“Case management powers 5. —(1) Subject to the provisions of the 2007 Act and any other enactment, the Tribunal may regulate its own procedure. … (3) In particular, and without restricting the general powers in paragraphs (1) and (2), the Tribunal may by direction— … (e) deal with an issue in the proceedings as a preliminary issue; …”
“(4) If the notice of appeal is provided after the end of any period specified in an enactment referred to in paragraph (1) but the enactment provides that an appeal may be made or notified after that period with the permission of the Tribunal— (a) the notice of appeal must include a request for such permission and the reason why the notice of appeal was not provided in time; and (b) unless the Tribunal gives such permission, the Tribunal must not admit the appeal.”
“34. … Applications for extensions of time limits of various kinds are commonplace and the approach to be adopted is well established. As a general rule, when a court or tribunal is asked to extend a relevant time limit, the court or tribunal asks itself the following questions: (1) what is the purpose of the time limit? (2) how long was the delay? (3) is there a good explanation for the delay? (4) what will be the consequences for the parties of an extension of time? and (5) what will be the consequences for the parties of a refusal to extend time? The court or tribunal then makes its decision in the light of the answers to those questions. … 37. …The general comments in the above cases will also be found helpful in many other cases. Some of the above cases stress the importance of finality in litigation. Those remarks are of particular relevance where the application concerns an intended appeal against a judicial decision. The particular comments about finality in litigation are not directly applicable where the application concerns an intended appeal against a determination by HMRC, where there has been no judicial decision as to the position. None the less, those comments stress the desirability of not re-opening matters after a lengthy interval where one or both parties were entitled to assume that matters had been finally fixed and settled and that point applies to an appeal against a determination by HMRC as it does to appeal against a judicial decision.”
“…A judge should address an application for relief from sanctions in three stages. The first stage is to identify and assess the seriousness and significance of the “failure to comply with any rule, practice direction or court order” which engages rule 3.9(1). If the breach is neither serious nor significant, the court is unlikely to need to spend much time on the second and third stages. The second stage is to consider why the default occurred. The third stage is to evaluate “all the circumstances of the case, so as to enable [the court] to deal justly with the application including [factors (a) and (b)]”. …”
“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 Rule 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 courts. If it needs to be said, I have now said it.”
“accept that the UT should adopt a different, i.e., more relaxed, approach to compliance with rules, directions and orders than the courts that are subject to the CPR.”
“I can detect no justification for a more relaxed approach to compliance with rules and directions in the tribunals… [i]t 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”
“In a nutshell, the cases on time limits and sanctions in the CPR do not apply directly, but the Tribunals should generally follow a similar approach.”
“43. ... Whether considering an application which is made directly under rule 3.9 (or under the FTT Rules, which the Supreme Court in BPP clearly considered analogous) or an application to notify an appeal to the FTT outside the statutory time limit, it is clear that the judge will be exercising a judicial discretion. The consequences of the judge's decision in agreeing (or refusing) to admit a late appeal are often no different in practical terms from the consequences of allowing (or refusing) to grant relief from sanctions - especially where the sanction in question is the striking out of an appeal (or, as in BPP, the barring of a party from further participation in it). The clear message emerging from the cases - particularised in Denton and similar cases and implicitly endorsed in BPP - is that in exercising judicial discretions generally, particular importance is to be given to the need for "litigation to be conducted efficiently and at proportionate cost", and "to enforce compliance with rules, practice directions and orders". We see no reason why the principles embodied in this message should not apply to applications to admit late appeals just as much as to applications for relief from sanctions, though of course this does not detract from the general injunction which continues to appear inCPR rule 3.9 to "consider all the circumstances of the case.”
“44. When the FTT is considering applications for permission to appeal out of time, therefore, it must be remembered that the starting point is that permission should not be granted unless the FTT is satisfied on balance that it should be. In considering that question, we consider the FTT can usefully follow the three- stage process set out in Denton: (1) Establish the length of the delay. If it was very short (which would, in the absence of unusual circumstances equate to the breach being “neither serious nor significant”), then the tribunal is unlikely to need to spend much time on the second and third stages – though this cannot be taken to mean that applications can be granted for very short delays without moving on to a consideration of those stages. (2) The reason (or reasons) why the default occurred should be established. (3) The tribunal can then move onto its evaluation of all the circumstances of the case. This will involve a balancing exercise which will essentially assess the merits of the reasons given for the delay and the prejudice which would be caused to both parties by granting or refusing the extension of time.” (1) Establish the length of the delay. If it was very short (which would, in the absence of unusual circumstances equate to the breach being “neither serious nor significant”), then the tribunal is unlikely to need to spend much time on the second and third stages – though this cannot be taken to mean that applications can be granted for very short delays without moving on to a consideration of those stages. (2) The reason (or reasons) why the default occurred should be established. (3) The tribunal can then move onto its evaluation of all the circumstances of the case. This will involve a balancing exercise which will essentially assess the merits of the reasons given for the delay and the prejudice which would be caused to both parties by granting or refusing the extension of time.”
“That balancing exercise should take into account the particular importance of the need for litigation to be conducted efficiently and at proportionate cost, and for statutory time limits to be respected.”
