[2014] UKFTT 162 (TC)
TC03300
Appeal number:
TC/2013/03074
PROCEDURE – application to
make appeal out of time - decision of Home Office not to restore seized lorry
tractor unit upheld on review - appellant had 30 days in which to appeal under
s 16(1) Finance Act 1994 - notice of appeal made out of time - appellant
claimed delays occasioned by postal delay, difficulties of translating
correspondence and an invitation to provide further evidence - whether tribunal
should give permission for appeal to be made - yes - application allowed
FIRST-TIER TRIBUNAL
TAX CHAMBER
|
|
MAREK
SZCZEPANSKI
|
Appellant
|
|
|
|
|
|
|
- and -
|
|
|
|
|
|
|
|
THE HOME OFFICE
|
Respondent
|
|
|
|
|
|
TRIBUNAL:
|
JUDGE EDWARD SADLER
|
|
|
IAN ABRAMS
|
Sitting in public at Bedford Square on 7 January 2014
The Appellant appeared in
person with Mr P Zelako as his interpreter
Mr Culver of the Home Office
Condemnation Legal Team, for the Respondents
© CROWN COPYRIGHT
2014
DECISION
Introduction
1.
This is an application by Mr Marek Szczepanski ("the Appellant")
for the tribunal to give its permission for the Appellant to make his appeal to
the tribunal out of time. The Home Office, the respondent party in these
proceedings, opposes that application.
2.
The Appellant's appeal is made under the provisions of the Finance Act
1994, following the decision of the Border Force (whose functions are now
carried out by the Home Office) not to restore to the Appellant a lorry tractor
unit seized by them in August 2012. Section 16(1) Finance Act 1994 provides
that an appeal may be made to the tribunal in relation to such a decision
within the period of 30 days beginning with the date of the document notifying
the decision in question. Section 16(1F) Finance Act 1994 confers on the
tribunal the discretion to allow a late notice of appeal, and, as we refer to
below, there is guidance from case law as to the approach we should adopt in
exercising that discretion.
3.
The decision against which the Appellant wishes to appeal is dated 11
February 2013, and the Appellant's notice of appeal to this tribunal (which
includes a request for permission to appeal out of time) is dated 19 April
2013, that is, some 67 days after the date of the decision letter. The
Appellant argues that his delay in making his appeal was a consequence of
postal delays as correspondence was conducted between the United Kingdom and
his home in Poland, and also by the need for him to obtain translations of the
lengthy decision letter and other correspondence. He argues that the decision
letter asked him for further information, which he provided, and he was not
aware that the 30 day period was running during that process. He also points
to confusion arising from a mistake in the decision letter.
4.
For the reasons we give below it is our decision to give permission for
the Appellant to make his appeal out of time.
Background circumstances
5.
It is necessary to set out in some detail the circumstances which led to
the decision of Border Force which the Appellant wishes to dispute, and the
further circumstances which resulted in the Appellant's notice of appeal being
out of time. We should make it clear that certain of the matters we refer to
below may be matters of fact in dispute between the parties should the
Appellant's appeal proceed. We record them for present purposes as the
contentions of the Appellant, and not as findings of fact (that, of course,
will be the task of the tribunal which eventually hears any substantive
appeal).
6.
The Appellant is of Polish nationality and lives in Lodzkie in Poland.
He speaks little or no English. He carries on a haulage business and owns two
lorry tractor and trailer units to operate in that business. The Appellant
drives one of the lorries and he employees a man, also a Polish national, to
drive the other. From time to time they transport goods to the United Kingdom.
7.
On 2 August 2012 at Dover port one of the Appellant's lorries (driven by
the employee) was intercepted by an officer of Border Force. On inspection it
was discovered that the fuel tank on the tractor unit of the lorry had been
tampered with, and in it was concealed 40,000 cigarettes. Border Force
calculated that the excise duty on the cigarettes amounted to £10,660. The
officer was satisfied that the cigarettes were held for a commercial purpose
and that they were, in brief, unlawfully imported.
8.
Thereupon, Border Force followed their standard procedure: they seized
both the cigarettes and the tractor unit - the latter as being liable to
forfeiture because it was adapted or altered for the purpose of concealing
goods and because it was used for the carriage of goods liable to forfeiture.
The driver of the lorry was advised that the owner of the lorry had the right,
within one month, to challenge the legality of the seizure in a magistrates'
court.
