
|
|
|
|
|
4,285.8 |
905.84 |
555.53 |
555.53 |
Transactions after
"This account is
in the name of (Mrs Buchanan). The main source of income is £150 per month from
(Lisa Marie Buchanan) (£11,514 for the period). It is assumed this is for
housekeeping, but no corresponding account has been identified for (Lisa Marie
Buchanan). The significant payments were made to card 01 on the
(Mrs Buchanan) financed the family lifestyle from her various accounts which contained tainted funds. In this account she received funds from her daughter for a living allowance but financed these from another account.
I have no information as to how (Mrs Buchanan) acquired such large cash deposits amounts into the account, as compared to the legitimate income that I have identified. In the absence of any evidence to the contrary, I conclude that the funds would appear to arise from unlawful conduct."
[35] The interim administrator did not revise these observations in her supplementary report or in her evidence. As already noted, Lisa Marie Buchanan's vouched legitimate income was considerable. Little of it passed through the only bank account in her own name for her own benefit. On any view she had ample cash resources to pay her mother for her "keep". The repetition of the formulaic last paragraph (which with little variation appears throughout the report) in respect of this account is not impressive. The report does not identify the "large cash deposits", and payments by Lisa Marie Buchanan, while not "legitimate income" in the sense of having been vouched by Inland Revenue records, were, on any reasonable view, as legitimate a source of funds in the hands of Mrs Buchanan as one might imagine.
[36] However, as appears from the appendix, the partial analysis does not reflect the detailed information available. There were five cash lodgements in 2001-2002 amounting to £3,550, but none thereafter. The sums lodged thereafter comprised in the main Lisa Buchanan's contributions to the household, Mrs Buchanan's redundancy payment, and some interest. The inference on which the petitioners rely is not supported by primary evidence to any extent.
[37] Mrs Buchanan's Lloyds TSB Account 73532868, balance £3.03, was the result of transactions, so far as material, over the period 1997-2005. An examination of this account appears to make it clear that it related to transactions with Marks & Spencer, and was used to repay an initial loan of £2,217.27 and other sums due to the retailer. There were cash lodgements and transfers from other accounts. But in 1999-2000 and subsequent years there were substantial deposits of sums paid by Mrs Buchanan's sister, Y Young, who purchased 56 Lochend Avenue. A sum of £4,000 was lodged in 2002-2003, but transferred in the same period to another account so that, if recoverable, it was thereafter represented in the other account. On any view the bulk of the money lodged in this account was legitimate.
[38] The balance of £1,506.26 in Royal Bank of Scotland Account 00645329 was built up of a mixture of cash lodgements and regular payments by direct debit from third parties that are not said to have been tainted. The individual circumstances of these various accounts are so different that it is impossible to envisage any form of "globalisation" that would deal adequately with the particular issues that necessarily arise from the scheme of the Act. On the other hand, there would be no difficulty in considering the totality of Mrs Buchanan's legitimate income against the picture that emerged at the end of the day from an individual investigation into each asset, provided that the methodology met the requirements of the scheme of the Act. In my view there are two separate strands of proof that have to be distinguished, namely whether, on the evidence tendered by the petitioners, there are assets that may be recoverable property applying the detailed provisions of the Act, and secondly, whether applying the test of balance of probabilities to the evidence as a whole satisfactory evidence has been tendered that characterises the asset either as the proceeds of unlawful conduct, directly or indirectly, or as mixed property. If the evidence relied on by the petitioners cannot support a valid inference that any asset is recoverable property, on a sound application of the Act, the quality of any contrary evidence is immaterial. The interim administrator's reports effectively acknowledge these two separate issues in relation to the items of heritable and moveable property targeted. But in my view they do not deal satisfactorily with the issues that arise in relation to bank accounts.
[39] In connection with those issues, it is necessary to return to the question of the weight to be given to Ms Rivers' evidence generally. I consider that the approach adopted by Mr Justice King in Jackson and Smith is correct and should be followed. It was clear from Ms Rivers' evidence that, strictly, much of it was hearsay. But that does not affect its admissibility, and no such point was suggested by the respondents. At paragraphs 110 to 114 Mr Justice King discussed the nexus that had to be established between the unlawful conduct alleged and the property sought to be recovered, following The Director of the Recovery Agency v Green [2005] EWHC 3168 (Admin) and Olupitan. I agree with his approach. Dealing with Mr Jackson as an individual, he concluded at paragraph 116 that he was entitled to take a global approach to the issue at proof that the property in issue was recoverable within the meaning of the act. In this case, I consider that it would not be inappropriate to deal with Mrs Buchanan on a global basis if once one had identified the balances or parts of balances on her bank accounts that were potentially recoverable property.
[40] However, I have come to the view that, looking at the information available as a whole, it is impossible to accept the evidence of the reports and of Ms Rivers in support of those reports so far the balances on Mrs Buchanan's bank accounts are concerned. I have set out an analysis of all of the accounts in the appendix to this opinion so far as detailed statements of account are available. In summary, my conclusions are as follows.
Lloyds TSB
Account 78245553
The balance on this account was reduced to £64.06 in 2002-3 by the transfer of £10,000 to Lloyds TSB Account 06028543. If the previous balance of £10,046.29 had been tainted in full or almost in full, as arguably it would have been, the £10,000 would have ceased to be recoverable as part of account 78245553. The interim administrator might have traced the sources of the remaining £64.06, but has not done so. There were other transfers out of the account, including £960 in 2001-2002 to Mrs J Stewart's account which is not said to be recoverable property. The pattern of lodgements and transfers in particular was such that one could not arrive at a view on apportionment without evidence, and without the respondents having been given an opportunity to comment. I shall refer later to evidence from Ms Rivers that acknowledged that this account was mixed property.
Lloyds TSB
Account 06028543
This account was for most of the period the principal working bank account operated by Mrs Buchanan. There were many large cash deposits into the account, which, together with transfers from other accounts which in turn had been credited with large cash sums, would have warranted an inference that to some extent at least this account represented property obtained by unlawful conduct. However, it was also the account into which Mrs Buchanan deposited her wages, miscellaneous cheque and other receipts, and Department of Works and Pensions benefits. The petitioners have not provided any evidence as to the apportionment of this account into parts representing recoverable property and other property. This would not have been a matter of simple arithmetic, even once one had decided on an approach to the ascription of payments within the account. It would have required expert analysis. Such evidence was not put to the respondents, nor put before the court.
Lloyds TSB
Account 73532868
I have referred to the build up of this account above. There has been no evidence that would entitle the court to apportion the residual balance on this account.
Lloyds TSB
Account 74381653
I have dealt with the contents of this account above.
