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Indeed, there seems to me force in the Appeal Courts own view that the Crowns case is logically stronger still in the light of PC Lynchs statement than without it. Ratio
Given, however, the view of the majority of this court that the application of the McInnes test here leads inescapably to the conclusion that there was a real possibility that the jury might have arrived at a different verdict ie that this would be the only rational view open to the Appeal Court I shall not carry my ow...
In the result, all that will be left for decision by the Appeal Court under section 118 of the 1995 Act is the question whether authority should be granted to bring a new prosecution under section 119. Ratio
To this end I agree with Lord Hope that the case should be remitted to a different constitution of the Appeal Court to determine that question and having done so to quash the conviction. RPC
Needless to say, I share to the full the regret expressed by Lord Hope both as to the delay our decision is likely to cause in the final disposal of the case and as to the distress it will cause to the deceaseds grieving relatives. Ratio
The Political Parties, Elections and Referendums Act 2000 (the Act) introduced, for the first time in this country, restrictions on the donations that can be made to registered political parties. FAC
All statutory references in this judgment are to the Act. FAC
Part IV of the Act specifies those from whom it is permissible for political parties to accept donations. FAC
Donations from an individual may only be accepted if the donor is on an electoral register. FAC
The Act confers on a magistrates court the power, at the instigation of the Electoral Commission (the Commission), to forfeit from party funds a sum equal to a donation that has been accepted from an impermissible source. FAC
This appeal raises the question of the criteria that should properly be applied by a magistrates court when exercising this power. Ratio
This question is of particular interest to the United Kingdom Independence Party (UKIP), a small registered political party which has yet to succeed in returning a member to Westminster. FAC
UKIP has relied for the majority of its funding on a single supporter, Mr Alan Bown. FAC
Since 2003 Mr Bown has made donations to the party, in one form or another, amounting to over 1 million. FAC
By inadvertence, between 1 December 2004 and 2 February 2006, he ceased to be on any electoral register. FAC
During this period his donations to UKIP amounted to 349,216. FAC
On 16 March 2007 the Commission made an application to the Senior District Judge in the City of Westminster Magistrates Court for an order forfeiting the whole of this sum. FAC
The Senior District Judge ordered the forfeiture of only a small proportion of this sum. FAC
The Act gives a political party a right to appeal to the Crown Court against a forfeiture order but no right of appeal is given to the Commission. FAC
UKIP did not appeal against the order of the Senior District Judge, but the Commission challenged his decision by an application for judicial review. FAC
In a judgment delivered on 22 January 2009 [2009] EWHC 78 (Admin) Walker J identified a wide range of matters to which the Senior District Judge should have had regard when considering the forfeiture application. FAC
He held that the Senior District Judge had failed to give adequate reasons for his decision and ordered that the case should be remitted to the magistrates court for further consideration. FAC
The Commission appealed to the Court of Appeal, and was successful [2009] EWCA Civ 1078. FAC
On 19 October 2009, giving the only reasoned judgment, Sir Paul Kennedy held that, on a true construction of the relevant provisions of the Act, the discretion of the Senior District Judge was very tightly circumscribed. FAC
There was a strong presumption in favour of forfeiture. FAC
Where a donation was received by a political party from an impermissible source a forfeiture order should follow as a matter of course in the absence of exceptional circumstances. FAC
The magistrates court should, on remission, reconsider the matter in accordance with this approach. FAC
Before this Court Mr Patrick Lawrence QC for UKIP has sought to uphold the approach of Walker J, whereas Mr Michael Beloff QC for the Commission has urged that the analysis of the Court of Appeal was correct. FAC
The difference between the two has been described as the presumption issue. FAC
The relevant provisions of the Act STA
Part I of the Act establishes the Commission which is given a wide range of regulatory powers and duties in relation to elections and political parties, including keeping under review the registration of political parties and the regulation of their income and expenditure (section 6(1)(e)). STA
Part IV deals with Control of Donations to Registered Parties and their Members etc. STA
Chapter II imposes restrictions on the receipt of donations. STA
Section 54(1) provides that a donation must not be accepted if the person seeking to make it is not, at the time of its receipt, a permissible donor, or if his identity cannot be ascertained. STA
Section 54(2) identifies those who are permissible donors. STA
These include an individual registered in an electoral register and a company registered under the Companies Act 2006, incorporated within the United Kingdom or another member state, and carrying on business in the United Kingdom. STA
Section 54(3) provides that a donation made in the form of a bequest will have been made by a permissible donor provided that he was registered in an electoral register at any time within the five year period that terminated with his death. STA
