“The arrangements were always so structured that the interest earned on the deposit exactly matched the quarterly amounts, which in turn exactly matched the interest, net of the margin, payable by the members on their borrowings. Thus if all went according to plan and the letter of credit was not called upon, the interest earned by the deposit was paid to Shamrock, in order that Shamrock could pay the corresponding quarterly amount to Hawksbridge, which in turn distributed that sum to the members in accordance with their respective shares. The members used the sums paid to them to discharge their obligation to pay interest to Barclays. The money therefore went round in a circle; and in doing so it too merely passed from one Barclays account to another, never leaving Barclays’ control.”
“in an ordinary case without unexpected complication this process, too, was essentially a bookkeeping exercise: when the loans to the members came to be paid off, the bank simply withdrew from the blocked deposit accounts the sums necessary to discharge the loans – the total required, as we have explained, invariably and exactly matching the deposited sums – while the interest arrangements were also structured so that, whenever redemption occurred, there was no shortfall in either direction.”
“the risk that the loans from the banks would not be repaid was effectively eliminated” and, at [132] of the Decision, that although the members’ borrowing arrangements constituted full recourse loans: “their exposure to any real risk of having to repay the loans from their own resources was illusory.”
“(1) The profits of a trade must be calculated in accordance with generally accepted accounting practice, subject to any adjustment required or authorised by law in calculating profits for income tax purposes.”
“(1) The same rules apply for income tax purposes in calculating losses of a trade as apply in calculating profits.”
“(1) In calculating the profits of trade, no deductions are allowed for – (a) expenses not incurred wholly and exclusively for the purposes of the trade, or (b) losses not connected with or arising out of trade.”
“There is no indication in these words that the ultimate use of the monies by the recipient is to be relevant to a determination of the purpose for which they were expended” and at [39]: “The starting point in this case is the purposive construction of s. 74, which points the tribunal towards a consideration of the use that was made of the disbursement in question in relation to the taxpayer’s trade, and does not require consideration of how the money was ultimately dealt with by the recipient.”
“in consideration of the rights and benefits obtained by Centre under [the HDA], Centre hereby undertakes and agrees to pay the Annual Advances and Final Minimum Sum to [Icebreaker] on the date specified”
“As a matter of construction, the HDA does not specify what the£1,273,866 was paid for, because of the uncertainty created by cl 4.1. The transaction as a whole, was however, correctly analysed by the FTT, in my judgment, as demonstrating that the sum of£1,064,000 that came from BoS to the members into Icebreaker, and then on to Centre, was paid for the purpose of securing the Annual Advances and the Final Minimum Sum. That is not a matter of looking at what Centre did with the money, but of looking at what Icebreaker paid the money for. I do not think there can be any realistic challenge to the FTT’s finding that Ms Hamilton, as the directing mind and will of Icebreaker, intended that£1,064,000 out of a payment of£1,273,866 was to be used for the purposes I have mentioned. Icebreaker, through Ms Hamilton, never expected or intended that the sum of£1,064,000 would be used for any film distribution trading purpose. Instead, Icebreaker intended and expected that the sum be used for the purposes of securing the Annual Advances and the Final Minimum Sum.”
“The underlying question, as the legislation makes clear, is whether the payment, that is of the fee payable by each partnership to Centipede or Shamrock, is made wholly and exclusively for the purposes of the partnership’s business. That business, as the appellant partnerships themselves argue, was the exploitation of intellectual property rights, and not the acquisition of an income stream which was guaranteed, irrespective of the success of that exploitation, and which was not even derived from it.”
“The essence of the appellant partnerships’ case is that money was borrowed in order that there should be a greater sum available for the exploitation of the intellectual property rights each had acquired than would have been the case had the members put in only the sums they could provide from their own resources. HMRC’s response is that none of the borrowed money was ever truly available for exploitation of the rights, and that the purpose of the borrowing coupled with the notional gross payment to each production company, was to create the illusion that the expenditure incurred by the partnerships in the first year was much greater than it truly was, in order to inflate the intended tax benefit. In our view, and for reasons we can explain now, HMRC’s case on this issue is unanswerable.”