Royal Bank of
This account was opened in 2000-2001 with a cash deposit of £500. In subsequent years there were further cash deposits which, like the first deposit might have supported an inference that the balance represented recoverable property at least in part. However, in 2001-2002 and thereafter there were identified unimpeachable deposits by direct debit, and frequent deposits of cheques that as a matter of common sense and one's experience of the drugs scene could not lightly be attributed to unlawful conduct. Apportionment would be required to reflect the scheme of the 2002 Act. That has not been done.
Royal Bank of
I have dealt with the contents of this account above. Credits to this account were again mixed, and, following the scheme of the Act, apportionment would be required. That has not been dealt with in evidence.
In the circumstances I shall refuse
to make any order in respect of these bank balances.
[41] It follows from the reasons for that conclusion that there is no basis for tracing recoverable property into any other target fund. It is impossible to categorise the sums transferred and therefore to characterise the resulting balance. The Co-operative Insurance Society ISA/PEP Account 75236950, balance £1,935.59 is claimed on the narrative:
"This is in the name of (Mrs Buchanan) for which there is a monthly £100 direct debit from (her) Lloyds TSB account 06028643.
I have no information as to how the Respondent acquired such large cash deposits into the account, as compared to the legitimate income that I have identified. In the absence of any evidence to the contrary, I conclude that the funds would appear to arise from unlawful conduct and are therefore recoverable."
On this occasion, the reasoning in the report is unintelligible. There were no "large cash deposits" into the account. The source of funding is identified. Since the direct debits were charged to an account that was itself a mixed fund, only a portion the transferred property would have been potentially recoverable in any event. In the absence of any means of identifying the portion, it has not been proved that any part of this account is recoverable.
[42] The Dunfermline Building Society Account 991675672, balance £542.83 is claimed on the following basis:
"This account
was opened on
I have no information as to how the Respondent acquired such large cash deposits into the account, as compared to the legitimate income that I have identified. In the absence of any evidence to the contrary, I conclude that the funds would appear to arise from unlawful conduct and are therefore recoverable."
The sums deposited were £146.50; £100; £10; £200; £46.33 and £40. The interim administrator's reasoning in support of this claim is unjustified on the basis of the primary information she collected. It is impossible to avoid the impression that this is mere rehearsal of language inserted at the press of a button from a word processor without thought. No objective basis has been made out for the recovery of this asset.
The heritable properties
[43] The
petitioners seek orders for the recovery of two items of heritable property,
127 Gilberstoun
"The property
was originally purchased by (Mrs Buchanan) on
In interview (Mrs Buchanan) claimed to have financed the £45,000 deposit in part from the equity released on the sale of 56/6 Lochend Avenue, with the balance coming from friends and family, primarily over £20,000 in cash which she allegedly found in her aunt's property. ...I have identified no independent evidence with which to substantiate this claim of cash from the aunt...
Although, (Mrs
Buchanan) sold her previous home at
It should be
noted that a cash lodgement of £45,000 was made on
Throughout the subsequent period, (Mrs Buchanan) has received significant unidentified cash lodgements to her accounts. Therefore, I would conclude the subsequent mortgage payments for the property would have been made from tainted funds.
In the absence of any evidence to the contrary, I can only attribute the funds for the purchase and subsequent mortgage payments to the proceeds of unlawful conduct and I therefore conclude that this property is recoverable."
[44] In Part III of the schedule to the petition the mortgage is treated as "associated property", in the following terms:
"Standard
Security by Marie Buchanan in favour of the Royal Bank of Scotland plc recorded
in the General Register of Sasines for the
[45] The interim administrator's supplemental report of August 2007 did not add to the positive case for recovery of the house or the treatment of the standard security. In oral evidence, Ms Rivers discussed the treatment of profits accrued on the house between acquisition and the present time. In her evidence in chief, she adopted the evidence set out in the main report. The effect of her evidence, if accepted as credible and reliable in fact and valid in law, would be that the petitioners would recover the property subject to paying off the outstanding balance of the mortgage. There was no effective challenge of Ms Rivers' financial analysis relating to 127 Gilberstoun in cross examination.
[46] The petitioners' written submissions relating to 127 Gilberstoun repeat Ms River's evidence in summary, counter the respondents' factual contentions, and contain the following submissions on the legal position:
"108. It is submitted that the Court should find that the loan repayments were made with recoverable property and that the entire value of the subjects less the outstanding loan is recoverable property.
110. Section 305 of the Act deals with tracing property. ... It provides that if a person enters into a transaction by which he disposes of recoverable property and he obtains other property in place of it the other property represents the recoverable property.
111. In this case it is submitted that the transaction which has been entered into is the part repayment of the loan. In return for the part repayment Mrs Buchanan has received an increase in the equity in the house. Her indebtedness has been reduced from £70,000 to £62,443 by the application of recoverable property to the repayment of the loan. This should be considered to be recoverable property in the hands of Mrs Buchanan.
112. The value of the subjects has not only increased by virtue of the repayment of the loan but has also increased by reason of the market rising. In this case the value of the subjects has risen from £115,000 to £290,000. The increase operates only to the benefit of Mrs Buchanan. It is a profit on the £45,000 which she used as a deposit and which came from unlawful conduct. It is not a profit on the £70,000 which she borrowed. The profit on the borrowed £70,000 is interest which she has paid to the lender. Profits on recoverable property, in this case the increase in the value of the property through the movement of the market, are recoverable property in terms of section 307 of the Act.
113. It is submitted that the foregoing approach to tracing loan repayments into property is one which the Court should adopt. The Act sets up a statutory scheme for which there is no direct equivalent at common law. The concept of property representing other property is one to be worked out in the context of the purpose of the Act which is, in short, to prevent crime being a profitable activity. If loan repayments could not be traced into the property acquired with the loan then the purpose and operation of the Act would be seriously undermined. It would mean that by buying assets on credit and repaying the loans with recoverable property the recoverable property could be effectively laundered and put beyond the reach of the statutory scheme.
114. It is submitted that, in the circumstances, the Court should order that the property at 127 Gilberstoun be vested in the Trustee for Civil Recovery. Section 272 of the Act makes provision for dealing with associated property. The court should make an order under section 272 (2) discharging the standard security in favour of the Royal Bank of Scotland and requiring the Trustee to redeem the outstanding loan as soon as reasonably practicable after vesting."
The submissions went on the deal with an alternative approach involving apportionment.
[47] The petitioners' submissions caused some concern, and they were given the opportunity to review them since that course was necessary in any event to allow the respondents to expand their written submissions. The petitioners tendered supplementary submissions which dealt with the arithmetical implications of a decision that apportionment was required, and contained the following additional submissions in support of the positive case:
"The petitioners' position is that the deposit (of £45,000) was paid with funds obtained through unlawful conduct, and that the whole profit attributable to the deposit is recoverable....
