APPEAL UNDER SECTION 74 OF THE CRIMINAL PROCEDURE (SCOTLAND) ACT 1995 BY HER MAJESTY'S ADVOCATE AGAINST (FIRST) GARY MARTIN WITHEY AND (SECOND) DAVID HENRY GRIER
APPEAL COURT, HIGH COURT OF JUSTICIARY
[2017] HCJAC 47
HCA/2016/213/XC and HCA/2016/214/XC
Lord Justice General
Lord Menzies
Lord Bracadale
OPINION OF THE COURT
delivered by LORD CARLOWAY, the LORD JUSTICE GENERAL
in
APPEAL UNDER SECTION 74 OF THE CRIMINAL PROCEDURE (SCOTLAND) ACT 1995
by
HER MAJESTY’S ADVOCATE
Appellant;
against
(FIRST) GARY MARTIN WITHEY and (SECOND) DAVID HENRY GRIER
Respondents:
Appellant: W McVicar AD, Jadelski, Shand; the Crown Agent
First Respondent: Duguid QC, Meehan; MacRoberts, Glasgow
Second Respondent: Jackson QC, Cheyne; Fleming & Reid, Glasgow
13 May 2016
The indictment
[1] The respondents are indicted along with Craig Whyte on a charge which libels, inter alia, as follows:
“(001) between 1 January 2010 and 6 May 2011 ... at the premises occupied by the Rangers Football Club plc ... you ... did conspire together to acquire and obtain by fraud a majority and controlling stake in the shareholding of [Rangers] ... through Wavetower Limited ... this being a company incorporated for the purposes of and the means used to effect said acquisition ...”.
At the material time, the vast majority of shares in Rangers was held by Murray MHL Limited (Murray). Wavetower was controlled by Mr Whyte. The charge continues by libelling that, in furtherance of this conspiracy, the accused carried out a number of actions, some involving false representations to certain companies, in order to obtain access to sums, which they could pretend were their own, with a view to establishing their financial credit. These subheadings involve only Mr Whyte and the first respondent, with the exception of one, which states that all three:
“(c) ... knowing that an independent committee ... had been set up by the board of [Rangers] ... with powers to consider the full implications of any future offers for [Rangers] you ... did ...
(ii) on 24 April 2011 at a meeting of the independent committee at Murray Park, wilfully conceal from the independent committee the Ticket Purchase Agreement with Ticketus hereinafter described ... in respect of sales of season tickets for seasons 2011-12, 2012-13 and 2013-14 being assets of [Rangers] normally available for public sale; induce the independent committee to believe that there was no requirement to arrange ring-fenced accounts for season ticket sales for the forthcoming season 2011-12, knowing that sales of season tickets for seasons 2011-12, 2012-13 and 2013-14 had been agreed with Ticketus aforesaid and this you did to prevent the independent committee from discovering same; knowing that the independent committee had concerns regarding the source of funding for the acquisition of [Rangers], the ability to provide cash to invest in [Rangers] for player acquisition, the ability to meet the liabilities of [Rangers] and the ability to provide working capital to fund future operations of [Rangers] you did repeatedly make false representations and pretences to the independent committee to the effect that they would be provided with sufficient evidence of same, knowing that you did not have sufficient evidence of same and had no intention of providing sufficient evidence of same; ...”.
The charge libels that Mr Whyte and the first respondent made certain pretences to representatives of Ticketus, with a view to ensuring that £24,337,094 was paid into a particular account so that they could demonstrate that this was part of their own funds. It continues with a series of detailed allegations before concluding, in relation to all three accused, as follows:
“All whereby you ... did obtain from Murray through Wavetower Limited ... 85.3% of the issued capital of [Rangers] for £1 by fraud and did thus obtain a majority and controlling stake in the shareholding of [Rangers] through Wavetower Limited aforesaid by fraud ...”.
