Barton and Booth – note on the Court of Appeal decision on Ivey and Ghosh
May 1, 2020
Benjamin Myers QC, Nicola Daley and Ray Smith of Exchange Chambers prosecuted Barton and Booth v R at trial. Benjamin Myers QC and Nicola Daley appeared on behalf of the prosecution in the appeal of Barton and Booth v R together with David Perry QC and Katherine Hardcastle of 6KBW College Hill.
The headline points of the judgement are as follows:
- The test for dishonesty in English criminal law is the test described by the Supreme Court in Ivey v Genting Casinos (UK) (trading as Crockfords Club)  UKSC 67. The test described in R v Ghosh  QB 1053 does not apply [Barton paragraphs 1 and 105].
- Where the Supreme Court directs that an otherwise binding decision of the Court of Appeal should no longer be followed and specifically proposes an alternative test that it says must be adopted, the Court of Appeal is bound to follow that direction from the Supreme Court even though it is strictly obiter [Barton paragraph 104].
- Whilst conspiracy to defraud requires both a) dishonesty and b) unlawfulness either as to the object of the agreement or the means by which it will be carried out, there is no requirement for ‘unlawfulness’ or ‘aggravating feature’ over and above that dishonest agreement, so long as that dishonest agreement includes an element of unlawfulness in its object or means [Barton paragraph 122].
- A person with capacity who chooses to gives away property or proprietary rights may still be the victim of an offence of dishonesty [Barton paragraph 131 to 140].
This note deals with points 1) and 2), which were at the heart of this appeal.
In Barton and Booth v R  EWCA Crim 575, the Criminal Division of the Court of Appeal considered the correct approach to be taken to dishonesty as it applies to the criminal law. In doing so, the Court confirmed that the test for dishonesty articulated in the Supreme Court decision of Ivey v Genting Casinos (UK) (trading as Crockfords Club)  UKSC 67 displaced the test for dishonesty that had been laid down in R v Ghosh  QB 1053 and which had applied in the criminal courts for 35 years.
In dealing with this issue, the five-judge Court presided over by the Lord Chief Justice, Lord Burnett of Maldon, considered also the application of the common law of precedent. This was a necessary part of the decision-making process because the Court of Appeal was required to consider the conflict between the well-established Court of Appeal authority of Ghosh and the Supreme Court decision in Ivey. What emerged in Barton was not only clarification that the Ivey test for dishonesty was the correct test for dishonesty in English law, but a modification to the common law rule of precedent.
The facts of Barton were extraordinary. David Barton was the owner of Barton Park nursing home in Southport. Over a period of two decades he used his position to groom, defraud and steal from certain elderly and dependant residents. Consistent features in the case of each victim targeted were that they were wealthy, vulnerable and childless. He obtained over £4,000,000 from his criminal activities and was finally arrested as he sought to defraud the estate of one of these residents for a sum of approximately £10,000,000. After a trial of 12 months he was convicted of offences of conspiracy to defraud, fraud, theft, false accounting and money laundering and was sentenced to 21 years’ imprisonment. Rosemary Booth, his general manager was convicted of offences of conspiracy to defraud and was sentenced to 6 years’ imprisonment.
Both defendants appealed against conviction and David Barton appealed against sentence. The appeals against conviction were brought on a variety of grounds, all of which were dismissed. David Barton’s sentence of imprisonment was reduced from 21 years’ imprisonment to 17 years. This note deals with the Court of Appeal’s judgment concerning the law of dishonesty and the approach to precedent. These were central aspects of the appeal.
The test for dishonesty
At trial the judge had directed the jury on the basis of the test for dishonest in Ivey, rather than the Ghosh test. This accorded with the observations of the Supreme Court in Ivey where that Court had identified the correct test and had said that the direction based on Ghosh should no longer be given. However, the fact remained that the Ivey direction had been given in observations that were strictly obiter dicta (ie., not essential to the reasoning of the Supreme Court with regard to the matter it was actually deciding). As a matter of precedent, obiter dicta are not binding. Therefore, in Barton, both appellants argued that the jury had been wrongly directed because the Ivey direction was not binding, that the Ghosh test was the test that should have been applied, and that the reasoning in Ghosh was to be preferred to that of the Supreme Court in Ivy.
The test for dishonesty as described in Ghosh was as follows:
“… a jury must first of all decide whether according to the ordinary standards of reasonable and honest people what was done was dishonest. If it was not dishonest by those standards that is the end of the matter and the prosecution fails.
If it was dishonest by those standards then the jury must consider whether the defendant himself must have realised that what he was doing was by those standards dishonest. …” [Ghosh paragraph1064D]
By contrast, in Ivey the Supreme Court describe the correct test as follows:
“When dishonesty is in question the fact-finding tribunal must first ascertain (subjectively) the actual state of the individual’s knowledge or belief as to the facts. The reasonableness or otherwise of his belief is a matter of evidence (often in practice determinative) going to whether he held the belief, but it is not an additional requirement that his belief must be reasonable; the question is whether it is genuinely held. When once his actual state of mind as to knowledge or belief as to facts is established, the question whether his conduct was dishonest is to be determined by the factfinder by applying the (objective) standards of ordinary decent people. There is no requirement that the defendant must appreciate that what he has done is, by those standards, dishonest.” [Ivey paragraph 74]
This test conflicted with that in Ghosh because it had the effect of applying the objective assessment of dishonesty to the defendant’s position (thereby reversing the order of the objective-subjective tests as described in Ghosh) and because it removed the requirement that a defendant must appreciate his own dishonesty by reference to the rest of society.
