Sydney Mwansa v Director of Public Prosecutions (Appeal No. 276/2021) (11 June 2024) – ZambiaLII

IN THE COURT OF APPEAL OF ZAMBIA Appeal No. 276/2021 HOLDEN AT KABWE (Civil Jurisdiction) BETWEEN: SYDNEY MWANSA APPELLANT AND THE DIRECTOR OF PUBLIC PROSECUTIONS RESPONDENT CORAM: Chashi, Muzenga and Patel, JJA On 13th October 2023 and 11t h June 2024 For the Appellant: Mr. S. Mbewe, Keith Mweemba Advocates For the Respondent: Mr. M. I. Chipawa, Senior State Advocate, National Prosecution Authority JUDGMENT MUZENGA JA delivered the Judgment of the Court. Cases referred to: 1. The Director of Asset Recovery and Others v Green and Others (2005) EWHC 3168 2. Asset Recovery Agency v Pamela Aboo (2018) EKRL 3. Teckla Nandjila Lameck v President of Namibia 2012 (1) NR 255 (HC) J2 4. Asset Recovery Agency v Rose Monyani Musanad and Others (2020) EKRL 5. The People v Austin Chisangu Liato (2015) Vol. 2 ZR 148 Legislation referred to: 1. The Forfeiture of Proceeds of Crime Act, No. 19 of 2010 1.0 INTRODUCTION 1.1 This is an appeal against a non-conviction-based forfeiture order given by Mr. Justice M. Chitabo, may his soul continue to rest in eternal peace, in respect of Lot No. 179922/M Sub H New Kasama, which was ordered to be forfeited to the State. Dissatisfied with the forfeiture order, the appellant appeals to this court. 2.0 BACKGROUND 2.1 The background to this appeal, is that the appellant was apprehended on 21 st February 2016, after Drug Enforcement Commission (DEC) officers were led to his apprehension, by one Teddy Matanda, the 2nd respondent in the court below. This was after Teddy Matanda was apprehended the same day, at the Intercity Bus Terminus and had 24 packets of suspected drugs. J3 2.2 Teddy Matanda narrated that as a taxi driver, he was sent by the appellant to collect a parcel from one Shaibu Abilahi Likuta, the 3rd respondent in the court below, who was a conductor for Falcon Bus which was coming from Tanzania. The trio were arrested on drug related offences arising from the 24 packets of suspected drugs which were subsequently found to be cocaine. 2.3 A further investigation revealed, that the appellant owned, or was in possession of Lot No. 179922/M Sub H New Kasama, Girsan Pistol Serial No. B02829, and House No. 7 Dongwe Road, Kamwala Lusaka, which properties were the subject of the forfeiture proceedings. A further check on the appellant's source of income and bank account activities, could not support or show that he was capable of owning the properties in question. 2.4 Consequently, the State was satisfied that the appellant's financial position could not support possession of such properties hence the conclusion that it was proceeds of crime. The State moved the court below for a non-conviction-based forfeiture. The respondent recalled that sometime in 2014, there was a tip-off from intelligence organs overseas, that the appellant was involved in a drug syndicate. J4 2.5 The appellant in opposing the respondent's application, stated that he acquired Plot No. 7 Dongwe Road, through the help and initiative of his employer Mr. Nick Simutowe and that he purchased the pistol in issue, as a security measure due to the fact that he would sometimes carry huge cash on behalf of his employer, Jan Japan for clearing and moving vehicles from Nakonde Border. As for Subdivision Hof Lot No. 179922/M, he stated that his wife Nalavwe Namfukwe contributed to its purchase through respective incomes, commissions and businesses. 3.0 DECISION OF THE COURT BELOW 3.1 The court below found that the appellant explained how he acquired Plot No. 7 Dongwe Road and that on the balance of probabilities, he had given a reasonable explanation that satisfied the court below that this house was purchased with the help of his employer and had in fact not yet finished paying the purchase price as the certificate of title was not yet in his name. 3.2 In respect of the pistol, the lower court found that there was undisputed evidence that the appellant had income and the State had not shown inability to purchase the pistol which was duly licensed. JS 3.3 As for Lot No. 179922/M Sub H New Kasama, based on the evidence of the earnings relating to this property, the court was satisfied, on the balance of probabilities, that the property is tainted as there was sufficient evidence to show that the appellant could not explain how he managed to purchase the plot and constructed the properties thereon. The court below relied on information linking the appellant to suspected drug trafficking in 2014. 3 .4 This property was thus forfeited to the State. 4.0 GROUNDS OF APPEAL 4.1 Unhappy with the Order of the court below, the appellant appeals to this court advancing three grounds of appeal couched as follows: 1. The trial Judge misdirected himself in law and fact when he held that the property, being Lot No. 179922/M Sub H, New Kasama, be forfeited to the State despite the property being jointly owned and constructed by the appellant and his wife. 2. The trial Judge misdirected himself in law and fact when he held that the property, being Lot No. 179922/M Sub H, New Kasama, is tainted property as there is insufficient evidence to show how the appellant managed to purchase the plot and construct the properties thereon contrary to the evidence of Nick Simutowe and Nalavwe Namfukwe under Cause No. SSPA/034/2016. 