[2] What is now charge (5) against all three accused, reads that:
“(05) between 6 May 2011 and 14 February 2012 ... at the premises occupied [Rangers] ... you ... were knowingly a party to the carrying on of the business of [Rangers] with intent to defraud creditors of the said company or for any fraudulent purpose (sic) in that you did exercise control and de facto control over the business, assets and financial management of the company in such a manner so as to make the Administration of the company inevitable and did fail to pay £2,800,000 to discharge a tax liability due by the company, fail to pay VAT, PAYE and National Insurance, fail to pay other debts due by the company, when funds were available to the company, pay debts due by Liberty Capital Limited from funds of the company, receive a further sum of £6,090,255.72 colloquially referred to as ‘roll over money’ from Ticketus ... and apply same to pay sums due in terms of the said Ticket Purchase Agreement dated 9 May 2011 all in order you (sic) [Craig Whyte] could buy back the said company from the Administrators free of debt: CONTRARY to section 993(1) and (3) of the Companies Act 2006”.
[3] After extensive debate, on 19 April 2016 the Preliminary Hearing judge determined that, in respect of the first respondent, his plea in bar of trial on the ground of oppression should be sustained, along with a plea to the relevancy of charge (5). In respect of the second respondent, the judge upheld a plea to the relevancy of charges (1) and (5). This effectively ended the charges against both respondents. Leave to appeal was granted. The appeal raises two issues. The first relates to the relevancy of charges (1) and (5). The second concerns the plea in bar. This plea is linked to a previous decision of the court (Holman Fenwick Willan v HM Advocate, 5 February 2016, unreported), sustaining pleas of oppression, taken in respect of a warrant granted for the recovery of material subject to a plea of confidentiality (legal privilege) maintained by solicitors for the respondents.
The Preliminary Hearing judge’s decision
Relevancy
[4] The PH judge took the view that charge (1), as pled against the second respondent, was irrelevant, primarily because he did not consider that subparagraph (c)(ii) (supra) relevantly averred the crime of fraud. It did not, in his view, aver any practical result from the false pretence averred. This reasoning stemmed from evidence, which was adduced at the PH, demonstrating that the Independent Committee did not have the power, as originally averred, to recommend acceptance or rejection of an offer to acquire Rangers. Rather, its role was to consider the implications of offers and nothing more. The judge took the view that no practical result could flow from the exercise of that power. The evidence was that the owner of the majority shareholding (Murray) would have proceeded with the sale no matter how the Committee viewed the offer. The judge noted that the Crown were suggesting that the Committee had smoothed the path to acquisition, but he commented that this allegation was wholly unspecific. In the absence of averments of causation, that the conduct led to a practical result, the averments within the subparagraph did not relevantly constitute fraud.
[5] The PH judge noted that the basis of the charge in subparagraph (c)(ii) was the wilful concealment of the Ticketus Purchase Agreement. He took the view, however, that, in a fraud of that type, it was essential to aver that there was a duty to disclose. For this reason also, the charge was irrelevant. A third basis for sustaining the plea to the relevancy was that it was not averred that, as at the date of the relevant meeting, the second respondent knew of the Agreement and its effect. He did not feature in the events surrounding the Agreement, as subsequently libelled.
[6] The PH judge accepted the general proposition that it was not necessary for each individual subhead in a charge of conspiracy to amount to a crime. However, in deciding whether the second respondent had been involved in a conspiracy, the jury would have to be directed to ignore the content of the subheads upon which he did not appear and to look solely at his actings as libelled in the subhead. They would have to be directed that the respondent had done nothing which was, in itself, criminal. He had no duty to disclose the Ticketus Purchase Agreement (assuming that he knew about it). Finally, the jury would require to be directed that his conduct was not only not criminal, it had no practical effect. No jury, properly directed, would have been entitled to return a verdict of guilt in relation to this respondent on the conspiracy charge.
[7] In relation to charge (5), the PH judge noted that the Crown had amended another charge, which had formally been on the indictment, by deleting averments of a conspiracy by Mr Whyte and others to acquire Rangers from the administrators fraudulently. The judge took the view that, if the Crown accepted that there was no such conspiracy, it had to follow that charge (5), in so far as it libelled a fraudulent intention to acquire Rangers from the administrators, no longer had a proper foundation. Where the Crown accepted that there was no fraudulent intention of the nature deleted, the equivalent words in charge (5) made no sense.