“The borrowing arrangements gave them nothing at all, but merely discharged the interest as time passed and repaid the capital at the end of the term. Indeed, the irrecoverable cost to them of the arrangement fees and margin led to the members making a certain loss, without the prospect of even a speculative gain from the use of the borrowed money. The agreements for borrowing, guarantee and repayment were, and we are satisfied were always seen by all concerned as, a means of increasing, without risk, the apparent size of the amount paid for the exploitation of the intellectual property rights each partnership had acquired. That is HMRC’s case and, again, it is in our view unanswerable. As we have already said the money was not, and could not be, used in the exploitation of the rights and the borrowing was an arrangement with no commercial but only a tax purpose.”
“The risk that the loans from the banks would not be repaid was effectively eliminated. In most cases the lending bank did not part with any money at all; in others it did so only when it had already received the equivalent amount in cleared funds.”
“The members’ exposure to any real risk of having to repay the loans from their own resources was illusory.”
“Overall a great deal of effort was expended by Ms Hamilton and, in submissions, by Mr Peacock and Mr Maugham in attempting to persuade us that the guaranteed payments represented a revenue stream genuinely derived from the exploitation of intellectual property rights, and that they, as well as the put option were “downside protection” sheltering the members from the risk that the projects would be unsuccessful. Even a cursory examination of the arrangements shows that this is not a proper interpretation of them. As we have said already, the guaranteed payments were due not only irrespective of success or otherwise of the projects, but were payable from a different source, the sum deposited by the principal exploitation company with the bank. Neither the borrowings nor the guaranteed payments had in reality, any connection at all to the intellectual property rights the partnership had acquired.”
“In our view there can be no doubt that she knew perfectly well from the outset that the money borrowed would be used, directly or indirectly, to secure its own repayment.”
“Once the contention that the borrowed money was used in the exploitation of intellectual property rights (or, indeed, played any part in the pursuit of the partnership’s business) is discarded, it inevitably follows that another reason for the borrowing must be found since it is implausible that the members would knowingly incur arrangement fees and margin merely in order to borrow money they did not need.”
“The arrangements for exploitation of the acquired intellectual property would have been equally effective without borrowing.”
“not simply a label or a conclusion applied at the end of the analysis but instead a valuable tool in arriving at a conclusion.”
“If the question is whether a given transaction is such as to attract a statutory benefit, such as a grant or assistance like legal aid, or a statutory burden, such as income tax, I do not think that it promotes clarity of thought to use terms like ‘stratagem’ or ‘device’. The question is simply whether upon its true construction, the statute applies to the transaction. Tax avoidance schemes are perhaps the best example. They either work (Inland Revenue Commissioners v Duke of Westminster[1936] AC 1 ) or they do not (Furniss v Dawson[1984] AC 474 ). If they do not work, the reason, as my noble and learned friend, Lord Steyn, pointed out in Inland Revenue Commissioners v McGuckian[1997] 1 WLR 991 , 1000, is simply that upon the true construction of a statute, the transaction which was designed to avoid the charge to tax actually comes within it. It is not that the statute has a penumbral spirit which strikes down devices or stratagems designed to avoid its terms or exploit its loopholes. There is no need for such spooky jurisprudence.”
“puts into sharp focus how artificial the borrowing was; if Ms Hamilton’s assertion is right, it follows that the members entered into, or put in place the possibility of their entering into, arrangements which had no purpose but to guarantee the servicing and repayment of loans, in order that they could borrow the money which would be used, directly or indirectly, to make the interest payments and eventual repayment of the borrowing. The borrowing had, and could only ever have had, that entirely circular purpose.”
“it is plain from the description of the security arrangements as we have set them out that the payments of the quarterly amounts and the final minimum sum had nothing to do with that assignment or grant. The quarterly amounts were met from, and only from, the interest generated on the amount Shamrock was required to deposit with the lending bank (which in turn was derived, at least in the majority of cases, from the sum paid to it by the partnership), and the final minimum sum was met from that same deposit. Shamrock’s ability to meet the guaranteed payments was wholly unaffected by its deployment of the rest of the money paid to it since, as we have said, it was only ever intended that it would pay the difference between the nominal gross cost of production and the sum paid for a share of the rights of the production companies and, thereafter, it made not a jot of difference to its ability to meet the guaranteed payments whether the project earned money or simply wasted it; the funds were in place and ring fenced so that they could be used for no other purpose.”
