LORD HUGHES: (with whom
Lady Hale, Lord Mance, Lord Hodge and Lord Lloyd-Jones agree)
A preliminary issue appeal
1.
This appeal raises a point of pure statutory construction relating to
the manner in which election expenses are required to be calculated and
declared. It is important to appreciate that the point is raised not, as it
might in other circumstances have been, on an application for judicial review
or a declaration as to the law, but as a preliminary question in a criminal
prosecution. The defendants face charges of knowingly making false declarations
in relation to election expenses, or aiding and abetting or encouraging or
assisting such offences. The parties asked the judge to determine the point on
a preparatory hearing pursuant to Part III of the Criminal Procedure and
Investigations Act 1996 (“the 1996 Act”). The criminal trial, although
technically begun by the preparatory hearing, has yet to take place, and no
jury has yet been sworn. No one can yet know what the real issues will turn out
to be at that trial. No one can yet know what the evidence will be, still less
which facts will be disputed and which common ground. The present question of
statutory construction may arise at the trial, or it may not. If it does arise,
it is unknown at this stage what its impact may be on the trial. For this
reason it is important that this judgment is directed to the pure question of
law, and that as little as possible is said about what the allegations are or
what the facts may turn out to be, lest there be risk that the jury’s
consideration of the case is affected. It is also for this reason that there
are automatic statutory restrictions in the 1996 Act upon reporting of
preparatory hearings and any appeals therefrom. This judgment is public and can
be reported in the usual way. But reporting must not go beyond what is in this
document together with the formal details permitted by statute: see the section
on reporting restrictions in para 31 at the end of this judgment.
The Certified Question
2.
The question of law certified by the Court of Appeal (Criminal Division)
as a point of law of general public importance was as follows:
“Do property, goods, services or
facilities transferred to or provided for the use or benefit of a candidate
free of charge or at a discount (as identified in section 90C(1)(a) of the
Representation of the People Act 1983 (as amended)) only fall to be declared as
election expenses if they have been authorised by the candidate, his election
agent or someone authorised by either or both of them?”
3.
Whilst that question might also arise in other contexts connected with
elections, in the present case it is raised by one of the realities of modern
campaigning. Political parties are often national in organisation. At a general
election, a national party may typically field candidates standing as adherents
to the party in all or many of the constituencies in the country. At such an
election, the legislation imposes separate limits on the expenditure which is
permitted to the candidate locally and to the party nationally. Both the
constituency candidate and the national party are required to submit returns setting
out their expenditure, and demonstrating that it falls within the limits
applied to them. But national party activity will typically amount to some
support for the constituency candidates standing in its interests. Especially
if the constituency is regarded by a party as marginal, the activities of the
national party in the constituency may well be extensive. So also they may if
the constituency candidate is a leading member of the national party, or for
that matter if one of the competing candidates is a prominent member of another
party. The question will arise when expenditure undertaken by the national
party falls to be accounted for as candidate expenditure, and to be limited by
the ceiling applied to constituency candidates, and when it should be returned
by the national party and governed by the different limit applied to national
parties. An illustration of the question is given by what was described by the
judge as “the battlebus issue”. If the national party sends a liveried coach
containing activists into key constituencies and they there campaign for the
party and/or its candidates, do the expenses fall to be accounted for
nationally or locally? That is by no means the only possible example of the
problem, nor is it the only one which may be in issue in the proposed trial in
the present case. Anyone familiar with modern election campaigns will
appreciate that there may be many other situations where work undertaken by
national parties potentially overlaps with, or arguably amounts to, the support
of one or more local candidates. The certified question which this court is
called upon to answer is likewise only one of a number of technical questions
of electoral law which may bear upon this potential overlap. This judgment is,
however, confined to that certified question.
The legislation
4.
Since the 19th century, legislation has imposed limits upon a candidate’s
election expenses. The current statute is the Representation of the People Act
1983 (“RPA 1983”). Some of the rules and concepts in that Act effectively date
from Victorian times; others have been added by successive modern adjustments,
and amendments have continued since 1983.
5.
Until 2000 there were no rules about national expenditure by political
parties. They were introduced by the Political Parties, Elections and
Referendums Act 2000 (“PPERA 2000”). That Act also made some amendments to RPA
1983.
