“Corporation tax 77. The tax legislation (examined in detail below) effectively permits a tax deduction to be taken by a company in respect of its amortisation of capital expenditure incurred on intangible fixed assets (including goodwill), to the extent that the expenditure and amortisation are reflected in the company’s UK GAAP-compliant accounts. There was some disagreement as to the precise consequences if the accounts were found not to be GAAP-compliant, explored in more detail … below. In outline, HMRC argued that relief would then be allowed based on what would have been GAAP-compliant accounts, whereas Nellsar’s argument was somewhat more nuanced. 78. When Nellsar acquired the various nursing/care homes, in each case it acquired a number of different assets, including the freehold property, various fixtures and fittings, inventory and the goodwill of the business. 79. UK GAAP required Nellsar to include the “identifiable assets” (i.e. those assets capable of being disposed of separately, without disposing of the business as a whole) in its balance sheet at “fair value”
“Company not drawing up correct accounts (1) If a company does not draw up accounts in accordance with generally accepted accounting practice (“correct accounts”)— (a) the provisions of this Schedule apply as if correct accounts had been drawn up, and (b) the amounts referred to in this Schedule as being recognised for accounting purposes are those that would have been recognised if correct accounts had been drawn up. (2) If a company draws up accounts that rely to any extent on amounts derived from an earlier period of account for which the company did not draw up correct accounts, the amounts referred to in this Schedule as being recognised for accounting purposes in the later period are those that would have been recognised if correct accounts had been drawn up for the earlier period. (3) The provisions of this paragraph apply where the company does not draw up accounts at all as well as where it draws up accounts that are not correct. …”
“Assets acquired or realised together (1) Any reference in this Schedule to the acquisition or realisation of an asset includes the acquisition or realisation of that asset together with other assets. (2) For the purposes of this Schedule assets acquired or realised as a result of one bargain are treated as acquired or realised together even though — (a) separate prices are, or purport to be, agreed for separate assets, or (b) there are, or purport to be, separate acquisitions or realisations of separate assets. (3) Where assets are acquired together — (a) any values allocated to particular assets by the company in accordance with generally accepted accounting practice shall be accepted for the purposes of this Schedule; (b) if no such values are allocated by the company, so much of the expenditure as on a just and reasonable apportionment is properly attributable to each asset shall be treated for the purposes of this Schedule as referable to that asset.”
“Just and reasonable apportionment (1) For the purposes of this Part consideration attributable— (a) to two or more land transactions, or (b) in part to a land transaction and in part to another matter, or (c) in part to matters making it chargeable consideration and in part to other matters, shall be apportioned on a just and reasonable basis. (2) If the consideration is not so apportioned, this Part has effect as if it had been so apportioned. (3) For the purposes of this paragraph any consideration given for what is in substance one bargain shall be treated as attributable to all the elements of the bargain, even though— (a) separate consideration is, or purports to be, given for different elements of the bargain, or (b) there are, or purport to be, separate transactions in respect of different elements of the bargain.”
“The identifiable assets and liabilities of the undertaking acquired shall be included in the consolidated balance sheet at their fair values at the date of acquisition. In this paragraph the “identifiable” assets or liabilities of the undertaking acquired means the assets or liabilities which are capable of being disposed of or discharged separately, without disposing of a business of the undertaking.”
“Tangible fixed assets 9 The fair value of a tangible fixed asset should be based on: (a) market value, if assets similar in type and condition are bought and sold on an open market; or (b) depreciated replacement cost, reflecting the acquired business’s normal buying process and the sources of supply and prices available to it. The fair value should not exceed the recoverable amount of the asset.”
“5 Company not drawing up correct accounts (1) If a company does not draw up accounts in accordance with generally accepted accounting practice (“correct accounts”)— (a) the provisions of this Schedule apply as if correct accounts had been drawn up, and (b) the amounts referred to in this Schedule as being recognised for accounting purposes are those that would have been recognised if correct accounts had been drawn up.”
“105 Assets acquired or realised together (1) Any reference in this Schedule to the acquisition or realisation of an asset includes the acquisition or realisation of that asset together with other assets. (2) For the purposes of this Schedule assets acquired or realised as a result of one bargain are treated as acquired or realised together even though — (a) separate prices are, or purport to be, agreed for separate assets, or (b) there are, or purport to be, separate acquisitions or realisations of separate assets. (3) Where assets are acquired together — (a) any values allocated to particular assets by the company in accordance with generally accepted accounting practice shall be accepted for the purposes of this Schedule; (b) if no such values are allocated by the company, so much of the expenditure as on a just and reasonable apportionment is properly attributable to each asset shall be treated for the purposes of this Schedule as referable to that asset.”
