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	England and Wales High Court (King's Bench Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (King's Bench Division) Decisions >> Marwaha v Director of Border Revenue & Anor [2025] EWHC 869 (KB) (10 April 2025) URL: https://www.bailii.org/ew/cases/EWHC/KB/2025/869.html Cite as: [2025] EWHC 869 (KB)

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IN THE HIGH COURT OF JUSTICE
KING'S BENCH DIVISION

		Royal Courts of Justice Strand London WC2A 2LL
		10/04/2025

This judgment was handed down remotely at 10.30am on 10^th April 2025 by circulation to the parties or their representatives by e-mail and by release to the National Archive.

Jason Beer QC (Sitting as a Deputy Judge of the High Court):

A. Introduction

1. Papaver somniferum, the flowering plant of the family Papaveraceae, is a smooth glaucous annual, with heart-shaped leaves (the upper ones of which clasp the stem, with toothed, wavy margins) and wide-open flowers with large petals surrounding a green, urn-shaped capsule with a flat cap, and many dark purple or yellow stamens. Opium, morphine, codeine, and heroin are all derived from the milky latex found in its unripe seed capsule. But dried poppy heads also make attractive ornamental and decorative objects. When a person imports such products into this country, those who safeguard our borders are obviously interested to discover the purpose of the importation and the use to which the product may be put.
2. In this case, the Defendants seized, forfeited and then destroyed three consignments of poppy heads imported by the Claimant. This Court subsequently found that the first two consignments (and, it followed from the Court's reasoning, the third) were not poppy straw within the meaning of the Misuse of Drugs Act 1971 ("the 1971 Act") and so there was no relevant prohibition on their importation: they were not liable to forfeiture at the time of their seizure.
3. Utilising a mechanism provided for under the Customs and Excise Management Act 1979 ("the 1979 Act"), the Claimant subsequently claimed, and was paid by the Defendants (following a determination by an Assessor, Tom Kark KC), a sum of money equal to the market value of the consignments at the time of their seizure – some £174,072. But the Claimant says that this does not represent the true value of his loss – he says that he suffered losses put variously in these proceedings at some £7m (Claim Form) or £14m (Schedule of Loss). He seeks to recover damages representing those losses in these proceedings.
4. The Defendants say that certain provisions of the 1979 Act preclude the Claimant from recovering such damages; that any such losses as he may have suffered were caused by the seizure of the consignments and not the destruction of the products (and this claim is only concerned with consequences of destruction, and not seizure); and that in any event the losses claimed are exaggerated.
5. The trial of these issues was principally taken up with submissions as to the law (and upon the findings that I should make by reference to the substantial body of written material that was placed before me), but I heard oral evidence from the Claimant himself over the course of a full day. The Claimant did not require the Defendants' two witnesses – Paul Walker (a Higher Officer and Team Leader for the Container Targeting Team within the Border Force) and Mark Smither (a designated Customs Officer within the Border Force) to give oral evidence, and so I have had regard to the evidence contained in their witness statements. Applications were made by the Claimant on the first day of the trial (i) to file and serve out of time (and in breach of an Unless Order) a witness statement from the Claimant's son that purported to give expert forensic accountancy evidence; and (ii) to call the authors of the forensic accountancy reports served by each party to give oral evidence. I refused both applications, and gave an ex tempore judgment at the time – my perfected reasoning is set out in the Coda at the end of this judgment.

B. The Facts

The Claimant and his business

6. The Claimant is an enterprising man. Having tried his hand at other business ventures, in 2013 he started a flower purchase and re-selling business as a sole-trader - trading as "UK Flower Power". From August 2019 some or all of this business was transacted from Globalprisenter Ltd ("Globalprisenter"), a company in which the Claimant is a shareholder. The Claimant became a member of the Society of American Florists. The business involved buying dried poppy heads (principally from growers in the Netherlands, but also to a lesser extent in the UK) in bulk, splitting the consignments he received, and then selling the poppy heads to 4 main customers, who themselves were wholesalers or retailers (principally in the USA – which he says accounted for 99% of his market). Dried poppy heads may be used for floral, decorative or ornamental purposes.

The Defendants

7. The First Defendant is the Director of Border Revenue and is an official designated by the Secretary of State under s6 of the Borders, Citizenship and Immigration Act 2009 ("the 2009 Act") to exercise general customs functions (as to which: see s1(1) of the 2009 Act) concurrently with the Commissioners of Her Majesty's Revenue and Customs ("HMRC"). Of relevance to these proceedings, condemnation proceedings are brought under the authority of the Director of Border Revenue – this includes, among other functions, the making of payments pursuant to paragraph 17 of Schedule 3 to the 1979 Act.
8. The Second Defendant is the UK Border Agency ("UKBA") and was formed as an executive agency of the Home Office on 1^st April 2009 by a merger of the Border and Immigration Agency, UK Visas and the detection functions of HMRC.
9. In April 2012, the border control division of the UKBA was separated from the balance of UKBA to form a separate command unit (but not a separate legal entity) within the Home Office known as the UK Border Force (the "Border Force"). Border Force officers act under Carltona principles on behalf of the Secretary of State for the Home Department to carry out "general customs functions" (see s3 of the 2009 Act), and they may also have "customs revenue functions" delegated to them by the Director of Border Revenue (see s9 of the 2009 Act).
10. I understand that, in practice, the statutory role of Director of Border Revenue is usually held by the Director General of Border Force, who in his capacity as Director General is accountable to the Secretary of State for the Home Department for general customs functions at the border.
11. For ease of reference (and because there is no need in the context of this claim to differentiate between the functions of the Director of Border Revenue and UKBA), I shall refer to them (and their officers) collectively as the Border Force.

The First Seizure

12. On 10^th or 13^th January 2015 (the Statements of Case join together in agreement that the date was 13^th January 2015, but the witness evidence is that it was 10^th January 2015), the Border Force seized a consignment of dried poppy heads – contained in 1004 boxes - at the Port of Felixstowe that had been imported (and therefore were owned) by the Claimant from the Netherlands. The consignment weighed approximately 6,000kgs.
13. It seems that the Border Force believed that the dried poppy heads were "poppy straw" – if that had been the case, the consignment would have consisted of a Class A controlled drug for the purposes of Part 1 of Schedule 2 to the 1971 Act and the importation of such a controlled drugs would have been unlawful by reason of s3 of the 1971 Act.
14. The seizure was made under powers given to the Border Force by s139(1) of the 1979 Act ("Any thing liable to forfeiture under the customs and excise Acts may be seized or detained by any officer or constable or any member of Her Majesty's armed forces or coastguard….").

The Second Seizure

15. On 13^th or 15^th January 2015 (again, there is common ground in the Statements of Case that the date was 15^th January 2015, but the witness evidence suggests that it was 13^th January 2015), the Border Force seized a second consignment of dried poppy heads – this time contained in some 891 boxes, and weighing some 5,500kgs - at the Port of Felixstowe. This was similarly the Claimant's property and had been imported from the Netherlands by him.

Retention

16. Mr Smither (who at the relevant times was a Higher Officer in charge of the local lockup facilities at the Port of Felixstowe which were used for the storage of seized and detained goods) explained that the goods seized in the course of the First and Second Seizures were not taken to the Queen's Warehouse (where they would, in the ordinary course of events, have been destroyed within 30 days), but were instead stored in a "shed". This building is not designed for the long-term storage of goods: it is close to the sea, is damp in the winter and suffers from infestations of pigeons and rodents. The seized poppy heads were removed from the trailers on which they had been transported, the cardboard boxes in which they were contained palletised and the pallets stored on the floor of the "shed".

The Condemnation: Proceedings in the Magistrates' Court and Crown Court

17. On 6^th February 2015 the Claimant's then solicitor wrote to the Border Force, giving notice that the two consignments of poppy heads seized by the Border Force were not liable to forfeiture. That was pursuant to paragraph 3 of Schedule 3 to the 1979 Act ("Any person claiming that any thing seized as liable to forfeiture is not so liable shall, within one month of the date of the notice of seizure or, where no such notice has been served on him, within one month of the date of the seizure, give notice of his claim in writing to the Commissioners at any office of customs and excise").
18. On 15^th June 2015 the Border Force initiated proceedings - by issuing a summons in the Ipswich Magistrates' Court – for the condemnation of the two consignments of poppy heads. That was pursuant to paragraph 6 of Schedule 3 to the 1979 Act ("Where notice of claim in respect of any thing is duty given in accordance with paragraphs 3 and 4 above, the Commissioners shall take proceedings for the condemnation of that thing by the court, and if the court finds that the thing was at the time of seizure liable to forfeiture the court shall condemn it as forfeited").
19. On 4^th April 2016 District Judge Dawson, sitting at the Ipswich Magistrates' Court, found that the two consignments of dried poppy heads were, at the time of their seizure, liable to forfeiture and therefore condemned them as forfeited. He did so because he found that, although the Claimant operated a genuine flower-importing business, the goods were "poppy straw" for the purposes of the 1971 Act.
20. Pursuant to paragraph 11(1) of Schedule 3 to the 1979 Act, the Claimant appealed to the Crown Court against the District Judge's decision. On 8^th July 2016 the Crown Court at Ipswich (HHJ Goodin and magistrates) dismissed the Claimant's appeal, confirming the condemnation of the two consignments of poppy heads.
21. In August 2016, and pursuant to s28 of the Senior Courts Act 1981, the Claimant applied to the Crown Court to state a case for the opinion of the High Court. The three questions raised for the opinion of the High Court were:

a. Was the Crown Court entitled to find that the goods imported were poppy straw within the meaning of the 1971 Act?

b. Was the Crown Court entitled to interpret "mowing" as meaning, harvesting reaping, picking or other removal from the soil without requiring or excluding any particular means of harvest?

c. Was the Crown Court correct to place weight on the opinion of forensic and botanical experts in order to determine the meaning of "poppy straw" when neither expert gave evidence on the means of cutting or expressed expertise in the method of cutting the poppy heads?

The Third Seizure

22. On 1^st November 2016 the Border Force seized a further consignment of dried poppies – some 4,324kgs - owned by the Claimant as they passed through the Port of Tilbury. The grounds for the seizure were the same as in relation to the first and second seizures. The Claimant challenged the third seizure by letter dated 29^th November 2016, and so condemnation proceedings were commenced by the Defendants and listed to be heard at Basildon Magistrates' Court.