In Ivey, Lord Hughes set out serious problems with this subjective second leg of Ghosh, which included:
- the more warped D’s standards of behaviour, the less likely it is that he will be convicted of dishonest behaviour;
- it had been designed to assess criminal responsibility by reference to the state of mind of D, but this was unnecessary;
- it was a test that was puzzling and difficult to apply in practice;
- it had led to an unprincipled divergence between the tests for dishonesty in criminal proceedings and civil actions;
- it represented a significant departure from pre-Theft Act 1968 law;
- it did not reflect the pre-Ghosh authorities, nor was it compelled by them.
[Lord Hughes in Ivey, paragraph 57]
Having reviewed the relevant authorities, the Supreme Court in Ivey concluded that Ghosh did not correctly reflect the law and that directions based upon it should no longer be given.
In Barton, the Court of Appeal considered the Supreme Court’s critical analysis of Ghosh. It considered also powerful authorities which post-dated Ghosh but which reflected a pre-Ghosh approach. Having done so, the Court concluded that the correct test for dishonesty in all criminal cases was that established in Ivey [Barton paragraph 105]
Whilst the identification of the correct test for dishonesty was at the centre of this appeal and whilst the Court regarded the test as described in Ivey to be the correct test, the issue arose of whether this obiter dicta of the Supreme Court could properly displace the well-established test in Ghosh and thereby bind the Court of Appeal now.
The Court found that it could do so and it came to this conclusion for the following reason. In Ivey, the Supreme Court had been unanimous in its formulation of the test for dishonesty. Moreover, it had stated clearly that the test it laid down was to apply to all directions on dishonesty and that the Ghosh test was no longer to apply. In such circumstances, the Court of Appeal concluded that the decision of the Supreme Court should be followed, notwithstanding that strictly it was obiter:
“We conclude that where the Supreme Court itself directs that an otherwise binding decision of the Court of Appeal should no longer be followed and proposes an alternative test that it says must be adopted, the Court of Appeal is bound to follow what amounts to a direction from the Supreme Court even though it is strictly obiter. To that limited extent the ordinary rules of precedent (or stare decisis) have been modified. We emphasise that this limited modification is confined to cases in which all the judges in the appeal in question in the Supreme Court agree that to be the effect of the decision.” [Barton paragraph 104]
Whilst this development is bound to generate analysis and comment, it is important to understand that this approach follows from the Court of Appeal’s previous analysis of how the law of precedent applied in R v James; R v Karimi  QB 588;  EWCA Crim 14. In James the Court of Appeal determined the correct statement of the law of provocation where there existed a conflict between the House of Lords decision in R v Smith (Morgan)  AC 146 and the Privy Council decision in Attorney General for Jersey v Holley  2 AC 580. The Court of Appeal recognised that it was the decision of the Privy Council that was binding notwithstanding the established rule that a decision of the House of Lords would ordinarily take precedence. They recognised this because:
- all the Law Lords in the Privy Council in Holley agreed that their decision would definitively clarify the English law;
- the majority in the Privy Council in Holley constituted half the Appellate Committee of the House of Lords;
- the result of an appeal to the House of Lords was a foregone conclusion (because on any such appeal, inevitably the House of Lords would follow the law as clarified by the Privy Council).
Therefore, in Barton, the Court concluded that:
“We are in a strongly analogous position, indeed it is stronger because the ordinary rules of precedent require us to follow decisions of the Supreme Court (as the successor of the Judicial Committee of the House of Lords). The undoubted reality is that in Ivey the Supreme Court altered the established common law approach to precedent in the criminal courts by stating that the test for dishonesty they identified, albeit strictly contained in obiter dicta, should be followed in preference to an otherwise binding authority of the Court of Appeal. As in James, we do not consider that it is for this court to conclude that it was beyond their powers to act in this way.” [Barton paragraphs102].
On this basis, the Court identified a limited modification of the ordinary rules of precedent [paragraph 104]. However this modification of the common law of precedent is described, it has the following effect: that where the Supreme Court makes a direction that arises obiter, and all the judges in that appeal agree that the purpose of such a direction is to state the law as it relates to a specific issue, that decision is binding on the Court of Appeal.
 Notwithstanding the scholarly debate generated by the demise of Ghosh, the way in which Ghosh enabled a defendant potentially to define the limits of his own dishonesty has long been considered an anomaly in the criminal law: for example, the law of self-defence does not allow a defendant to justify violence on the basis of what he or she believed members of the public would consider acceptable, nor can reasonable belief in consent in cases of rape be justified on the basis of a defendant’s personal beliefs as to the standards of other members of the public.
 In particular, Royal Brunei Airlines Sdn Bhd v Tan  2 AC 378 and Barlow Clowes International Ltd v Eurotrust International Ltd  1 WLR 1476;  UPPC 37: at Barton paragraphs 83, 91, 107 and 108.