“[I]f a company prepares accounts which are not GAAP-compliant, under paragraph 5 the tax treatment should be decided as if GAAP-compliant accounts had been prepared. If GAAP-compliant accounts allocated separate values to particular assets which had been acquired together, then under paragraph 105(3)(a) that allocation must be accepted. Paragraph 105(3)(b) only came into play if a company prepares GAAP-compliant accounts but those accounts do not contain allocations of value between separate assets which need to be treated differently for tax purposes under Schedule 29. It is only in such cases that paragraph 105(3)(b) steps in to require a just and reasonable apportionment.”
“The effect of paragraph 105(3)(b)… was that even if the accounts were not drawn up (and the individual assets valued) in accordance with GAAP (so that one fell outside 105(3)(a)), the correct method of valuing the assets for the purposes of the relief was by applying a “just and reasonable apportionment”; and since Nellsar had used one of the methods of valuation recognised in GAAP (depreciated replacement cost) in carrying out its apportionment, that apportionment must be accepted… paragraph 105, being the more specific provision, overrode paragraph 5 on this point.”
“The aggregate amount of the value of the land for the existing use or a notional replacement site in the same locality, and the gross replacement cost of the buildings and other site works, from which appropriate deductions may then be made to allow for the age, condition, economic or functional obsolescence, environmental and other relevant factors; all of these might result in the existing property being worth less to the undertaking in occupation than would a new replacement.”
“A market-based concept whereby a potential purchaser, and thus the valuer, estimates the maintainable level of trade and future profitability that can be achieved by a competent operator of a business conducted on the premises, acting in an efficient manner. The concept involves the trading potential rather than the actual level of trade under the existing ownership so it excludes personal goodwill.” , (2) derive the fair maintainable operating profit (“FMOP”) from the FMT, (3) arrive at the market value by capitalising the FMOP at a rate which reflects “the risk and rewards of the property and its trading potential” and analysing and applying “evidence of relevant comparable market transactions”
“Where that valuation method is applied, is the resulting figure the value of the leasehold interest, or the value of both the leasehold interest and “transferrable goodwill”?”
“The RICS guidance has, throughout all the versions of GN1, GN2 and VPGA4 A later version of the GNs provided to us, recognised that it is possible, by the application of appropriate adjustments, to convert an “operational entity” valuation to an “empty property” (or similar) valuation. Both experts agreed with this proposition. The effect of this is that whilst it is still “the property” that is being valued, that property can nonetheless be valued in different “states” whilst complying with RICS guidance.”
“However, as is made explicit in VPGA4, this capital value should then be moderated by reference to appropriate assumptions. One possible assumption is that the property is “non-trading”, in which case it is specifically stated that the difference between an “operational entity” and a “non-trading” valuation could reflect the “cost and time involved in purchasing and installing the trade inventory, obtaining new licences, appointing staff and achieving FMT [fair maintainable turnover]”
“We should emphasise that in doing so, regard may be had to the trading history of each property, which we consider to be, at least in part, an inherent aspect of the property itself. Both valuation experts agreed that in valuing a closed down nursing home, some account may well be taken of the “stigma” attached to the property, depending on the reason for the closure. Obviously no such stigma should be assumed in the present cases, and it may be that the valuers’ view of the risk, cost and time involved in reaching FMT will be informed, at least in part, by the trading history of the relevant property. We would also consider that the status of a property as effectively “grandfathered” for the purposes of National Minimum Standards would also be assumed to continue for the purposes of the valuation exercise: the fact that the property must in our view be separately valued as an “identifiable asset” in the way we have outlined does not mean that it should be regarded as closed and would therefore require bringing up to National Minimum Standards before it could be re-opened.”