“In doing so, the FTT can have regard to any obvious strength or weakness of the applicant's case; this goes to the question of prejudice – there is obviously much greater prejudice for an applicant to lose the opportunity of putting forward a really strong case than a very weak one. It is important however that this should not descend into a detailed analysis of the underlying merits of the appeal.”
“We have, however, concluded that the FTT did make an error of law in failing to acknowledge or give proper force to the position that, as a matter of principle, the need for statutory time limits to be respected was a matter of particular importance to the exercise of its discretion.”
“The exercise of a discretion to allow a late appeal is a matter of material import, since it gives the tribunal a jurisdiction it would not otherwise have. Time limits imposed by law should generally be respected.”
“we consider the three stage structure of the discretion at [44] of Martland … to represent an unimpeachable approach.”
“94. …At [44] of Martland, the Upper Tribunal set out the three-stage test. That paragraph says nothing about the ex-ante weight to be attached to the factors being weighed and is unimpeachable. “95. The question is whether [45] of Martland … goes further and in referring to the “particular importance of the need for litigation to be conducted efficiently and at proportionate cost, and for statutory time limits to be respected” was doing what the Court of Appeal did in Denton, and according these factors particular weight. Read on its own, it must be doubted whether Martland was doing this. Martland at [45] is not unequivocally clear, and can be read as merely stressing that these factors matter, as indeed they do. But there can be no doubt that the Upper Tribunal has subsequently followed the Denton approach not merely as to the structure of the discretion (ie the three-stage test) but also as to the (additional, extra) weight to be accorded to theCPR 3.9 (a) and (b) factors (ie the “top table” point) ...”
“91. …In summary, Marcus Smith J concluded that paragraph [45] of Martland was clearly wrong in glossing section 83G of VATA 1994 so as to include the factors contained in the current version ofCPR 3.9 , which are absent from the statutory test in section 83G. Judge Cannan did not consider Martland to be clearly wrong in this respect, concluding that Parliament had envisaged that the Upper Tribunal would give guidance on the exercise of the discretion in section 83G, which could extend to drawing an analogy with the CPR and giving guidance on the weight to be attributed to particular factors.”
“92. The Appellant submits that as a matter of judicial comity we should follow the decision in Medpro UT unless we consider it to be clearly wrong. The difficulty for us here is the existence of two previous decisions of the Upper Tribunal, one of which holds the other to be clearly wrong. 93. We find ourselves unable to conclude that either decision is clearly wrong or, conversely, clearly right. We note that HMRC are contemplating an appeal so it is possible the conflict may be resolved at a higher level, but we cannot delay this decision on that account. In the circumstances, we consider that we should follow Medpro UT on the grounds that it is the more recent decision and expressly considers the correctness of the earlier decision.”
“44. I also consider that Marcus Smith J’s characterisation of the Martland guidance (as interpreted in Katib) as amounting to a fetter on discretion is overblown. The three- stage test described in Martland plainly requires the FTT to consider all the circumstances of the case. That expressly recognises that there is a judicial discretion to be exercised. 45. In my judgment, therefore, Marcus Smith J was wrong, and Judge Cannan was right…First, guidance is just that: guidance. Where a superior court or tribunal gives guidance to an inferior court or tribunal, the inferior court or tribunal may depart from it if it gives sound reasons for doing so. That is reflected in Lady Rose’s reference to the absence of special circumstances. Second, as Lady Rose made clear, it is appropriate for an appellate court to lay down guidance even where a discretion appears to be unfettered. Third, in BPP the Supreme Court specifically approved the giving of guidance where non-compliance with time limits is in issue.”
“…The Martland guidance (as amplified by Katib) is appropriate.”
“In the context of an appeal right which must be exercised within 30 days from the date of the document notifying the decision, a delay of more than three months cannot be described as anything but serious and significant.”
“NOTICE OFASSESSMENT OF MIS DECLARATION PENALTY … As the Value Added Tax return for this period contained an inaccuracy that resulted in an overstatement of your entitlement to a repayment, the Commissioners for HM Revenue and Customs, using their statutory powers underSection 63 of the VAT Act 1994 , have made an assessment of misdeclaration penalty: … If you disagree with our decision. you need to write to us within 30 days of the date of this notice, telling us why you think our decision was wrong and we will look at it again. If you prefer, we will arrange for a review by a person-not previously involved in the matter. You will then have the right to appeal to an independent tribunal. Alternatively you can appeal direct to the tribunal within 30 days of this notice.”
“Given the extensive history of litigation and disputes as to tax owed there has been a very large volume of documentation generated over the course of many years which has had to be considered by the taxpayers professional advisors. The Appeal is being lodged against a background of a considerable degree of pressure being exerted by HMRC via County Court proceedings [Claim no. 9WD03777] and we reserve the right to amend and/or add to these Grounds of Appeal as the taxpayer has not been able (in spite of the considerable volume of documentation in his possession) to provide us with a complete set of records.”
“permission to appeal out of time should only be granted exceptionally, meaning that it should be the exception rather than the rule and not granted routinely.”
“… the purpose of the time limit is to bring finality, and that is a matter of public interest, both from the point of view of the taxpayer in question and that of the wider body of taxpayers.”