Oppression
[8] The PH judge rejected a plea of oppression from the second respondent based upon the conduct of the Crown in relation to a number of matters including: what was said to be the unnecessary detention of the second respondent in a dawn raid; his appearance on a petition which had no evidential basis; and the failure of the Crown to investigate his defence. In approaching this plea, the judge distinguished two different bases for the plea of oppression. The first was where, as a result of the Crown’s conduct, a fair trial could not take place. The second was where, again as a result of the Crown’s conduct, it was necessary for the court to intervene in order to protect the integrity of the justice system. The judge based this distinction upon Warren v Attorney General for Jersey [2012] 1 AC 22. The second respondent’s failed argument had fallen into the second category, which (as distinct from the first category) involved no balancing exercise.
[9] The PH Judge dealt with the first respondent’s argument under the first category of unfair trial. The background involved civil proceedings in London against a firm of solicitors, of whom the first respondent was a partner. This litigation alleged a conspiracy mirroring charge (1). The Crown had obtained a warrant to search the home of the first respondent and the offices of the solicitors. This had resulted in the recovery of, amongst other items, three documents. These were all examined by the Crown and disclosed to the several co-accused. It was this warrant which the court subsequently suspended as oppressive. The basis for that decision was that the Crown had sought the warrant without intimation, in circumstances in which they were in active discussions with the havers. The warrant was also held to be oppressive by reason of its scope.
[10] The first of the documents (Pro 1168) was created by Messrs Clyde & Co, Solicitors, in connection with the civil litigation. It included 22 pages of annotated draft defence and counterclaim. The second (Pro 1170) was again created by Messrs Clyde & Co in connection with the litigation. It was headed “Discussion points/questions for [the first respondent]”. The third document (Pro 1172) was an unsigned 22 page draft statement prepared by, or on behalf of, the first respondent, on the basis of information provided by him in connection with the London litigation. It set out, in some detail, the first respondent’s position in respect of the allegations contained in charge (1).
[11] The PH judge held that the statement prepared on behalf of the first respondent covered his entire involvement in the acquisition of Rangers from early 2010 to February 2012. The Crown’s examination of this document had provided them with a material unfair advantage. Consequently it had materially disadvantaged the first respondent. The Crown knew the first respondent’s detailed response to the charge. They would be able to prepare their case in such a way as to seek to rebut that response. The judge was persuaded that, having knowledge of the contents of this document, and the co-accused having equal knowledge, was the equivalent of them having access to discussion points and questions prepared by the first respondent’s own counsel in these proceedings. This highlighted the material advantage given to the Crown by their having improperly accessed this document. The respondent had been placed in a significant disadvantage by this privileged material not having remained confidential.
[12] It was not good enough, reasoned the PH judge, for the Crown to say that the points involved were obvious and would in any event have occurred to the Crown. They had been given advance notice of the perceived weaknesses and difficulties in the respondent’s position as seen from the position of his own legal advisers. In ordinary circumstances, the Crown could never have such information. In short, the Crown had been provided with a road map to prepare their case against the respondent. The judge considered that similar considerations applied to the other documents. Treated cumulatively, the respondent had been “clearly materially prejudiced and the Crown and the co-accused’s advisers are materially advantaged”. The judge had found it difficult “to think of unfairness of a more significant extent and degree than has occurred here by the improper viewing by the Crown and disclosure by the Crown of the three documents”. They provided an almost total insight in to the first respondent’s position.
[13] The PH judge considered that the question for the court was whether there had been “prejudice so grave as to be incapable of being removed by an appropriate direction to the jury, or by other appropriate action on the part of the trial judge, so as to give the minuter a fair trial” (see Mitchell v HM Advocate 2003 JC 89; Dyer v Von 2008 SCCR 265). Ultimately he concluded that this was one of these rare cases, both exceptional and blatant, where a decision regarding oppression could be made at the preliminary stage. The Crown, by their actings, had become aware of material of such a nature that the first respondent’s defence had been prejudiced. Any trial would be “completely unfair”. In terms of Mowbray v Crowe 1993 JC 212, justice could not be seen to be done. This too amounted to oppression. The judge accordingly sustained the plea of oppression.