“224. We have therefore reached the following conclusion in principle. 225. We consider that since we regard operational nursing/care homes to be sufficiently similar in type and condition to the “identifiable asset” which is required to be valued in each of the present appeals, it is possible to ascribe market values pursuant to paragraph 9(a) of FRS 7 to each such “identifiable asset” by reference to sales of operational nursing/care homes on the open market by applying appropriate adjustments as contemplated by RICS guidance (see [212] to [214] above). 226. Accordingly, it was not open to Nellsar to recognise the homes in question at depreciated replacement cost pursuant to paragraph 9(b) of FRS 7; the relevant accounts of Nellsar were therefore not drawn up in accordance with generally accepted accounting principles and accordingly were not “correct accounts” for the purposes of Part 1 of Schedule 29 FA02 or the successor legislation; and the legislation should therefore apply as if “correct accounts” had been drawn up, recognising the fair values of the respective properties on acquisition at their respective market values (see [218] above). 227. For this purpose, “market value” should be assessed on the basis of the homes as standalone assets, without staff, residents, contracts, permits, chattels of any kind (apart from those so affixed at the time of sale as to be part of the property under the general law) or any other accoutrements of a business (see [220] above). The market value will, in line with RICS guidance, reflect the trading potential of the property in each case. 228. As to the relevant apportionments for SDLT purposes, these are to be carried out following the basic methodology set out in the HMRC Practice Note, but using market values of the relevant assets (see [223] above). 229. If the parties are unable to agree any market values required in order to implement this decision in principle, then such market values will ultimately need to be determined by the Upper Tribunal (Lands Chamber).”
“[40] In our view the question of what is generally accepted accounting practice, as well as the question whether a particular set of accounts are prepared in accordance with it, is a question of fact to be determined with the assistance of expert evidence. Professional accountants are best placed to understand accounting statements in their context, and in particular their 'spirit and reasoning'. For example, and relevant to this case, the purpose and significance of the concept of functional currency is not clear without an understanding of accounting concepts and the wider context. We agree therefore with the approach of Arnold J in Smith Smith v HMRC[2011] STC 1724 (Arnold J) . [41] What is a matter for a court or tribunal, however, is the proper assessment of expert evidence. Clearly a judge may prefer the evidence of one expert to that of another, but this should be fully reasoned and the judge should not simply 'develop his own theory' (see for example Devoran Joinery Co Ltd v Perkins[2003] EWCA Civ 1241 ,[2003] All ER (D) 140 (Sep), at [24]).”
“52. The tribunal was thus a specialised tribunal not merely by virtue of its function, but also by virtue of the expertise of its members. That is significant in the present case because the central issue which it faced was whether Mr Smith’s [the taxpayer’s] accounts had been prepared in accordance with generally accepted accounting practice. It follows, for the reasons given above, that particular deference is to be given to its decision. [53] Secondly, the tribunal's decision was given after a four-day hearing at which a number of witnesses gave oral evidence. In addition to Mr Smith, these included Mr Tidbury and two expert witnesses, Lee Elsworth FCA (for Mr Smith) and Anil Mathew FCCA (for HMRC). In its decision the tribunal considered the evidence of each of the three accountants in detail. This tribunal does not have the advantage, which the tribunal did have, of seeing the witnesses give evidence. It follows, for the reasons given above, that this tribunal should be slow to conclude that the tribunal was not entitled to reach the conclusions it reached…. [54] Thirdly, counsel for HMRC submitted that in reality the appeal was an attempt by Mr Smith to re-argue questions of fact and evaluation which had been decided by the tribunal with a view to trying to persuade this tribunal to take a different view. In my judgment this submission is well founded.” (Emphasis added)
“As I have said, it seems to me that one cannot take a more advantageous line for the taxpayer than to regard that as the applicable principle when considering the function of the court in relation to the tribunal's findings in this kind of case. This is indeed the nature of the questions of law that are raised or sought to be raised in the present case, that the findings were unsupported by the evidence or contrary to the evidence that was given. It is right, in my judgment, to strike two cautionary notes at this stage. There is a well-recognised need for caution in permitting challenges to findings of fact on the ground that they raise this kind of question of law. That is well seen in arbitration cases and in many others. It is all too easy for a so-called question of law to become no more than a disguised attack on findings of fact which must be accepted by the courts. As this case demonstrates, it is all too easy for the appeals procedure to the High Court Now, in relation to tax appeals, replaced by the Upper Tribunal:Tribunals, Courts and Enforcement Act 2007 to be misused in this way. Secondly, the nature of the factual inquiry which an appellate court can and does undertake in a proper case is essentially different from the decision-making process which is undertaken by the tribunal of fact. The question is not, has the party upon whom rests the burden of proof established on the balance of probabilities the facts upon which he relies, but, was there evidence before the tribunal which was sufficient to support the finding which it made? In other words, was the finding one which the tribunal was entitled to make? Clearly, if there was no evidence, or the evidence was to the contrary effect, the tribunal was not so entitled. It follows, in my judgment, that for a question of law to arise in the circumstances, the appellant must first identify the finding which is challenged; secondly, show that it is significant in relation to the conclusion; thirdly, identify the evidence, if any, which was relevant to that finding; and, fourthly, show that that finding, on the basis of that evidence, was one which the tribunal was not entitled to make. What is not permitted, in my view, is a roving selection of evidence coupled with a general assertion that the tribunal's conclusion was against the weight of the evidence and was therefore wrong. A failure to appreciate what is the correct approach accounts for much of the time and expense that was occasioned by this appeal to the High Court”
“Where an appeal is made on Edwards v Bairstow grounds, it is important to particularise, in advance of the hearing, the parts of the relevant decision and the parts of the evidence before the FTT which are the subject matter of the appeal.”