“Judge Bishopp: Now, the last point I wanted to raise with you is this. Looking at the arrangement from a purely Shamrock point of view, what was the benefit to you of taking money from the LLP, putting it on the deposit and then giving it back four years later? A: Well, it was part of the deal. Judge Bishopp: I know it was part of the deal, but from Shamrock’s point of view what was the commercial advantage of it? You took money – let’s take a simple example. The PEA fee was£5 million . A: Yes. Judge Bishopp: Final minimum sum was£4 million . So you have£1 million to use in promoting the project. 4 million has to go into a bank account. You can’t touch it. There is no benefit to you out of it, because the interest it earns is paid immediately to the LLP, and at the end of the four years or whatever the period turned out to be, you just hand it back again. And you have all the hassle in the meantime of going into all these agreements. What, from Shamrock’s point of view, is the commercial advantage of being that? A: I see, sir. Specifically putting the money on deposit so that the letter of credit can be – Judge Bishopp: Well, I understand that. But you could have just have easily have said, “We don’t need 5 million; 1 million will do. Keep the other 4”? A: But that is where the figures in the services and licensing agreement and having those two separate ones are – having the two separate agreements, I think is vital. But for the cash to actually be there and to get the letter of credit, I completely agree, on that specific part of the deal it is just a nuisance for Shamrock, I do agree, yes. Judge Bishopp: I still don’t understand what the commercial advantage to Shamrock of doing it was. Taking the money, putting it into a sterile account and then handing it back again. A: I see. Yes, as I think as far as I am concerned a commercial advantage is that Shamrock has a lot business from Icebreaker LLP. Judge Bishopp: I see, so you did it because Icebreaker asked to? A: Yes. Judge Bishopp: Nothing more to it than that? A: None at all. Judge Bishopp: OK that answers my questions.”
“Both Mr Hutton and Ms Hamilton were asked why the arrangements could not have been made in a single document providing for production (taking the Planeteer agreement as a simple example) of the recordings in exchange for a single payment of£160,000 and 50% of the revenue, and neither could give to us what we can regard as a convincing, or even coherent, explanation of the reason why there were two agreements rather than one, and two payments rather than one.”
“We have concluded that the arrangement by which the principal exploitation company supposedly made a payment to the production company offset by a payment for a share of the revenues was a pretence, designed, if we may say so rather crudely, to confer some plausibility on the claim that the borrowed money was available for use in the exploitation of intellectual property rights. In our judgment it failed in that objective.”
“Even if it was not spelt out to each member that Shamrock would deposit a sum equivalent to the members’ aggregate borrowings with the bank, Ms Hamilton knew that to be the case; we are satisfied, as was the First-tier Tribunal which heard Icebreaker 1 (see [110] of its decision), that she knew perfectly well, and could have told any member or IFA who enquired, that the only security the bank would accept, in any of these cases, was a cash deposit and that, whether or not the exploitation fee was the direct source of the deposit, the amount borrowed could never be available in practice for exploitation. It is nothing to the point that Shamrock might have used the whole payment for the exploitation of the intellectual property rights the partnership had acquired and met the guaranteed payments by some other means; the reality is that all concerned knew, or would have learnt if they enquired, that it would not do so, and that it was never intended that it should.”
“We recognise that what the recipient does with the money it receives is not the test, but it is nevertheless unrealistic to disregard the application of the money when, as we are satisfied is the case here, the payer knows and intends that the money will be used in a particular way: such use becomes the payer’s purpose. That is, we think, what Millett LJ meant by propositions (2) and (4) in the extract of his judgment in Vodafone which we have set out above.”
“(2) To ascertain whether the payment was made for the purposes of the taxpayer’s trade it is necessary to discover his objective in making the payment. Save in obvious cases which speak for themselves, this involves an enquiry into the taxpayer’s subjective intentions at the time of the payment… (4) Although the taxpayer’s subjective intentions are determinative, these are not limited to the conscious motives which were in his mind at the time of the payment. Some consequences are so inevitably and inextricably involved in the payment that unless merely incidental they must be taken to be a purpose for which the payment was made.”
“The proposition that the exploitation services fee was paid wholly and exclusively for the purpose of exploiting intellectual property rights is, therefore, to be rejected. It requires us to disregard the reality that all those concerned knew and intended that a relatively modest part of the total fees would actually be used in the exploitation of those rights, while the greater part would not; and the obvious fact is that the partnership would not have handed over the money if there had been no assurance of a guaranteed income stream.”
“a cat does not become a dog because the parties have agreed to call it a dog.”