6.
The two statutes adopt similar general schemes to control expenses. The
principal (but not the only) controls are these.
(i)
They list, in Schedules to the Acts, the kinds of expenditure which
count as declarable expenses (and some kinds which do not).
(ii)
They prescribe who may incur those expenses, and thus fix responsibility
on identifiable persons. In the case of constituency expenses, those persons
are the candidate, his agent, and others if authorised by either of them. In
the case of party expenses, those persons are the party treasurer and deputy
treasurer, or others if authorised by either. Similarly, the statutes prohibit
payment of expenses by persons other than those specified.
(iii)
They impose financial limits on the expenses which may be incurred and
paid.
(iv)
They require a specified person to make a return of the expenses
incurred. In the case of the constituency, that person is the appointed
election agent of the candidate. In the case of party expenditure, it is the party treasurer. Moreover, the returns must
be accompanied by formal declarations of accuracy. Those must be made by the
person making the return and, in the case of the constituency, also by the
candidate.
(v)
Each of the statutes contains a provision including in the expenses
which must be declared, and which must fall within the relevant limit, the cost
of things which are supplied either free of charge or at a discount to the
candidate or party as the case may be, where that cost would, if paid for by
the candidate or party, be election expenses. These are sometimes referred to,
although not in all the statutes, as “notional expenditure”.
As will be seen, the certified question in this case asks
about the relationship between the second and fifth of these controls.
7.
It is a feature of the legislation that the two categories of expenses,
local and national, whether or not they may in practice overlap, are treated as
mutually exclusive. When PPERA 2000 introduced controls over party expenditure
it labelled it in section 72 “campaign expenditure”, and defined it as:
“(2) ‘Campaign expenditure’,
in relation to a registered party, means (subject to subsection (7)) expenses
incurred by or on behalf of the party which are expenses falling within Part I
of Schedule 8 and so incurred for election purposes.”
The meaning of “election purposes” in this subsection is
wide: it is defined thus in subsection (4):
“‘For election purposes’, in
relation to a registered party, means for the purpose of or in connection with
-
(a) promoting or procuring
electoral success for the party at any relevant election, that is to say, the
return at any such election of candidates -
(i) standing in the name
of the party, or
(ii) included in a list of
candidates submitted by the party in connection with the election; or
(b) otherwise enhancing the
standing -
(i) of the party, or
(ii) of any such
candidates,
with the electorate in connection
with future relevant elections (whether imminent or otherwise).”
It follows that if the definition stopped there, all
party activity which has the purpose of enhancing the standing of any of
its candidates would count as campaign expenditure. The mutual exclusion of
party expenses and local candidate expenses is, however, achieved by subsection
(7), to which the foregoing definition is expressly made subject. That provides
(as amended by section 20 of, and paragraph 5(2)(a) of Schedule 6 to, the
Recall of MPs Act 2015):
“‘Campaign expenditure’ does not
include anything which (in accordance with any enactment) falls to be included
in -
(a) a return as to election
expenses in respect of a candidate or candidates at a particular election, or
(b) ... [not here relevant].”
8.
The principal debate in this appeal centres on two provisions of RPA
1983, sections 90ZA and 90C. As the numeration suggests, both are additions to
the statute as originally enacted. Section 90C was added with effect from July
2001 by section 134(1) of PPERA 2000. Section 90ZA was inserted by section
27(2) the Electoral Administration Act 2006 and came into force in September
2006.
9.
Section 90ZA of RPA 1983 contains the current meaning of “election
expenses” (ie, in relation to general elections, those incurred by constituency
candidates). It provides:
“90ZA Meaning of
‘election expenses’
(1)
In this Part of this Act ‘election expenses’ in relation to a candidate
at an election means (subject to subsection (2) below and section 90C below)
any expenses incurred at any time in respect of any matter specified in Part 1
of Schedule 4A which is used for the purposes of the candidate’s election after
the date when he becomes a candidate at the election.
(2)
No election expenses are to be regarded as incurred by virtue of
subsection (1) above or section 90C below in respect of any matter specified in
Part 2 of Schedule 4A.
(3)
In this section and in section 90C below, ‘for the purposes of the
candidate’s election’ means with a view to, or otherwise in connection with,
promoting or procuring the candidate's election at the election.