The First Destruction

23. Although there had been no final determination of the Case Stated, sometime in November and December 2016, the Border Force destroyed all the dried poppy heads comprising the First and Second Seizures. The evidence now available records that the reasons for the destruction were as follows:

a. The boxes of poppy heads were stored on approximately 100 pallets, which had to be moved around the "shed" with some frequency in order to accommodate the storage of other goods.

b. The space that the boxes were occupying, and the need frequently to move them, had an adverse effect on the Border Force's operations at the Port – as Mr Smither put it: "From an operational point of view, the items had to go."

24. It follows that there is not evidence available that the perishability of the goods – and specifically whether they were of a perishable nature - was addressed by the Border Force at the time of the destruction of the goods.
25. It seems that, at some stage, the goods that were subject to the Third Seizure were also destroyed – the circumstances in which that occurred, or the reasons for it, are not addressed in the evidence before me.

The Condemnation: Proceedings in the High Court

26. The first hearing of the Case Stated came before Mitting J, who adjourned the hearing to enable investigation into the travaux préparatoires to the Single Convention on Narcotic Drugs 1961, which (together with the 1971 Convention on Psychotropic Substances and the 1988 Convention against the Trade in Narcotic Drugs and Psychotropic Substances):

a. Govern the relevant international obligations of the United Kingdom; and

b. Are given effect to by the 1971 Act and the Misuse of Drugs Regulations 2001.

27. The Case Stated came on for hearing before Charles J on 29^th June 2017. In a reserved judgment handed down on 2^nd November 2017 (see Rajan Marwaha v UK Border Revenue Agency [2018] 1 WLR 758) he held in summary that:

a. The poppy heads imported by the Claimant and which had been subject to the First and Second Seizures were grown from seed and harvested on specially adapted trailers – they were not mown, but were handpicked and harvested with care by a team of some 8 people in order to preserve the heads for ornamental or decorative purposes;

b. Accordingly, they did not constitute "poppy straw" within the meaning of the Single Convention on Narcotic Drugs 1961 and as such did not constitute "poppy straw" within the meaning of Schedule 2 to the 1971 Act (as defined in Part IV of that Schedule) and, accordingly, were not a "controlled drug" within the meaning of that Act;

c. It followed that the importation of the products into the United Kingdom (and their exportation out of the United Kingdom) did not contravene the prohibition in s3 of the 1971 Act and, as a result of that, were not liable to forfeiture under s 49(l)(b) of the 1979 Act.

The s144 Certificate

28. So far as is material, s144 of the 1979 Act provides as follows:

Protection of officers, etc. in relation to seizure and detention of goods, etc.

(1) Where, in any proceedings for the condemnation of any thing seized as liable to forfeiture under the customs and excise Acts, judgment is given for the claimant, the court may, if it sees fit, certify that there were reasonable grounds for the seizure.

(2) Where any proceedings, whether civil or criminal, are brought against the Commissioners, a law officer of the Crown or any person authorised by or under the Customs and Excise Acts 1979 to seize or detain any thing liable to forfeiture under the customs and excise Acts on account of the seizure or detention of any thing, and judgment is given for the plaintiff or prosecutor, then if either—

(a) a certificate relating to the seizure has been granted under subsection (1) above; or

(b) the court is satisfied that there were reasonable grounds for seizing or detaining that thing under the customs and excise Acts,

the plaintiff or prosecutor shall not be entitled to recover any damages or costs and the defendant shall not be liable to any punishment.

(3) Nothing in subsection (2) above shall affect any right of any person to the return of the thing seizure or detained or to compensation in respect of any damage to the thing or in respect of the destruction thereof.

29. In the light of the outcome of the proceedings before Charles J in the High Court in relation to the First and Second Seizures, the Director of Border Revenue decided not to pursue the condemnation proceedings in the Basildon Magistrates' Court in relation to the Third Seizure: he accordingly withdrew them. Accordingly, on 14^th May 2018 the Basildon Magistrates' Court dismissed the Director of Border Revenue's complaint (the Court also granted a certificate pursuant to s144(1) of the 1979 Act in relation to the Third Seizure, which certificate states that there were reasonable grounds for the seizure of the goods seized on 1^st November 2016 – this is of relevance to an argument that the Defendants maintained up to, but not at the conclusion, of the trial of the present claim).

The Schedule 3 Procedure

30. There exists a statutory process for awarding a form of compensation where goods which were not liable to forfeiture have in fact been sold or destroyed. As the terms of that process, and its operation in this case, are important to the determination of this claim, I set out in Section D below the detail of the statutory process. It is sufficient to note for now that there exists a power to destroy goods (see paragraph 16 of Schedule 3 to the 1979 Act) and a duty to pay a form of compensation for goods that have been destroyed (see paragraph 17 of Schedule 3 to the 1979 Act).
31. On 8^th March 2018 the Claimant wrote to the Border Force seeking payment under paragraph 17 of Schedule 3 to the 1979 Act in relation to the destruction of his property, stating "I understand the compensation due in respect of destruction of the seed heads (which is set out in para 17, Sched 3 of the Customs and Excise Management Act 1979) is the market value at the time of the seizure…I look forward to hearing from you with your proposals for making payment to me of the market value of the goods."
32. On 18^th April 2018 the Border Force wrote to the Claimant on a without prejudice basis, stating that it would "pay appropriate recompense" and offered – on an ex gratia basis – the sum of £60,894.57 in full and final settlement in relation to the first and second consignments (this figure was seemingly reached by converting the stated purchase price for the consignments from Euros to Sterling, using an historic exchange rate – it was later increased to £62,263.50, taking into account the Claimant's representations on the appropriate exchange rate).
33. The Claimant replied to this offer, stating that it was not an ex gratia payment, but rather that, in consequence of the finding on the Case Stated:

…the Border Agency is required to give compensation in accordance with para 17, Sched 3 of the Customs and Excise Management Act 1979, not to make an 'ex gratia' payment. The matter of compensation is thus a legal entitlement not a payment made by reason of moral but not legal obligation…I would respectfully remind you that in the absence of reaching agreement, application must be made in accordance with sub-paragraph 17.4 of schedule 3 of the 1979 Act for a referee to be appointed whose decision shall be final and conclusive. Accordingly, I invite the Border Force to consider the information contained in my letter of 8 March 2018 and to submit a revised offer of statutory compensation.

34. On 8^th August 2018 the Border Force wrote again to the Claimant, again without prejudice, and made an offer of settlement (on the same basis as before) in relation to the third consignment in the sum of £56,208.50.
35. The parties were unable to agree on quantum and so that dispute was referred to Tom Kark KC, who was appointed by the Lord Chancellor as a Referee pursuant to paragraph 17(4) of Schedule 3 to the 1979 Act. In proceedings before Mr Kark:

a. The Claimant sought damages of £6,746,827 plus an estimated £1,000,000 for loss of goodwill - most of this figure was made up of alleged consequential losses flowing from the Claimant's alleged inability to pursue his business as a result of the seizures. The submissions on quantum that were placed before Mr Kark on behalf of the Claimant were largely prepared by, or with the input of, the Claimant's in-house accountant, Mr Mano Butani. They were made expressly without prejudice to the Claimant's "…claim for the recovery of all losses and damages, and without prejudice to issuing court proceedings to recover all loss and damage arising from the wrongful seizure of the goods in January 2015 and November 2016".

b. The Border Force submitted that the Claimant ought to be paid the sum of £118,472.00 (i.e. the sum of the £62,263.50 and £56,208.50 previously offered).

36. In interim and final decisions promulgated on 21^st August and 11^th November 2020, Mr Kark KC held that:

a. The assessment of the market value under paragraph 17 of Schedule 3 does not require the assessment of damages as if the goods had been unlawfully converted or destroyed by way of some other tortious act. The assessment is restricted by the statue which allows it to take place and simply provides for the assessment of the market value of the goods concerned;

b. The travel costs of the importers are not recoverable in addition to the value of the goods;

c. The market value is not necessarily equivalent to the replacement costs of the goods in the UK;

d. When applying the words 'market value', Parliament intended to mean a price at which goods could be bought and sold in a legitimate market;

e. Where there is no market in the jurisdiction where the goods were seized it is permissible to look for a market value at a place where similar goods are lawfully bought and sold which may include the country where the goods were purchased;

f. The legal foundation for such an assessment is one of statutory interpretation rather than the application of common law principles applicable to the measure of damages for torts or breaches of contract causing the loss of goods.

37. He found that the relevant market value was the market price of the goods once imported into the UK and at the time of their seizure (as opposed to their purchase price in Holland) and accordingly found that the market value of the goods for the purposes of paragraph (17)(1)(c) of Schedule 3 was £174,072.
38. The Border Force accordingly offered to pay the sum of £174,072 to the Claimant. Enclosed with the offer letter was a pro-forma document called "Letter of Compensation Acceptance" which stated "I agree to accept the offer of £174,072 as full and final settlement of the matter relating to the goods."
39. On 5^th February 2021 the Claimant's solicitors wrote to the Border Force enclosing a copy of the pro-forma document, signed by them (but with the words "Please see letter attached dated 5^th February 2021" written in hand on it). That letter stated:

1. Our client will accept the payment of £174,072 as an Interim payment and without waiver of his rights to damages, as outlined in the submissions and information provided to Mr Kark QC. The sum offered is the absolute minimum that UKBF is liable for.

2. The payment is to be accepted without prejudice to further High Court claims.

3. We invite you to make the payment on this basis and to agree to a mediation In March 2021.

4. All rights are reserved especially in relation to claiming further damages additional to the sum of £174,072 being paid to our client.

40. On 19^th February 2021 the Border Force wrote to the Claimant, stating: "Given the determination made by the Independent Referee under paragraph 17(1)(c) of Schedule 3 to CEMA 1979, we consider the compensation payment to be in full and final settlement of the matter."
41. On 26^th February 2021 the Border Force effected the payment by bank transfer and the funds were duly cleared into Claimant's bank account.
42. On 2^nd March 2021, the Claimant again wrote "The payment is accepted as satisfaction of Mr Kark QC's Determination, not in settlement of all claims and not in settlement of this matter."