3. The trial Judge misdirected himself in law and fact when he held that there is a link between the interrogations that J6 were held in 2014 in connection with suspected drug trafficking and the offences that were alleged to have been committed in 2016 and that while the appellant was only arrested in 2016, there is evidence to link him through his phone number to a drug trafficking syndicate from as far back as 2014 without taking into account the appellant's defence under Cause No. SSPA/034/2016. 5.0 APPELLANT'S ARGUMENTS 5.1 The gist of the appellant's arguments in support of ground one of the appeal is that the lower court made the Forfeiture Order without complying with the dictates of Section 30 of the Forfeiture of Proceeds of Crime Act1 (hereinafter referred to as "The Act"). According to the appellant, there is evidence on the record indicating that the property in question is jointly owned by him and his wife, Nalavwe Namfukwe, which the court below failed to take into consideration. Section 30 of the Act provides as follows: "Where a public prosecutor applies under section twenty nine for a forfeiture order - (a) the public prosecutor shall give not less than thirty days written notice of the application to any person who is known to have an interest in the tainted property in respect of which the application is being made; (b) any person who claims an interest in the property in respect of which the application is J7 made may appear and produce evidence at the hearing of the application; and ( c) the court may, at any time before the final determination of the application, direct the public prosecutor to (i) Give notice of the application to any person who, in the opinion of the court, appears to have an interest in the property; and (ii) Publish in the Gazette or a daily newspaper of general circulation in Zambia, a notice of the application." 5.2 Counsel contended that there is evidence on the record that the property in question, was jointly owned by the appellant and his wife (Nalavwe Namfukwe) as evidenced by the contract of sale on the record. It was submitted that Section 30 above was not complied with, as she was not given notice as a person with interest in the matter. We were urged to allow this ground of appeal. 5.3 The gist of the appellant's arguments in support of the second ground of appeal, is that the trial court erred in finding that the property in question is tainted property. The appellant contends that the circumstances of this case do not fit into the definition of tainted property as provided in Section 2 of the Act. J8 5.4 It was contended that there was no evidence on a balance of probabilities that the subject property was tainted by, being used in, or in connection with the commission of the offence. According to the appellant, the claim for civil forfeiture, cannot be sustained solely upon the basis or assertion that a respondent has no identifiable lawful income to warrant his lifestyle. We were referred to three foreign cases summarised below. 5.5 The first case is an English case of The Director of Asset Recovery and Others v Green and Others1 in which it was held that: "In civil proceedings for recovery under Part 5 of the Act, the Director need not allege the commission of any specific criminal offence but must set out the matters that are alleged to constitute the particular kind or kinds of unlawful conduct by or in return for which the property was obtained. A claim for civil recovery cannot be sustained solely upon the basis that a respondent has no identifiable lawful income to warrant his lifestyle." 5.6 The second case is a Kenyan case of Asset Recovery Agency v Pamela Aboo2 in which it was observed that: "Forfeiture proceedings are Civil in nature and that is why the standard of proof is on a balance of probabilities ..... in the case of Director of Asset Recovery, Republic and Others v Green and Others (2005) EWHC 3168 the court stated as follows: J9 "In civil proceedings for recovery under Part 5 of the Act, the Director need not allege the commission of any specific criminal offence but must set out the matters that are alleged to constitute the particular kind or kinds of unlawful conduct by or in return for which the property was obtained." ..... the proceedings before this court are to determine the criminal origins of the property in issue and not a criminal prosecution against the respondent where the presumption of innocence is applicable." 