(4)
For the purposes of this Part of this Act, election expenses are
incurred by or on behalf of a candidate at an election if they are incurred -
(a) by the candidate or his
election agent, or
(b) by any person authorised
by the candidate or his election agent to incur expenses.
(5) [not here relevant]
(6) In this Part and in
Part 3 of this Act, any reference (in whatever terms) to promoting or procuring
a candidate’s election at an election includes doing so by prejudicing the
electoral prospects of another candidate at the election.
(7) Schedule 4A has effect.
[Note: this schedule specifies the kinds of expenditure which are categorised
as election expenses.]
(8) [not here relevant].”
10.
Section 90C of RPA 1983 contains provision for things supplied to a
candidate either free of charge or at a discount. It provides (as amended by
section 74(1) of, and paragraph 117 of Schedule 1 to, the Electoral
Administration Act 2006):
“90C Property, goods, services
etc provided free of charge or at a discount
(1) This section applies
where, in the case of a candidate at an election -
(a) either -
(i) property or goods is
or are transferred to the candidate or his election agent free of charge or at
a discount of more than 10% of the market value of the property or goods, or
(ii) property, goods,
services or facilities is or are provided for the use or benefit of the
candidate free of charge or at a discount of more than 10% of the commercial
rate for the use of the property or for the provision of the goods, services or
facilities,
and
(b) the property, goods,
services or facilities is or are made use of by or on behalf of the candidate
in circumstances such that, if any expenses were to be (or are) actually
incurred by or on behalf of the candidate in respect of that use, they would be
(or are) election expenses incurred by or on behalf of the candidate.
(2) Where this section
applies -
(a) an amount of election
expenses determined in accordance with this section (‘the appropriate amount’)
shall be treated, for the purposes of this Part of this Act, as incurred by the
candidate, and
(b) the candidate’s
election agent shall make a declaration of that amount,
unless that amount is not more
than £50.
This subsection has effect subject
to Part 2 of Schedule 4A to this Act.
(3) Where subsection
(1)(a)(i) above applies, the appropriate amount is such proportion of either -
(a) the market value of the
property or goods (where the property or goods is or are transferred free of
charge), or
(b) the difference between
the market value of the property or goods and the amount of expenses actually
incurred by or on behalf of the candidate in respect of the property or goods
(where the property or goods is or are transferred at a discount),
as is reasonably attributable to
the use made of the property or goods as mentioned in subsection (1)(b) above.
(4) Where subsection
(1)(a)(ii) above applies, the appropriate amount is such proportion of either -
(a) the commercial rate for
the use of the property or the provision of the goods, services or facilities
(where the property, goods, services or facilities is or are provided free of
charge), or
(b) the difference between
that commercial rate and the amount of expenses actually incurred by or on behalf
of the candidate in respect of the use of the property or the provision of the
services or facilities (where the property, goods, services or facilities is or
are provided at a discount), as is reasonably attributable to the use made of
the property, goods, services or facilities as mentioned in subsection (1)(b)
above.
(5) Where the services of an
employee are made available by his employer for the use or benefit of a
candidate, then for the purposes of this section the commercial rate for the
provision of those services shall be the amount of the remuneration and
allowances payable to the employee by his employer in respect of the period for
which his services are so made available (but shall not include any amount in
respect of any contributions or other payments for which the employer is liable
in respect of the employee).
(6) In this section ‘market value’,
in relation to any property or goods, means the price which might reasonably be
expected to be paid for the property or goods on a sale in the open market; and
paragraph 2(6)(a) of Schedule 2A to this Act shall apply with any necessary
modifications for the purpose of determining, for the purposes of subsection
(1) above, whether property or goods is or are transferred to a candidate or
his election agent.”
11.
There are further provisions in the statutes for other kinds of
elections, including referendums, and also for expenditure at elections by
those who are neither candidates nor political parties, such as pressure groups.
The latter expenditure is called “controlled expenditure”. These provisions
are, like those relating to constituency candidates and central parties,
relatively complex. It is not necessary to refer to them in detail, but it is
relevant to note that in several respects they adopt forms of control parallel
to those outlined at para 6 above, including provisions for notional
expenditure. Controlled expenditure, campaign expenditure and candidate’s
election expenses are, once again, made mutually exclusive, each with the others,
by section 87(1) of PPERA 2000.