“VGPA 4 is, in my judgment, clear that (like other methods of valuation) what it is aiming at is a valuation of property (i.e. a freehold or leasehold interest). The profits method of valuation is guidance on how to value property of a particular type. VGPA is replete with references to the valuation of property….”
“50. All these passages stress that what is being valued is the property asset, how to value it is by the profits method, and the inclusion of trading potential as part of that property valuation reflects value that is inherent in the property asset itself. Trading potential refers to future profits, rather than actual profits. That potential is available to any reasonably efficient operator who acquires the property. On the basis that goodwill is what brings in custom, it will be reflected in the turnover and the profit of the actual business. Yet it was common ground that the valuation by the profits method was based on the market’s perception of fair maintainable trade and fair maintainable operating profit; and that that method of valuation applied both to freehold and leasehold property. Even if no business is being conducted on the property, the profits method is still the appropriate way to value it, as section 7 of VGPA 4 explains. 51. Put shortly, VPGA 4 does not recognise the concept of “transferable goodwill” as an asset separate from the property interest. It does, however, recognise “personal goodwill” which is excluded from the valuation under para 2.10. Apart from that personal goodwill, VPGA 4 does not refer to goodwill at all.”
"65. The error of law which, in my judgment, the UT made was to disaggregate property value on the one hand, and 'transferable goodwill' on the other. VPGA4 is aimed at the valuation of property interests. That they are valued by reference to trading potential does not mean that two separate assets are being valued. …The error that the UT made was in attempting to extricate the value of the business use from the property value. 66. In so far as there is a concept of transferable goodwill of a hypothetical business, it is simply part of the inherent qualities of the property itself and its trading potential, as stated in VGPA4 ... There is only one asset, namely the property, and the profits method of valuation is, as its description implies, no more than a method of arriving at the value of the property."
“211. But equally, we do not accept that, in the absence of a sufficiently active market in sales of non-operating nursing/care homes, this necessarily means that Nellsar is forced back, as it maintains, on using depreciated replacement cost for the purposes of ascribing a fair value to the property. 212. The reason for this is that FRS7 requires fair value to be based on market value (rather than DRC) “if assets similar in type and condition are bought and sold on an open market”
“42. Although the FRS contains specific requirements for determining fair values of different classes of assets and liabilities, the concept of fair value underlying the specific rules is the value at which the asset, or liability, could be exchanged in an arm’s length transaction between informed and willing parties. 43. Where similar assets are bought and sold on a readily accessible market, the market price will represent the fair value. Where quoted market prices are not available, market prices can often be estimated, either by independent valuations, or valuation techniques such as discounting estimated future cash flows to their present values. In some cases, where quoted market prices are not available, subsequent sales of acquired assets may provide the most reliable evidence of fair value at the time of the acquisition. 44. Where a fair value is based on a market price, it is important to ensure that such price is appropriate to the circumstances of the acquired business. For example, it may be possible to obtain a price for secondhand plant and machinery of the type used in the business, but the secondhand market may deal in very small volumes; or the items may not be identical in terms of the ability to obtain maintenance or technical support from the manufacturer or for the machinery to be customised to the requirements of the business. In general, unless the acquired business is genuinely able to consider the purchase of second-hand equipment as a viable alternative to purchasing direct from the manufacturer, the fair value of plant and machinery is more appropriately determined from the replacement cost of an equivalent new asset, depreciated where appropriate to reflect its age and condition.” (Emphasis added)
“Valuations based on Market Value (MV) shall adopt the definition, and the interpretive commentary, settled by the International Valuation Standards Committee.”