The petitioners' position is that the mortgage could not have been obtained were it not for the £45,000 deposit paid by the respondents, and that the while profit attributable to the outstanding mortgage is therefore recoverable. Marie Buchanan's salary would have been clearly insufficient to allow her to obtain a mortgage of £70,000....
The petitioners' position is that the capital repayments (of the mortgage) were made from funds obtained through unlawful conduct, and that the whole profit attributable to the capital repayments is therefore recoverable....
The petitioners' position remains that (Mrs Buchanan) has already had substantial benefits from property and funds obtained through unlawful conduct (many of which are not recoverable), that she is not entitled to any further benefit from the said property, and that the whole profit attributable to the capital repayments is recoverable."
The reference to previous benefits was to the benefit of having occupied the property as a family home, but the submission had the character of a moral rather than an economic argument.
[48] There was no evidence tendered to support the proposition that
the mortgage could not have been obtained at the time it was, and in the
circumstances relating to the transaction, and I am of opinion that this
element of the petitioners' revised submissions cannot be taken into account.
The mortgage was obtained, and, so far as the evidence led shows, that was the
result of an unimpeachable transaction. A mortgage application was made initially
to
[49] The Royal Bank of
"(1) 'Associated property' means property of any of the following descriptions (including property held by the respondent) which is not itself the recoverable property - any interest in the recoverable property...."
It was not disputed that a mortgage is capable of being an interest in heritable property in the hands of the lender. It also appears to be clear that the bank, as lender, would be an "excepted joint owner" in terms of section 270(2) and (4), and that section 272(2) and (3) would apply. In an appropriate case a court might be asked to make a recovery order in respect of such an interest. Nor is there any difficulty with the submission that so far as the lender is concerned the contractual interest received from the borrower is profit that would accrue in respect of the lender's interest in the property. The petition had to deal with the bank's interest if the order sought against Mrs Buchanan in respect of the heritable property as a whole was to have a proper effect. But the important issue appears to me to be whether the bank's interest is relevant to the order sought against Mrs Buchanan in any other respect.
[50] Section 307 provides:
"(1) This section applies where a person who has recoverable property obtains further property consisting of profits accruing in respect of the recoverable property.
(2) The further property is to be treated as representing the property obtained through unlawful conduct."
It is a condition of the application of the provision that recoverable property has been identified in the first place. Section 306 provides:
"(1) Subsection (2) applies if a person's recoverable property is mixed with other property (whether his property or another's).
(2) The portion
of the mixed property which is attributable to the recoverable property
represents the property obtained through unlawful conduct.
(3) Recoverable property is mixed with
other property if (for example) it is used -
(b) in part payment for the acquisition of an asset."
[51] The asset that the petitioners seek to recover is described,
properly, in the second schedule to the petition in terms of the heritable
title of the proprietor. If it is recoverable its current value is of interest
only in relation to the price that can be obtained on sale with a clear title.
The value does not describe the asset, nor is it relevant to its description.
That asset was acquired on
"The effect of these provisions, so far as material, is that where, for example, a property acquired is in part 'recoverable property' and in part not, for example where a house is bought with funds both unlawfully and lawfully provided, only 'the portion' attributable to the unlawful element is recoverable: section 306.... The Act gives no guidance about what 'portion' of a mixed property is attributable to recoverable property beyond the language itself used in section 306 (2)"
I agree with those observations. On the evidence before me the mortgage obtained by Mrs Buchanan from the bank was lawfully provided money and the relevant portion of the property is not recoverable property. That, however, does not solve the problem of apportionment, and that cannot be addressed without dealing with the mortgage.
[52] The petition seeks discharge of the standard security, on condition of payment to the bank of the outstanding debt. A recovery order is not sought. The petitioners do not contend in this case that the standard security is itself recoverable property. As already mentioned, I found difficulty with the petitioners' argument. Paragraph 108 contained a statement of the petitioners' general position: that the Court should find that the loan repayments were made with recoverable property and that the entire value of the subjects less the outstanding loan was recoverable property. There is an issue whether the loan payments were wholly from recoverable property to which I shall return. Leaving that aside, the next proposition was that if a person enters into a transaction by which he disposes of recoverable property and he obtains other property in place of it the other property represents the recoverable property. As a generality there is no difficulty with that: section 305. The following proposition was:
"111. In this case it is submitted that the transaction which has been entered into is the part repayment of the loan. In return for the part repayment Mrs Buchanan has received an increase in the equity in the house. Her indebtedness has been reduced from £70,000 to £62,443 by the application of recoverable property to the repayment of the loan. This should be considered to be recoverable property in the hands of Mrs Buchanan."
In my opinion the proposition involves a degree of confusion of thought. At its core is a contention that the reduction of a liability may be an addition to what has otherwise been identified as recoverable property. The reduction of a liability is not property on any ordinary use of language. Nor was I referred to any provision of the Act that would entitle one to treat it as such. The reduction of the debt put nothing into Mrs Buchanan's hands that could be described as property. Her interest as proprietor was not changed in any respect by the repayment. The "equity" referred to confuses her interest in the property with its value. Paragraph 112 further confuses the issue. The assertion that the whole "profit" attributable to the increase in market value accrued on the £45,000 component of the price is without merit and is a denial of common sense. The comment that the profit on the mortgage was the interest paid confuses the situations of the lender and the owner of the interest in the heritage. It is extremely doubtful whether an unrealised increase in value of an asset that has not changed over time is a "profit" in the sense of the Act at all. If an asset is recoverable property it will be recovered as it exists: in this case a heritable asset with whatever value the market puts on it at the point of realisation. What that asset might realise on sale at the instance of the Trustee would be a price. It would be of no significance for the operation of the Act that the price realised was greater or less than the price originally paid for the asset. The terms of section 307(1) support the view that the "profits" in contemplation are separate from the property generating those profits. It is "further property" that is targeted.
[53] It may be that the result of this view is that there may be occasions when loan repayments could not be traced into property acquired with the benefit of the loan separate from the asset acquired by the application of the loan. It could mean that by buying assets on credit and repaying the loans with recoverable property the recoverable property could be effectively laundered and put beyond the reach of the statutory scheme. But this is an expropriatory statute, and if that were the result of a sound construction of its terms, it would be for Parliament to remedy any deficiency in the framework that was thought to exist. I am not convinced that the result complained of necessarily follows. In the absence of a contradictor presenting a full argument it would not be appropriate to express concluded views on the issue. But in terms of section 272(2) the petitioners might have sought a recovery order vesting the lender's interest in the Trustee with a provision in terms of sub-section (3)(b) imposing a condition on anyone seeking to discharge the standard security to make payment to the Trustee of a sum representing the value of the reduction in the liability attributable to property obtained by unlawful conduct, that is the proportion of the repayments funded from the mixed property comprised in Mrs Buchanan's Lloyds TSB Account 06028543. But that has not been the petitioners' approach in this case and the lack of any basis for apportionment of the capital repayments on the mortgage would make such an exercise impossible in the circumstances.