5.7 The third case is a Namibian case of Teckla Nandjila Lameck v President of Namibia3 in which it was stated that: "Asset forfeiture is ...... a civil remedy directed at the confiscation of the proceeds of crime and not at punishing an accused . . . . . . even if there is a prosecution, the remedy is thus directed at the proceeds and instrumentalities of crime and not at the person having possession of them." 5.8 We were invited to consider and appreciate the wisdom of these foreign persuasive authorities, as they were based on the interpretation of provisions relating to civil proceedings for forfeiture similar to the provision of Sections 29 and 31 of our Act. 5.9 It was contended that no evidence was placed before the lower court for the subject property to be tainted property by being proceeds of crime. The appellant contended that no evidence was adduced to JlO prove that the property was either delivered or realised from the commission of a serious offence or that it was realised from disposal of or other dealings with proceeds of a serious offence or indeed that it was acquired from proceeds of a serious offence. 5.10 In support of this argument, we were referred to another Kenyan case of Asset Recovery Agency v Rose Monyani Musanad and Others4 in which the court stated that: "Taking all the facts placed before me in this matter, I am satisfied that the applicant has established, on a balance of probabilities, that the assets and the funds the subject of the application do not have a lawful basis. The respondents generally, but the 1 st respondent in particular, has not shown a legitimate source of the funds ....... . The respondents have given explanations that do not show that the funds deposited in the 1s t respondent's account, which were the sources of funds for the motor vehicles had a legitimate source. That being the case, it is my finding and I so hold that the assets and funds in this case are, for the most part, proceeds of crime, and that they are liable to forfeiture to the State." 5.11 It was submitted that the import of this case is that, mere suspicion of a property to be proceeds of crime, does not suffice, as evidence ought to be placed before the court, to demonstrate that the funds Jll used to purchase such an asset or property in question are from illegitimate sources or are derived from a commission of an offence. 5.12 In summing up the arguments in support of ground two, it was contended that, other than the mere allegations against the appellant, the respondent did not establish criminal or illegitimate origins of the money the appellant used to purchase the subject property and construct the incomplete structures thereon. We were urged to find merit in ground two and allow the appeal. 5.13 In support of the last ground of appeal, the appellant contends that the allegation that he was involved in a drug syndicate was not supported by evidence to connect the subject property to the purported syndicate or proceeds therefrom. It was contended, that the assertion that because the appellant was questioned in 2014, concerning a purported unnamed syndicate, cannot be a basis for concluding that the subject property was tainted property. 5.14 All in all, we were urged to allow the appeal and grant the appellant costs. J12 6.0 RESPONDENT'S ARGUMENTS 6.1 In responding to the first ground of appeal the respondent contends that the learned trial Judge did not misdirect himself in law and fact when he held that property Lot No. 179922/M Subdivision H, New Kasama be forfeited to the State, despite the property being jointly owned and constructed by the appellant and his wife. It was submitted that Section 30 of the Act was complied with as notice of the application was given to the person known to have an interest. 6.2 According to learned counsel, the purpose of Section 30 is to allow a person known who has an interest in the property to make a presentation to the court before a Forfeiture Order is made by the court. It was contended that from the court's record, the appellant and his wife were granted that opportunity and made presentations before the court below. 6.3 We were urged to dismiss this ground of appeal as it lacks merit. 6.4 In responding to the second ground of appeal, it was learned counsel's contention that there is sufficient evidence on the record which establishes on a balance of probabilities that the property is tainted property. It was contended that it is clear from the record of appeal J13 that the respondent proved on a balance of probabilities that the property is tainted property because: (i) the appellant had this property; (ii) the appellant's financials from legitimate sources do not support the appellant's possession of the said property; (iii) the appellant was found in possession of 24 kilograms of cocaine and was convicted of the offence of trafficking; (iv) no receipts or delivery notes were provided for the materials said to have been provided by Simutowe; (v) earnings from the employment do not match up to assets and the same was being applied towards the liquidation of the car loan at Jan Japan. 