12.
For each type of regulated expenditure, the statutes require a return. In
the case of election expenses by a candidate, the duty to make the return falls
on the candidate’s appointed election agent. Section 81(1) RPA 1983 (as amended
by section 24 of, and paragraph 27 of Schedule 4 to, the Representation of the
People Act 1985 and by section 138(1) of, and paragraph 7(2) of Schedule 18 to,
PPERA 2000) provides:
“81. Return as to election
expenses
(1)
Within 35 days after the day on which the result of the election is
declared, the election agent of every candidate at the election shall deliver
to the appropriate officer a true return containing as respects that candidate -
(a) a statement of all
election expenses incurred by or on behalf of the candidate; and
(b) a statement of all
payments made by the election agent together with all bills or receipts
relating to the payments.”
The return must, by section 82(1) and (2), be accompanied
by declarations by both the agent and the candidate that it is accurate. The
potential consequences of failure to deliver an accurate return and declaration
are serious. By section 82(6) knowingly to make a false declaration is the
criminal offence of corrupt practice, whilst by section 84 simple failure to
make a correct return or declaration is the offence of illegal practice. The
former carries imprisonment and a fine, by section 168. The latter carries a
fine, by section 169. Both have the further notable effect, by section 173, of
disqualification from the House of Commons or other elective office, subject,
in the case of specified excuses and proof of good faith, to the court’s power
to relieve of that consequence (section 86).
The rival submissions
13.
The Crown’s case is that campaigning activity undertaken in a
constituency by the central national party may be free or discounted services
within section 90C, and thus be accountable for by the candidate, whenever:
(i) it amounts to
services “provided for the use or benefit of the candidate” (section 90C(1)(a)(ii));
and
(ii) they were “made use
of by or on behalf of the candidate” (section 90C(1)(b)); and
(iii) they were so made
use of “in circumstances such that if any expenses were to be … actually
incurred by or on behalf of the candidate in respect of that use, they would be
… election expenses incurred by or on behalf of the candidate” (section
90C(1)(b)).
If those three conditions are met, say the Crown, section
90C(2) applies, and the expenses are to be “treated … as incurred by the
candidate” and must be declared as such by his election agent.
14.
The defendants contend that such campaigning by the national party
cannot amount to election expenses for which the candidate has to account
unless he or his agent, or someone authorised by either of them, has authorised
the expenditure. Authorisation is, say the defendants, a central feature,
throughout the legislation, of responsibility for electioneering expenses.
Section 90ZA(4) so provides for a candidate’s election expenses, and says
plainly that such expenses are only incurred (and thus declarable) if they are
incurred by the candidate, or his election agent, or someone else authorised by
either of them. Say the defendants, provisions essentially mirroring section
90ZA(4) are to be found throughout the legislation and are applied to all the
various forms of electioneering expenses, such as the party’s campaign
expenditure, the controlled expenditure of pressure groups, and referendum
expenditure.
15.
Both parties also relied on consequentialist arguments supporting the
construction for which they contended. The Crown suggested that unless its
construction is adopted the evasion of controls on expenditure would be
encouraged. It also submitted that its construction is consistent with a desire
to maintain equivalence between the position of a candidate supported by a
national party and an independent candidate who has no national organisation
behind him. For their part, the defendants contended that unless authorisation
is kept firmly at the centre of responsibility for declaring expenses, the task
of an election agent would become impossible wherever the national party
undertakes campaigning activity which in fact benefits the local candidate, but
which he has not sought out, required or authorised; that would apply, say the
defendants, in a great number of constituencies, if not in most.
Analysis
16.