9.
The Appellant did not take steps to challenge the legality of the
seizure. Instead, on 3 September 2012 he wrote by email to Border Force asking
for the tractor unit to be restored to him. Border Force replied, requesting
extensive information about the Appellant's employment of the driver, the
Appellant's procedures to prevent smuggling of goods by his driver, and the
arrangements made for collection of the transported goods from the consignor
and their delivery to the consignee.
10.
The Appellant supplied such information as he had, but much of the
documentation was in Polish.
11.
On 14 December 2012 an officer of Border Force wrote to the Appellant
refusing to restore the tractor unit.
12.
On 2 January 2013 the Appellant emailed Border Force, who took the terms
of the email to be a request for a review of the decision of 14 December 2012.
In that email the Appellant provided further information about the
circumstances in which the employee driver had access to the tractor unit (he
parked it at his home, rather than at the Appellant's premises).
13.
On 11 February 2013 Border Force wrote to the Appellant (the letter was
sent by post to his address in Poland) to inform him that the officer's
decision of 14 December 2012 had been reviewed, and that the result of that
review was to uphold the original decision to the effect that the tractor unit
would not be restored. The letter was not received by the Appellant until 25
February 2013. The Appellant obtained a translation of it into Polish from a
local lawyer, and this took some days. Because of an error in the letter
(referred to below) the lawyer was not clear whether the vehicle was to be
restored.
14.
The review decision letter of 11 February 2013 is some seven and a half
pages long. It sets out in detail the circumstances of the seizure of the
lorry in August 2012; the basis in law of the seizure; the history of the
correspondence between the Appellant and Border Force since that seizure;
Border Force's policy for the restoration of commercial vehicles which have
been seized; a summary of the legislation relating to restoration; the
application of Border Force's policy to the circumstances of the seizure of the
Appellant's lorry tractor unit; and the reasons why it remains the decision not
to restore the vehicle.
15.
The review decision letter explains that an appeal to this tribunal may
be made against the decision not to restore the vehicle, and that such an
appeal must be made within 30 days of the date of the letter. Full contact
details of the tribunal are given.
16.
On the first page of the review decision letter there is the following
sentence:
"I have now completed my review and conclude
that: the vehicle should not be restored." [Bold as in the original]
17.
In the conclusion section of the review decision letter there is the
following sentence:
"For the reasons set out above I conclude that
the vehicle should be restored."
This, of course, is a mistake. As we mention, it was
corrected on 20 March 2013.
18.
The conclusion section of the review decision letter also has the
following sentence:
"If you have fresh information that you
would like me to consider then please write to me: however, I will not enter
into further correspondence about evidence that has already been
provided."
19.
On 8 March 2013 the Appellant (from an address in London NW10, which he
asked Border Force to use for the purpose of contacting him) wrote by post and
fax to Border Force referring to the review decision letter and asking for
permission and co-operation to put forward further evidence: the Appellant
referred to the Tachograph in the tractor unit, and asked for it to be checked
to determine the movements of the vehicle prior to its journey to Dover. As
the Appellant saw it, the Tachograph record would demonstrate that the driver
of the lorry had lied about the movements of the tractor unit and trailer, and
would vindicate the Appellant's account of what had happened. In his letter
the Appellant also asked whether it was a mistake that in the conclusion
section of the review decision letter it stated that the vehicle should be
restored.
20.
On 20 March 2013 Border Force replied to the Appellant's letter. They
did so by post to the Appellant's address in Poland (and not to the London
address). They corrected the error in the conclusion section of the review
decision letter and pointed out that in the context of the letter as a whole,
and in particular the clear statement on the first page of the letter, it was
obvious that the statement in the conclusion section of the letter was a
typographical error. They refused to allow the vehicle to be inspected.
21.
The letter of 20 March 2013 concluded with the following paragraph
(matters of emphasis as in the original):
"Appealing Against My Decision
If you had wished to contest my decision you had 30
days from the date of that letter, to lodge an appeal with a Tribunal that
is independent of BF. An appeal should have be [sic] made on the
appropriate forms, available with an explanatory leaflet from the Tribunals
Service and should have include [sic] a copy of that letter."
22.
At about this time the Appellant instructed Claims Pro Limited to act
for him in this matter. The point was not entirely clear at the hearing, but it
appears that this organisation has a Polish-speaking lawyer on its staff. He
did not attend the hearing as the Appellant could not afford to pay his costs.