The Claim

43. The claim was issued on 3^rd November 2021. The amount sought on the face of the Claim Form was approximately £7m.
44. The wrongful acts with which this claim is concerned are the destruction of the three consignments of poppy heads, not the earlier act of their seizure (and retention) by the Defendants. This is for three reasons.

a. First, that is exactly how the Claimant's case is pleaded – very carefully by Philip Coppel KC, who was then acting for the Claimant - in the Particulars of Claim and in the Reply. In particular, the former uses "the First Destruction" and "the Second Destruction" as defined terms and then carries those defined terms forward when alleging tortious conduct by the Defendants (i.e. the claims of trespass and conversion) and when identifying the acts of the Defendants which caused the Claimant loss and damage. In short, although the acts of seizure and retention are mentioned in the Particulars of Claim, that is only as narrative background and not as founding any cause of action pursued by the Claimant.

b. Second, it is clear that any claim in relation to the First and Second Seizures would have been barred by the provisions of the Limitation Act 1980 by the time that the claim came to be issued. The seizures occurred in January 2015: by s2 of that Act, the primary limitation period expired in relation to claims found on tort in January 2021. This claim was issued 10 months' later, on 3^rd November 2021. By contrast, the destruction of the goods comprised in the First and Second Seizures occurred in November 2016, and so the claims arising from that destruction were in time for limitation purposes. This doubtless had an effect on the formulation of the claim.

c. Third, the Border Force sought and obtained a certificate under s144(1) of the 1979 Act in relation to the Third Seizure - the effect of that certificate is that it would not have been possible to call into question in these proceedings the lawfulness of the Third Seizure: see s144(2)(a) of the 1979 Act. The Defendants' solicitors clearly took this point in pre-claim correspondence when seeking to respond to a threatened claim that was principally focussed on the damages which were said to have flowed from the seizure and retention of the goods. This doubtless also had an effect on the formulation of the pleaded claim which, as I have explained, is concerned with destruction of the goods alone.

The Claimant's bankruptcy

45. On 17^th June 2024 the Claimant was adjudged bankrupt. On 15^th January 2025 the Claimant's Trustee in Bankruptcy assigned the cause of action which is the subject matter of this claim to the Claimant, thus allowing him to pursue it personally.

C. The Issues

An issue abandoned

46. In their Defence, and in their Skeleton Argument for the trial of this claim, the Defendants maintained that the claim fell to be dismissed because they enjoyed a "statutory immunity" pursuant to s144(2) of the 1979 Act. That is not correct. As I have explained in paragraph 44 above (and as Mr Tankel urged upon me), these are proceedings founded upon the Defendants' destruction of the Claimant's property – not the seizure or detention of it. Section 144(2) provides a form of protection to certain classes of officials in relation to the seizure and detention of property, but no protection in relation to the destruction of property. This is clear from the terms of s144(2) itself ("…on account of the seizure and detention of any things…") and from s144(3), which expressly preserves a right to bring proceedings in relation to the destruction of property even if a court has certified under s144(1) that there were reasonable grounds for the seizure of it.
47. The Defendants sought to argue at one stage this claim is in fact a proceeding brought "on account of the seizure and detention" of the poppy heads as the destruction of the poppy heads was part and parcel of the Defendants' operational management of the seized goods.
48. But after some gentle exploration of the true meaning and effect of s144(2), and of the terms of s144(3) in particular, Mr Tankel accepted that s144(2) did not relate to a claim founded upon the destruction of property and afforded no immunity or defence to the Defendants in this claim. This was a wise and proper concession to make.

The live issues

49. By the end of oral argument, and supplemental written submissions lodged to address and properly explore an argument raised by the Claimant very late in the day – namely in his closing oral submissions – it seemed to me that the following issues required to be determined:
50. First, whether the payment of a sum of money to the Claimant by the Defendants and the acceptance of that money by the Claimant under paragraph 17(1) of Schedule to the 1979 Act prevented the claim from bringing this action by reason of the operation of paragraph 17(3) of Schedule 3 to the 1979 Act. This includes consideration of the following subsidiary issues:

a. Whether (if the terms of the paragraph are otherwise satisfied) the restriction in paragraph 17(3) of Schedule 3 to the 1979 Act operates to prevent a claimant from commencing an action or whether it only operates so as to prevent a claimant from continuing a subsisting claim.

b. Whether the poppy heads were "destroyed under paragraph 16 [of Schedule [3]" in circumstances where the power of destruction under paragraph 16 of Schedule 3 was exercisable if the Defendants were of the opinion that the poppy heads "…were of a perishable nature." The position in relation to the first condition involves consideration of whether the poppy heads were "destroyed under paragraph 16 [of Schedule [3]" in circumstances where the power of destruction under paragraph 16 of Schedule 3 was exercisable if the Defendants were of the opinion that the poppy heads "…were of a perishable nature" and there is not evidence now available to establish that, at the times of the destructions, the Defendants had formed such an opinion.

c. Whether the Claimant's reservation, in correspondence, of his right to bring a claim for damages other than the market value of the goods, when accepting the Defendant's payment, defeats the restriction on maintaining a claim imposed by paragraph 17(3) of Schedule 3.

51. Second, whether the consequential losses which the Claimant seeks to recover were on the evidence caused by the seizure and retention of the goods, or were instead caused by their destruction.
52. Third, if the Claimant is entitled to recover damages then the issue arises as to the quantum of those damages – in particular can the Claimant recover damages (and, if so, in what sum) in relation to the following four heads of loss:

a. The market value of the three consignments of poppy heads at the time and place of the conversion;

b. The transportation costs associated with the importation of the three consignments of poppy heads;

c. The loss of profits represented by the lost opportunity to re-sell the three consignments of poppy heads; and

d. Other consequential business losses.

D. Analysis, Findings and Conclusions

First Issue: Extinguishment of the claim by reason of paragraph 17(3) of Schedule 3 to the 1979 Act

53. The relevant parts of the statutory scheme are paragraphs 16 and 17 of Schedule 3 to the 1979 Act:

(16) Where any thing has been seized as liable to forfeiture the Commissioners may at any time if they see fit and notwithstanding that the thing has not yet been condemned, or is not yet deemed to have been condemned, as forfeited...(b) if the thing seized is a living creature or is in the opinion of the Commissioners of a perishable nature, sell or destroy it.

(17)(1) If, where any thing is delivered up, sold or destroyed under paragraph 16 above, it is held in proceedings taken under this Schedule that the thing was not liable to forfeiture at the time of its seizure, the Commissioners shall, subject to any deduction allowed under sub-paragraph (2) below, on demand by the claimant tender to him—

(a) an amount equal to any sum paid by him under sub-paragraph (a) of that paragraph; or

(b) where they have sold the thing, an amount equal to the proceeds of sale; or

(c) where they have destroyed the thing, an amount equal to the market value of the thing at the time of its seizure.

(2) Where the amount to be tendered under sub-paragraph (1)(a), (b) or (c) above includes any sum on account of any duty or tax chargeable on the thing which had not been paid before its seizure the Commissioners may deduct so much of that amount as represents that duty or tax.

(3) If the claimant accepts any amount tendered to him under sub-paragraph (1) above, he shall not be entitled to maintain any action on account of the seizure, detention, sale or destruction of the thing.

(4) For the purposes of sub-paragraph (1)(c) above, the market value of any thing at the time of its seizure shall be taken to be such amount as the Commissioners and the claimant may agree or, in default of agreement, as may be determined by a referee appointed by the Lord Chancellor (not being an official of any government department or an office-holder in, or a member of the staff of, the Scottish Administration), whose decision shall be final and conclusive; and the procedure on any reference to a referee shall be such as may be determined by the referee.

54. It will be noted that paragraph 17(3) provides alternatives to return of the seized items in circumstances where the item is no longer available: (i) if the owner has paid a fee for return of the item, he is entitled to the refund of that fee (paragraph 17(1)(a)); or (ii) if the item has been sold by Border Force, the owner is entitled to the proceeds of sale (paragraph 17(1)(b)). In both cases the scheme ensures that the Border Force makes no profit from the unlawful seizure - the owner is placed in the same position as if the item had been returned to him. No compensation is available under paragraph 17 for the loss of use of the item or (in relation to paragraph 17(1)(b)) for any issue of sale at an undervalue.
55. Paragraph 17 of Schedule 3 is not intended to provide for common law damages; but rather for an amount less than that: R (Revenue and Customs) v Machell [2006] 1 WLR 609 at [34], per Stanley Burnton J. It does not include indirect/consequential losses such as importing costs (see [35] of Machell). It is recognised that in many cases this may not amount to adequate compensation but no formula, short of full compensation, could be fair as between the personal importer and the public purse in all cases (see [38] of Machell).
56. The Defendants submit that, as the Claimant accepted the sum of £174,072, which was an amount tendered to him pursuant to paragraph 17(1) of Schedule 3 on account of the destruction of the goods, then he is not entitled to maintain this present claim for damages by reason of the operation of paragraph 17(3) of Schedule 3 because it is an action on account of the destruction of the same goods. As I have explained above (see [50]), this contention involves the determination of three sub-issues:

a. Whether (if the terms of the paragraph are otherwise satisfied) the restriction in paragraph 17(3) of Schedule 3 to the 1979 Act operates only to prevent a claimant from commencing an action or whether it operates so as to prevent a claimant from continuing a subsisting claim.

b. Whether the circumstances of this case fall within paragraph 17 at all when that paragraph requires the goods to have been inter alia "destroyed under paragraph 16 [of Schedule 3]" in circumstances where the power of destruction under paragraph 16 of Schedule 3 was exercisable if the Defendants were of the opinion that the poppy heads "…were of a perishable nature" and there is not evidence now available to establish that, at the times of the destructions, the Defendants had formed such an opinion.

c. Whether the Claimant's reservation, in correspondence, of his right to bring a claim for damages other than the market value of the goods, when accepting the Defendant's payment, defeats the restriction on maintaining a claim imposed by paragraph 17(3) of Schedule 3.

I address each of these sub-issues below.

(1) What does "…not be entitled to maintain any action…" mean in paragraph 17(3)?