It is plainly correct, as Ms Montgomery QC contended for the defendants,
that the concept of authorisation of expenses is frequently resorted to in the
legislation. In applying the control which restricts those who may incur
constituency election expenses, section 75 RPA 1983 does so by making it an
offence to incur such expenses unless one is the candidate, his election agent,
or a person authorised in writing by the election agent to do so. Similar
provisions are to be found in the controls relating to party campaign expenses
(section 75(1) PPERA 2000) and to controlled expenditure by recognised third
parties (section 90 PPERA 2000). The same concept is employed in what the
defendants contend is the crucial section relating to constituency election
expenses, namely section 90ZA(4) RPA 1983. That, as has been seen, addresses
the question of when election expenses are to be regarded for the purposes of
the Act as incurred “by or on behalf of a candidate”. This question has to be
addressed because in several places the Act attaches consequences when expenses
have been incurred “by or on behalf of a candidate”. The duty to make a return
under section 81 arises when expenses are thus incurred, but not otherwise. The
monetary limit on expenses imposed by section 76(1) of RPA 1983 is similarly
imposed in relation to expenses incurred by or on behalf of the candidate. And
section 73(1) of RPA 1983, which prohibits the payment of election expenses
otherwise than via the election agent, speaks once again of prohibiting the
payment of expenses which are incurred “by or on behalf of” the candidate. What
section 90ZA(4) undoubtedly does is to say that actual (as distinct from
notional) constituency election expenses are only incurred by or on behalf of
the candidate if they are incurred either by the candidate himself, or by his
election agent, or by someone authorised by either of them. It is no doubt
correct that the effect of section 90ZA(4) is that authorisation (by candidate,
election agent or person authorised by either) is ordinarily a necessary
feature of constituency election expenses falling within that section and thus
within the rules about monetary limit (section 76) and payment (section 73). It
is also correct that there are broadly similar provisions in PPERA 2000
employing the concept of authorisation in the equivalent contexts of party
campaign expenses and third party controlled expenses when it comes to monetary
limits and the prohibition of payment by other people.
17.
The critical question, however, is whether this concept of authorisation
also governs the notional expenditure provision in section 90C of RPA 1983, and
for that matter its equivalents in PPERA 2000 for party campaign expenses and
third party controlled expenses. The certified question (see para 2 above) asks
in terms whether the conditions set out in section 90ZA(4) apply to notional expenditure
within section 90C. The defendants contend that they do. The Court of Appeal
was persuaded that they were right. In the end this depends on the words of the
statute.
18.
Section 90C asks, by subsections (1)(a) and (b), three questions about
the expenditure it is considering. If those questions are answered “yes”, then
by subsection (2) it stipulates that the expenditure shall be “treated … as incurred
by the candidate” for the purposes of the Act. That is a deeming provision. If
the conditions are satisfied, the notional expenditure becomes by statute the
same as if it had been actually incurred by the candidate, even though it has
not actually been incurred by him. The three questions can be simplified for
present purposes by expressing them in terms of services, but of course the
same applies to goods, property or facilities. The questions posed by
subsections (1)(a) and (b) are:
1. Were the services
provided for the use or benefit of the candidate either free of charge or at a
discount of more than 10% of commercial value? (subsection (1)(a))
2. Were they made use
of by or on behalf of the candidate? (subsection (1)(b)) and
3. If the services had
actually been paid for (expenses actually incurred) by or on behalf of the
candidate, would those expenses be election expenses incurred by or on his
behalf (and thus subject to the various controls imposed by the Act)? (also
subsection (1)(b)).
19.
There is no room in this sequence of conditions or questions for an
additional requirement that the provision of the services must have been
authorised by the candidate or his election agent, or by someone authorised by
either of them. The test is a different one from that in section 90ZA(4) for
expenses actually incurred. The test is use, by or on behalf of the candidate
(although see para 25 below).
20.
This analysis is confirmed by the express provision in section 90ZA(1)
that the definition of election expenses there provided is subject to section
90C. What section 90ZA(4) does is to stipulate when election expenses, defined
as subject to section 90C, are incurred by or on behalf of the candidate. But
section 90C(2) includes also as expenses incurred by the candidate those which
satisfy the conditions of section 90C(1)(a) and (b). In short, rather than section
90C incorporating the words of section 90ZA(4), it provides an additional
category of expenditure which has to be included within subparagraph (a) of that
latter subsection - that is to say as expenses notionally incurred by the
candidate.
21.
There is nothing in the Act (or for that matter in the equivalent
provisions of PPERA 2000) which necessitates departure from this natural
reading of section 90C.
22.
The third condition/question is an essential part of the operation of
section 90C. Unless the services (etc) fall within one of the categories of
election expenses caught by the Act, and particularly by Schedule 4A (as
inserted by section 27(5) of the Electoral Administration Act 2006), and unless
payment by the candidate himself, if made, would amount to election expenses,
section 90C simply does not bite. It is not, however, necessary to adopt the
defendants’ construction of the Act in order for the third condition/question
to have content.