23.
The Appellant's notice of appeal is dated 19 April 2013, although it
appears to have been sent to the tribunal by email on 26 April 2013. The
notice of appeal includes a request for permission to appeal out of time,
giving reasons for the late making of the appeal (those reasons are set out
below), and extensive grounds of appeal. The essence of the grounds of appeal
is that the employee driver's account to the officer who seized the tractor
unit (which implicates the Appellant in the smuggling) is untrue and can be
proved to be so by an examination of the Tachograph.
24.
The Appellant's business is severely damaged by his inability to use the
tractor unit. Further, the vehicle is security for financing which the Appellant
undertook to purchase the vehicle, and the financing institution is threatening
to seek possession of the Appellant's home to recover the financing if the
vehicle is no longer available as security.
The parties' submissions
25.
The Appellant made his case through his friend Mr Zelako who acted as
his interpreter.
26.
The Appellant's case is that he did not delay unduly making his appeal -
the period of 30 days was simply not long enough for him to understand what was
happening and to take the steps necessary to make his appeal. He points to the
fact that it took 14 days for the review decision letter to reach him, because
it was posted (he had been in email contact with Border Force, but they did not
send the letter to him by email), so that half of the 30 day period had expired
before he was even aware of it.
27.
He then points to the complexity of the review decision letter, with its
extensive reference to matters of English law and Border Force policy. He
first had to obtain a translation, and then attempt to understand the letter in
order to decide whether to appeal and then to frame the ground of appeal. It
is reasonable that he should have adequate time to consider and then deal with
these matters.
28.
The Appellant then points to the error in the review decision letter,
which gives two clear but opposite conclusions. Border Force might say that
the context shows that there was a typographical mistake, but the Appellant's
Polish lawyer was unclear on the point, and for a non-English speaker this
added to the complexity of the matter, until it was corrected in the letter of
20 March 2013 (again, sent by post, and to Poland rather than to the London
address given for correspondence).
29.
More significantly, the Appellant had understood from the review
decision letter that the matter was still open if the Appellant could offer
fresh evidence, and he assumed from the invitation to send fresh evidence that
the 30 day appeal period would not run whilst that fresh evidence was being
considered. The Appellant wanted the Tachograph to be examined to prove the
movements of the tractor unit and to vindicate his case that the driver had
lied - this would be fresh evidence which the Appellant considered would be
very material.
30.
Once the Appellant had eventually received the letter of 20 March 2013,
which not only corrected the review decision letter, but also made it clear
that Border Force would consider no further points, the Appellant took the
steps necessary to prepare and submit his notice of appeal to the tribunal.
31.
The repossession by the Appellant of his tractor unit is a matter vital
to his livelihood and, indeed, to the retention of his home. He has to make
every effort to have it restored. He has throughout tried to respond fully and
promptly to Border Force correspondence, but the complexity of the law and the
language difficulties inevitably mean that he requires more time than would
otherwise be the case. He has not acted irresponsibly, and he should in all
the circumstances be allowed to proceed with his appeal against the decision
not to restore the vehicle.
32.
Mr Culver, for the Home Office, argued that timetables and deadlines in
the litigation process are there for a purpose: they provide certainty for the
parties and ensure that litigation is pursued in a fair and timely manner,
which is in the interests of the parties and also necessary for the
administration of justice by the courts. Only in the most exceptional cases
should a court exercise its discretion to waive them. He referred us to
decisions of the European Court of Human Rights in the cases of Welter v Sweden (1985) and J & P M Dockery (a firm) v Secretary of State for the
Environment (2002).
33.
In the circumstances of the Appellant, although the review decision
letter may have been received late, there was still time for him to make his
appeal within the statutory time period. The Appellant had conducted previous
correspondence in adequate English, indicating that he had access to persons
who spoke good English, and it was not therefore established that the need to
translate letters was a significant factor in the time it took the Appellant to
respond and take action.
34.
Further, the Appellant cannot claim that he was confused by the
procedures and the time when the 30 day period began to run - his earlier correspondence
with Border Force indicated that he was aware of the action he needed to take
at each stage of the process. Moreover, even when it was made clear to the
Appellant in the letter of 20 March 2013 that the 30 day period had expired,
the Appellant did not rush to lodge his notice of appeal at the earliest
opportunity, but waited until mid-April.
