Norris v Government of the United States of America and others [2007] EWHC 71 (Admin), [2007] All ER (D) 199 (Jan)
Queen’s Bench Division (Divisional Court)
Auld LJ and Field J
25 January 2007
An agreement to price-fix dishonestly to cause prejudice to others comes within the scope of the offence of conspiracy to defraud. Mere secrecy, which is a necessary part of a cartel, as opposed to positive dishonesty, is clearly capable of being regarded by an English jury as dishonest according to the ordinary standards of reasonable and honest people.
Richard Gordon QC and Martin Chamberlain (instructed by White & Case) for the appellant.
David Perry QC and Adina Ezekiel (instructed by the Crown Prosecution Service) for the government.
Khawar Qureshi QC (instructed by the Treasury Solicitor) for the secretary of state.
David Vaughan QC, Thomas de la Mare and Sarah Ford (instructed by Jones Day) for the first intervening party.
Richard Lissack QC, James Flynn QC and Eleanor Davison (instructed by the Treasury Solicitor) for the Serious Fraud Office.
The appellant was formerly chief executive of a leading international manufacturer of carbon products. The US government alleged that the company was involved in illegal price-fixing, and sought the extradition of the appellant accordingly. It was contended that the conspirators had routinely sold products to their customers pursuant to an agreement to avoid price competition. In effect, they had defrauded their customers by requiring higher prices than would have been charged had there been no conspiracy. The
appellant was also charged with offences relating to his alleged obstruction of the authorities in their investigation.
Under US law, the offence charged in relation to price-fixing did not require proof of dishonesty, although the trial attorney averred that the conduct in question had in fact been dishonest. The district judge found that the price-fixing conduct alleged would constitute the offence of conspiracy to defraud at common law and that, in relation to the allegations of obstruction, he was concerned with the essentials of the relevant conduct, namely, whether, had it occurred in the UK, it had been aimed at interfering with a criminal investigation taking place within the UK.
The secretary of state subsequently ordered the appellant’s extradition, and he appealed. He contended that the alleged price-fixing conspiracy did not amount to an extradition offence for the purposes of s 137(2) of the Extradition Act 2003 (EA 2003), because dishonesty was not required under US law. He also disputed that the conduct of obstructing foreign investigators constituted an offence under English law, having regard to
s 137, EA 2003.
LORD JUSTICE AULD:
His Lordship considered Welham v DPP [1960] 1 All ER 805; Scott v Metropolitan Police Commissioner [1974] 3 All ER 1032; Re Ismail [1998] 3 All ER 1007; Office of the King’s Prosecutor, Brussels v Cando Armas [2006] UKHL 67; [2006] 1 All ER 647; R v De Berenger (1814) 3 M&S 67; R v Lewis (1869) 11 Cox CC 404; Jones v North [1875] LR 19 Eq 426; Scott v Brown [1892] 2 QB 724; Mogul Steamship [1892] AC 25; Attorney General of the Commonwealth of Australia v Adelaide Steamship Co Ltd [1913] AC 781; Rawlings v General Trading Co [1921] 1 KB 635; and Government of Canada v Aronson [1989] 2 All ER 1025.
Secrecy, which almost always had to have as its object misleading customers into believing that they were paying a market or near market price, instead of one rigged by suppliers in the market, was clearly capable of being regarded by an English jury as dishonest and, on that account, a criminal conspiracy to defraud. The test of dishonesty for a jury was the well-
established test articulated by Lord Lane in R v Ghosh [1982] 2 All ER 689, namely whether a jury would consider the conduct in question as dishonest “according to the ordinary standards of reasonable and honest people”; and, if so, whether the proposed defendant “must have realised that what he was doing was by those standards dishonest”.
The fact that such conduct had not been put to juries as a species of dishonesty over the last 150 years, with or without the benefit of the Ghosh definition, was no reason for distinguishing it in context from the many other forms of dishonest conduct for which the offence was apt.
Then, there was secret price-fixing, with some additional element of dishonesty over and above the secretiveness of the arrangement, which it was argued had not been alleged against the appellant. His Lordship held that the difference in law between deceiving potential customers by secrecy and some other form of dishonesty was difficult to discern.
His Lordship further considered Wai Yu Tsang v R [1991] 4 All ER 664. The conduct alleged against the appellant, a “combination...or conspiracy by traders in restraint of trade”, with the added ingredient(s) of an intention financially to prejudice the conspirators’ customers, was capable of being regarded by ordinary people as dishonest.
His Lordship turned to the argument that the alleged obstruction of the US authorities was not capable of amounting to an extradition offence. He considered Re Al-Fawwaz [2001] UKHL 69, [2002] 1 All ER 545 and R v Secretary of State for the Home Department, ex p Norgren [2000] QB 817.
He concluded that simply because the alleged interference with justice was, say, directed against a particular functionary in the particular institutional set-up of the extraditing state could not, on that account, exclude such manner of conduct from being an extradition offence in the UK because there was not exact correspondence with a functionary or institution in the UK.
Section 137,EA 2003 clearly indicated a broad conduct-based approach, shorn of the national and institutional setting in which it had
occurred. The transposition required by ss 137(2)(b) and 137(3)(c) was the same; they sought to identify the conduct, wherever it had occurred, the like of which would constitute an offence if committed in the UK.
The appeal would therefore be dismissed. Field LJ agreed.
