The Court held:

by five votes to two, that Article 6 § 2 (presumption of innocence) of the European Convention on Human Rights was not applicable;

unanimously, that there had been no violation of Article 6 § 1 (right to a fair trial);

and that there had been no violation of Article 1 of Protocol No. 1 (protection of property).

The applicant, Steven Phillips, is a British national, who was convicted on 27 June 1996, at Newport Crown Court, of being involved in the importation in November 1995 of a large quantity of cannabis resin, contrary to section 170(2) of the Customs and Excise Management Act 1979. On 12 July 1996 he was sentenced to nine years’ imprisonment. He had previous convictions, but none concerning a drugs-related offence.

An inquiry was then conducted into the applicant’s means under Section 2 of the Drug Trafficking Act 1994. At the confiscation hearing before the Crown Court, the judge applied section 4(3) of the 1994 Act, which empowers a court to assume that all property held by a person convicted of a drug-trafficking offence within the preceding six years represented the proceeds of drug trafficking. On this basis, the applicant was assessed to have received, as the proceeds of drug trafficking, 91,400 pounds sterling (GBP) and a confiscation order was made for this amount. If the applicant failed to pay, he was to serve an extra two years’ imprisonment, consecutive to the nine-year term.

The applicant was refused leave to appeal against conviction and sentence (including the imposition of the confiscation order).

The applicant complained that the statutory assumption under the 1994 Act violated his right to be presumed innocent, guaranteed under Article 6 § 2. He also complained that the confiscation order was in breach of Article 1 of Protocol No. 1 to the Convention.

The Court considered that the confiscation procedure was analogous to the determination by a court of the amount of a fine or the length of a period of imprisonment to impose upon a properly convicted offender, (see also Welch v. the United Kingdom, 9 February 1995). Article 6 § 2 does not apply to sentencing and the Court, therefore, found that the article was not applicable to the confiscation proceedings brought against the applicant.

The Court considered that a person’s right in a criminal case to be presumed innocent and to require the prosecution to bear the onus of proving the allegations against him or her formed part of the general notion of a fair hearing under Article 6 § 1.

However, the Court observed that the statutory assumption under Section 4(3) of the 1994 Act was not applied in order to facilitate finding the applicant guilty of an offence, but, instead, to enable the national court to assess the amount at which the confiscation order should properly be fixed. Thus, although the confiscation order calculated by way of the statutory assumption was considerable – GBP 91,400 – and although the applicant risked a further term of two years’ imprisonment if he failed to make the payment, his conviction of an additional drug-trafficking offence was not at stake.

Further, the system was not without safeguards. The assessment was carried out by a court with a judicial procedure including a public hearing, advance disclosure of the prosecution case and the opportunity for the applicant to adduce documentary and oral evidence. The court was empowered to make a confiscation order of a smaller amount if satisfied, on the balance of probabilities, that only a lesser sum could be realised. The principal safeguard, however, was that the assumption made by the 1994 Act could have been rebutted if the applicant had shown, again on the balance of probabilities, that he had acquired the property other than through drug trafficking. Furthermore, the judge had a discretion not to apply the assumption if he considered that applying it would give rise to a serious risk of injustice.

In calculating the amount of the confiscation order based on the benefits of drug trafficking, the trial judge had expressed himself to be reliant on the statutory assumption. However, the Court noted that, in respect of every item taken into account, the judge was satisfied, on the basis either of the applicant’s admissions or evidence adduced by the prosecution, that the applicant owned the property or had spent the money, and that the obvious inference was that it had come from an illegitimate source. Furthermore, had the applicant’s account of his financial dealings been true, it would not have been difficult for him to rebut the statutory assumption. Finally, when calculating the value of the realisable assets available to the applicant, it was significant that the judge took into account only the house and the applicant’s one-third share of the family business, specific items which he had found on the evidence still to belong to the applicant.

Overall, therefore, the Court found that the application to the applicant of the relevant provisions of the Drug Trafficking Act 1994 was confined within reasonable limits, given the importance of what was at stake, and that the rights of the defence were fully respected. It followed that the Court did not find that the operation of the statutory assumption deprived the applicant of a fair hearing in the confiscation procedure. In conclusion, there had been no violation of Article  6 § 1.

The Court noted that the figure payable under the confiscation order corresponded to the amount by which the Crown Court judge found the applicant to have benefited from drug trafficking over the preceding six years and was a sum which he was able to realise from the assets in his possession.  Against this background, and given the importance of the aim pursued, the Court does not consider that the interference suffered by the applicant with the peaceful enjoyment of his possessions was disproportionate. It followed that there had been no violation of Article 1 of Protocol No. 1.