Last month the Supreme Court made a fundamental change in the law that will have a wide effect on many of our clients charged with dishonesty offences. The well-established test in the case of Ghosh is history. Now, the law is found in Ivey v Genting  UKSC 67 (not as catchy).
What has changed?
The fundamental principle of the test remains, to assess whether what the defendant was doing was dishonest by the standard of ordinary and honest people. What a defendant cannot fall back on now is whether he appreciated that what he was doing was dishonest to those ordinary and honest people.
The difficulty as the court saw it was primarily based on a Defendant’s view of society; whether or not that view was warped.
A defendant could appear to a jury to have an honest belief that what he was doing was not dishonest and nor would ordinary and honest people view it that way. This is despite it being patently obvious to the contrary.
In those circumstances, the judge would have to direct, on the evidence that the second leg of the test had not been satisfied. This served to highlight the disparity between the objective and subjective elements of the test.
When Ghosh was decided in 1982, it was in contemplation of a raft of inconsistent decisions surrounding the issue of dishonesty.
Fast-forward 35 years, the court is no longer satisfied with the Ghosh test. The Supreme Court summed up the issues with it as follows:
- It has the unintended effect that the more warped the defendant’s standards of honesty are, the less likely it is that he will be convicted of dishonest behaviour.
- It was based on the premise that it was necessary in order to give proper effect to the principle that dishonesty, and especially criminal responsibility for it, must depend on the actual state of mind of the defendant, whereas the rule is not necessary to preserve this principle.
- It sets a test which jurors and others often find puzzling and difficult to apply.
- It has led to an unprincipled divergence between the test for dishonesty in criminal proceedings and the test of the same concept when it arises in the context of a civil action.
- It represented a significant departure from the pre-Theft Act 1968 law, when there is no indication that such a change had been intended.
- Moreover, it was not compelled by authority. Although the pre-Ghosh cases were in a state of some entanglement, the better view is that the preponderance of authority favoured the simpler rule that, once the defendant’s state of knowledge and belief has been established, whether that state of mind was dishonest or not is to be determined by the application of the standards of the ordinary honest person, represented in a criminal case by the collective judgment of jurors or magistrates.
To put it another way and to borrow from R v Greenstein  WLR 1353:
‘There remains the objection that to adopt a subjective test is to abandon all standards but that of the accused himself, and to bring about a state of affairs in which ‘Robin Hood would be no robber’.
It is par for the course that a Defendant will argue he did not believe he was doing wrong, nor would others have held the belief he was being dishonest. If the Crown was unable to disprove this, then on direction, the Defendant was entitled to be acquitted.
The court now wants to juries look at it this way:
- Ascertain the individual’s knowledge and belief to the facts, and;
- That his belief must be reasonable, and;
- Once his actual state of mind has been established, assess whether his conduct was honest or dishonest by the standards of ordinary decent people.
This means that, once it has been established what the Defendant knew, even if his belief was reasonable on the facts, if it falls short of an objective standard, he has been dishonest.
Time alone will tell what impact this will have on defendants charged with dishonesty offences, however, it will be interesting to see how legal advisors and the judiciary put the new test into practice. It may well be the case that more appeals are required to clarify the mechanics of this refined dishonesty test.
It is worth pointing-out this also affects civil practitioners. They may ponder, when their clients are accused of fraud or fundamental dishonesty, how the judiciary now views dishonesty.
Callum Brook, part of that criminal law team, has experience in crime and civil law and so he is well-placed to deal with cases involving both types of law.
Many of our criminal team are also accredited in specialist handling of vulnerable witnesses. This new accreditation is not yet mandatory but Central Chambers is proud to be ahead of the curve on this and other initiatives.