57. The Claimant raised an entirely new argument in his closing submissions, not heralded in the correspondence, in the pleadings, in his skeleton argument or in his opening. The Defendants accepted they were not prejudiced in evidential terms by reason of the argument being raised at this late stage – i.e. they would not have called or adduced any different evidence, nor asked different questions of the Claimant. But the issue raised by the Claimant could not be fairly determined when appropriate thought had not been given to it, especially by the Defendants, and proper research had not been undertaken. And so, I allowed time for written submissions to be made after the conclusion of the hearing.
58. The Claimant submits that the words "maintain any action" in paragraph 17(3) ("If the claimant accepts any amount tendered to him … he shall not be entitled to maintain any action on account of the … destruction of the thing") mean "continue any action which is already on foot at the time the amount has been tendered to him", and therefore the restriction in paragraph 17(3) only applies to claims where there is a pre-existing claim. In other words, paragraph 17(3) does not prevent the bringing or institution of a claim after the acceptance of a sum tendered to him. Accordingly, as in this case the claim was issued after the Claimant's acceptance of the £174,072 tendered to him by the Defendants, the restriction in paragraph 17(3) is irrelevant and inoperative.
59. The Claimant relies on what he says is the ordinary meaning of the word maintain, namely to cause or enable (an existing condition or situation) to continue. He contrasts the use of the phrase "maintain any action" in paragraph 17(3) with the use of the phrase "bring or maintain" in other legislative contexts. He says that the word "bring" indicates that there is no thing (claim) currently in existence and that if the words were synonymous then Parliament would not have used the phase "bring or maintain" in these other statutes.
60. It seems to me that no assistance can be garnered from this comparative exercise with the drafting of other legislation. Firstly, words and phrases in a statute derive their meaning from their context, in particular in the context of the section as a whole and in the wider context of a relevant group of sections (and, indeed, other provisions in a statute and the statute as a whole may provide the relevant context). But more particularly, as it seems to me, Parliament does not have any hard-and-fast drafting practice in relation to the use of the phrases "bring or maintain any action" or "maintain any action" – and certainly none which allows sound principles or conclusions. Some statutes refer to "bring or maintain", others only to "maintain" but, significantly, in the latter case, there are many examples where "maintain" must include "bring".
61. One might look by way of example to ss12 and 33(2) of the Limitation Act 1980. These sections relevantly provide:

12 Special time limit for actions under Fatal Accidents legislation.

(1) An action under the Fatal Accidents Act 1976 shall not be brought if the death occurred when the person injured could no longer maintain an action and recover damages in respect of the injury (whether because of a time limit in this Act or in any other Act, or for any other reason).

33 Discretionary exclusion of time limit for actions in respect of personal injuries or death

(2) The court shall not under this section disapply section 12(1) except where the reason why the person injured could no longer maintain an action was because of the time limit in section 11.

62. Where a potential action is time-barred under the Limitation Act 1980, the reference to "maintain an action" must be read as "bring an action" - because an action that has already been commenced could not be time-barred. It is of particular note that in s12(1) the words "brought" and "maintain" are used interchangeably within the same provision.
63. One might also look by way of example to s49 of the Sale of Goods Act 1979 – this provides:

Action for price

(1) Where, under a contract of sale, the property in the goods has passed to the buyer and he wrongfully neglects or refuses to pay for the goods according to the terms of the contract, the seller may maintain an action against him for the price of the goods.

(2) Where, under a contract of sale, the price is payable on a day certain irrespective of delivery and the buyer wrongfully neglects or refuses to pay such price, the seller may maintain an action for the price, although the property in the goods has not passed and the goods have not been appropriated to the contract.

64. It will be noted that in s49(1) an action for breach of contract can only arise after the buyer has neglected or refused to pay for the goods - yet the subsection refers to the seller "maintaining" an action. Similarly, s49(2) stipulates that an action for breach of contract may arise after the passage of a certain day, but again the subsection refers to "maintaining" an action.
65. All of this goes to show, in my judgment, that the phrase "maintain any action" can, having regard to the context, encompass the bringing of an action. What matters is the context. Here, little assistance is given by the words used elsewhere in paragraph 17, or in Schedule 3, or indeed elsewhere in the 1979 Act. But the Claimant's interpretation would in my judgment undermine the purpose and object of the statutory scheme, which is to provide a relatively prompt and accessible, but final, remedy for the owner whose goods have been seized when they were not liable for forfeiture. It is intended to be final (subject of course to a claim for judicial review). But on the Claimant's case any claimant would be able to await payment under paragraph 17(1), and then bring a claim the very next day. This would defeat the purpose of the scheme. Moreover, the restriction in paragraph 17(3) is not operative until the recipient accepts the money tendered to them: if an owner is not satisfied with the payment offered, or the outcome of any determination, they should reject any funds that are tendered to them, and go to court instead. By contrast, the Claimant's construction would bypass this by allowing an owner to bank the funds, but still be able to go to court for any claimed additional sums (or indeed to re-argue the matters determined by the referee, whose decision is supposed to be "final and conclusive": see paragraph 17(4)).
66. I cannot detect any basis in policy for distinguishing between existing and future claims, as the Claimant's approach would have it. In fact, there appears to be less justification for permitting a new claim to be brought than there would be for permitting an existing claim to continue: at least in respect of an existing claim, the litigation process will already be underway, and costs will already have been incurred, and yet these may not be recoverable if the claim is then extinguished under paragraph 17(3).
67. All of this leads me to the clear conclusion that on its true interpretation the restriction in paragraph 17(3) of Schedule 3 to the 1979 Act is a restriction on both bringing new claims and continuing existing claims if the terms of the sub-paragraph are otherwise satisfied.

(2) Do the circumstances of this case fall within paragraph 17(1)?

68. The second sub-issue also concerns paragraph 17 of Schedule 3, but is centred on sub-paragraph (1), rather than sub-paragraph (3). It will be recalled that the restriction in paragraph 17(3) is operative "If the claimant accepts any amount tendered to him under sub-paragraph (1)." That raises an issue of whether this Claimant accepted an amount tendered to him under sub-paragraph (1). That sub-paragraph imposes a duty on a person in the position of the Defendants when (so far as is relevant to this claim) two conditions are met: (i) goods are "destroyed under paragraph 16", and (ii) it is held in proceedings taken under Schedule 3 that the goods were not liable to forfeiture at the time of their seizure.
69. There is no issue in this case about satisfaction of the second condition: proceedings were taken under Schedule 3, and it was held (i) by Charles J (by reason of his judgment) in relation to the First and Second Seizures; and (ii) by the Basildon Magistrates' Court (by reason of its dismissal of the complaint) in relation to the Third Seizure that the goods were not liable to forfeiture at the time of their seizure (even though, in relation to the Third Seizure, the Basildon Magistrates' Court also issued a certificate stating that there were reasonable grounds for seizure of the goods taken in the Third Seizure).
70. The position in relation to the first condition involves consideration of whether the poppy heads were "destroyed under paragraph 16 [of Schedule [3]" in circumstances where the power of destruction under paragraph 16 of Schedule 3 was exercisable if the Defendants were of the opinion that the poppy heads "…were of a perishable nature" and there is not evidence now available to establish that, at the times of the destructions, the Defendants had formed such an opinion.
71. The Claimant did not argue strenuously at trial that the absence of evidence establishing a decision by the Defendants to destroy the poppy heads on the grounds that they were "…of a perishable nature" meant that the restriction in paragraph 17(3) of Schedule 3 was ineffective. This was doubtless motivated by a range of factors, including:

a. That he expressly conceded, through his counsel in his closing submissions, that it is more likely than not that, had the Defendants expressly addressed the issue of perishability at the point of destruction in November/December 2016, they would have concluded that the goods were of a perishable nature: "We don't know one way or the other the state of the goods as at December 2016 so cannot tell if the Defendants would have concluded that the goods were perishable – but I accept that it is more likely than not that they would have so concluded – because of the way in which the goods had been treated,"

b. The fact that, contemporaneously to the relevant events, it was the Claimant's own view that the goods were perishable (and, a fortiori, of a perishable nature) – more than that, he communicated that view to the Defendants. Thus, on 16^th January 2015, the Claimant wrote to the Defendants asking for the immediate return of the poppy heads, stating that delay "could affect their aesthetics or be detrimental to it, they are very sensitive Dried Papaver Heads". Shortly thereafter, on 16^th March 2015 the Claimant's then legal representatives wrote to the Defendants seeking restoration, stating: "We should draw your attention, as will be self-evident, that the items in question are dried flowers. Such items have a very limited shelf life and will be deteriorating whilst they remain subject to the seizure" (I note, in passing, that this letter appears on its face to suggest the likely deterioration of the goods without reference to where they are being stored, or the conditions of such storage). They followed this up on 13^th April 2015, writing "We would emphasise again that the dried flower poppies which have been seized are a deteriorating asset" (again, on its face, the complaint in this letter does not depend upon knowledge of the actual conditions of storage).