6.5 In addition, it was contended that the property is reasonably suspected to be proceeds of crime. We were referred to the case of The People v Austin Liato5 in which the Supreme Court observed inter alia that: "Reasonable suspicion as used in Section 71(1) of the Forfeiture of Proceeds of Crime Act is mere conjecture or surmise, shy of actual proof that a state of affairs exists. Such suspicion must be based on articulable facts." J14 6.6 Additionally, the respondent contends that the bank statement exhibited by the appellant does not help his case in showing that he had the resource as the statement does not have a lump sum withdrawal which can be said to have been applied towards the purchase of the plot and other building materials. The only huge cash withdrawal was in 2013, that is, 8th October, 2013, of K49,000.00 and this was long before he purchased the plot in New Kasama which plot was purchased on 19th February 2014 and the terms of the contract indicate that he paid K140,000.00 upon signing the contract. It was submitted that the appellant failed to account for how he raised the money that he used to purchase and develop property in question. According to the respondent, the only inference that can be drawn from these facts are that the appellant commingled proceeds from drug trafficking considering the unassailable fact that the appellant was connected to an international drug trafficking syndicate from as far back as 2014 and was convicted of trafficking in 24 kilograms of cocaine. 6. 7 It was the respondent's further submission that even if the 24 kilograms of cocaine which the appellant was found in possession of JlS did not reach the market, the fact that the appellant failed to provide legitimate source of funds, accounting for the property being Lot No. 179922/M Subdivision H, it means that the property is a proceed of crime falling well within the meaning of proceed of crime. We were urged to take judicial notice of the fact that drug traffickers avoid using legitimate financial systems in laundering the proceeds of drug trafficking as that is the easiest way of one being detected. 6.8 In summing up the arguments in support of the second ground of appeal, it was the respondent's contention that the Kenyan case of Asset Recovery Agency v Rose Monyani Musanda and Others cited supra aids the respondent, albeit in a persuasive manner, in that the appellant did not show legitimate source of funds used to acquire and construct the forfeited property whose value is 3.9 million Zambian Kwacha. Counsel emphasised that the respondent placed sufficient evidence before the trial court which is beyond mere suspicion and that the learned trial Judge cannot be faulted when he concluded as he did. 6.9 In responding to ground three, it was contended that the learned trial Judge did not misdirect himself in law and fact when he held that there is a link between the interrogations that were held in 2014 in J16 connection with the suspected drug trafficking and the offences that were alleged to have been committed in 2016. It was submitted that there is evidence on the record of appeal, from the case record under cause number SSPA/034/2016, from a Mr. Chisuta, that the appellant was linked to a drug trafficking syndicate based in Tanzania, operating in connection with individuals in Zambia and that these had trafficked drugs in and out of Zambia to Malaysia. 6.10 It was contended further, that the record of appeal shows that the learned trial Judge dealt with this evidence at pages J37 to J38 of the Judgment. It was the respondent's further contention that the interrogations that were held in 2014 placed the appellant on the radar and he was being trailed until 2016 when he was apprehended and charged with trafficking in 24 kilograms of cocaine. 6.11 All in all, we were urged to dismiss the appeal for want of merit. 7.0 DECISION OF THE COURT 7.1 We have pedantically considered the record of appeal and the arguments before us. We shall deal with ground one first and then proceed to consider grounds two and three together, as they are related. J17 7.2 Before we consider the first ground, we wish to comment on the growth or rise of white collar crimes, not only in our country but the world at large. Because of the sophisticated manner in which these offences are committed, their detection, investigation and prosecution is extremely difficult. The illicit proceeds of these criminal activities are used to perpetrate and finance criminal activities in countries and the globe. This has continued to adversely affect economies, the general well-being and in some instances leads to political instability. This is what has led to many countries to enact forfeiture legislation, domesticating various regional and international instruments. The Supreme Court in the case of The People v Austin Chisangu Liato had this to say at page 179: "Forfeiture legislation was prompted in large measure by the desire to circumvent the difficulties encountered in