[54] Returning to the initial purchase, it is appropriate to comment on the practical implications of the view that a portion only of Mrs Buchanan's interest in 127 Gilberstoun may be recoverable property. Section 273(2) must be satisfied. That could be achieved readily by vesting a pro indiviso share of the property in the Trustee for Civil Recovery. That would give rise to a right to seek division and sale, but allow Mrs Buchanan the opportunity to acquire the Trustee's interest for value. It would be for the petitioners to consider in that context whether any order was required in relation to the mortgage.
[55] The sum applied in purchase of 127 Gilberstoun was withdrawn
from Mrs Buchanan's Lloyds TSB account number 06028543. That account had
an opening balance at
[56] The answers to the petition offer as explanation for the cash
deposit: "Explained and averred £20,000 came from the First Respondent's uncle
and the balance came from the sale of
[57] The total throughput of cash sums in Mrs Buchanan's accounts at
or about the time of this transaction far exceeds anything that could be
explained by her legitimate income and verified capital receipts. In the
absence of any acceptable evidence to the contrary, the irresistible inference
from the pattern of lodgements, taking account of the change from previous
periods, is that the money was obtained from Mr Buchanan's unlawful
conduct. Looking at the issue more narrowly, the balance on Mrs Buchanan's
account number 06028543 on
[58] Given that the petitioners' position is that the heritable property represents the proceeds of Mr Buchanan's unlawful conduct, it is appropriate to follow the movements on Mrs Buchanan's bank accounts chronologically, inter alia to identify when property in the form of heritable rights came to represent cash sums. For this purpose a global approach to the analysis of Mrs Buchanan's transactions may be appropriate. It is also necessary to take a common sense approach to the material. Thus, it has to be borne in mind that what one is concerned with fundamentally, in this case, is an allegation that Mrs Buchanan benefited from the application of the proceeds of dealing in controlled drugs. I have heard no evidence that would suggest that those who may have entered into such transactions with Mr George Buchanan paid by cheque, much less by cheque in Mrs Buchanan's favour. A cursory examination of the details of Mr Buchanan's bank accounts indicates that cheque payments were not the norm in his banking operations. I can see no basis for a conclusion that cheque lodgements into Mrs Buchanan's bank accounts could have been obtained by unlawful conduct of the sole kind in issue in this case.
[59] Applying these views, the analysis which seems to me to be appropriate is set out in the appendices to this opinion. Cash lodgements and payments are identified where the pattern or amounts appear to me to be potentially significant. Lloyds TSB account number 06028543 was a principal operating account and contains the bulk of Mrs Buchanan's banking transactions including miscellaneous lodgements that have no identifiable characteristics and in particular none that point to the probability that they relate to the proceeds of crime. Indeed the experience of any criminal judge includes the accumulated weight of evidence from expert Drug Squad officers on the patterns of dealing. Nothing in this case suggests that payment by cheque in pounds and pence has superseded the "tenner" and "score" class "A" deals and £5 cannabis deals that have typified street level dealing for decades, nor indicated that higher up the chain of supply cash has been superseded in any way as the accepted method of payment. It offends common sense to treat many of the lodgements in Mrs Buchanan's accounts as tainted without having regard to the reality that what this case depends on is proof of the much repeated mantra that Mrs Buchanan has deposited large cash sums into her accounts that cannot be explained by her verified legitimate income, justifying the inference that they represent the proceeds of Mr Buchanan's dealing in controlled drugs. Similarly, I have identified debits where they appear material, but in other respects have ignored details.
[60] Making allowance for these factors, the banking position that
existed in 1998-99 when 127 Gilberstoun was purchased has been set out above.
Mrs Buchanan has given varying accounts of the sources of the money lodged on
[61] The second item of heritable property in respect of which a
recovery order is sought is
"(Mrs
Buchanan's) uncle purchased
The supplementary report of August 2007 did not add to the primary facts relied on in respect of this asset. In her oral evidence, Ms Rivers stated that it appeared that Mrs Buchanan had funded the purchase, subsequently having it transferred to her absolutely without consideration when it had already appreciated in value.
[62] Mrs Buchanan cross examined Ms Rivers at some length about this
transaction, and later gave evidence on her own behalf. Technically, she did
not give positive evidence in support of the propositions she put to Ms Rivers.
However, I have taken the view that in the interests of fairness I should take
account of her contentions, however placed before the court, rather than adopt
a strict approach to the evidence. Ultimately, Ms Rivers' position did not
alter. Mrs Buchanan pointed to transactions in the year 1998-1999 when her
account number 06028543 had been inflated by the lodgement of the equity
proceeds of the sale of
[63] Mrs Buchanan asked whether Ms Rivers accepted that a withdrawal
of £10,000 on
[64] This
was an area in which Mrs Buchanan's need for competent professional support was
great. On a straightforward arithmetical analysis of the Lloyds TSB account
78245553, the sum that was lodged following the withdrawal from account number
06028543 was exhausted by the withdrawals on 12 and 18 May. What Mrs Buchanan
had to explain, or explore with Ms Rivers in cross examination, were the two
deposits on £9,500 and £2,000 on 2 and
[65] The issue, however, is whether it has been established that the
purchase price of 33/2 Loaning Crescent was in fact obtained from
unexplained funds supporting the inference that those funds were obtained from
Mr Buchanan's unlawful conduct, or not, having regard to Mrs Buchanan's ultimate
explanation that the funds used were the proceeds of sale of Lochend Avenue
notwithstanding the sequence of entries in her bank accounts. The balance on
Mrs Buchanan's Lloyds TSB account 7824553 had been built up after April 1997
almost entirely by cash lodgements. There had been some interest on the
account, and a small amount of miscellaneous cash and cheque lodgements. But on
any view almost the whole of the balance of £10,163.76 brought forward at the
beginning of 1999-2000 was attributable to large cash lodgements. There were
additional cash lodgements of £16,800 during the year, but, as set out in the
appendix these comprised nine separate and varied sums the largest of which was
£9,500 but most much smaller. The withdrawal of the price of the property on 2
July could be ascribed to any of several lodgements depending on the convention
or rule one chose to apply. The 2002 Act does not prescribe any particular
approach. Ms Rivers' approach was essentially negative: there were cash
movements and in the absence of positive evidence to the contrary she inferred
that the price had come wholly from tainted funds. Mrs Buchanan's account
suffers from the failure to be able to point to any actual inter-account
transfer of funds from her Lloyds TSB account 06028543 to her account 78245553.