“We also accept HMRC’s argument, drawn from E V Booth v Buckwell, that it is open to them, and by extension us, to view the agreements for what they are, rather than for what they purport to be. In short, the reality is that part of the payment by each partnership to the principal exploitation company represented the price of the guaranteed income stream notwithstanding its description as something else”
“In my judgment, where parties to a composite transaction have, as a result of negotiations between themselves, provided that part of the consideration is to be paid for one part of the transaction and part for another, they cannot subsequently seek to re-allocate the consideration for tax purposes. They have chosen to carry through the transaction in a particular manner, and the taxation consequences flow from the manner adopted.”
“The Crown’s position may well be different in certain cases. After all, the Crown was not a party to the transaction.”
“In Samarkand the Tribunal stated (at §292) that “it was very unlikely that they [i.e. the rights to future profits] would have produced any significant sums, and we do not believe that there was any real chance or expectation that they would deliver a return big enough to compensate for the net present value losses”
“Sir – it is a matter really between Mr Maugham and Mr Blair, but can I just make clear my understanding that that point is only being taken in the individual references, and I understand – Judge Bishopp: It is irrelevant to your client’s case, is it not? Mr Peacock: My belief is it’s not relevant, but I would be grateful for my learned friend Mr Blair’s – Mr Blair: I have already confirmed that outside court, I am happy to confirm it. Judge Bishopp: All right, well, it’s not a part of the statutory test, so that is that, is it not? Mr Peacock: We don’t want to find ourselves also suddenly needing some music expert. Judge Bishop: Perhaps join forces with Mr Maugham. Mr Peacock: That may be suitable.” (4) It can be seen that Mr Blair was happy to confirm that “that point was not being taken in the LLP appeal but only in the individual references”; but the transcript unfortunately does not make it entirely clear what Mr Peacock meant, or Mr Blair understood, by “that point”
“When I asked – I am now giving evidence – Mr Blair was he taking ‘that point’, ill defined, undefined, or its equivalent, which is what I did ask him, it was: was he taking valuation points of the type found in paragraph 52. Mr Justice Nugee: Yes, and he said no. Mr Peacock: He said no” (5) I asked Mr Davey if he was able to tell me what Mr Blair’s recollection of the conversation outside court was. Having initially said that he was not, he subsequently made inquiries of Mr Blair, who is now HHJ Peter Blair QC, and I was told that he had indicated that he did not consider it appropriate now that he is on the Bench to comment on out of court communications which took place several years ago when he was at the Bar. However, he had asked to see the transcript of the appeal hearing and had confirmed there was nothing that counsel for the Revenue said on the matter that he felt needed to be corrected. That is a reference to what Mr Davey told me which was as follows: “Mr Justice Nugee: Can I ask you what your submission is as to what the point is that Mr Peacock says: “My understanding is that it is only being taken in the individual references.”
“I have already confirmed it outside court, I am happy to confirm it.”
“If you hark back to the debate Mr Blair and Mr Maugham had on Day 1, Mr Blair confirmed that he was not taking any valuation question in the partnerships’ appeals.”
“But the counterparty who you are engaging with, here Shamrock, has promised to provide services to you and you have agreed a fee for those services, and it is not said that there is anything either under or over market value about the fee that has been agreed.”
“Now, am I right in thinking, can I put it this way: one way in which the Revenue might choose to, in a particular case, attack a payment as not being wholly and exclusively for X is to show that 95 was paid for X but the real value of X was 15? Mr Davey: Yes. Mr Justice Nugee: You did not set out to do it that way. You did not call evidence. You did not plead the real value of X was 15. You did not call evidence that the real value of X was 15. You did not put the value of X directly in issue in that way. But you say that that is not the only way in which you can show what the 95 was paid for was not wholly for X. You can show it by showing that the 80 never became available for any other purpose than to repay the 80 that had been borrowed. It was never intended to become available for any other purpose than to repay the 80 that was borrowed. That’s not a valuation point. It may logically follow from that that the value of the services were likely to be about 15. But you are not relying on a valuation point to get to a conclusion. You are getting to a conclusion through use of other factual findings. So you have not directly attacked the value of the services or called evidence as to the value of the services, or put that in issue. Equally, you have not anywhere said, “we accept the services are worth 95”
“Look at the contract. As well as the car washing you get the£900 back. That£900 back is worth£900 because you also get interest in the meantime. So you cannot have spent the£900 on getting the car washed”
“To my mind the commerciality of the transaction is plain. I respectfully disagree with the contrary inferences of the Special Commissioners and the Judge on this point: they seem to me to be based on an incorrect appreciation of the facts.”
