The judge had erred in refusing to grant a certificate of inadequacy, under s.14 Drug Trafficking Offences Act 1986, in respect of a confiscation order.Appeal from the decision of Gibbs J refusing to grant a certificate of inadequacy pursuant to s.14 Drug Trafficking Offences Act 1986 to the claimant ('C'), who was the former wife of a major drug trafficker. The Act had since been repealed and replaced but it was common ground that it was the relevant Act to apply in the circumstances. In 1994, C had been sentenced to three years' imprisonment and given six months in which to pay a sum of approximately ?700,000. A period of 12 months' imprisonment in default of payment was imposed to the conclusion of the sentence. C had served her term of imprisonment and paid some, but not all, of what she was ordered to pay. C then applied for a certificate of inadequacy on the basis that she had no money, no access to money and was existing in straightened circumstances and on benefits. The Crown Prosecution Service submitted that the only way for a defendant to avoid serving a period of imprisonment in default of payment was to pay the confiscation order in full. C accepted that if she could not obtain a certificate of inadequacy she would indeed be liable to serve such a term of imprisonment. The judge took the view that in the event that he did not grant a certificate of inadequacy, the magistrates' court could take into account C's hardship when dealing with enforcement of the confiscation order. The judge held that, following the making of the confiscation order, and in full knowledge that the court had held the sum in question to be the proceeds of drug trafficking, C did substantially contribute to those funds being placed beyond the reach of the confiscation order. Accordingly, he found that he was unable to exercise his discretion in favour of C and was constrained to disregard the inadequacy in the realisable property, with the result that he could not grant a certificate of inadequacy pursuant to s.14 of the Act.HELD: (1) The judge did not identify any powers available to the magistrates to take into account hardship so as to avoid imprisoning in instances where there were in fact no assets available to satisfy a confiscation order. (2) If the assets had been C's and she had dissipated them after the making of the order, then a certificate would have been issued. It did not appear that the judge bore that in mind. There was no moral distinction between dissipating the assets oneself and facilitating the dissipation of those assets by someone to whom one had given them. In so far as the dissipation was done in order to ensure that C's children were looked after, any moral distinction must be in her favour. The judge should have considered these matters and borne them in mind when deciding whether or not to exercise his discretion in favour of the prosecution. There was no sign that he did so. (3) The judge did not appear to have kept in mind that he was being asked by the prosecution to exercise a discretion in their favour. The default position was that a certificate should have been issued where there was an inadequacy. (4) The provisions at issue were difficult to construe. However, the judge had not articulated his reasoning for exercising his discretion in favour of the prosecution and the appeal should be allowed.Appeal allowed.
 EWCA Civ 1608