72. Despite the Claimant's approach I nonetheless consider that it is appropriate that I should address the issue. It raises two points. The first is whether it would be open to the Claimant, having regard to his participation in a process under paragraph 17(1) (which is only available where goods have been destroyed under paragraph 16), to argue that the goods were not destroyed under paragraph 16 or whether he would be estopped by convention from doing so. The second is whether, in the event that it is open to the Claimant to argue that the goods were not destroyed under paragraph 16, it is open to the Defendants to argue that the restriction in paragraph 17(3) is nonetheless operative because – had they turned their minds to the conditions in paragraph 16 at the times of the destructions, the Defendants would have decided that the goods were of a perishable nature and accordingly would have been destroyed.
73. The starting point for considering the first issue involves a consideration of the nature of the process involved under paragraphs 16 and 17 of Schedule 3 and then a review of the Claimant and Defendants' conduct under that process in this case.
74. The statutory scheme is, as it seems to me, intended to be a relatively quick and straightforward process that allows owners to obtain a form of compensation promptly and with certainty, relieving them of the time and expense of litigation and the court's processes. The aim of ensuring that an owner can be placed in funds quickly is doubtless so that they may then buy whatever they have lost or, if they are a merchant, then they can trade through the difficulty. In many cases there will be arguments that both sides to the dispute might take (which may only emerge as a result of the disclosure and witness statement processes, involving the expenditure of lots of time and money). Accordingly, by using the statutory scheme, an owner may be giving up arguments that would be open to them in litigation in return for the benefits they obtain under the scheme.
75. In this case, the Claimant himself commenced the statutory process, making a demand for payment under Schedule 3 to the Act, and well understood the process in which he was engaged (his written submissions were entitled, for example, "In the matter of a referral to a referee pursuant to paragraph 17 of Schedule to 3 Customs and Excise Management Act 1979"). He adduced hundreds of pages of evidence before the independently appointed Referee – setting out his claimed losses, including various reports from his in-house accountant Mano Butani. The Referee considered all of this material and required the Defendants to make a substantial payment to the Claimant. The Claimant accepted the Defendants' payment and banked it.
76. For the obligation to make a payment under paragraph 17(1) to arise, or for a Referee to be appointed under paragraph 17(4), it was a necessary condition that the goods had been destroyed under paragraph 16. The parties had a shared understanding (or even an assumption) that that was so and acted or relied on that understanding (or assumption) by commencing, pursuing and concluding the steps under the statutory scheme. The Defendants relied on the shared understanding or assumption by participating in the statutory process and paying out a substantial sum (and giving up various legal arguments that may have been open to them had the matter proceeded by way of litigation). The parties having acted in this manner, with the Claimant having acquired the benefit of the payment of a substantial sum and the Defendants having suffered the detriment of paying it, it seems to me that it would be unconscionable or unjust to allow either of the parties- here, the Claimant - to deny or depart from the shared understanding or assumption that was shared between them. In these circumstances, it seems clear to me that an estoppel by convention has arisen that prevents (or would prevent the Claimant had he taken the point more firmly) from arguing that the goods were destroyed under paragraph 16 of Schedule 3.
77. I should say finally on this first point that I reject the wider claim of estoppel that was pleaded in the Defence (and hinted at in the Defendants' Opening Skeleton Argument) to the more general effect that, the Claimant having participated in the statutory scheme, he is estopped now from seeking damages for consequential losses. That puts the matter far too generally and is not supported in law. It is, of course, the case that - the Claimant having accepted a payment tendered to him under paragraph 17(1) of Schedule 3 - he is not entitled to bring this claim. But that is because of the operation of 17(3) of Schedule 3 and not by the operation of any wider estoppel. My decision above in relation to the estoppel which is operative here is restricted to the much narrower issue of whether it would be open to the Claimant to seek to argue that the restriction in paragraph 17(3) is not operative in this case because there was no destruction under paragraph 16.
78. Turning to the second point, and assuming for one moment that the conclusion is different to the one that I have reached above, and it is open to the Claimant to argue that the goods were not destroyed under paragraph 16, can the Defendants argue that the restriction in paragraph 17(3) is nonetheless operative because, had they turned their minds to the conditions in paragraph 16 at the times of the destructions, they would have decided that the goods were of a perishable nature and would accordingly have been destroyed? Whilst the Defendants submitted that this involved consideration of what the phrase "…of a perishable nature" means, the importance of the fact that it was the subjective view of the Defendants that was relevant ("…in the opinion of the commissioners…"), and the factual evidence in this case as to the nature of the poppy heads and their conditions of storage, in my view it would not have been open to the Defendants to argue this point in this way.
79. In support of their general point, the Defendants argued that when a statute provides that a threshold condition is met when it is met "in the opinion of [the decision-maker]", the intention is to widen the circumstances in which the threshold can be met, by making it a subjective question (subject only to Wednesbury reasonableness) rather than an objective one for the court. They submitted that the statute is not to be interpreted as requiring the decision-maker actually to be of the relevant opinion at the time of the decision to destroy the goods, because that would make the threshold narrower rather than wider.
80. However, in R (HM Revenue & Customs) v Machell [2006] 1 WLR 609 HMRC sought to challenge two determinations made by a referee under paragraph 17 of Schedule 3, one of which concerned the destruction of alcohol in error (as the alcohol in question was not of a perishable nature and had therefore not been destroyed under paragraph 16). One of the issues in the claim was whether the referee has jurisdiction to determine the market value of the alcohol that had been destroyed in error. Stanley Burnton J held that there was no such jurisdiction – see [26]:

The statutory power to destroy seized goods is confined to things that are "in the opinion of the Commissioners of a perishable nature: paragraph 16(b) of Schedule 3 to CEMA. If they destroy goods that are not in their opinion of a perishable nature, as in the case of the spirits that were the subject of Mr Machell's determination of 27 January 2005 (and the goods are not living creatures), they do not act under paragraph 16. Paragraph 17 is concerned with any thing which has been "delivered up, sold or destroyed under paragraph 16 above". It does not apply to something destroyed otherwise than under paragraph 16. It follows that a referee has no power to make a determination under paragraph 17(4) in respect of such things.

81. In my view this conclusion, with which I respectfully agree, is of significance to the issue before me. Like Stanley Burnton J, it seems to me that the issue is not whether the Defendants would have made a decision that the goods were of a perishable nature – but for the estoppel, in order for the restriction in paragraph 17(3) to have been operative, the only issue would have been whether the Defendants in fact destroyed the goods under paragraph 16, not whether they would have done so.

(3) Did the Claimant's reservation of his position when accepting the Defendant's payment take the case outside the restriction in paragraph 17(3)?

82. The Claimant placed emphasis in his oral evidence, and through his counsel in his opening and closing oral submissions, on the fact that he had accepted the Defendants' offer of payment of £174,072 expressly on the basis that it was without prejudice to his right to pursue a claim for damages for losses greater than that sum. He relied in particular on the terms of his submissions to Tom Kark KC (see [35(a)] above), the endorsement on the signed Border Force pro-forma (see [39] above), the terms of his solicitor's letter of 5^th February 2021 (see [39] above), and the terms of his solicitor's letter of 2^nd March 2021 (see [42] above).
83. If this was a straightforward case being judged according to the ordinary law of offer and acceptance, then these points might be interesting. But the simple fact is that the exercise is governed by, and only by, paragraph 17(3) of Schedule 3 – and it provides: "If the claimant accepts any amount tendered to him under sub-paragraph (1) above, he shall not be entitled to maintain any action…" It will be seen, as the Defendants properly submit, that the language of the statute is unqualified and unequivocal: what matters is whether there has been acceptance by the Claimant of the amount tendered to him by the Defendants. And here there was such an acceptance. It is not difficult to understand why the 1979 Act approaches matters in this way - the payment by a defendant is a sum representing an award that follows from independent dispute resolution process conducted by an independent person appointed by the Lord Chancellor. Moreover, that person's decision is described in paragraph 17(4) as "final and conclusive". The statutory scheme exists in the public interest as an appropriate means of striking a balance between providing a measure of compensation in cases of wrongful destruction without exposing those who safeguard our borders to extensive and uncertain liabilities. If the statutory scheme was as the Claimant suggests, the restriction set out in paragraph 17(3) would be deprived of any effect.
84. I should add, finally on this issue that the Claimant said in his oral evidence (and I paraphrase) that Mr Kark had said in the course of his decisions that the award he was making was only in relation to the market value of the goods, and that the Claimant could still recover damages in relation to the balance of his losses. In fact, what Mr Kark said was "I am firmly of the view that my assessment may not include an assessment of damages because I am limited by the specific statutory wording. There may still be a right to take action under the common law but whether or not such action takes place is outside my remit and does not affect this determination" (emphasis added). It is therefore clear that Mr Kark did not say that there was a right to take action despite his determination, still less that there was an entitlement to damages despite his determination. In any case, it is not the determination which is the operative bar to this claim, it is the Claimant's acceptance of payment of the sum determined by Mr Kark.

Conclusion on this issue

85. For the reasons set out above, this claim for damages may not be maintained by the Claimant. It is prohibited by paragraph 17(3) of Schedule 3 to the 1979 Act. That is enough to dispose of this claim, but I shall nonetheless determine, in deference to them, the balance of the submissions made to me.

Second Issue: Causation of Consequential Losses

86. There is one main causation issue, namely whether the consequential losses which the Claimant seeks to recover were on the evidence caused by the seizure and retention of the goods, or were instead caused by their destruction. As I have observed above (see [44] above), this claim only concerns the latter act: it is only if the Claimant can prove that that the Defendants' destruction of his goods caused him consequential losses, that he can recover in respect of those losses.
87. The evidence before me does not establish that the consequential losses which the Claimant seeks to recover were caused by the destruction of the goods – instead it is all the other way: the consequential losses were, on the Claimant's account, caused by the seizure and retention of the goods, not their destruction. This accords entirely with what I would expect to occur in the ordinary course of events. The first two consignments were seized in January 2015 and, because they had been seized, he was unable to carry on his trade with them. Destruction only occurred nearly 2 years later.
88. In his written evidence, the Claimant says that it was the seizure and retention of his goods that caused the loss – e.g. "The seizures impacted on the profits of my business, as I was unable to continue trading whilst legal proceedings were ongoing…"; "…I was so engrossed in the court case. I was very busy studying the law, so that I could represent myself at Ipswich Crown Court. I was unable to continue the business…"; and elsewhere the Claimant describes how it was the impact of the condemnation proceedings, and uncertainties caused by the risk of further seizures, that led to his inability to pursue the business.
89. The Claimant's oral evidence was, if anything, to stronger effect – he told me directly that it was the seizure that interrupted the business, rather than the destruction that affected the business. Specifically, in answer to a question as to whether any customers had referred to the destruction of the goods as a reason not to trade with him, he said "No. In business no news is good news, but bad news travels fast."
90. This is reflected in the evidence of the accountants that is before me. They have helpfully prepared inter alia a summary of the Claimant's quarterly sales from April 2013 right up until July 2019. And what this shows is that, according to the amounts banked in the Claimant's bank account, the impact on sales occurred immediately after the first two seizures, not after the destructions. Thus, the quarterly sales before the first two seizures in January 2015 were £93,000 (quarter ending June 2013), £215,000 (quarter ending September 2013), £101,000 (quarter ending December 2013), £118,000 (quarter ending March 2014), £114,000 (quarter ending June 2014), £176,000 (quarter ending September 2014), and £118,000 (quarter ending December). These dropped – after the seizures – to £62,000, £41,000, £30,000 and £27,000 in the following four quarters. In his oral evidence the Claimant accepted that these figures showed that it was indeed the consequences of the first two seizures that had an adverse impact on his sales figures – he said that bad news travelled fast, that his customers found alternatives suppliers, and that his customers did not hang on waiting for him to return to them once he had got his stock back.
91. Taken together, this evidence establishes that the consequential losses that the Claimant seeks to recover were caused by the seizure and retention of the goods, not their destruction. Accordingly, this would have been a quite separate basis to have dismissed those parts of the claim seeking to recover such consequential losses (these are identified in [92(d)] below).