However, her position that in fact as events developed she was applying the
proceeds of
Vehicles
[66] Vehicles and associated personal number plates comprise the
next class of assets for which the petitioners seek a recovery order. Four
motor cars and three associated private registration numbers are described in
the order sought: (1) a Range Rover with the registration number DDD 74;
(2) a Mercedes with the registration number SO52 HSV which is not treated as a
separate item of property; (3) a Ford Focus with the registration number
M20 LLL; and (4) a Mini Cooper with the registration number L14 YAM. The four
vehicles were purchased between
[67] The Range Rover was purchased on
[68] In the analysis appended to this opinion, I have adopted the interim administrator's description of the cheques for £10,000 in the absence of any other explanation. However, if these sums related to the acquisition of a vehicle it must have been a different vehicle from the Range Rover purchased some months later. Since it appears to me that the whole pattern of movements on the bank accounts was of the circulation of large cash sums through one or other of the active accounts it would be equally consistent with the overall picture that no asset was purchased, and that the cash simply returned to circulation in specie. So far as the identification of recoverable property is concerned, the position is that either the whole cash element of £27,655 requires to be explained as from an unidentified source as at 10 December 2002, or £1,000 plus £7,655 requires such explanation and £20,000 can be traced into the vehicle on the basis that, as lodged in the bank, it was the proceeds of Mr Buchanan's unlawful conduct followed into the hands of Mrs Buchanan. As already set out, account number 06028543, at best for the petitioners, contained mixed funds. Only a portion of the £20,000 could properly be treated as recoverable property, and that on the assumption that a portion of the total flow of cash through the account was tainted. Since there is no acceptable basis for the apportionment of Mrs Buchanan's bank balances in any event, treating the £20,000 as proposed would be destructive of the petitioners' case.
[69] The purchase of the Mercedes is recorded by Western Automobile
Company as having been by Mrs Buchanan. The interim administrator's main report
states that the vehicle was registered in Mr Buchanan's name. But that was not
established. The company's receipt shows that the whole price was paid on
[70] The Mercedes registration number SO52 HSV cost £22,295. The
trade in of a TVR Cerbera provided £18,000 of that price, and the balance of
£4,295 was paid in cash. The date on the invoice for the Mercedes was
[71] The TVR was purchased on
[72] The third vehicle for which a recovery order is sought is the
Ford Focus and relative private registration number. The total price of the
purchase was £12,075. £8,700 was attributed to the trade in of a Mitsubishi
Space Wagon that had been purchased on
[73] The respondents' position in the pleadings is that the Ford Focus was bought by Mr Buchanan for Lisa Marie Buchanan, and that she has been repaying the purchase price to Mr Buchanan at £200 per month. Ms Buchanan did not give evidence. She did not cross examine Ms Rivers about the transaction. I have already mentioned that the respondents did not rely on section 308 of the Act. This appears to me to have been an unfortunate consequence of the lack of consistent and competent legal advice and support available to the respondents and to Ms Lisa Marie Buchanan in particular. Her evidence that she had an agreement to pay for the vehicle, coupled with a statement that she had no knowledge that the cash used by her father was the proceeds of his criminal conduct would at least have required answer. As matters stand that would be pure speculation.
[74] However, it is legitimate for the court to examine the basis on which Ms Buchanan's position is dealt with. In the interim administrator's supplementary report, the response to the respondents' averments is:
"I have reviewed Lisa Buchanan's bank accounts and I am unable to identify the withdrawal of £200 per month ...
I have also seen no evidence of £200 per month being lodged into George Buchanan's bank accounts in relation to repayment for the Ford Focus.
Absent evidence to the contrary, I have not included the above within my assessment of the financial affairs of the Respondents."
I found this response profoundly disappointing. A cursory glance at the analysis of Lisa Marie Buchanan's bank account shows beyond doubt that she did not lodge all of her legitimate income in bank, and must have operated on a cash basis in her daily life. Mr Buchanan used bank accounts sparingly. The whole thrust of the case is that he had and handled large sums of cash. Why it should be thought that he would lodge in bank sums paid by his daughter for the car escapes me. However, in the result the court is confronted with a situation in which the tracing rules clearly apply to the Ford Focus in the absence of a relevant answer based on section 308 and evidence from Ms Buchanan.
[75] The final vehicle in issue is Liam Buchanan's Mini Cooper. This
vehicle was purchased on
Mr Buchanan
[76] Mr Buchanan has lodged written submissions in which he has criticised the interim administrator's approach to the analysis and presentation of financial information relating to his own position and the financial positions of his family. He has prepared an alternative analysis, introducing into a table having generally the same format as the interim administrator's black hole analysis additional heads of income and other legitimate receipts. The result of his exercise is a balance of legitimate income over bank lodgements, showing, on his approach, that the family had more than enough resources to fund the lodgements and other expenditure relied on by the petitioners. Mr Buchanan cannot be criticised for adopting this approach to analysis: he was merely following the format used against him. But it suffers from the same defects as the interim administrator's analysis, in confusing the separate interests and positions of the respondents and his own as interested party.
[77] There is a further difficulty in the way of Mr Buchanan adopting this approach. His evidence and that of Mrs Buchanan was that he had never contributed any funds to Mrs Buchanan or his children. The generality of that contention cannot be accepted. It is clear that he must have been the source of the cash used to purchase the motor cars used by Mrs Buchanan and the two children, whether or not there was an agreement for reimbursement in the case of the children. The positions of the individual respondents cannot be considered in cumulo, in my opinion, for the same reasons as I have set out in respect of the interim administrator's analysis.
[78] So far as Mr Buchanan is concerned, the only assets for which a recovery order is sought that are of interest in this connection are the cars. As indicated above the transactions for which there are records were entered into in name of Mrs Buchanan. I accept her evidence that these transactions were either concluded in fact by Mr Buchanan in her name without involving her, or that her participation was to accommodate Mr Buchanan. It is highly probable, on his own assessment of his character, that he was a bad father and husband. He was a man whose will would not easily have been resisted by Mrs Buchanan. It was also his evidence that he had purchased the cars. I have also set out the basis for the conclusion that there were no cash withdrawals from bank accounts in name of Mrs Buchanan that could relate to most of the transactions. In these circumstances, I conclude that the cars, however registered, were purchased by Mr George Buchanan using cash over which he had sole control at the material times.
[79] Mr Buchanan's income from legitimate sources, on his own analysis, was wholly insufficient to finance any but a basic life style. He was on benefit at all times when not in prison. It is, in my view, highly probable that he obtained all of the social security and other benefits he has disclosed, notwithstanding the interim administrator's reservations. However, these would have made no contribution to the purchase price of the vehicles in question. And Mr Buchanan did not contend otherwise. His evidence was that the cars were purchased from money that he "watched" for Mr Gahfour. He said that he had watched a lot of money for Mr Gahfour, mentioning sums of £72,000, £34,000 and £100,000.