Submissions
Crown
RELEVANCY
[14] In relation to the relevancy of charge (1), the advocate depute submitted that the PH judge had erred in holding that it was necessary for subparagraph (c)(ii) to constitute a freestanding crime of fraud and that the actions libelled in that subparagraph required to lead to a clear practical result in relation to the sale of Rangers. The charge averred that the second respondent had been a party to a conspiracy to defraud and an actual fraud. The subparagraph set out the basis upon which it could properly be concluded that he had acted in a manner designed to further the aims of the conspiracy and in furtherance of a common plan to commit fraud. There was no requirement for a definite practical result to have followed as a consequence of his individual acts. The practical result had, however, been the sale of Rangers by Murray to Wavetower. The judge had erred in failing to recognise that the true issue was not whether the majority shareholders would or would not have proceeded with the sale in light of the views of the Independent Committee, but whether the second respondent knew that his actions would contribute to the achievement of the fraud.
[15] The PH judge had erred in finding that it was necessary to aver a duty to disclose. He had conflated that concept with wilful concealment, which was what was actually libelled. Where what was alleged was wilful concealment, there was no requirement to establish a duty to disclose. It was sufficient that the true position had been concealed and that that had been done wilfully and with intent to defraud. In any event, the judge had erred in finding that the same requirement had applied in respect of the second part of the subparagraph, which libelled repeatedly making false representations and pretences to the Independent Committee to the effect that the Committee would be provided with evidence about funding in circumstances where it was averred that there was no intention to provide such evidence.
[16] The PH judge had erred in finding that the charge was irrelevant because the Crown had not averred that the second respondent knew of the agreement with Ticketus. Such an allegation was included in the words “wilfully conceal” and “knowing that sales of season tickets for seasons ... had been agreed with Ticketus”. The conclusions which the judge had reached, in relation to how a jury would require to be directed, were erroneous. Although there was passing reference to HM Advocate v Barbier (1867) 5 Irv 482, Docherty v Brown 1996 JC 48 and Gibson v The National Cash Register Co 1925 SC 500, it was not ultimately contended that these cases were of direct relevance. The whole charge was sufficiently relevant to go to the jury.
[17] In relation to charge (5), the PH judge had erred in concluding that amendments made by the Crown to another charge had any effect on the relevancy of this one. The relevancy of each charge required to be considered separately. The effect of the Crown deleting certain averments did not mean that they accepted that the matters deleted did not occur. The offence was a statutory one. It was sufficient to describe it in the words of the enactment itself. The respondents had obtained fair notice of what the Crown intended to prove by virtue of the disclosure regime. The charge averred trading whilst insolvent with intent to defraud creditors. That was sufficient, within its terms, to merit a conviction (see Skene: Corporate Insolvency, Stair Memorial Encyclopaedia (re-issue) para 351). The fraudulent purpose had been to bring about the administration with the intention of defrauding the creditors, notably HMRC.
OPPRESSION
[18] On oppression, the fact that the Crown happened to know what the defence case might be was not an unique situation. The privileged material recovered had played no part in the decision to prosecute. There had been no blatant attempt to take advantage of the content of the documents. The decision of the PH judge had been premature. It was not possible to know at the preliminary stage that the trial would inevitably be unfair. Knowledge of a defence case did not necessarily cause prejudice (Moir v HM Advocate 2005 JC 102 at para [51], Barclay v HM Advocate 2013 JC 40 at para [17] et seq). It was accepted that none of the recovered material would be admissible.