Issue 3: Quantum

92. If, contrary to my findings as set out above, the Claimant is entitled to recover damages then the issue arises as to the quantum of those damages. Standing back, the Claimant essentially seeks damages under four heads of loss:

a. The market value of the three consignments of poppy heads at the time and place of the conversion;

b. The transportation costs associated with the importation of the three consignments of poppy heads;

c. The loss of profits represented by the lost opportunity to re-sell the three consignments of poppy heads; and

d. Other consequential business losses.

I address each head of loss in turn below.

(1) Market value of the consignments of poppy heads

93. The ordinary measure of damages for a claim in a claim for conversion of this kind is the market value of the goods at the time and place of the conversion (here, the conversion occurred on the dates that the goods were destroyed – in November and December 2016).
94. The Claimant has already been paid a sum assessed by the Referee as representing the market value of the goods in the UK at the point of their seizure – some £174,072. Mr Kark explained in detail how he had arrived at that assessment in his second decision – essentially using evidence as to the market value of poppy heads in the UK at the time of the relevant seizures.
95. I am of course not bound in any way to accept the approach taken by Mr Kark, nor the conclusions that he reached.
96. However, the Claimant has put before the Court exactly the same evidence as was placed before Mr Kark as to the market value of poppy heads in the UK at the time of their seizure. In these circumstances, I see no reason or basis to depart from the assessment of the market value of £11 per kilo – resulting in a calculation of losses exactly the same as that reached by Mr Kark: £174,072. As the Claimant has already been paid that sum it follows that the Claimant has suffered no recoverable loss in this respect.
97. I would add that the assessment that I have set out above is very likely to represent overcompensation of the Claimant. That is because Mr Kark was calculating the market value of the goods at the point of their seizure, whereas my task would be calculating their value at the point of their destruction – in the case of the first and second consignments, this was nearly two years later. The evidence establishes that the goods subject to the First and Second Seizures very much degraded in that time, not least because of the conditions in which they were kept: their market value is likely to have been very much less as a consequence of this.

(2) Transport costs

98. The evidence establishes that the transport costs for each shipment was €2,400 – applying an appropriate exchange rate, this equates to a loss of £5,648 in relation to all three shipments. This sum was excluded from the Referee's award – he held that he did not have jurisdiction to make an award in relation to transport costs. Had I made an award of damages, I would have included in it the sum of £5,648, representing the lost transport costs incurred in respect of the three shipments.

(3) Loss of profit on the re-sale of these three consignments

99. There are two main issues which arise in relation to this head of loss. Firstly, whether a claim for loss of profit may be maintained in the circumstances of these destructions of the goods. Secondly, if so, what is the proper measure of the loss of profit having regard, in particular, to the degradation of the first two consignments by the time of their destruction.
100. As to the first issue, I would have seen no reason in principle why a claim for loss of profit ought not to be available to the Claimant: three consignments of his goods were destroyed, and he therefore lost the opportunity to sell them at a profit.
101. The second issue is more complicated. The evidence establishes that the first and second consignments were, by November and December 2016, more likely than not to have degraded to such an extent that they were not capable of sale at all, still less at a profit. This evidence comes from the Claimant and his representatives themselves (I have summarised it at [71(b)] above), making clear their position that these products were indeed of a perishable nature and actually perishing in the course of their retention; from the Defendants' evidence as to the nature of the storage conditions – cold, wet, damp, and infested; and from customer complaint emails in relation to other shipments made by the Claimant (i.e. quite outside of these three consignments), making it clear that the delicate and ornamental nature of the poppy head was easily lost – and that customers noticed it, and refused to countenance it. This conclusion means that I would have left out of account any claim for loss of profit in relation to the first and second consignments.
102. The position is different in relation to the third consignment, which seemingly was destroyed relatively proximately to its seizure. I would have been prepared to assume that all of this consignment of poppy heads was to have been re-sold in the USA (even though there was no direct evidence of purchasers being lined up in relation to this consignment, I would have been prepared to accept the more general evidence that the vast majority of the Claimant's re-selling business was to the USA). The expert accountants jointly agree that a sale price of £65 per kilo was reasonable (the experts calculate that this equates to a total sale price of £1,030,000 having regard to the total seized in all three consignments). The accountants agree that the net loss of profit on all three shipments was £247,656.26 (rounding up and taking into account the difference between purchase price in Netherlands and Mr Kark's sale price in the UK). This assumes that the whole of the stock would have sold, that all of that would have sold in the USA, that there would have been no returns. As I have said, I would not have been prepared to include as part of a loss of profit claim any sums relating to the first and second consignment – which were effectively unsaleable. That means that some 11,500 kgs, or 73% of the total, comes out – with the result that the loss of profit in relation to the third seizure would have been assessed in the sum of £66,867.

(4) Other consequential losses

103. The Claimant seeks very substantial damages indeed for other consequential losses – essentially arguing that the destruction of the three consignments led to the entire destruction of his business.
104. This would have raised two sub-issues: (i) whether these consequential losses are recoverable at all; and (ii) if so, the quantum of those losses (and, in particular, whether the losses should be calculated on the basis of the Claimant's tax return, or his bank statements).
105. In relation to the first issue, I have gained valuable assistance from the judgment of Sales J (as he then was) in Checkprice v Commissioners for HMRC [2010] EWHC 682 (Admin). There, Checkprice made a similar claim for consequential losses (see [54]). Sales J rejected the argument in strong terms (see [55]):

I do not accept that damages should be awarded for such alleged consequential loss. The market value of the goods in this case represents what Checkprice could have sold them for, and in my view the appropriate compensation to Checkprice for loss of that money is by way of payment of interest on that sum. If Checkprice had opportunities to enter into transactions at a profit, one would expect it to be able to raise finance to do so. Checkprice's claim for consequential loss therefore depends on the notion that Checkprice was unable to raise the finance for such further transactions. It is not suggested that Checkprice had any specific profitable transaction in contemplation in relation to these goods, still less that HMRC were on notice of any such specific transaction. Nor were HMRC on notice that Checkprice's financial situation was such that it would be unable to fund any profitable transactions which presented themselves. In broad terms, the interest payable on the damages representing the market value of the goods corresponds with the interest which might be expected to be paid by Checkprice if raising equivalent funds to engage in further transactions. That is the extent of the loss which it was reasonably foreseeable that Checkprice might suffer from its loss of the money represented by the value of the detained goods. I consider that the consequential losses now claimed by Checkprice are too speculative and too remote to be compensated by an award of additional compensation: see Saleslease Ltd v Davis [2000] 1 All ER (Comm) 883, 887-889 and Clerk and Lindsell on Torts, 19th ed., paras. 2-141 and 2-142.

106. In my view precisely the same considerations, and outcome, apply in the present claim. All of the same points read across with equal force to the present claim (save for Sales J's comments on interest: here, the Claimant received payment via the statutory scheme).
107. It is clear from the evidence that, despite the seizures, the Claimant had stock for sale; that he was in possession of a substantial cash sum from which to buy replacement stock; and, by the time of the third seizure, he had still more stock available for sale.
108. The Claimant told me in evidence that at the time of the seizures he had little money in the business, but I reject that evidence, not least on the basis of the joint position of the experts that the business had £250,000 cash in the bank which was sufficient to purchase replacement stock for the first two seizures.
109. The Claimant's evidence was additionally that his bank accounts were shut down (he does not say by whom) when the Defendants seized the products. I reject that evidence, not least because (i) the Claimant's bank statements before me post-date the seizures and show the Claimant continuing actively to trade and (ii) a table of the Claimant's foreign exchange transactions prepared by the Defendant's expert witness shows the Claimant continuing actively to trade.
110. In relation to the third seizure, the experts jointly agree that purchase and foreign exchange accounts records indicate that stock imports of £155,854 were made from August 2016 to December 2016; that these imports were sufficient to generate sales of around £921,000; and that it accordingly appears on the evidence that the Claimant should have had sufficient stock to continue to trade without interruption after the third seizure.
111. In addition to establishing that the destructions were not responsible for the demise of the Claimant's business, all of this evidence goes also to show that it was not reasonably foreseeable to the Defendants that the destruction of goods nearly 2 years after their seizure would disrupt the Claimant's business in the manner claimed – instead, what it shows is that replacement stock was reasonably foreseeably purchasable. I should add that, in his oral evidence (but not in correspondence, in his Statements of Case, in his two witness statements, or otherwise), the Claimant suggested that his business model meant that it was necessary for him to have sufficient stock at all times to protect against an adverse weather event (that tended to come in 8 yearly cycles), and that the Defendant's destructions disrupted this business model (it was never explained how this was so). Given the late emergence of this case, and the absence of any evidence explaining how the Defendant's alleged disruption of it should be translated into calculations of actual loss, I would not have been minded to formulate any awards of damages on the basis of it: there simply would not have been a proper evidential foundation to do so. In any event, if this evidence was accurate and reliable, it could have caused the Claimant yet more difficulties, namely how it can possibly have been said to have been reasonably foreseeable that this was the Claimant's business model.
112. In relation to the second issue, it is necessary to set out a little of the process by which the evidence, including the expert evidence, emerged in this case
113. The Claimant served an expert report from Mr Howard Sears of Price Bailey on 28^th April 2023. Mr Sears based his report on materials provided by the Claimant's in-house accountant, Mr Mano Butani. The following is of note from Mr Sears' report:

a. He says that he has received "very little accounting evidence" in support of the claim.

b. He relied instead upon tax assessments issued by HMRC and calculated back from there.

c. He identified that there were a number of serious gaps in the Claimant's evidence. In particular:

i. The Claimant told Mr Sears that he kept only paper books and records. He said these were destroyed by a "rat infestation".

ii. The Claimant said that he "cannot remember" the name of the person who advised him on his tax returns 2013-2016.

iii. The Claimant said that he was unable to obtain historic tax returns from HMRC. HMRC said it had sent them, but the Claimant claimed that they had not arrived with him.

iv. The only tax information provided was a "tax year overview" for the years 2014/15 through 2017/18 (no tax was payable in the last two years).

d. The Claimant's bank statements were also unavailable to Mr Sears, but no explanation has been provided for this.

e. The accounting information provided was incomplete, and the information that there was contained various "anomalies".

f. A gross profit of 93% was claimed, but "many of the expenses are round sum amounts and not supported by documentary evidence".

g. Mr Sears was "not able to place any reliance" on the accounting information provided.

h. There was "insufficient documentation to try and recreate the accounting records for UKFP".

i. Mr Sears stated that he "had very little factual information on which to base the Claimant's profits…It is very difficult for me to prepare projected profit and loss accounts."

j. It was unclear whether claimed profits could be projected forwards at all because "[The Claimant] has failed to supply me with information as to the further sales which were in the pipeline but cancelled because of the seizures or whether the business could have been adapted to circumvent the HMRC seizure issues by the goods not entering the UK at all."

k. Mr Sears asked for but did not receive evidence of "how the seizures impacted on cash flow and why, with money in the bank, finance could not have been obtained from elsewhere."