Section 56 imposes duties in relation to the acceptance or return of donations and imposes criminal sanctions for breach of those duties. STA
Where section 54 prohibits acceptance of a donation it must be returned within 30 days of receipt. STA
If it is not, both the party and the treasurer of the party are guilty of an offence, albeit that it is a defence to prove that all reasonable steps were taken to verify or ascertain whether the donor was a permissible donor and that, as a result, the treasurer believed that he was a permissible donor. STA
The effect of section 56(5) is that a donation will be deemed to have been accepted, even if it is returned within 30 days, unless a record can be produced of its receipt and its return. STA
Section 58 contains the provision that has given rise to this appeal. STA
It deals with forfeiture of donations that have been made by impermissible or unidentifiable donors. STA
Where these have been accepted, notwithstanding that their acceptance was prohibited, section 58(2) provides: The court may, on an application made by the Commission, order the forfeiture by the party of an amount equal to the value of the donation. STA
Section 58(4) makes it plain that such an order may be made whether or not proceedings are brought against any person for an offence connected with the donation. STA
Section 58(5) provides that in England and Wales the court is a magistrates court. STA
Section 60 provides that proceedings under section 58 shall be brought against the party in its own name and not in the name of any of its members and that any amount forfeited is to be paid out of the funds of the party. STA
It is notable that section 58 does not provide for the automatic forfeiture of any donation that is accepted from an impermissible source. Ratio
The provision that the court may order its forfeiture confers a discretion on the court. Ratio
Furthermore it has been common ground, rightly in my view, that the Commission also enjoys a discretion whether or not to make an application for forfeiture to the court. Ratio
The Act itself gives no indication of the criteria that should govern the exercise of either discretion. Ratio
It is the former discretion that is critical, but it would be strange if the courts discretion was narrower than that of the Commission. Ratio
The second issue of interpretation Ratio
The primary issue is the presumption issue. Ratio
Does section 58(2) confer a broad discretion on the court whether or not to make a forfeiture order, or is there a strong presumption in favour of forfeiture? But section 58(2) raises a secondary issue of interpretation. Ratio
It confers on the court a power to order forfeiture of an amount equal to the value of the donation. Ratio
Where the court exercises this power, does it have to order forfeiture of an amount equal to the total value of the donation, or is it implicit that the court has a discretion to order forfeiture of a lesser sum if it considers this appropriate? This has been described as the all or nothing issue. Ratio
There is a potential interrelationship between the presumption issue and the all or nothing issue. Ratio
The Commission argues that Parliament has deliberately chosen a stringent regime in order to ensure that political donations come from acceptable sources. Ratio
There is no half-way house. Ratio
Similar policy considerations support both a strong presumption in favour of forfeiture and a requirement that forfeiture should be total. Ratio
Conversely a wide discretion whether to forfeit or not sits better with a power to order partial forfeiture, so that the court has the flexibility to tailor its order to the particular facts. Ratio
The approach to interpretation Ratio
The answer to the all or nothing issue will not, however, determine the presumption issue. Ratio
This is demonstrated by the fact that both Walker J and the Court of Appeal held that the power conferred on the magistrates court by section 58(2) was an all or nothing power. Ratio
In these circumstances I have not found it helpful to try to answer the all or nothing issue first. Ratio
The more helpful approach is to consider the interpretation of section 58(2) having regard to the mischief at which it is aimed. Ratio
The parties are agreed that the discretion conferred by section 58(2) should be used to promote the policy and objects of the statute. Ratio
This proposition is supported by high authority see Padfield v Minister of Agriculture, Fisheries and Food [1968] AC 997 at 1030 per Lord Reid. Ratio
This principle led Lord Bridge to observe in R v Tower Hamlets London Borough Council, Ex p Chetnik Developments Ltd [1988] AC 858, at p 873: Thus, before deciding whether a discretion has been exercised for good or bad reasons, the court must first construe the enactment by which the discretion is conferred. PRE
Some statutory discretions may be so wide that they can, for practical purposes, only be challenged if shown to have been exercised irrationally or in bad faith. Ratio
But if the purpose for which the discretion is intended to serve is clear, the discretion can only be validly exercised for reasons relevant to the achievement of that purpose. PRE
In applying the Padfield principle in this case there are two questions to be asked. Ratio
The first is: what are the objects of the forfeiture permitted by section 58(2)? The second is: why has Parliament chosen to give the court a discretion whether or not to order forfeiture of a donation that has come from an impermissible source rather than to make such forfeiture automatic? To answer these questions it...