[80] The only sum for which there is any documentary evidence is a
sum of £72,260 which the interim administrator included in her report. I dealt
with that sum in my opinion of
[81] I have not heard from Mr Gahfour, despite making it clear that
his evidence was of central importance in resolving the issues that arise in
respect of these sums. There is much that remains unexplained. Both the interim
administrator and Mr Buchanan have dealt with the sum of £72,260 as
arising in 1998-99. It was seized by the police on
[82] The sum does not, of course, exist independently. In my opinion of 10 March 2006 I dealt with a sum of £22,000 recovered from 127 Gilberstoun, and rejected the proposition that that sum was part of the £72,260 returned by the police. Many of the notes were dated after the return of the larger sum, and 60% of the notes were contaminated by diamorphine. Whether the £72,260 was used in the purchase of cars or not is immaterial to the disposal of the issue of the recoverability of the cars. If it was so used, the cars now held represent the original money. If it was not so used, the cars must have been purchased using other cash for which no explanation has been tendered. In either event, the cars are recoverable property.
[83] In his submissions, Mr Cullen tendered a table demonstrating that the cash applied in successive purchases of cars exceeded £72,260 by a margin of £57,770. No evidence before me would support a legitimate explanation for Mr Buchanan's ability to apply that sum from legitimate sources. Mr Buchanan's explanation can be inferred from his general evidence: all such sums came from Mr Gahfour. But that explanation can have no more weight in respect of the £57,770 than it has in respect of the £72,260. In general, I consider that on the evidence as a whole it is highly probable that Mr Buchanan purchased high value motor cars to re-cycle or launder the proceeds of his dealing in controlled drugs. I should note that in evidence at this hearing, Mr Buchanan expressed surprise that I should have "convicted" him of dealing in controlled drugs when a jury had acquitted him. I have previously set out my reasons for arriving at the view that he dealt in controlled drugs on the test appropriate in proceedings such as these, namely the balance of probabilities, having regard to the evidence led before me. Nothing in the present proceedings has persuaded me that I should suggest that conclusion was incorrect. It would not be open to me to reverse it in any event.
Mrs Buchanan
[84] The position of Mrs Buchanan has been complicated by the production of numerous financial analyses on differing bases. On 30 October, 2007, following the conclusion of the evidence, the interim administrator produced two tables. In the first of these, she aggregated the verified income of Mrs Buchanan, Liam and Lisa Marie Buchanan and set against that sum values derived from the Family Spending Survey tables to demonstrate that Mrs Buchanan was living beyond her legitimate means. I shall ignore that table. The material was not put in evidence before me, and Mrs Buchanan had no opportunity to question it or to comment on how it might have related to her circumstances. In any event without supporting evidence it appears to offend against the fundamental principle that statistical data is not valid at the level of the individual. The whole exercise is tendentious in the extreme. The second table purports to be an individual black hole table for Mrs Buchanan. It is periled on the proposition that the expenditure on all of the vehicles purchased was from Mrs Buchanan's resources. That is unacceptable on the view I take of the realities of the situation. And I repeat what I have said already: there is no acceptable evidence of cash movements on any of Mrs Buchanan's bank accounts that could relate to these transactions. If there were to be a proposition that she held large sums of cash that were at her disposal for the purchase of cars that should have been put to her. I have not found these late statements helpful.
Cash
[85] The remaining assets for which an order is sought are cash sums
recovered from 127 Gilberstoun: £2,801 on
[86] In 2004-2005, Mrs Buchanan had wages of £3,820.51 and benefits of £1,774.60. Wages lodged amounted to £3,387.77, and benefits lodged amounted to £1,918.17. Again it appears that Mrs Buchanan did not lodge the whole of her wages in bank though the difference is small, and that benefits lodged must have included sums referable to her relatives' care. In this year she lodged cash sums amounting to £19,300. On no view could her legitimate income allow for such a level of lodgements and explain the cash recovered from 127 Gilberstoun. The two children, of course, gave no evidence to indicate that part or all of the money belonged to them. In the circumstances it must be concluded on balance that the funds recovered were tainted.
[87] There remains one bank account that has not been dealt with, Lisa Marie's trust account for her younger brother. The cash lodgements in that account have not been traced to any other source. The child had no income. No question of apportionment arises. There has been no evidence of donation by any third party outside the immediate family. There is no technical failure to follow the scheme of the Act, and, failing acceptable evidence to weigh in the balance in favour of a legitimate source, it must be concluded that these funds are recoverable.
[88] In summary, I shall refuse the prayer of the petition in respect of:
(a) 33/2 Loaning
Crescent,
(b) all of the
bank and other money accounts identified with the exception of the sum held by
Lisa Marie Buchanan as trustee for Lewis Buchanan in
Otherwise I shall hear parties by order on the orders required in the light of this Opinion.
