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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Eclipse Film Partners No. 35 LLP v Revenue & Customs [2014] EWCA Civ 184 (26 February 2014) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2014/184.html Cite as: [2014] EWCA Civ 184 |
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ON APPEAL FROM THE UPPER TRIBUNAL
(Tax and Chancery Chamber)
Judge Roger Berner
TC/2009/10762
Strand, London, WC2A 2LL |
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B e f o r e :
LADY JUSTICE BLACK
and
LORD JUSTICE KITCHIN
____________________
Eclipse Film Partners No. 35 LLP |
Appellant |
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- and - |
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The Commissioners for Her Majesty's Revenue & Customs |
Respondent |
____________________
Mr Rajesh Pillai (instructed by HM Revenue & Customs) for the Respondent
Hearing date: 24th January 2014
____________________
Crown Copyright ©
Lord Justice Moses:
"Costs or Expenses
(1) The costs of and incidental to –
(a) all proceedings in the First-tier Tribunal…
shall be in the discretion of the Tribunal in which the proceedings take place.
(2) The relevant Tribunal shall have full power to determine by whom and to what extent the costs are to be paid.
(3) Subsections (1) and (2) have effect subject to Tribunal Procedure Rules.
(4) In any proceedings mentioned in subsection (1), the relevant Tribunal may –
(a) disallow, or
(b) (as the case may be) order the legal or other representative concerned to meet, the whole of any wasted costs or such part of them as may be determined in accordance with Tribunal Procedure Rules."
The Tribunal Procedure Rules are made under s.22 of the 2007 Act and their content is described in broad terms in paragraph 12 of Schedule 5.
"(1) The overriding objective of these Rules is to enable the Tribunal to deal with cases fairly and justly.
(2) Dealing with a case fairly and justly includes –
(a) dealing with the case in ways which are proportionate to the importance of the case, the complexity of the issues, the anticipated costs, and the resources of the parties."
In interpreting any Rule, the Tribunal must seek to give effect to the overriding objective (Rule 2(3)) and the parties are required to help the Tribunal to further the overriding objective and to co-operate with the Tribunal generally (Rule 2(4)(a)(b)).
"(1) Subject to the provisions of the 2007 Act and any other enactment, the Tribunal may regulate its own procedure.
(2) The Tribunal may give a direction in relation to the conduct or disposal of proceedings at any time, including a direction amending, suspending or setting aside an earlier direction.
(3) In particular, and without restricting the general powers in paragraphs (1) and (2), the Tribunal may by direction –
…
(i) require a party to produce a bundle for a hearing…"
"10.—(1) The Tribunal may only make an order in respect of costs (or, in Scotland, expenses)—
(a) under section 29(4) of the 2007 Act (wasted costs);
(b) if the Tribunal considers that a party or their representative has acted unreasonably in bringing, defending or conducting the proceedings;
(c) if—
(i) the proceedings have been allocated as a Complex case under rule 23 (allocation of cases to categories); and(ii) the taxpayer (or, where more than one party is a taxpayer, one of them) has not sent or delivered a written request to the Tribunal, within 28 days of receiving notice that the case had been allocated as a Complex case, that the proceedings be excluded from potential liability for costs or expenses under this sub-paragraph;
…
(2) The Tribunal may make an order under paragraph (1) on an application or of its own initiative.
(3) A person making an application for an order under paragraph (1) must—
(a) send or deliver a written application to the Tribunal and to the person against whom it is proposed that the order be made; and
(b) send or deliver with the application a schedule of the costs or expenses claimed in sufficient detail to allow the Tribunal to undertake a summary assessment of such costs or expenses if it decides to do so.
(4) An application for an order under paragraph (1) may be made at any time during the proceedings but may not be made later than 28 days after the date on which the Tribunal sends—
(a) a decision notice recording the decision which finally disposes of all issues in the proceedings; or
(b) notice of a withdrawal under rule 17 (withdrawal) which ends the proceedings.
(5) The Tribunal may not make an order under paragraph (1) against a person (the "paying person") without first—
(a) giving that person an opportunity to make representations; and
(b) if the paying person is an individual, considering that person's financial means.
(6) The amount of costs (or, in Scotland, expenses) to be paid under an order under paragraph (1) may be ascertained by—
(a) summary assessment by the Tribunal;
(b) agreement of a specified sum by the paying person and the person entitled to receive the costs or expenses (the "receiving person"); or
(c) assessment of the whole or a specified part of the costs or expenses incurred by the receiving person, if not agreed.
(7) Following an order for assessment under paragraph (6)(c) the paying person or the receiving person may apply—
(a) in England and Wales, to a county court, the High Court or the Costs Office of the Supreme Court (as specified in the order) for a detailed assessment of the costs on the standard basis or, if specified in the order, on the indemnity basis; and the Civil Procedure Rules 1998 shall apply, with necessary modifications, to that application and assessment as if the proceedings in the tribunal had been proceedings in a court to which the Civil Procedure Rules 1998 apply;
…
(8) In this rule "taxpayer" means a party who is liable to pay, or has paid, the tax, duty, levy or penalty to which the proceedings relate or part of such tax, duty, levy or penalty, or whose liability to do so is in issue in the proceedings."
"It was clearly in the interests of all concerned – both the parties and the Tribunal itself – that there should be a single and agreed bundle, compiled and organised in a way which best facilitated the presentation of a very complex case. Had we directed each party to prepare its own bundle the costs would (by effect rather than specific direction) have been divided between the parties but to the detriment of the efficient conduct of the hearing generally and to the detriment of the parties in preparing for the hearing. A direction for one party to prepare an agreed bundle and the required copies of that bundle, and for the costs of that exercise to be met equally by the parties is fair and just in the circumstances of this case, and a proper exercise of the case management powers conferred on the Tribunal by Rule 5. In no sense, having regard to the purpose of Rule 10, could such a direction be said to be a purported award of costs which Rule 10 prohibits in the circumstances of this case."
Lady Justice Black:
Lord Justice Kitchin: