Home Information Cases Brian Foulser, Doreen Foulser v Revenue & Customs Commissioners (2011)

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Brian Foulser, Doreen Foulser v Revenue & Customs Commissioners (2011)

Summary

The First-tier Tribunal (Tax Chamber) had no inherent powers. Any power that might be implied under the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009 r.5, enabling the tribunal to debar a party from proceedings in order to give effect to the overriding objective to deal with cases fairly and justly, would not extend to questions that did not specifically involve issues of unfairness within the tribunal proceedings themselves, which were appropriate for the jurisdiction of the Divisional Court.

Facts

The applicants (F) applied for an order debarring the respondent Revenue from making submissions or adducing evidence in ongoing appeal proceedings before the First-tier Tribunal concerning an assessment to capital gains tax.

F's application was based on the Revenue's alleged conduct of arranging, on the second day of a tribunal hearing, for F's tax adviser (G) to be arrested and detained, and the execution of warrants to enter, search and make seizures from premises occupied by G and associated companies. F alleged that the Revenue's motives included obtaining sight of legally privileged and confidential material, alerting the tribunal to G's arrest and detention, causing the postponement of the hearing, causing publicity and embarrassment, and placing pressure oppressively on F to settle.

F argued that the Revenue had been guilty of such serious misbehaviour that it should not be allowed to benefit to their detriment, that it would be unfair if the Revenue was permitted to proceed with its case, and that the tribunal had an inherent jurisdiction to debar a party from proceedings on the basis of the second category of abuse of process referred to in R. (on the application of Ebrahim) v Feltham Magistrates Court [2001] EWHC Admin 130, [2001] 1 W.L.R. 1293, namely cases where it would be unfair to the defendant to be tried. The Revenue submitted that as a creature of statute the tribunal's procedural powers were limited to those expressly or impliedly set out in the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009.

Held

(1) On the authorities, and in particular as made clear in the judgment of Hinkinbottom J. in R. (on the application of V) v Asylum and Immigration Tribunal [2009] EWHC 1902 (Admin), the instant tribunal did not have any inherent powers, R (on the application of V) applied, Kelly v Ingersoll Rand Co [1982] I.C.R. 476, Khan v Heywood and Middleton Primary Care Trust [2006] EWCA Civ 1087, [2007] I.C.R. 24, O'Keefe v Southampton City Council [1988] I.C.R. 419, Care First Partnership Ltd v Roffey [2001] I.C.R. 87 and Smith v Revenue and Customs Commissioners [2005] V. & D.R. 479 considered. Its only powers were those necessary for its proper functioning, which were restricted to powers expressly conferred through the Rules or statutory framework, or that could properly be implied into the statutory scheme through the construction of the Rules. The powers to strike out a party's case or bar a respondent from taking further part in proceedings were set out in r.8. However, that Rule was not exhaustive of all possible circumstances where the tribunal might have the power to strike out a case or prevent a respondent from proceeding, Hunter v Chief Constable of the West Midlands [1982] A.C. 529 considered. Each case fell to be determined, in light of the authorities, on its merits (see paras 16, 18, 19, 21-23, 31, 37, 41 of judgment). (2) The question was whether the power that F sought the tribunal to exercise could be implied. Such a power could only be implied by a construction of the provision for the tribunal to regulate its own procedure as set out in r.5, construed to give effect to the overriding objective, in r.2, to deal with cases fairly and justly. If fairness and justice demanded, the instant tribunal might therefore have power to make directions under r.5 where there was no express provision elsewhere in the Rules, Kelly considered. However, in the instant case the power asserted by F could not and should not be implied, not because of a construction of the Rules, but based on the nature of the power asserted. F had not sought to rely on an argument that they could not have a fair hearing, and the judgment in Ebrahim indicated that questions of a stay of proceedings or an effective striking out of a party's case that did not specifically involve issues of unfairness within the court proceedings themselves were appropriate for the jurisdiction of the Divisional Court and not that of the lower courts, Ebrahim applied. Even if the Divisional Court did not have jurisdiction over cases of abuse such as that alleged by F, which was doubted, that could not constitute a reason for implying such a jurisdiction on the tribunal's part. The tribunal did not have jurisdiction to make the order applied for (paras 32, 42-46).

Application refused

First Tier Tax Tribunal
Judge Roger Berner
Judgment date
4 October 2011
References

​LTL 17/11/2011 : [2012] SFTD 94 : [2011] STI 3050 : [2011] UKFTT 642 (TC)