APPENDIX
ANALYSIS OF MRS BUCHANAN'S BANK ACCOUNTS
This table covers movements
on Mrs Marie Buchanan's Bank accounts:
Lloyds
TSB Account 78245553: (TSB 5553);
Lloyds
TSB Account 06028543: (TSB 8543);
Lloyds
TSB Account 73532868: (TSB 2868);
Lloyds
TSB Account 74381653: (TSB 1653);
Royal
Bank of
Royal
Bank of
1997 -98
|
Year |
TSB 5553 |
TSB 8543 |
TSB 2868 |
TSB 1653 |
RBS 5329 |
RBS 5243 |
|
1997-98 |
|
|
|
|
|
|
|
Opening balances |
1,220.21 |
805.81 |
28.71 |
451.70 |
|
|
|
Lodged: |
|
|
|
|
|
|
|
Wages |
|
7,496.41 |
|
|
|
|
|
Cash |
3,300.00[1] |
|
514.00[2] |
200.00 |
|
|
|
Misc. Cash and cheques |
443.70 |
1,117.94 |
|
110.56 |
|
|
|
Transfer |
|
|
185.00 |
|
|
|
|
Interest |
84.09 |
|
|
|
|
|
|
Loan |
|
|
2,217.27[3] |
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
5,048.00 |
9,420.16 |
2,944.98 |
762.26 |
|
|
|
|
|
|
|
|
|
|
|
Drawn: |
|
|
|
|
|
|
|
Mortgage |
|
865.20 |
|
|
|
|
|
Living expenses |
|
2,890.09 |
|
|
|
|
|
Direct debits |
|
1,674.61 |
726.39 |
|
|
|
|
Cash & Cheques |
|
1,299.80 |
2,179.31 |
|
|
|
|
Transfer |
|
185.00 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
0.00 |
6,914.70 |
2,905.70 |
0.00 |
|
|
|
|
|
|
|
|
|
|
|
Bal fwd |
5,048.00 |
2,505.46 |
39.28 |
762.26 |
|
|
1998 -99
|
Year |
TSB 5553 |
TSB 8543 |
TSB 2868 |
TSB 1653 |
RBS 5329 |
RBS 5243 |
|
1998-99 |
|
|
|
|
|
|
|
Opening balances |
5,048.00 |
2,505.46 |
39.28 |
762.26 |
|
|
|
Lodged: |
|
|
|
|
|
|
|
Wages |
|
11,245.62 |
|
|
|
|
|
Cash |
10,000.00[4] |
52,042.00[5] |
820.00[6] |
|
|
|
|
Misc. Cash and cheques |
|
3,279.62 |
|
507.21 |
|
|
|
Transfers |
|
5,000.00[7] |
1,160.00[8] |
|
|
|
|
Interest |
115.76 |
|
0.40 |
37.59 |
|
|
|
|
|
18,211.15 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
15,163.76 |
92,283.85 |
2,019.68 |
1,307.06 |
|
|
|
|
|
|
|
|
|
|
|
Drawn: |
|
|
|
|
|
|
|
Mortgage |
|
2,681.82 |
|
|
|
|
|
Living expenses |
|
10,747.03 |
|
|
|
|
|
Direct debits |
|
4,028.99 |
1,521.96 |
|
|
|
|
Cash |
|
14,020.00[10] |
|
|
|
|
|
Cash & Cheques |
|
7,077.25 |
155.00 |
600.00 |
|
|
|
Transfer |
5,000.00 |
1,160.00 |
|
|
|
|
|
127 G'stoun |
|
45,000.00 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
5,000.00 |
84,715.09 |
1,676.96 |
600.00 |
|
|
|
|
|
|
|
|
|
|
|
Bal fwd |
10,163.76 |
7,568.76 |
342.72 |
707.06 |
|
|
2000-2001
|
Year |
TSB 5553 |
TSB 8543 |
TSB 2868 |
TSB 1653 |
RBS 5329 |
RBS 5243 |
|
2000-01 |
|
|
|
|
|
|
|
Opening balances |
5,619.71 |
1,359.66 |
12.45 |
1,113.24 |
|
|
|
Lodged: |
|
|
|
|
|
|
|
Wages |
|
15,678.17 |
|
|
|
|
|
Dep w&p |
|
1,318.33 |
|
|
|
|
|
Cash |
4,200.00[11] |
7,460.00[12] |
|
1,000.00[13] |
500.00 |
|
|
Misc. Cash and cheques |
631.66 |
728.16 |
280.00 |
|
|
|
|
Transfers |
|
5,250.00 |
4,200.77[14] |
540.00[15] |
|
|
|
Interest |
22.67 |
0.43 |
0.01 |
11.97 |
0.79 |
|
|
"Y Smith 54" |
|
|
1,680.00 |
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
10,474.04 |
31,734.75 |
6,173.23 |
2,665.21 |
500.79 |
|
|
|
|
|
|
|
|
|
|
Drawn: |
|
|
|
|
|
|
|
Mortgage |
|
4,747.12 |
|
|
|
|
|
Living expenses |
|
11,632.05 |
|
|
26.05 |
|
|
Direct debits |
|
3,374.88 |
1,894.59 |
|
|
|
|
Cash |
3,200.00[16] |
450.00 |
3,470.00 |
1,540.00 |
|
|
|
Cash & Cheques |
|
10,761.32 |
416.00 |
|
|
|
|
Transfer |
5,250.00 |
|
100.00 |
|
|
|
|
Bank charges |
|
|
|
|
36.00 |
|
|
|
|
|
|
|
|
|
|
Totals |
8,450.00 |
30,965.37 |
5,880.59 |
1,540.00 |
62.05 |
|
|
|
|
|
|
|
|
|
|
Bal fwd |
2,024.04 |
769.38 |
292.64 |
1,125.21 |
438.74 |
|
2001-2002
|
Year |
TSB 5553 |
TSB 8543 |
TSB 2868 |
TSB 1653 |
RBS 5329 |
RBS 5243 |
|
2001-02 |
|
|
|
|
|
|
|
Opening balances |
2,024.04 |
769.38 |
292.64 |
1,125.21 |
438.74 |
|
|
Lodged: |
|
|
|
|
|
|
|
Wages |
|
15,721.21 |
|
|
|
|
|
Dep w&p |
|
986.74 |
|
|
|
|
|
Cash |
10.000.00[17] |
6,827.00[18] |
|
|
6,473.00[19] |
3,550.00[20] |
|
Misc. Cash and cheques |
|
1,570.39 |
|
|
1,981.00 |
379.99 |
|
Transfer |
|
1,000.00 |
45.00 |
|
|
|
|
Interest |
7.25 |
0.50 |
0.44 |
|
2.52 |
55.89 |
|
Y Smith |
|
|
1,950.00 |
|
|
|
|
"Miss K Connelly" |
|
|
|
|
600.00 |
|
|
"CHB" |
|
|
|
|
491.40 |
|
|
Lisa Buchanan |
|
|
|
|
|
1,800.00[21] |
|
|
|
|
|
|
|
|
|
Totals |
12,031.29 |
26,875.22 |
2,288.08 |
1,125.21 |
9,986.66 |
5,785.88 |
|
|
|
|
|
|
|
|
|
Drawn: |
|
|
|
|
|
|
|
Mortgage |
|
2,858.04 |
|
|