proving and dealing with serious offences such as money laundering and drug trafficking. Writing in the Journal of Money Laundering, Justice Anthony Smellie, QC, Chief Justice of the Cayman Islands, made the following pertinent observations:- "The worldwide adoption of laws which enable the confiscation of the proceeds of crime reflects the acknowledged importance of depriving the criminal of his profits. These laws recognise that organised criminals use their proceeds of crime to insulate themselves by the use of intermediaries, from detection and arrest. They acknowledge that the J18 more profitable the crime, the more difficult it becomes for law enforcement to link the criminal to it. The proceeds of crime become the very means by which the bastions of organised crime can be treated and sustained." This statement captures succinctly, the thinking which quickly permeated international debate on the subject or proceeds of suspected crime. Various international conventions were made to provide flexible standards on the burden of proof, those referred to be the appellant being some of them." 7.3 The focus now, is not only to punish the perpetrators of various criminal activities, but to also go for properties which are tainted, that is properties in connection with or used in or in connection with the commission of the offences. In short, taking away the joy or motivation for committing these offences by going after the properties. That is the spirit and intent behind the enactment of the forfeiture law. Having stated the foregoing, we now revert to consider the grounds of appeal. 7.4 In support of ground one, the appellant contends that the lower court made the Forfeiture Order without complying with the dictates of Section 30 of the Act. The respondent on the other hand argued that the purpose of Section 30 is to allow a person who has an interest in the property to make a presentation to the court before a J19 Forfeiture Order is made by the court. The respondent further submitted that from the court's record, the appellant and his wife were granted that opportunity and made presentations before the court below. 7.5 It is not in dispute, that the property, the subject of the Forfeiture Order herein, is jointly owned by the appellant and his wife as per the contract of sale. The respondent is obligated by Section 30{a) of the Act to give not less than thirty days written notice of the application to any person who is known to have an interest in the tainted property in respect of which the application is being made. The respondent abdicated in this obligation and this was a serious error. This obligation is not satisfied by the mere fact that the wife to the appellant testified in court as a witness. In this case, she came as a witness at the instance of the appellant. This requirement is there to ensure fair trial and adequate opportunity to enable a person with interest in the property, subject to forfeiture, sufficient time to protect or defend their interest. 7.6 The trial court equally fell into grave error, when it did not order or direct the respondent, to give notice of the application to Nalavwe J20 Namfukwe, as soon as it became clear that she had an interest in the property and also order them to publish in the Gazette or a daily newspaper of general circulation in Zambia, a notice of the application, as required under Section 30(c) of the Act. The question that arises therefore is whether in the circumstances of this case, the foregoing errors could justify the setting aside of the Forfeiture Order? 7. 7 Whether or not a Forfeiture Order could be set aside on that basis alone largely depends on whether prejudice was occasioned or not. In this case, the appellant was aware of the proceedings together with his wife Nalavwe Namfukwe. The appellant defended his interest in the property whereas his wife chose to come as his witness. After she became aware of the proceedings, being a person who had an interest in the property, she would have joined proceedings and defended her interest in the property. Civil forfeiture proceedings are civil in nature and the rules of civil procedure on locus and joinder applies. Ordinarily, this should have precluded any issues of prejudice. However, in the light of the fact that what was violated was a statutory provision, couched in mandatory terms, prejudice cannot be said to J21 have been offset. In the circumstances we find merit in ground one of the appeal. 7.8 We now turn to consider grounds two and three. It was submitted on behalf of the appellant that there was no evidence on a balance of probabilities that the subject property was tainted by being used in, or in connection with the commission of the offence and that the allegation that the appellant was involved in a drug syndicate was not supported by evidence to connect the subject property to the purported syndicate or proceeds therefrom. On the other hand, learned counsel for the respondent argued with equal force that there is sufficient evidence on the record which establishes on a balance of probabilities that the property is tainted property. Relying on the Liato case supra, learned counsel for the respondent argued that the fact that the appellant failed to provide legitimate source of funds, accounting for the property, being Lot No. 179922/M Subdivision H, it means that the property is a proceed of crime falling well within the meaning of proceeds of crime. 