35.
As for the fresh evidence which the Appellant offered, if it was as
important as the Appellant now contends, why was the point not raised until his
letter of 8 March 2013, more than six months after the seizure of the vehicle?
In any event, even if it were fresh evidence, producing that evidence does not
excuse the lateness of the appeal notice.
36.
In all the circumstances the reasons offered by the Appellant for making
his appeal out of time are inadequate and in no way justify his appeal being
made more than 30 days after the statutory limit. The tribunal should
therefore not exercise its discretion to allow the Appellant's appeal to be
made out of time. Alternatively the tribunal should strike out the Appellant's
proceedings under Rule 8(3)(b) of the Tribunal Procedure (First-tier) (Tax
Chamber) Rules 2009 on the grounds that the Appellant cannot deal with the
proceedings fairly and justly because of the tardiness of the Appellant in
making his appeal.
Discussion and conclusion
37.
The issue we have to decide is whether we should exercise the discretion
conferred on us by section 16(1F) Finance Act 1994 to allow the Appellant to
appeal to the tribunal out of time.
38.
The Upper Tribunal has provided recent guidance as to the approach we
should adopt in exercising that discretion, as set out in the cases of Data
Select Ltd v HMRC [2012] UKUT 187 (TCC) and O'Flaherty v HMRC [2013] UKUT 161 (TCC). That guidance is not in conflict with the authorities to
which Mr Culver referred us. We are, as in the conduct of any proceedings in
this tribunal, to have regard to the overriding objective of dealing with the
case fairly and justly. We must consider all material factors (and exclude
consideration of anything which is not material), and those factors include the
purpose of the time limit; the length of the delay in making the appeal; the
reasons for the delay; the merits of the appellant's substantive appeal; and
the prejudice and other consequences for the respective parties in, on the one
hand, allowing the out of time appeal, and, on the other hand, refusing to
allow the Appellant to make his appeal. Those factors are then to be weighed
up in reaching a considered conclusion viewing matters as a whole. The O'Flaherty
case in particular makes it clear that the focus of the tribunal should not be
exclusively, or even predominantly, on determining whether or not the taxpayer
had a reasonable excuse for his delay in making his appeal.
39.
The purpose of the time limit for making an appeal as provided in
section 16(1) Finance Act 1994 seems clear: it is to give a point of finality
and therefore certainty to both parties that an appeal will be pursued (so that
the matter will be determined in due course by the tribunal) or that it will
not be pursued (so that the matter can no longer be in issue). What is equally
clear is that this purpose may yield to other factors, since we have a
discretion to set that time limit aside.
40.
We consider that the Appellant has made a strong case for us to exercise
that discretion.
41.
First it is clear that the actions of Border Force had the effect of
curtailing the 30 day period: they chose to send the review decision letter by
post to the Appellant when they could, concurrently, have emailed it to the
Appellant. They were in email contact with him at that time. The result was
that the effective appeal period for the Appellant was reduced to 16 days.
42.
Secondly, Border Force could reasonably have anticipated that the
Appellant would require time to translate and then understand the review
decision letter. It is a long letter dealing with a complex matter and citing
legislation which is specialist and technical in its nature. We do not
criticise the letter - it endeavours to render as clearly and comprehensively
as possible matters which are highly complex in law, as any judge who has
adjudicated on seizure and restoration matters will readily attest. It cannot
therefore come as a surprise to Border Force that it should take some further
days - even if he acted with the utmost expedition - for the Appellant to gain
sufficient understanding of the review decision letter to enable him, first, to
decide whether or not to appeal, and secondly to frame the grounds of his
appeal.
43.
If matters rested there, Border Force must, had they applied their minds
to it, have concluded that the Appellant was likely by force of circumstances
to make his appeal out of time, and they cannot therefore reasonably claim that
they have been unfairly treated if it is indeed made out of time and the
tribunal then proceeds to give permission for the late appeal to be made.
44.
For the Appellant, matters were confused by two further features of the
review decision letter, both of which contributed to his delay in making his
appeal.
45.
The first is the clear statement in the conclusion section of the letter
that the vehicle should be restored. Understandably the Appellant felt the
need to have the matter settled beyond doubt. He told us that the lawyer in
Poland who translated the letter could not advise him for certain of the
consequence of the letter given the express contradiction within the letter.