The legislative history Ratio
The Labour Partys 1997 Election Manifesto announced the following intention: We will oblige parties to declare the source of all donations above a minimum figureForeign funding will be banned. Ratio
On 12 November 1997, shortly after taking up office, the Prime Minister extended the terms of reference of the Committee on Standards in Public Life to add: To review issues in relation to the funding of political parties, and to make recommendations as to any changes in present arrangements. Ratio
This led to the Fifth Report of the Committee, under the chair of Lord Neill of Bladen QC, on the Funding of Political Parties in the United Kingdom (the Neill Report), which was published in October 1998. Ratio
Chapter 4 of the Neill Report dealt with Donations: Transparency and Reporting. Ratio
It recommended the imposition on political parties of a duty to report the sources of donations, backed by criminal sanctions: 4.61 The reporting obligations of the political parties should be backed by criminal sanctions. Ratio
These should be so drafted as to distinguish between inadvertent and deliberate failure to report a disclosable donation. Ratio
In the latter case those responsible could be fined or imprisoned. Ratio
In both cases the court would have power to order the defaulting political party to forfeit a sum not exceeding the unreported donation. Ratio
Knowingly to make a false return should also be an offence. Ratio
Prosecutions would be put in the hands of the Director of Public Prosecutions and should not be the concern of the Election Commission. Ratio
Private prosecutions should be allowable. Ratio
Chapter 5 of the Neill Report dealt with Foreign Donations. Ratio
After setting out the arguments for and against a ban on foreign donations, the Committee reached the following conclusion: 5.16We have, therefore, concluded that, at a time when the whole question of the funding of political parties is being re-examined, it is right to take the opportunity to lay down the principle th...
The Report explained that the Committee had found it difficult to produce a definition of foreign donations for the purpose of banning these. Ratio
Accordingly they decided to approach the problem from the opposite direction by defining permissible sources from which alone donations could be received. Ratio
The Report explained: 5.20 We begin by considering those individuals from whom the political parties should be able to receive donations. Ratio
We believe that they come under two headings: those who are registered voters in the United (1) Kingdom; and (2) those who are eligible to be put on an electoral register in the United Kingdom. Ratio
5.21 As to the distinction between (1) and (2) above, we think that a donation could be properly received from a person who was eligible to be put on the electoral register because such a person already has, under existing legislation, the right to participate in the electoral process subject to taking the additional s...
5.22 Categories (1) and (2) cover not only British subjects resident here, but extend to Commonwealth citizens resident here, citizens of the Republic of Ireland resident here, and citizens of the European Union resident here. Ratio
The categories also include persons known as overseas voters. Ratio
The test of entitlement to be entered on an electoral register was a rational basis for discriminating between donors with adequate connections with the United Kingdom and foreign donors. Ratio
British, Republic of Ireland, Commonwealth and European Union citizens are entitled to register on an electoral register in the electoral area in which they reside section 4 of the Representation of the People Act 1983. Ratio
If a donor is not qualified to be entered on an electoral register in the United Kingdom it is not unrealistic to treat that donor as lacking sufficient connection with the United Kingdom to be a desirable source of party funding. Ratio
The following paragraph of the Report dealt with enforcement and penalties in relation to the ban on foreign donations: 5.42 In essence, what we said in Chapter 4 at paras 4.60 and 4.61 should apply here too with necessary modifications. Ratio
Thus, the Election Commission will have statutory powers to call for information and to institute an investigation into any donation which it suspects has not come from a permissible source. Ratio