7.9 We note that in making the order for forfeiture, the court below pre occupied itself with whether the appellant, having regard to his income J22 or earnings was capable of procuring the plot in issue and build thereon. This consideration is irrelevant in terms of non-conviction based forfeiture. Section 29 of the Act provides that: "A public prosecutor may apply to a court for an order for forfeiting to the State all or any property that is tainted property." 7.10 In terms of Section 2 of the Act the definition of tainted property is the following terms: "Tainted property" in relation to a serious offence or a foreign serious offence, means - (a) any property used in, or in connection with, the commission of the offence; (b) property intended to be used in, or in connection with, the commission of the offence; or ( c) proceeds of the offence; and when used without reference to a particular offence means tainted property in relation to a serious offence." 7.11 It is clear from the foregoing provisions, that what is cardinal, is whether the property in issue is tainted property or not. If it is tainted property, is it tainted in relation to a serious offence or not? And in terms of Section 2, a serious offence is one in which the maximum J23 sentence provided by law is death or imprisonment for not less than 12 months. 7 .12 Therefore, a forfeiture of tainted properties, will not be made unless the offence in issue is a serious offence. It does not matter whether a person has sufficient resources to enable him or her acquire such properties. The issue is whether the property is tainted in connection to a serious offence. It may be possible that a person may have the means to procure the property in issue due to their current resources but still involve themselves in criminal activities, the proceeds of which they use to procure, wholly, or partially, some properties. Those properties can be a subject of forfeiture, notwithstanding. 7.13 We hold the view that although non-conviction based forfeiture ( civil forfeiture) is not based on a conviction, there is need to clearly identify the offence which the respondent has committed or alleged to have committed, and then a clear connection established on the balance of probabilities how the offence (serious offence) is related to the property in issue i.e. wholly or partly derived or realised from the commission of the offence; wholly or partly derived or realised from a disposal or other dealing with proceeds of crime. J24 7.14 The Liato case supra is inapplicable to the facts of this case as in that case, the respondent was charged with the offence of possession of property reasonably suspected to be proceeds of crime contrary to Section 71(1) of the Act. For this offence, it is our considered view that it is sufficient for the prosecution to establish, on the balance of probability, that the accused was in possession of property and that there was reasonable suspicion of the property being proceeds of crime. It thus remains on the person so charge, to show that he, or she, had sufficient resources to acquire such property (negativing reasonable suspicion) or that he or she had no reasonable grounds for suspecting that the property in their possession, was derived or realised, directly or indirectly, from any unlawful activity as per the defence in Section 71(2) of the Act. 7 .15 In casu/ the court below lost sight of the issue, by focusing on financial capacity. The question the trial court ought to have answered is, whether the property in question was tainted property. The evidence in this case, in support of the application, was information from intelligence sources. This is not evidence, even when considered on the balance of probability, as this is inadmissible information. Further J25 there is no evidence, on the balance of probability, connecting any proceeds of crime being used to procure the plot and building of the structures thereon. Therefore, had the trial court properly directed itself, it would have found that the respondent did not establish their case on the balance of probability. We therefore find merit in grounds two and three and set aside the Forfeiture Order. 8.0 CONCLUSION 8.1 Having found merit in the appeal we set aside the Forfeiture Order. We order that Lot No. 179922/M Sub H, New Kasama be surrendered to the appellant. 8.2 Because of the issues this appeal has raised each party will bear its own costs. COURT OF APPEAL JUDGE K. MUZENGA A. N. PATEL, SC COURT OF APPEAL JUDGE COURT OF APPEAL JUDGE