[19] Mowbray v Crowe 1993 JC 212, which had been founded upon by the PH judge, involved a different set of facts in which the prosecution had been mounted, following upon improper questioning of the accused by the procurator fiscal. It could be distinguished. In any event, each case depended upon its own facts and circumstances. There had been nothing surprising in the material recovered. Were the Crown to take advantage of material recovered in this way, the matter could be revisited at trial. Reference was made to a number of examples of oppression (Fraser v Deveney 2014 SCCR 147; McLeod v Tiffney 1994 JC 77; Wilson v Harvey 2015 JC 117; Boyes v McLeod 1998 SCCR 373; and Sloan v Crowe 1996 SCCR 200). The Crown had not deliberately sought to take advantage of the material in such a way that justice could not be seen to be done.
Second Respondent (Relevancy)
[20] The second respondent maintained that the PH judge had been correct in his description of fraud as requiring a practical result by means of a false pretence. No practical result had been brought about by the conduct alleged against this respondent in the charge. The judge had heard evidence that the majority shareholders would have paid no regard to the views of the independent committee, irrespective of what they might have been. It was essential that a causal connection should exist between an alleged deception and the result suffered by the victim. The Crown had assumed that the shareholders would have been affected by knowledge of the Ticketus Purchase Agreement, but there was nothing in the charge which laid the foundation for the causal connection required. Without establishing that the false belief, which the Committee had allegedly acquired, was an operative cause of the sale, no practical result arose from the conduct averred. Causing a belief was not a practical result.
[21] The judge had been correct to hold that, in a fraud of the type alleged, which was one based upon omission, it was essential to aver a duty to disclose or a basis from which such a duty could be inferred. No positive act of concealment was libelled against the second respondent. The judge had been correct to categorise the conduct as one of omission. Without averments of knowledge on the part of the second respondent in relation to the Agreement, the subparagraph was irrelevant. In relation to that Agreement, its central purpose was not specified.
[22] It was accepted that there could be a crime of conspiracy, even if the subheads did not themselves amount to a crime. In the context of this case, the PH judge had been correct to conclude that, without a crime alleged within the subparagraph, there could be no relevant basis for a charge of conspiracy. In referring to the jury directions, the judge was simply demonstrating how the charge came to be irrelevant. His conclusion that an inference of guilt could not properly be made was correct.
[23] Although it may be generally inappropriate to consider amendments to one charge when considering the relevancy of another, the PH judge had not erred in doing so in the particular circumstances of this case. Section 993 of the 2006 Act made it an offence to carry on business with intent to defraud creditors. The appointment of an administrator is not of itself a fraud on the company’s creditors. There were no other averments inferring fraud in respect of the way the company was being run, other than not paying certain creditors. Not paying creditors was not a fraud. The Crown had failed to libel in what way not paying the creditors instructed a fraud. There were no averments of fraudulent trading. The libel, that the purpose of putting the company into administration was to buy it back free of debt, was misconceived. The company was never bought back, nor could it have been. It went into liquidation. A new company simply bought the assets of the old. In summary, there were no averments about: the way in which the creditors were to be defrauded; the mismanagement of the company; how placing the company into administration could defraud creditors; and how the creditors of the company came to be defrauded by the sale of assets.
First respondent (Oppression)
[24] The first respondent maintained that the PH judge had been correct in his conclusions relative to the legally privileged documents. These had been seized from the first respondent’s home, despite the respondent having told the police that the documents were legally privileged. Although an undertaking had been subsequently given by the Crown to appoint a commissioner to consider the issue of privilege, the documents were not sent to a commissioner, but examined by the Crown and disclosed to the co-accused. All three documents related to civil proceedings by the administrators of Rangers against Collyer Bristow, of which the first respondent was a partner. The Crown had repeatedly maintained that legal privilege had been waived, but at a hearing on 22 February 2016, it was accepted that legal privilege had been asserted, but ignored. Not only had the documents been viewed by the Crown, even after the assertion of legal privilege in the English court proceedings, the Crown had sent the documents to a forensic accountant for consideration. The resultant report referred to all three documents.