“Section 24 focuses on the incurring of expenditure by the trader on the provision of plant or machinery wholly and exclusively for the purposes of his trade. It therefore requires one to look only at what the taxpayer did. To the test posed in s 24 it is immaterial how the trader acquires the funds to incur the expenditure or what the vendor of the provided plant or machinery does with the consideration received.”
“One cannot ignore the reality of the pipeline, nor can one ignore the fact that ownership was transferred to BMBF with whom it remains, and that leases were granted to BGE and BGE (UK). On any view those are real transactions of lasting consequences in the real world” and at [58]: “Once one accepts the transfer of ownership, it is difficult to question the reality of the expenditure by which the purchase price was discharged. Furthermore, BMBF gave evidence that it financed the purchase price in the normal way by a loan from its parent bank, in accordance with its standard drawing facility, and that it was not concerned with the security arrangements made by the bank. There is no indication that this evidence was disbelieved.”
“Section 24(1) requires that a trader should have incurred capital expenditure on the provision of machinery or plant for the purposes of his trade. When the trade is finance leasing, this means that the capital expenditure should have been incurred to acquire the machinery and plant for the purpose of leasing it in the course of the trade.”
“These statutory requirements, as it seems to us, are in the case of a finance lease concerned entirely with the actions of the lessor. The Act says nothing about what the lessee should do with the purchase price, how he should find the money to pay the rent or how he should use the plant.”
“So far as the lessor is concerned, all the requirements of section 24(1) are satisfied. Mr Boobyer, a director of BMBF, gave unchallenged evidence that from its point of view the purchase and leaseback was part of its ordinary trade of finance leasing. Indeed if one examines the acts and purposes of BMBF, it would be very difficult to come to any other conclusion. The finding of the Special Commissioners that the transaction “had no commercial reality” depends entirely upon an examination of what happened to the purchase price after BMBF paid it to BGE. But these matters do not affect the reality of the expenditure by BMBF and its acquisition of the pipeline for the purposes of its finance leasing trade.”
“If the lessee chooses to make arrangements, even as a preordained part of the transaction for the sale and leaseback, which result in the bulk of the purchase price being irrevocably committed to paying the rent, that is no concern of the lessor. From his point of view, the transaction is exactly the same. No one disputes that BMBF had acquired ownership of the pipeline or that it generated income for BMBF in the course of its trade in the form of rent chargeable to corporation tax. In return it paid£91m . The circularity of payment which so impressed Park J and the special commissioners arose because BMBF, in the ordinary course of its business, borrowed the money to buy the pipeline from Barclays Bank and Barclays happened to be the bank which provided the cash collateralised guarantee to BMBF for the payment of the rent. But these were happenstances. None of these transactions, whether circular or not, were necessary elements in creating the entitlement to the capital allowances.”
“Section 74(1)(a) in particular [ie of ICTA 1988], specifically makes clear that only monies “wholly and exclusively laid out or expended for the purposes of the trade” are to be deductible. There is no indication in these words that the ultimate use of the monies by the recipient is to be relevant to a determination of the purpose for which they were expended. The focus is always on the taxpayer’s own business. In other words, the statute directs attention to a single end of the telescope.”
“In these circumstances, it seems to me that analysing the transaction as a whole, and looking at the matter exclusively from Icebreaker’s end of the telescope, the payment of£1,064,000 , as part of the global payment of£1,273,866 , was not made wholly and exclusively for the purposes of Icebreaker’s trade. Indeed, that part of the payment was not made for the film distribution trade at all. It was made so that Icebreaker could be assured that it, and therefore, its members would recover the loans that its members had borrowed from BoS, and which had been used to finance precisely that sum by way of investment into Icebreaker.… The payment of£1,064,000 was never intended to be used for any film production or distribution purpose…. The sum of£1,064,000 was expended and disbursed for the sole purpose of investment and security, and not for Icebreaker’s film trade properly so regarded.”
“We recognise that what the recipient does with the money it receives is not the test, but it is nevertheless unrealistic to disregard the application of the money when, as we are satisfied is the case here, the payer knows and intends that the money will be used in a particular way: such use becomes the payer’s purpose.”