23.
It would appear to be true that one consequence of the addition of
section 90C to the Act is to qualify the effect of a modest exemption for small
expenditure, always in the Act and now contained in section 75(1ZA) (as
inserted by section 131(3) of PPERA 2000) and (1ZZB) (as inserted by section
25(3) of the Electoral Administration Act 2006). Those provisions exempt from
the rule that unauthorised persons may not incur expenses in support of a
candidate small payments (now not exceeding £700) made independently of any
similar ones. The effect of section 90C would appear to be that, although by
section 75 the payer of such small sums is not guilty of the offence of making
an impermissible payment, nevertheless services (etc) provided by someone who
spends such a sum upon them may count as notional expenditure which must be
declared and counted towards the statutory limit if (but only if) the services
are made use of by the candidate or on his behalf. Those are, however, not
necessarily inconsistent provisions.
24.
It is no doubt true that in practice it is difficult to envisage the transfer
of property or goods, also covered by the notional expenditure provisions of
section 90C, occurring without the concurrence of the candidate. That may be
relevant to the proper construction of the expression “made use of by or on
behalf of the candidate”, or for that matter to whether any declaration made is
knowingly false, but it cannot be a reason to import into any part of section
90C the wording of section 90ZA(4).
25.
The Court of Appeal drew attention to the second condition/question set
out in para 18 above, posed by section 90C(1)(b). It drew attention to the fact
that the subsection is satisfied when the services (etc) are made use of by
anyone, on behalf of the candidate, and that it is not limited to use by the candidate
or his election agent. It is, however, important to observe that section
90C(1)(b) is not satisfied merely by the services (etc) being for the benefit
of the candidate. There is a plainly deliberate difference of expression
between subsections (1)(a)(ii) and (1)(b). The services (etc) have, by
(1)(a)(ii) to be provided “for the use or benefit” of the candidate
(emphasis added). But their cost only counts as notional expenditure if they
are “made use of by or on behalf of the candidate”: subsection (1)(b). Mr
Straker QC, for the Crown, was at pains to submit that making use of the
services (etc) involves some positive activity by the candidate or someone on
his behalf. Ordinarily, one would also expect that it would involve conscious
activity. It is not enough that the services enure for the benefit of the
candidate unless he or someone on his behalf makes positive use of them. Care
will have to be taken upon the question of who may be found to be acting on
behalf of the candidate in making positive use of such services, but the
problem of who acts on behalf of a candidate, and when, is not an unfamiliar
one in election law. It does not seem likely that use by a campaigner would be
held to be by or on behalf of a candidate who had positively refused to accept
the benefit of the services (etc). There may, on some facts, be a difference
between the critical requirement for use by or on behalf of the candidate and
the suggested one of authorisation, but in many cases those factual issues may
well be closely related.
26.
The legislation contains provisions also for regulating donations. In
RPA 1983 they are found in section 71A (as inserted by section 130(2) of PPERA
2000) and Schedule 2A (as inserted by section 130(3) of, and Schedule 16 to,
PPERA 2000). In summary, donations must be made to the candidate or election
agent, and must not be accepted unless made by a “permissible donor”, as
defined in section 54 PPERA 2000. The provision of free or discounted services
may also amount to a donation - see paragraph 2(1)(e) of Schedule 2A. The maker
of a donation may commit an offence if he makes it to someone other than the
candidate or agent. The agent must include in the return required by section 81
the details of any donation accepted either by him or the candidate: Schedule
2A paragraphs 10-12. No doubt, ordinarily at least, acceptance of a donation
will involve the awareness of the recipient, in the same way as a transfer of
property or goods to either of them would. It may well follow that the agent or
candidate could not be said to be a secondary party to a donor’s offence of
impermissible donation unless they knew of it, and perhaps that a donation of
which neither is aware has not been “accepted” for the purpose of inclusion in
the return. That, as above, may help to throw light on the meaning of the
expression in section 90C(1)(b) “made use of by or on behalf of the candidate”.
