Bramley Ferry Supplies Ltd v Revenue and Customs (VAT - APPEALS : Extension of time) [2016] UKFTT 0378 (TC)

FTT-Tax
Bramley Ferry Supplies Ltd v Revenue and Customs (VAT - APPEALS : Extension of time)
[2016] UKFTT 0378 (TC) · 2016-05-09
[37]“ 37. There is nothing in the wording of the relevant rules that justifies either a different or particular approach in the tax tribunals of FtT and the UT to compliance or the efficient conduct of litigation at a proportionate cost. To put it plainly, there is nothing in the wording of the overriding objective of the tax tribunal rules that is inconsistent with the general legal policy described in Mitchell and Denton . As to that policy, I can detect no justification for a more relaxed approach to compliance with rules and directions in the tribunals and while I might commend the Civil Procedure Rules Committee for setting out the policy in such clear terms, it need hardly be said that the terms of the overriding objective in the tribunal rules likewise incorporate proportionality, cost and timeliness. It should not need to be said that a tribunal's orders, rules and practice directions are to be complied with in like manner to a court's. If it needs to be said, I have now said it.[38]A more relaxed approach to compliance in tribunals would run the risk that non-compliance with all orders including final orders would have to be tolerated on some rational basis. That is the wrong starting point. The correct starting point is compliance unless there is good reason to the contrary which should, where possible, be put in advance to the tribunal. The interests of justice are not just in terms of the effect on the parties in a particular case but also the impact of the non-compliance on the wider system including the time expended by the tribunal in getting HMRC to comply with a procedural obligation. Flexibility of process does not mean a shoddy attitude to delay or compliance by any party. ” 14. Turning to the questions posed by Morgan J in Data Select ; as Judge Bishopp said in Leeds City Council v HMRC [2014] UKUT 350 (TCC) at [24] the purpose of the time limit:
“… is to require a party asserting a right to do so promptly, and to afford his opponent the assurance that, after the limit has expired, no claim will be made.” ie to provide certainty and avoid delay in litigation. 15. As for the length of the delay, in this case the appeal should have been made by 7 May 2015 but was received by the Tribunal almost eight months later on 24 December 2015. 16. The explanation for the delay was, according to the witness statement of Mr Panesar an “administrative error” which “only became apparent on or around 24 December, upon reviewing the file”
. However, such an explanation, which raises more questions than it does answers (eg why did it take until 24 December 2015 to review a file when it was understood that a Notice of Appeal had been submitted in May 2015) cannot in my judgment, without any further clarification, be regarded as a “good explanation” especially when, unlike BPP which considered the Tribunal Procedure (First-tier Tribunal)(Tax Chamber) Rules 2009, the time limit in this case was imposed not by any rule, practice direction or court order but by an Act of Parliament. 17. Turning to the consequences for the parties if an extension of time was either granted or refused, Mr Hobson submits that if an extension was granted HMRC would be prejudiced in that it would have to divert resources to defending an appeal which it was entitled to consider did not exist. 18. Mr Panesar in his witness statement concedes that there is “ some prejudice” caused to HMRC if a late appeal is allowed but says that Bramley:
“… would suffer irremediable harm should it not be able to appeal the decision at this stage. A very real consequence of this would be the winding up of the company.”
Although, in the absence of Mr Panesar, Mr Snell was unable expand on the explanation for the delay he was able to do so in respect of the “real” consequences for Bramley it were not able to make its appeal. 19. He referred to the decisions of the Administrative Court in HT & Co (Drinks) Ltd v HMRC [2015] EWHC 659 (Admin) and the Court of Appeal in CC&C v HMRC [2014] EWCA Civ 1655 which held that a challenge to the revocation of a WOWGR registration should be made before the Tribunal rather than by way of judicial review unless, as Cobb J observed at [59] of HT & Co (Drinks) Ltd , it can be demonstrated that HMRC’s decision was of an “elevated and “exceptional” category which could be described as fundamentally unlawful”. This, Mr Snell submits, would effectively preclude Bramley from being able to challenge HMRC’s decision in this case. 20. Mr Snell also contends that if, as in this case, the delay appears to be that of a legal representative rather than the appellant itself, damages for a “loss of chance” would not be an adequate remedy and submits, relying on Rowland v HMRC [2006] STC (SCD) 536 , that Bramley should not in effect be held responsible for the failings of its advisers. Although the Tribunal was persuaded by such an argument in One Source (London) Ltd v HMRC [2015] 0500 (TC), finding that the appellant should not be prejudiced by a failure of Rainer Hughes (the same solicitors relied upon by Bramley) to submit an appeal on time it concluded, at [65]: “Generally, as already stated, an extension of time is the exception rather than the rule. However, having considered the explanation for the delays, having taken into account all the matters set out above, with particular reference to the overriding objective and the potential merits of the appeal, this is a case in which in the interests of justice we should exercise the Tribunal's discretion to permit the appeal to be made after the expiry of the normal time limit.” 21. However, unlike the Tribunal in One Source where there was a delay of two months I am not satisfied that there is a good explanation for the delay of almost eight months in the present case. I also reject Mr Snell contention that the potential merits of the appeal of the appeal should be taken into account. As More-Bick LJ, giving the judgment of the Court of Appeal said, at [46] in R (on the application of Dinjan Hysaj v Secretary of State for the Home Department [2014] EWCA Civ 1633 :[46]“ If applications for extensions of time are allowed to develop into disputes about the merits of the substantive appeal, they will occupy a great deal of time and lead to the parties' incurring substantial costs. In most cases the merits of the appeal will have little to do with whether it is appropriate to grant an extension of time. Only in those cases where the court can see without much investigation that the grounds of appeal are either very strong or very weak will the merits have a significant part to play when it comes to balancing the various factors that have to be considered at stage three of the process. In most cases the court should decline to embark on an investigation of the merits and firmly discourage argument directed to them. Here too a robust exercise of the jurisdiction in relation to costs is appropriate in order to discourage those who would otherwise seek to impress the court with the strength of their cases. ”22. Therefore, having carefully considered all the circumstances of the case, given the approach taken in BPP with regard to litigation being conducted efficiently, the fact that the appeal in the present case is almost eight months out of time, and the wholly inadequate explanation for the delay, notwithstanding the effect on Bramley, permission to extend the time limit for an appeal to be made is refused.23. Accordingly the appeal is dismissed. Right to apply for permission to appeal24. This document contains full findings of fact and reasons for the decision. Any party dissatisfied with this decision has a right to apply for permission to appeal against it pursuant to Rule 39 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. The application must be received by this Tribunal not later than 56 days after this decision is sent to that party. The parties are referred to “Guidance to accompany a Decision from the First-tier Tribunal (Tax Chamber)” which accompanies and forms part of this decision notice. JOHN BROOKS TRIBUNAL JUDGE RELEASE DATE: 11 MAY 2016

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