“2. In order to apply Market Value to certain property types it may be necessary to add a statement clarifying both what is being valued and any Assumptions that are inherent in the valuation. Examples include property that is normally sold having regard to its trading potential, and Plant & Machinery, both of which are discussed below. The circumstances of the valuation may also require Special Assumptions to be made (see Appendix 2.3). However, it should be recognised that although additional words may be required to clarify the application of Market Value, this is not a different basis, but rather the same core basis with additional Assumptions. … 6. There are certain categories of property designed or adapted for particular uses which change hands in the open market as fully operational business units for a strictly limited use at prices based directly on trading potential. The price will include trade fixtures, fittings, furniture, furnishings and equipment. This type of property includes: hotels, bars, some restaurants, movie theatres or cinemas, gasoline or petrol stations. In these cases the valuer will need to supplement Market Value with additional words clarifying whether the valuation assumes that the property changes hands as a fully-equipped, trading entity, or on some other Assumption or Special Assumption (see Appendix 2.2 and Appendix 2.3). Further information on this type of trade-related valuation is also contained within GN1.” (Emphasis added).
“These Appendices were not included in the copy of Practice Note 3 included in our bundle.”
“4. Trading property 4.1 In the case of a trading property the Special Assumptions may include that: … - the businesses is closed when it is actually trading from the property; …”
“1. Introduction 1.1 The commentary to PS3.2 indicates that special consideration must be given to the application of Market Value to certain categories of property that are normally bought and sold on the basis of their trading potential. Examples of this type of property include hotels, bars, restaurants, movie theatres [movie theatres replaced by “theatres” in 2007 version] or cinemas, gasoline or petrol stations [“gasoline or petrol stations” replaced by “fuel stations” in 2007 version][“, and care homes” added in 2007 version]. The essential characteristics of properties that are normally sold on the basis of their trading potential is that they are designed, or adapted, for a specific use and that ownership of the property normally passes with the sale of the business as an operational entity. 1.2 This Guidance Note [“is restricted to trade related property valuations. It” added in 2007 version] considers the additional criteria that need to be considered by the valuer in these cases. It [“. It” replaced by “, but” in 2007 version] does not concern itself with methodology [“methodology” replaced by “methods of valuation” in 2007 version], which will vary depending upon the trading [“trading” deleted in 2007 version] property to be valued.”
“4.1 A trade related property will usually be valued to market value or market rent, but valuers are commonly asked for valuations subject to special assumptions.
“8.5 I consider a property only valuation could have been provided in accordance with Red Book as a Special Assumptions valuation and those assumptions would need to be agreed with the client. In the accounting circumstances we are reviewing I would consider such assumptions may have been: a) The property is non-operational; b) TFFF&E [Trade Furnishings, Fixtures, Fittings and Equipment] are present or not as per client instructions; c) The property is in its existing physical condition; d) There are no adverse circumstances that led to the property being non-operational; such as administration, forced closer under regulation or major new competition. 8.6 Such assumptions would allow a valuer to consider the property as closely as possible to the actual circumstances but without the business. 8.7 There may well be difficulty in assessing the value of the property directly to examples of other non-operational properties that sold in the open market where the Special Assumptions also applied as there would be very few such sales. It would also be difficult in most instances to identify examples of any non-trading care home sales whatever the circumstances of closure as, overall, there are very few sales of non-operational care homes in any one year. I return to this below. 8.8 The vast majority of care homes are sold as fully equipped operational entities. I note FRS 7 does not give any guide as to frequency of sales but, for a valuer, the frequency is very likely to be too little for there to be reliable comparable sales on which to directly base a valuation of the property only. In those circumstances, and I would fully expect those circumstances to arise in all but the rarest of cases, the valuer would normally apply a residual approach to the valuation, commencing with a valuation as a fully operational entity and then making deductions therefrom (as is market practice) to arrive at a non-operational property value that reflects what the market would pay. However, it does not seem to me that FRS 7 allows the valuer to use this alternative approach. 8.9 It would be for the client to decide whether such an approach would be acceptable for the purposes of paragraph 9 a) of FRS 7 and the valuer would be instructed accordingly.” (Emphasis added)
“Unless they can be measured at market value, the fair values of non-monetary assets will normally be based on replacement cost.”