114. Overall, it is evident that Mr Sears was perturbed: "whilst being engaged in this matter, I have asked many questions and evidence, further information and explanations have not been forthcoming."
115. In August 2023, the Defendants served an expert report from Mr Tim Sture of Sture Forensic in response. His report did not have the benefit of the Claimant's bank statements (which were disclosed much later).
116. On 21^st December 2023, the Claimant filed and served a Schedule of Loss, totalling approximately £14million which was seemingly based entirely upon the evidence of, and appears to have been drafted by, Mr Butani. Notably, it ignored the evidence of Mr Sears altogether (and it remained the case that, right up until the end of the trial, the Claimant had not prepared a Schedule of Loss based upon the evidence of Mr Sears).
117. On 2^nd February 2024, the Defendants filed and served a counter-schedule of loss, based on the expert report of Mr Sture.
118. On 6^th February 2025, the experts filed and served a joint statement. They set out a number of different alternatives but agreed on every point within each of those alternatives. The headline figures are that:

a. If the Claimant's tax returns are used as the basis for assessment, then the Claimant's maximum potential loss would be £3,688,503.

b. If the Claimant's bank statements are used as the basis for assessment, then the Claimant's maximum potential loss is £931,991.

119. Both figures above are heavily caveated, for a range of reasons given in the Joint Statement.
120. It follows that two main issues arise in relation to the quantum of the consequential loss claim. Firstly, whether the court utilise the Claimant's tax returns or his bank statements as the primary source of evidence for his income and outgoings. Secondly, what (if any) discounts to the headline figures fall to be made to reflect the heavy caveats identified by the accountants.
121. In relation to the first issue, I have no doubt at all that no reliance ought to be placed on the Claimant's tax returns as a basis for the calculation of losses (and instead his bank statements provide some evidence upon which to base the calculation of such losses):

a. First, the accountants agree that the bank statements are likely to be a more reliable basis for assessment than are the tax returns.

b. Second, the bank statements are in one sense a source of independent evidence as to the Claimant's income and expenditure, whereas the tax returns were created without, it seems, recourse to any primary underlying material and at a time when this claim was in contemplation.

c. Third, the bank statements are contemporaneous evidence, whereas the tax returns were created years later for a different purpose.

122. The first point in paragraph 121 above speaks for itself; the second and third require explanation.

123. The Claimant explained to me in evidence that in the relevant period he had two bank accounts – the first a TSB account in the name of UKFP; and the second a Lloyds account in the name of the Developing World Air Ambulance (the Claimant gave a very unsatisfactory explanation as to why the account was in this name – essentially he said it was in this name because he was running a charitable project to buy air ambulances, and associated services, for developing countries, yet (i) this does not account for the fact that his poppy head import and export business was run through this account, (ii) there are no payments from the account to buy things that one would ordinarily associate with running a charitable project of this kind – like helicopters (albeit the Claimant claimed, in a moment of panic in the witness box, that he had written to Dassault Aviation "…to see how much these things cost…"), and (iii) he ran this charity "as a personal appeal" (he said that the Charity Commission had advised him that there was no need to run the charity as a charity and instead run it as a "personal appeal" – albeit he had never made an appeal to anyone for any money) and was happy to forego the 25% gift aid tax relief that was available to him ("that's for the accountant to work out, not me")). Be that as it may, the bank accounts at least show money coming in and money going out of the accounts: these are events which I, and the accountants, can have faith in actually having occurred.

123. The tax returns, by contrast, are quite different:

a. The first tax return presented to me by the Claimant was for the tax year 6^th April 2013 – 5^th April 2014, but was dated 23^rd May 2019. It shows one source of income, for UKFP, for this period. The Claimant said in evidence that this tax return was completed for him by Mr Butani. The tax return states on its face that "This re-presentation of information follows the letters sent by out accountant Amass BTC 11^th April 2019 – 15^th April 2019." In his oral evidence the Claimant said that he agreed that this reasonably read as if UKFP was stating that the information in the tax return was simply a re-presentation of information that had been submitted in an earlier tax return. The Claimant said in evidence that he could not remember whether this was in fact the case and, if it was the case, why he would be re-submitting a tax return 5 years after the period to which it related. He said that he could not remember who was submitting his tax returns for him before Mr Butani came on the scene for the first time in 2019 (save to say that he was someone who happened to be walking past his business at Star House). The Claimant agreed in evidence that he had signed the tax return on 22^nd May 2019 and agreed that the amount shown for turnover for that year - £650,000 – was an oddly round figure. Some "Notes to the Accounts" have been written on the tax return in an "Any other information" box – these state "The accounts have been prepared from past records, which are not kept in an orderly manner…" and "...the bank statements for that period have been mislaid." The Claimant could not remember where Mr Butani had got that information from, and could not explain why Mr Butani had not gone to the bank to get historic bank statements from them in order to complete this tax return. But he did remember that this tax return was created, and filed, because he needed to secure a BRP Visa for his wife, who is from India, and therefore needed to show to the Home Office that he has an income. He said, finally on this issue, that he had not paid any tax for the year 2013-2014 in the years 2014 – 2019.

b. The second tax return presented to me was for the tax year 6^th April 2014 – 5^th April 2015. It was also dated 23^rd May 2019, was also completed by Mr Butani, was also signed as true by the Claimant, also had a round figure for turnover (this time £1.6m), and also contained the same notes as before. The Claimant explained that this tax return was created for the purposes of facilitating a visa application, and that he could not explain why Mr Butani had not accessed his bank statements. He said that he had not previously paid tax on the income that he had received that year.

c. The third tax return presented to me was for the tax year 6^th April 2015 to 5^th April 2016. It was submitted by a tax adviser called Amass BTC (a company for who Mr Butani worked)– and so the Claimant said that it must have been submitted after 2019. A turnover of £795,000 was declared. The Claimant said that he could not remember filing a tax return for this year, nor having paid any tax for the year 2015 – 2016.

124. It was these three figures - £650, £1.6m, and £795,000, taken from the tax returns – that had been used as an underlying basis of sales in each of these three years to seek to calculate the Claimant's consequential losses. Examination of the Claimant's bank statements for those three years show, however, that the sales that went through the bank accounts were £527,756, £470, 316 and £97,802 respectively – i.e. they are very different.
125. The Claimant sought to explain the difference in his evidence by saying that there was a "cash element" to his business (which, when it came in, he kept in a box and then spent it – at one point he says that there was £880,000 in the box, which had been stolen during a robbery at his home). I am afraid to say that I cannot rely on this evidence which seeks to explain away the difference between the sums shown in the tax return and those shown in the bank accounts, because:

a. The accountants agree that "It would be highly unusual for export sales of this level to be made in cash in our experience" and "It is highly unusual, verging on implausible, that overseas customers would pay for exports in cash."

b. There is no other evidence in the form of invoices, receipts or other records that confirms that exports were paid for in cash.

c. To the extent that Western Union, MoneyGram or a similar money transfer agent was used to transfer this cash to the Claimant, then records of such transactions from them would be an obvious port of call for assistance – the Claimant said that he had never considered asking any such provider for their records in order to seek to establish his losses.

126. The fourth and fifth tax returns presented to me – for the tax years 6^th April 2016 – 5^th April 2017 and 6^th April 2017 to 6^th April 2018 respectively – each declared that the Claimant declared no income whatsoever. But the bank accounts show income of over £300,000 in those two years. The Claimant had no real explanation for that in his oral evidence, other than to say that – in relation to all five sets of tax returns – "These are old returns, we cannot rely on them. There are further re-submitted tax returns, which I have not disclosed, but I think that they have been given to the experts." The experts have not, I should say, been provided with any "re-submitted" tax returns beyond those mentioned in their reports and the joint statement (they would, on the Claimant's account be "re-re-submitted tax returns").
127. In the end, the Claimant is right, but not for the reason that he gave: I cannot rely on the tax returns that he has submitted to the Court.
128. For all of these reasons, if I had assessed quantum, I would have done so on the basis of the Claimant's bank accounts. That would lead to a consequential loss at its highest of £931,991 – such loss representing all of the consequences of the Defendants' conduct on the Claimant's business i.e. the seizure of the goods (and the damage to the Claimant's supply chain, damage to his business reputation and consequent loss of orders), their retention for the best part of two years in the case of the First and Second Seizures (again, putting that stock out of use for the Claimant, with a consequent effect on his ability to trade), and the destruction of those goods.
129. Turning to the second issue, I would have discounted that maximum loss by 90% by reason of (i) the fact that the evidence makes clear to me that even if, contrary to my findings above as to causation, that some consequential loss was caused by the destruction of the goods, the overwhelming majority of losses sustained by the Claimant were on this hypothesis (i.e. ignoring all of my other findings) caused by the seizure and retention of the goods, not their destruction; and (ii) on this hypothesis, the Claimant would have had returned to him in November/December 2016 some seriously perished poppy heads. The consequential loss would therefore have been assessed in the sum of £93,199.