But it affords no reason for importing the terms of section 90ZA(4) into
section 90C. Rather, the donation provisions are broadly consistent with the
construction of section 90C here set out.
27.
It is not necessary, in order to give effect to the plain reading of the
Act here set out, to have resort to the Crown’s consequentialist arguments,
which do not in any event have great substance. There appears to be no
particular reason why this reading of section 90C can alone deter deliberate
evasion of the spending limits by the acceptance of services (etc) provided
free or at a discount. Deliberate evasion would equally be deterred on the
construction advanced by the defendants. It may well be that the problem of
potentially overlapping campaigning by a national party and its local
candidates does not apply to independent candidates who lack a national party
behind them. But that independents do not have a national party behind them is
a simple fact of electoral life, and applies whatever is the correct
construction of section 90C. Moreover, independent candidates may in any event
be offered services (etc) from supporters other than a national party, and section
90C, whatever its correct construction, needs to and does apply to them also.
28.
The plain reading of the Act here set out cannot be displaced by
possibly inconvenient or even newly recognised consequences. It may or may not
be true that the notional expenditure provisions, including section 90C, were
directed principally at evasion of expenses controls by candidates (or parties)
who might arrange for unregulated persons to provide goods, property, services
or facilities for them either free or at a discount. It may or may not be true
that the application of these provisions to the undoubtedly imprecise question
of when expenditure is party expenditure and when it is candidate expenditure
was not anticipated. It seems, from the material provided to this court, that
the Electoral Commission’s helpful guidance documents issued over several
years, whilst they certainly both address the question of apportionment of
expenditure between party and candidate, and deal with the concept of free or
discounted services, nowhere appear to alert readers to the possible link
between them, nor to the application of the notional expenditure rules to what
must sometimes be a difficult exercise of separating local from national
expenditure.
29.
The potential difficulties for election agents, and for that matter for
candidates, in knowing what must and must not be included in their returns, are
indeed likely to be increased by the complications of national and local
expenditure which in practice may overlap but by statute have to be mutually
exclusive. The fact that they are mutually exclusive does not, as the
defendants at one point submitted, mean that all expenditure defaults to
constituency expenses. Indeed, it is because the two have to be separated, and
if necessary maybe apportioned, that the task of the election agent is made
more difficult. The point that the candidate and election agent risk the
commission of criminal offences is well made. Criminal liability is no small
matter even if regulatory statutes sometimes invoke it as if it were less
significant than it is. But the more serious offence of knowingly making a
false declaration is committed only when there is a dishonest state of mind,
and the defendant knows that the declaration ought to include something which
it does not: see the judgment of Lord Bingham of Cornhill CJ in R v Jones
and Whicher [1999] 2 Cr App R 253, especially at 259B, which decision Mr
Gordon QC, on behalf of the Electoral Commission intervening in the present
case, took care to underline, and which the Crown has not suggested calls for
any qualification. The strict liability offence is of course different, but the
Act stipulates in section 86 for a specific power to relieve from sanctions
where the offence has been committed despite good faith. The potential
difficulties faced by agents are in any event more the consequence of the
difficulty of separating national from local expenditure than of the terms of
section 90C.
Conclusion
30.
For the reasons set out above, this appeal must be allowed and the question
which was certified by the Court of Appeal (para 2 above) must receive the
answer “No”. The test for the operation of section 90C is the threefold one set
out above (see para 18).
Reporting restrictions
31.
Section 37 of the Criminal Procedure and Investigations Act 1996 imposes
statutory reporting restrictions in relation to the hearing of interlocutory appeals
such as the present. The objective is to ensure that the jury’s consideration
of the evidence and issues put before it is not at risk of being affected by
prior reporting, for example of the details of the allegations or of discussion
of possible issues. Those restrictions apply to the hearing of this appeal. The
court is satisfied that there is no reason to modify them in the present case,
except to permit the reporting of this judgment. Until the conclusion of the
trial, nothing may be reported except the following:
(a) the identity of the
court(s) and the name of the judge(s);
(b) the names, ages, home
addresses and occupations of the accused and witnesses;
(c) the offences
charged, as summarised in this judgment;
(d) the names of counsel
and solicitors engaged in the appeal;
(e) whether for the
purposes of the appeal representation was provided to either of the accused
under Part 1 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012;
and
(f) this judgment.