[25] The issue was whether the first respondent had been prejudiced by the actings of the Crown (Dyer v Von 2008 SCCR 265 at 270; Fraser v Deveney 2014 SCCR 147 at paras [10-12]). That was primarily a matter for the PH judge to determine. In doing so, he had identified the correct facts and directed himself accurately on the law. The submissions for the Crown were the same as had been advanced at the PH. They had failed to identify any directions which could be given to the jury which would remove the prejudice caused. The judge had correctly identified the issue as one of fair trial as distinct from conduct of the Crown (R v Maxwell [2011] 1 WLR 1837 at para [13]). He had not conflated the two. The case involved the important right of protecting legally privileged material. The judge had been in the best position to gauge the level of prejudice caused.
[26] In relation to the first document (Pro 1168), the judge had been entitled to reach the view that the first respondent had been materially prejudiced, as a result of the Crown learning what the observations of his counsel were. Similar considerations applied to the second document (Pro 1170), which set out no less than 81 questions seeking answers from the first respondent. In the third document (Pro 1172), counsel had set out the first respondent’s position in detail relative to the issues in charge (1). As a particular example of prejudice, this document stated what the first respondent knew about the general level of indebtedness of Murray to their bankers, the guarantee from Sir David Murray relative to Rangers’ indebtedness to the same bankers, the potential to release him from that guarantee, and the effect of that on the sale of Rangers. These were all matters which the Crown would not have been aware of from the disclosed statement of Sir David, the Crown’s principal witness. It could affect Sir David’s credibility and reliability. The Crown had secured advance notice of the defence line. Taking the three documents cumulatively, the judge had been entitled to hold that the first respondent had been materially prejudiced and the Crown and the co-accused materially advantaged.
[27] The PH judge had identified the relevant considerations for a plea of oppression. He had noted that it was not being said that there was an affront to justice as a result of a continued prosecution. Rather, the question was whether the respondent could obtain a fair trial. The judge had not decided the matter under reference to any purported general rule that, if the Crown had knowledge of an accused’s defence, a fair trial was thereby impossible. Rather, the judge regarded this as an exceptional case. The tabling of the plea at this stage was not premature. The judge had not overestimated the significance of the documents. He had carefully considered them and assessed their significance in the context of the allegations libelled. These documents might be used by the co-accused for use at trial. Once legal privilege was lost, it was lost forever (Passmore: Privilege (3rd ed) paras 7.311-317, 370-385). Essentially the Crown were in the same position as they had been in Mowbray v Crowe 1993 JC 212.
[28] In relation to the relevancy of charge (5), the judge had not erred in upholding the relevancy plea. He had been correct in holding that the averment of a failure to pay “other debts due by the company” lacked sufficient specification and did not give fair notice of the Crown’s case.
Decision
Relevancy
[29] Notwithstanding the complexity which the Crown have introduced into this indictment, the case libelled against the second respondent is relatively straightforward. It is, as is contained in the libel, that he, and two others, conspired together to acquire Rangers by fraud. So far as this respondent is concerned, his involvement was limited to attending the meeting on 24 April 2011, at which it is said that he wilfully concealed from the Independent Committee, which was tasked with considering the implications of offers to buy Rangers, the fact that an agreement had been reached with Ticketus whereby money from season ticket sales for three years would not be available to Rangers because it had effectively been diverted into the hands of the potential acquirers. It is alleged that it was represented to the Committee that evidence about the true financial position would be provided, whereas there had been no intention of doing so, because no such evidence could exist. All of this culminates in an averment that this resulted in the majority shareholders selling Rangers to the three accused.
[30] Fraud requires there to be a false pretence, made dishonestly, in order to bring about a definite practical result (Macdonald: Criminal Law (5th ed) 52). The false pretence averred in subparagraph (c)(ii) is the wilful concealment of the Ticketus Purchase Agreement from the Independent Committee. It is not said that the inducement of a belief in the collective mind of the Committee itself amounted to a fraud. The creation of a belief is not normally to be categorised as a practical result. Rather, the result libelled, and hence the completed crime, was the obtaining of the majority shareholding in Rangers.