“In short, this is indeed a case in which, as though by magic, the appearance is given that the taxpayer has incurred capital expenditure, but the truth is otherwise. The structure created to achieve the conjuring trick is, as usual in such cases, both complex and artificial.”
“The facts of that case [Ensign] were different, since in that case there was not ‘in any meaningful sense’ a loan at all. In this case there was a loan but there was not, in any meaningful sense, an incurring of expenditure of the borrowed money in the acquisition of software rights. It went into a loop in order to enable the LLPs to indulge in a tax avoidance scheme.”
“What is said to be the non-business purpose here, can only be expressed as generating a stream of income to be received by the partnership which facilitates, and is designed to support, the borrowing of the individuals…. That, I say, is a false line of reasoning. It assumes that generating a stream of income as a trader is necessarily and automatically a non-business purpose, just because that stream of income is to be used to support the borrowing by the individuals.”
“The starting point for determining the correct accounting treatment of whatever we find to be an allowable revenue expense is the requirement of FRS18 that the payments made by the partnerships in respect of services received by them should be treated as expenses in the accounting period to which they relate.”
“The LLP shall promptly pay all invoices received by it in relation to Exploitation Costs up to a maximum amount to be agreed. The LLP undertakes to pay an amount of£1,315,000 in respect of such Exploitation Costs to Centipede immediately upon signature hereof.”
“Immediately upon signature of this Agreement the LLP will pay to Shamrock a fee in the sum of£4,729,000 (the “Fee”) for provision of its services hereunder….”
“Shamrock hereby agrees to exploit the Rights, procure Materials and seek to maximise Revenue to the best of its skill and ability. Shamrock will incur Exploitation Costs and enter into Service Agreements and Licence Agreements for this purpose.”
“The LLP and Shamrock shall work together to procure Materials and generate Revenue and shall consult each other frequently in relation to all matters relating to the Rights of whatsoever nature, giving due and proper consideration to each other’s views.”
“….Shamrock shall procure that one of its senior representatives will be available on reasonable notice to attend meetings and discuss the Rights and their exploitation with the LLP’s representatives.”
“Shamrock shall work with the LLP and, if directed by the LLP, the Original Licensors to exploit the Rights in accordance with this Agreement. Shamrock shall ensure that the Rights are at all times given fair and equitable treatment and are not discriminated against in favour of any other rights or activity with which Shamrock and/or its senior representatives may be involved.”
“We will provide you with advisory services relating to the acquisition, licensing and exploitation of distribution rights in all forms of intellectual property. We will advise you on all of the areas of business set out in the LLP agreement of today’s date, including the negotiation and entry into the agreements of sub-contractors and other third parties for the exploitation of such distribution rights. We confirm that upon receipt of a written request from the members of Icebreaker 7 LLP (the “Members”), we will be obliged to attend any meeting of the Members that may be notified to us.”
“(1) This rule and rule 25 do not apply to a road transport case, in respect of which Schedule 1 makes alternative provision. (1A) Subject to any direction given by the Upper Tribunal, a respondent may provide a response to a notice of appeal. (2) Any response provided under paragraph (1A) must be in writing and must be sent or delivered to the Upper Tribunal so that it is received – (a) if an application for permission to appeal stands as the notice of appeal, no later than 1 month after the date on which the respondent was sent the notice that permission to appeal had been granted; (aa) in a fast track case, two days before the hearing of the appeal; (ab) in a quality contracts scheme case, no later than 1 month after the date on which a copy of the notice of appeal is sent to the respondent; or (b) in any other case no later than 1 month after the date on which the Upper Tribunal sent a copy of the notice of appeal to the respondent. (3) The response must state – (a) the name and address of the respondent; (b) the name and address of the representative (if any) of the respondent; (c) an address where documents for the respondent may be sent or delivered; (d) whether the respondent opposes the appeal; (e) the grounds on which the respondent relies, including (in the case of an appeal against the decision of another tribunal) any grounds on which the respondent was unsuccessful in the proceedings which are the subject of the appeal, but intends to rely [on] in the appeal; and (f) whether the respondent wants the case to be dealt with at a hearing. (4) If the respondent provides the response to the Upper Tribunal later than the time required by paragraph (2) or by an extension of time allowed under rule 5(3)(a) (power to extend time), the response must include a request for an extension of time and the reason why the response was not provided in time. (5) When the Upper Tribunal receives the response it must send a copy of the response and any accompanying documents to the appellant and each other party.”