827.70 |
|
|
Living expenses |
|
14,007.33 |
|
|
5,289.32 |
|
|
Direct debits |
|
5,503.52 |
1,808.29 |
|
|
|
|
Cash |
|
|
|
|
2,000.00 |
1,500.00 |
|
Cash & Cheques |
|
2,334.37 |
267.64 |
|
30.80 |
|
|
Transfer |
960.00[22] |
120.00 |
|
|
|
|
|
Transfer |
1,000.00 |
|
|
|
|
|
|
Transfer |
25.00[23] |
|
|
|
|
|
|
Bank chgs |
|
|
|
|
120.00 |
|
|
|
|
|
|
|
|
|
|
Totals |
1,985.00 |
24,823.26 |
2,075.93 |
1,125.21 |
8,267.82 |
1,500.00 |
|
|
|
|
|
|
|
|
|
Bal fwd |
10,046.29 |
2,051.96 |
212.15 |
1,125.21 |
1,718.84 |
4,285.88 |
2002-2003
|
Year |
TSB 5553 |
TSB 8543 |
TSB 2868 |
TSB 1653 |
RBS 5329 |
RBS 5243 |
|
2002-03 |
|
|
|
|
|
|
|
Opening balances |
10,046.29 |
2,051.96 |
212.15 |
1,125.21 |
1,718.84 |
4,285.88 |
|
Lodged: |
|
|
|
|
|
|
|
Wages |
|
4,317.64 |
|
|
|
7,764.00[24] |
|
Dep w&p |
|
1,098.82 |
|
|
|
|
|
Cash |
|
27,545.00[25] |
4,000.00[26] |
|
5,060.00[27] |
|
|
Misc. Cash and cheques |
|
2,966.53 |
|
|
1,200.73 |
|
|
Transfer |
|
4,000.00 |
|
|
1,000.00 |
|
|
Transfer |
|
10,000.00 |
|
|
|
|
|
Transfer |
|
200.00 |
|
|
|
|
|
Interest |
17.77 |
1.55 |
0.36 |
4.98 |
4.94 |
24.09 |
|
"Y Smith 54" |
|
|
2,040.00 |
|
|
|
|
Lisa Buchanan |
|
|
|
|
|
1,800.00 |
|
"Miss Connelly" |
|
|
|
|
1,200.00 |
|
|
"CHB" |
|
|
|
|
912.60 |
|
|
|
|
|
|
|
|
|
|
Totals |
10,064.06 |
52,181.50 |
6,252.51 |
1,130.19 |
11,097.11 |
13,873.97 |
|
|
|
|
|
|
|
|
|
Drawn: |
|
|
|
|
|
|
|
Mortgage |
|
|
|
|
3,917.06 |
|
|
Living expenses |
|
14,766.78 |
|
|
1,046.44 |
|
|
Direct debits |
|
2,360.62 |
1,972.68 |
|
5,040.85 |
|
|
Cash |
|
|
|
|
|
500.00 |
|
Cheque |
|
6,000.00[28] |
|
|
|
11,454.59[29] |
|
'Range Rover' |
|
23,719.00[30] |
|
|
|
|
|
Cash & Cheques |
|
4,593.35 |
|
|
9.99 |
|
|
Transfer |
10,000.00 |
|
4,000.00 |
|
|
1,000.00 |
|
Bank Cgs |
|
|
|
|
120.00 |
|
|
Interest |
|
|
|
|
|
13.54 |
|
|
|
|
|
|
|
|
|
Totals |
10,000.00 |
51,439.75 |
5,972.68 |
0.00 |
10,134.34 |
12,968.13 |
|
|
|
|
|
|
|
|
|
Bal fwd |
64.06 |
741.75 |
279.83 |
1,130.19 |
962.77 |
905.84 |
2003-2004
|
Year |
TSB 5553 |
TSB 8543 |
TSB 2868 |
TSB 1653 |
RBS 5329 |
RBS 5243 |
|
2003-04 |
|
|
|
|
|
|
|
Opening balances |
64.06 |
741.75 |
279.83 |
1,130.19 |
962.77 |
905.84 |
|
Lodged: |
|
|
|
|
|
|
|
Wages |
|
956.19 |
|
|
|
|
|
Dep w&p |
|
5,059.85 |
|
|
|
|
|
Cash |
|
7,350.00[31] |
|
|
|
|
|
Misc. Cash and cheques |
|
2,005.88 |
|
|
|
|
|
Transfer |
|
300.00 |
|
|
|
|
|
Interest |
|
3.07 |
0.24 |
3.76 |
|
0.32 |
|
Y Smith |
|
|
680.00 |
|
|
|
|
Lisa Buchanan |
|
|
|
|
|
150.00 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
64.06 |
16,416.74 |
960.07 |
1,133.95 |
|
1,056.16 |
|
|
|
|
|
|
|
|
|
Drawn: |
|
|
|
|
|
|
|
Mortgage |
|
|
|
|
|
|
|
Living expenses |
|
11,412.38 |
|
|
|
|
|
Direct debits |
|
3,011.14 |
657.56 |
|
|
|
|
Cheque |
|
|
|
|
|
|
|
'Range Rover' |
|
|
|
|
|
|
|
Cash & Cheques |
|
419.10 |
|
|
|
500.00 |
|
Transfer |
|
200.00 |
300.00 |
|
|
|
|
Transfer |
|
500.00 |
|
|
|
|
|
Transfer |
|
100.00 |
|
|
|
|
|
Interest |
|
|
|
|
|
0.63 |
|
|
|
|
|
|
|
|
|
Totals |
0.00 |
15,642.62 |
957.56 |
0.00 |
|
500.63 |
|
|
|
|
|
|
|
|
|
Bal fwd |
64.06 |
774.12 |
2.51 |
1,133.95 |
|
555.53 |
2004-2005
|
Year |
TSB 5553 |
TSB 8543 |
TSB 2868 |
TSB 1653 |
RBS 5329 |
RBS 5243 |
|
2004-05 |
|
|
|
|
|
|
|
Opening balances |
64.06 |
774.12 |
2.51 |
1,133.95 |
|
|
|
Lodged: |
|
|
|
|
|
|
|
Wages |
|
3,387.77 |
|
|
|
|
|
Dep w&p |
|
1,918.17 |
|
|
|
|
|
Cash |
|
4,100.00[32] |
15,300.00[33] |
|
|
|
|
Misc. Cash and cheques |
|
277.28 |
|
|
|
|
|
Transfer |
|
1,000.00 |
|
|
|
|
|
Transfer |
|
3,000.00 |
|
|
|
|
|
Transfer |
|
500.00 |
|
|
|
|
|
Transfer |
|
1,000.00 |
|
|
|
|
|
Interest |
|
1.64 |
0.66 |
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
64.06 |
15,958.98 |
15,303.17 |
1,133.95 |
|
|
|
|
|
|
|
|
|
|
|
Drawn: |
|
|
|
|
|
|
|
Mortgage |
|
|
|
|
|
|
|
Living expenses |
|
9,460.33 |
|
|
|
|
|
Direct debits |
|
1,162.23 |
|
|
|
|
|
Loans Direct |
|
|
300.14 |
|
|
|
|
Cheque |
|
|
7,000.00 |
|
|
|
|
Cash |
|
222.40 |
3,000.00 |
500.00 |
|
|
|
Transfer |
|
50.00 |
1,000.00 |
|
|
|
|
Transfer |
|
|
3,000.00 |
|
|
|
|
Transfer |
|
|
1,000.00 |
|
|
|
|
|
|
|
|
|
|
|
|
Totals |
64.06 |
10.894.96 |
15,300.14 |
500.00 |
|
|
|
|
|
|
|
|
|
|
|
Bal fwd |
64.06 |
5,064.02 |
3.03 |
633.95 |
|
|