[31] The fundamental difficulty with the relevancy of this limited libel, in so far as it is directed against the second respondent, is that there is no apparent link between the representation and the practical result. The charge does not aver a representation to the persons whom, it is alleged, were defrauded or a representation targeted at those persons through another. The majority of shares in Rangers were owned by Murray MHL Limited. If any fraud were to be perpetrated, it must have involved a representation in some way directed towards Murray, as, in effect, the owners of Rangers. This is indeed the concluding part of the libel. The difficulty is that the second respondent’s particular acts, in concert with Mr Whyte and the first respondent, libelled in subparagraph (c)(ii), relate to the concealment of facts not from Murray but from the Independent Committee which, it is also libelled, was set up to advise the board of Rangers. There is no apparent connection between the pretence said to have been made by, or in the presence of, the second respondent and the alleged practical effect on the owners of Rangers. In these circumstances, the essentials of the charge of fraud are not present and the libel, so far as the completed crime of fraud is concerned, is irrelevant.
[32] The Crown contention at the appeal hearing was that Murray would not have sold the shares to Wavetower if they had known about the Ticketus Purchase Agreement. That is a contentious issue between the parties. For reasons which were not made clear at the hearing of the appeal, the PH judge heard evidence about this at the Preliminary Hearing. The judge records that the evidence was all to the same effect, viz. that Murray would have proceeded with the sale whatever the views of the Independent Committee. Whether that is true or not, the concealment of the Agreement from Murray is not libelled nor is it stated in subparagraph (c)(ii) that the accused knew that the concealment of the Agreement from the Independent Committee could, or did, have any effect on Murray’s corporate thinking.
[33] In certain circumstances, a relevant charge of conspiracy would exist based purely upon the terms of the preamble to charge (1). However, the court did not understand that the Crown sought a conviction other than on the basis of the second respondent’s involvement by virtue of his acts as libelled in subparagraph (c)(ii). Unless it could be said that the concealment of the Ticketus Purchase Agreement was a material cause of the sale, the case against the second respondent would fail. The court has proceeded on this basis; that the conspiracy element of the libel could not, in the case of the second respondent, stand alone. The inference of conspiracy on the part of the second respondent stemmed only from the acts libelled in the subparagraph.
[34] For completeness, the absence of an averment of knowledge of the Ticketus Purchase Agreement by the second respondent would not have been fatal to the charge. Such knowledge is implied in a libel that there was wilful concealment of the fact. Similarly, it can be inferred from the terms of the libel that the Crown intend to prove that, in the circumstances, there was a duty to disclose the relevant information. The absence of a specific statement to that effect does not render the libel irrelevant.
[35] In relation to the statutory charge under section 993 of the Companies Act 2006, the allegation is that the accused carried on the business of Rangers in a manner which deliberately avoided paying HM Customs & Revenue VAT, PAYE and National Insurance over a prolonged period of time. There is an averment of a failure to pay other debts and of paying certain debts to a company controlled by one of the accused from funds received from Ticketus. The relevancy of the libel in charge (5) requires to be considered independent of any other charge or deletions to it. Whether it is relevant or not will depend upon its own terms.
[36] The fundamental problem with the charge is that it contains no allegation that the accused were trading whilst Rangers were insolvent, which appears to be at the core of the Crown’s thinking. The allegation is simply one of not paying some debts and paying others. Neither act on its own relevantly avers fraudulent trading, contrary to the section. Trading in a manner which would result in a company going into administration cannot, without more, be said to be a fraud on the creditors (whom administration is intended to protect). The allegation that the motive for putting the company into administration was to “buy back” the company “free of debt” is not easy to understand. The charge is, in any event, an irrelevant one.
Oppression
[37] The plea which was taken by the first respondent was one of oppression at common law. It was not a plea in bar based upon a breach of Article 6 of the European Convention on Human Rights. The latter would only arise in the event of the oppression plea failing (Fraser v Deveney 2014 SCCR 147, Lord Drummond Young at para [10]). The court has the power at common law to prevent the Crown from proceeding with a prosecution where oppression is found to have occurred.