F. Outcome

130. The claim is dismissed against both Defendants. I shall set a timetable for the making of written submissions in relation to consequential matters, including costs, and will determine those matters on the papers.
Coda

Ruling on application by the Claimant that forensic accountancy expert witnesses give oral evidence at trial

131. By paragraph 4 of the Order of Master McCloud of 28^th June 2022, the parties were given permission to rely upon the written evidence of expert accountants. One per side was allowed. No permission was given to call any expert as a witness to give oral evidence in this trial.
132. The Claimant and the Defendant have both instructed experts as to quantum. They have produced individual expert reports:

a. Mr Howard Sears of Price Bailey Chartered Accountants dated 28^th April 2023 [HB/1134], with responses later to Part 35 questions served by the Defendants dated 28^th July 2023 [HB/1195]; and

b. Mr Timothy Sture of Sture Forensic dated "August 2023" [HB/1210] (the Claimant did not ask the Defendants' expert any Part 35 questions).

133. In accordance with the directions of the court, the experts met online on 3^rd February 2025 and have produced a very helpful joint statement [SB/573]. This materially states:

[2] The Claimant has wished to advance his claims on the basis of tax returns including trading results for:

a. the years ended 31 March 2014 and 2015 as the key periods not affected by seizures, and

b. the years ended 31 March 2016, 2017, 2018, and 2019 as periods affected by the seizures, with losses continuing thereafter…

[4] There was a lack of business records available due to rat infestation for the parties to review. In addition, there were a lack of accounting working papers to back up the figures that were included within the returns.

[5] Due to the lack of records and plausible explanations we are unable to confirm whether the accounts and subsequent disclosures to HMRC are reliable….

[7] There were no business accounting records for sales to confirm accuracy. In reviewing the bank statements, there were a significant amount of banking's, but this fell short of the total amount in sales for the years ended March 2014 to 2016 by at least £1.4m.

[8] The £1.4m gap was described as cash sales that the claimant undertook due to the pressure upon him following the seizure of the goods, which were from UK sources for sales completed in the US.

[9] We did not have any evidence to confirm that these cash sales were exports to the US or sales in the UK…

[17] We agree that for the reasons noted we cannot confirm whether the profits or loss included within the tax returns are correct…

[19] We agree that if the court accepts that the seizure of goods was responsible for the loss of the business and its decline and that they accept the figures filed within the tax returns to be the basis on which to calculate the loss of profits then we confirm that the maximum potential loss would be £3,688,503 after taking into account loss recovered following Mr Kark's determination of £174,072.

Evaluation based on bank statements

….

[23] It is possible that the bank statements seen do not provide a complete list of all business sales receipts in the period covered - i.e., sales may be higher than shown by the bank statements…

[25] We agree that:

…

(h) No evidence has been provided to support either cash sales of £900,000 or £1,369,450.

(i) It is highly unusual, verging on implausible, that overseas customers would pay for exports in cash.

(j) The pattern of sales shown by the bank receipts does not support a claim for exponential growth in the business. The Quarterly Totals calculated at TS Joint Statement Appendix 6 suggest that the business was declining in the months leading up to the first and second seizures:

(i) The peak in annual sales was in the 12 months to May 2014 at £554,501.

(ii) In the last 12-month period before the first seizure (the calendar year 2014), sales of £526,419 were almost identical to those in the year ended March 2014 (£527,756), which is a 4% decline from the peak.

Which to prefer, and why: tax returns / accounts v bank statements

[28] Neither the tax returns nor the bank statement evidence provides enough information for us to be able to provide a definitive confirmation that one is more reliable than the other as a complete and accurate record of all business transactions….

[31] From a review of the bank statements we can see that the claimant transferred money between other bank accounts, statements for which we have not been provided with….

[33] Without the full suite of all bank accounts, it is impossible to confirm that the bank statements that we do have are reliable to provide any certainty over the level of trading.

[34] In principle, though, as the bank statements were prepared independently as a contemporaneous record of business transactions, they should inherently be more reliable than the tax returns which were prepared several years later by the Claimant with assistance from his business accountant….

The availability of cash in the bank to identify whether or not (a) RM could have bought replacement stock; (b) RM was continuing to trade

(a) ability to buy replacement stock

[48] The month end bank balances have been summarised at Joint Statement TS

Appendix. From those, it can be seen that the business had bank resources:

(a) in excess of £250,000 from January 2015 to November 2015. On that basis, for several months after the first and second bank seizures in January 2015, the Claimant had sufficient cash resources available to replace the stock seized;

(b) of more than £50,000 from November 2016 until October 2017. The third seizure was in November 2016 with a value of £47,572 per the Kark assessment. On that basis, it is not clear that the Claimant had sufficient cash resources to replace the full lost stock - the available balance would just about cover the value of the seized stock but some cash reserves would be needed to fund operations in general. However, some of the loss could have been replaced from existing funds…

Summary and conclusion

[53] We have faced considerable difficulties in obtaining sufficient evidence to confirm the Claimant's actual trading income and expenses.

[54] We have prepared two illustrative calculations but wish to emphasise that we are not confident that either is an accurate representation of actual profit levels, but for the seizure profit levels, or loss suffered: there is a great deal of uncertainty regarding many of the figures, and we have been forced to rely on many assumptions.

134. It follows from a reading of the joint statement that the accountants set out a number of alternative approaches that the Court might make to calculating the alleged loss. Within each alternative, the accountants agree on everything. Deciding as between the alternative approaches – if it becomes necessary to determine the issue of quantum - will be a question for the Court rather than a matter of expert opinion. I note in particular that there is no dispute as between the experts as to which method of loss calculation should be adopted.
135. I therefore come to the same decision as HHJ Tindal did on 27^th January 2025 when he refused the identical application that I have before – paragraph 5 of his Order was "The Claimant's application for permission to call oral evidence from the experts at trial is refused, subject to any renewed application either party may make to the trial judge following receipt of the expert's joint statement."
136. I would add the following by way of supplemental reasoning. The background to the request to call oral evidence from both accountants was a very late application by the Claimant to adduce evidence from his expert witness in a supplemental report. It was very late because the claimant had 2 years to prepare such a supplementary report, and because it was made very shortly before trial. The application was also made in the context of the Claimant having failed to file his initial expert report in accordance with an Order made at a Case Management Conference on 28^th June 2022, and the making of an Unless Order on 16^th March 2023 by Mr Justice Lane and condemning him in costs. On 27^th January 2025 HHJ Tindal dismissed the Claimant's application to adduce additional expert evidence from his own expert accountant (there was no renewal of that application before me).
137. For all of these reasons, the application is dismissed.

Ruling on application to adduce expert evidence from the Claimant's son

138. Additionally, as I walked into Court, I was presented with an application to adduce evidence from the Claimant's son in the form of some pieces of paper comprising a document entitled "Financial Report Business Losses and Revised Compensation Claim." In summary, this sought to advance entirely new evidence as to the calculation of the Claimant's alleged losses, resulting in different figures from those pleaded in the Schedule of Loss and in the Claimant's expert accountant's report (and, notably, arrived at by different methods and using different underlying data than had been used to calculate the Schedule of Loss and in the provision of figures by the Claimant's (and the Defendants') expert witnesses).
139. I dismiss the application for the following reasons.
140. First, this is in substance opinion evidence, but it is not given by a person who is an expert witness. The document in which the evidence is contained is headed a "Financial Report Business Losses and Revised Compensation Claim" and purports to give evidence as to the appropriate approach to the calculation of the Claimant's losses. The Claimant's son does not possess any expertise in these matters sufficient to qualify him to give opinion evidence about them. This first reason is determinative of the application: quite simply, the evidence is not admissible.
141. Second, the document sought to be relied on as constituting the expert evidence is not compliant with Part 35 of the Civil Procedure Rules (or the Practice Direction thereunder) in any respect. In particular: (i) It is not signed; (ii) it does not contain a Statement of Truth appropriate for an expert witness; (iii) it does not contain an expert witness declaration; (iv) it does not state the substance of all material instructions, whether written or oral, on the basis of which the document was written; and (v) it is not addressed to the Court.
142. Third, the proposed "expert witness" is not independent in any sense. The author of the document is the Claimant's son and a co-director of a company with the Claimant – it is noticeable that the documents refers in places to "our claim".
143. Fourth, the document strays outside the permissible issue which would be properly addressed in an expert accountancy report – in places it makes submissions of law. Not only is this impermissible, but it is also yet another indication that the author of the document did not know or understand the appropriate boundaries of an expert report or the duties of an expert witness.
144. Fifth, there is already extensive expert evidence before the Court in the form of the reports of Mr Sture and Mr Stears and in their joint statement. By Part 35.1 of the Civil Procedure Rules "Expert evidence shall be restricted to that which is reasonably required to resolve the proceedings." This opinion evidence is not in my opinion reasonably required to resolve the proceedings.
145. Sixth, the application is made very late – as I say, it was say handed to me as I entered Court, having apparently been filed by CE File yesterday, Sunday 9^th February 2025 – and no proper explanation has been given for the late service. The relevant procedural background to this sixth point is that on 22^nd June 2022 Master McCloud made an Order at the Case Management Conference giving the parties permissions each to rely on the written evidence of an expert accountant, with a timetable for service of the Claimant's report by 8^th September 2022 and the Defendant's report by 3^rd October 2022. The Claimant did not meet this deadline, and applied for an extension of time. On 14^th March 2023 Mr Justice Lane made an Unless Order extending time until 28^th April 2023 – if the Claimant did not comply with that deadline, he was debarred from replying on expert evidence. The Claimant met that deadline, but then nearly two years later sought to rely on additional expert evidence (namely a further a further report from Mr Sears). That application came before HHJ Tindal (sitting as a Judge of the High Court) on 27^th January 2025 – i.e. about a fortnight before the commencement of this trial - and he dismissed it. Against this background, even if I had determined that the evidence in the document was admissible as expert evidence, that the document was in proper form, and that such evidence was reasonably required in the proceedings, I should have declined to accede to the application.
146. For all of these reasons, the application is dismissed.