Border Force brushed this to one side as a typographical error which was
apparent in context, but that response is too dismissive of the Appellant's
particular disadvantages in dealing with these matters. The point was
corrected in the letter of 20 March 2013, but although the Appellant had taken
the trouble of giving Border Force an address in London to expedite matters,
they used his address in Poland, with consequential delays.
46.
The second is the invitation for further evidence for the review officer
to consider. It is not an unreasonable assumption, and one which the Appellant
apparently made, that if further evidence is provided, the decision remains
open and not final. What is not made clear in the review decision letter is
that even if further evidence is provided for consideration by the review
officer, the 30 day appeal period nevertheless applies. The Appellant believed
he was providing further evidence (or, more precisely, a means whereby Border
Force could discover that further evidence). When it became clear to the
Appellant that this would not be considered (that is, when he received the
letter of 20 March 2013 in Poland), he began in earnest the preparation of his
appeal. We might add that there was something equivocal about the review
officer's view about the 30 day appeal period - he felt the need to make some
reference to it at the end of his letter of 20 March 2013, half referring to it
in the past conditional tense and half in the future tense, no doubt as a
result of a somewhat mangled "copy and paste" exercise. What it is
not is a clear statement that the 30 day appeal period has expired.
47.
Mr Culver submits that even if allowance is made for these factors,
there was further and unjustifiable delay on the Appellant's part in making his
appeal. We do not agree. Taking all these factors together, and the need for
the Appellant to frame his grounds of appeal by careful reference to the terms
of the review decision letter, we do not consider that the Appellant was tardy
or careless of the need to press on with the appeal proceedings.
48.
We must also take into account the merits of the Appellant's appeal. In
restoration proceedings the tribunal has, by virtue of the provisions in
section 16(4) Finance Act 1994, a restricted, supervisory, jurisdiction only.
In summary, it can direct the reviewing officer to review his decision once again
if the review procedure is flawed in any way (for example, a relevant matter of
evidence has been disregarded in reaching the review decision, or a stated
policy has not been properly applied). The tribunal cannot substitute its own
decision even if it might have reached a different decision on the facts. In
practice, a person seeking to appeal successfully against an officer's decision
not to restore a vehicle in which goods have been smuggled faces a challenging
task.
49.
The Appellant bases his appeal on the records which the Tachograph is
likely to reveal, together with challenges to the assertions made by the review
officer in reaching his decision as to the use and monitoring of fuel
consumption. These are relevant matters to an appeal against the decision of
Border Force which deserve to be examined in substantive tribunal proceedings.
50.
Finally, we consider the prejudice which each party might respectively
suffer should we allow or, alternatively, refuse the Appellant's application.
51.
If we allow the application so that the appeal can proceed, it is
difficult to see that the Home Office suffers any prejudice beyond the obvious
point that it has to defend an appeal which otherwise could not be made. Mr
Culver could identify no particular detriment, in preparing and then making its
case, which the Home Office would suffer by allowing the appeal to be made on
19 (or 26) April 2013 rather than on 13 March 2013.
52.
In contrast, the Appellant may be severely disadvantaged if he cannot
make his appeal, since he thereby loses the opportunity to attempt to save his
livelihood and even his home.
53.
Taking all these factors together: that Border Force should have
anticipated that the Appellant would, in all the circumstances, struggle to
make his appeal within the 30 day period; that the Appellant had reasonable
grounds for his delay in making his appeal out of time; that his appeal has
some merit in that the grounds of appeal are material to a challenge to Border
Force's decision; and that the Appellant is at risk of significant hardship if
his appeal cannot proceed, we conclude that we should exercise our discretion
to allow the Appellant to make his appeal out of time.
54.
We therefore allow the Appellant's application for his appeal to be made
out of time, and his appeal may therefore proceed.
Right to apply for permission to appeal against this decision
55.
This document contains full findings of fact and reasons for the
decision. Any party dissatisfied with this decision has a right to apply for
permission to appeal against it pursuant to Rule 39 of the Tribunal Procedure
(First-tier Tribunal) (Tax Chamber) Rules 2009. The application must be
received by this Tribunal not later than 56 days after this decision is sent to
that party. The parties are referred to “Guidance to accompany a Decision from
the First-tier Tribunal (Tax Chamber)” which accompanies and forms part of this
decision notice.
EDWARD SADLER
TRIBUNAL JUDGE
RELEASE DATE: 5 February 2014