[38] The test is set out in Stuurman v HM Advocate 1980 JC 111 in which the Lord Justice General (Emslie), delivering the Opinion of a Full Bench, said (at 122) that the power would be exercised “only in special circumstances which are likely to be rare”. He continued:
“The special circumstances must indeed be such as to satisfy the court that, having regard to the principles of substantial justice and of fair trial, to require an accused to face trial would be oppressive. Each case will depend on its own merits, and where the alleged oppression is said to arise from events alleged to be prejudicial to the prospects of fair trial the question for the court is whether the risk of prejudice is so grave that no direction of the trial judge, however careful, could reasonably be expected to remove it”.
Future jury directions, in respect of the matters under consideration in this case, are an improbable prospect. The issue then is whether it can be said at this stage that, having regard to the principles of justice and of a fair trial, the court should intervene to stop the prosecution (see also the Full Bench decision in MacFadyen v Annan 1992 JC 53, LJC (Ross) at 60).
[39] The law does not recognise a distinction between cases where a fair trial cannot take place and those where the holding of a trial would be, as it is put in other jurisdictions, an affront to justice (Warren v Attorney General for Jersey [2012] 1 AC 22, Lord Dyson at para 21, quoting his dictum in R v Maxwell [2011] 1 WLR 1837 at para 13). A contention that the acts of the Crown have amounted to an affront to justice, or will undermine public confidence in the criminal justice system and bring it into disrepute, are to be considered in the context of an argument that these acts prevent a fair trial from being held. A submission that, as a result of the Crown’s acts, justice cannot be seen to be done will also be considered in that context (Mitchell v HM Advocate 2003 JC 89, Lord MacFadyen at para [10]). All are aspects of fairness of trial as that concept is understood at common law. A trial which is an affront to justice, or in which justice cannot be seen to be done, will not be a fair one.
[40] Whether a fair trial is possible will depend upon the particular facts and circumstances. These will include not only the nature of the Crown’s conduct but also such matters as the seriousness of the charge and the public interest in ensuring that crime is detected and prosecuted (see, for Article 6 pleas, Gafgen v Germany (2011) 52 EHRR 1 at para 178). What may be regarded as amounting to oppression in the context of a minor summary complaint (eg Mowbray v Crowe 1993 JC 212) will not necessarily be the same when dealing with serious crime prosecuted on indictment.
[41] The Crown, having formed an erroneous view of the law, recovered legally privileged material. They should not have done this. It is not disputed that the particular documents under consideration would not have escaped the important protection which confidentiality gives to the solicitor/client relationship. That protection is one which the court must guard jealously. In the majority of cases, that may be achieved simply by excluding evidence recovered in breach of that confidentiality. In that connection, it is unlikely that the court would allow evidence illegally obtained to be used either by the Crown or a co-accused (Brand v HM Advocate 2012 SCCR 451, Lord Eassie at para [11]). There will, however, be those rare cases where that remedy will not redress the illegitimate prejudice caused to an accused by reason of the Crown’s conduct. This is such a case.
[42] The fact that the Crown happen to become aware of the nature of an accused’s defence is not of itself sufficient to justify the sustaining of a plea in bar based on oppression. Knowledge of a defence can occur through a number of legitimate means, such as the court ordering a retrial on appeal or by operation of the statutory provisions concerning special defences and defence statements. The accused may have volunteered this information at interview or when speaking to a third party. Those situations are not akin to the present. The fundamental problem is that not only did the Crown recover the confidential material, which included a detailed statement of the first respondent relative to the facts libelled in charge (1), they proceeded to examine it in the face of a plea of legal privilege. Even after that plea had been stated in court proceedings, they sent it to an expert witness for consideration. Such acts were not only oppressive, they were also such that no mechanism can be effectively used to remedy the prejudice to the defence in having the first respondent’s detailed account to his solicitors revealed to both Crown and co-accused. It is a factor in favour of the Crown that they were not acting in bad faith, but only upon, first, a misconception of the law and, secondly, latterly pure carelessness. Nevertheless, the level of illegality is such that it can neither be condoned nor countenanced notwithstanding the relatively serious nature of the charge. In these circumstances, even if the court does not agree entirely with the reasoning of the PH judge, it is unable to fault his conclusion that the plea of oppression ought to be sustained.
[43] For these reasons, the Crown appeals are refused.