“202. We prefer the argument of Mr Jones on this point. As he pointed out, the basic scheme of the legislation was to align the tax treatment of intangibles with the correct accounting treatment of them. It would be a strange outcome if paragraph 105(3)(b) gave a company the option of “switching off” the correct accounting treatment under GAAP where intangible assets are acquired as part of a business acquisition, and replacing it with a “just and reasonable apportionment” of the overall acquisition cost. Mr Farrell’s fallback argument on the point – that an apportionment decided on the basis of depreciated replacement cost would necessarily be a “just and reasonable” one because it was a basis “approved by accounting standards” – is equally unattractive, because it proceeds from the starting point that the accounts are not “correct” (i.e. GAAP-compliant) for the very reason that they adopted a depreciated replacement cost basis of valuation of the properties. 203. As Mr Jones pointed out, there are clearly situations where paragraph 105(3)(b) can fill what would otherwise be a potential lacuna arising from the absence of any requirement under GAAP to value any particular asset in a company’s accounts – for example where a company had incurred expenditure on a bundle of intangible assets and GAAP did not require it to allocate individual values to the constituent parts of the bundle; it might be necessary to differentiate between the different parts for tax purposes, in which case paragraph 105(3)(b) provided the appropriate mechanism for doing so. This provided a justification for paragraph 105 which did not put it into conflict with paragraph 5.”
“3. The words, in sub-s (2), 'in such manner as is just and reasonable' and 'as near as may be, according to the respective values of those interests' suggest a broad rather than an actuarial approach in which all relevant considerations may be taken into account. They permit (inter alia) consideration of the settlor's letter of intent which shows, at least, that the settlement was to be regarded as for the benefit of the grandchildren, not of the settlor's two children.”
“The apportionment is to be carried out on a 'just and reasonable' basis so that 'the chargeable gain is apportioned, as near as may be, according to the respective values of those interests'. The governing words are 'just and reasonable': they confer on the inspector and the commissioners a wide latitude in judgment. The task is to apportion the chargeable gain, as near as may be, according to respective values. The language is apt to cover a valuation of interests where factors other than the market value of a property interest have to be considered. … For the purpose of valuation, the intention of the settlor, as evidenced by the deed and its recitals, is a significant factor to which value is to be attached to the extent that is just and reasonable and in a manner which, as near as may be, reflects the respective interests under the settlement. Further, the letter of intent, though not by itself of great weight, is admissible as supporting the intention manifested in the settlement itself.”
“219. We should emphasise that in saying this, we are not laying down any particular assumptions or adjustments that we consider should apply in preparing the revised valuations – that is a matter of professional valuation opinion upon which the Lands Chamber of the Upper Tribunal will in due course, if necessary, adjudicate when it comes to determining actual valuations.”
“220. In view of the agreement referred to at [10] above [i.e. as to the role of the FTT – see paragraph 70 above], therefore, our decision is limited to stating that in valuing the properties in question, the method to be adopted is to value them pursuant to paragraph 9(a) of FRS7 on the basis set out in the RICS guidance referred to above, but in accordance with FRS6 & 7 valuing only the “identifiable asset” in each case, i.e. assuming there to be no current staff, residents, contracts, permits or other accoutrements of a business and excluding any chattels which, as a matter of real property law, did not form part of the land at the time of Nellsar’s purchase.”
“The identifiable assets and liabilities of the undertaking acquired shall be included in the consolidated balance sheet at their fair values at the date of acquisition. In this paragraph the “identifiable” assets or liabilities of the undertaking acquired means the assets or liabilities which are capable of being disposed of or discharged separately, without disposing of a business of the undertaking.”
“80. Before examining the disputed passages of the Decision and the transcript of the hearing before the FTT, we should record that it was common ground that the authorities established a number of propositions. First, was the proposition that the Decision had to be read fairly and as a whole, not picking upon individual passages in isolation. Secondly, the FTT was under no obligation to deal with every submission or piece of evidence – to conclude otherwise would place an intolerable burden on the fact-finding tribunal. It was necessary only to deal with relevant evidence and submissions. Moreover, the mere fact that the FTT does not refer to a piece of evidence does not mean that the evidence was overlooked or ignored. Thirdly, there was a presumption that if the FTT correctly sets out the law it can be taken to have applied it correctly. Obviously, mistakes can be made and if it can be shown that the FTT did not apply the legal test correctly that presumption can be rebutted.”
“It is well established that reasons given for a decision can always be better expressed, but that judgments and decisions should be read on the assumption that judges and tribunals know what they are doing unless they have demonstrated the contrary. In the same way I think a decision such as that of the FTT here should be read on the assumption that the FTT intended it to be rational, coherent and consistent unless one is driven to the conclusion that it cannot be so read.”