20779

Jurisdiction – Strike-out application – Repayment claim – Letter stating that verification continuing – No appealable decision

Costs – Application for costs after appeal struck out – Held appeal not frivolous or vexatious – One day notice of application – Costs refused

LONDON TRIBUNAL CENTRE

	FIRST CLASS COMMUNICATIONS	Appellant

- and -

	THE COMMISSIONERS FOR HER MAJESTY’S REVENUE AND CUSTOMS 	Respondents

Tribunal: THEODORE WALLACE (Chairman)

Sitting in public in London on 15 August 2008

Terence Brown, company secretary, for the Appellant 

George Rowell, Counsel, instructed by the Solicitor for the Respondents

© CROWN COPYRIGHT 2008

DECISION ON APPLICATION

	This was an application by Customs dated 13 June 2008 that the appeal be struck out under Rule 6 on the grounds that there was no appealable decision.

	The notice of appeal identified the decision as being in a letter dated 25 February 2008. The letter contained the following passages:

“… the contents [of your letter] will have no impact on the extended verification action that is continuing in relation to your company’s fifteen repayment returns.
… I cannot intervene in the verification process.
… the verification process is continuing.”

	Mr Brown informed me that £400,000 is being withheld from the 06/06 claim.

	Mr Rowell said that if the appeal was purely based on the letter of 25 February 2008 it could be dealt with quite quickly. If the Appellant contended that the letter should not be taken at face value and that there had in fact been a decision, then an adjournment would be needed with witnesses and the Appellant should give the grounds for contending that there had in reality been a refusal.

	Mr Brown said that the letter of 25 February refused him permission to ask more questions as to why no decision had been made. He believed that Customs had in fact taken a decision in spite of the wording of the letter but said that he was not competent to argue that point and that the company could not afford a legal representative. He said that the Appellant’s claim should have been resolved long ago and another officer was looking into the matter following representations by an M.P. He said that the repayment was being delayed pending the prosecution of the supplier which is listed for January 2009.

	The Appellant had written to Customs in June saying that the High Court decision in Touchwood Services Ltd v Revenue and Customs Commissioner [2007] STC 1425 was made “without the Ukrainian/European Court of Justice judgement being taken into account.” Mr Brown did not have a copy of the case in question nor any reference.

	A witness statement by Warren Wald, the officer handling the claim, was faxed to the Appellant on the evening before the application. 

	It is clear that the letter of 25 February 2008 is not expressed as a decision on the repayment claim, stating in terms that the verification is continuing. A decision to defer a decision is not an appealable decision. In order to succeed the Appellant would have to show that notwithstanding the wording of the letter a decision had in fact been made. As already stated, Mr Brown did not seek to pursue the contention that a decision had been made on or before the date of the February letter stating that his main complaint was as to the delay.

	I am satisfied that the letter of 25 February 2008 did not constitute an appealable decision to refuse repayment. If the Appellant had formally contended that the letter misrepresented the position, I would have directed particulars of such allegation. Mr Brown did not pursue this and I accordingly directed that the appeal be struck out.

	Mr Rowell applied for costs Customs having put the Appellant on notice late on the day before the hearing. He contended that this fell within the Statement by Hon Peter Brooke, Minister of State, in 1986 as being “a frivolous or vexatious” case.

	I refused the costs application. There has been a long delay in giving a decision and none has been given yet. The remedy for alleged delay is judicial review; however, if it is contended that a decision has been made, the forum is the Tribunal.  The division of jurisdiction creates difficulties for lawyers let alone unrepresented Appellants. In the circumstances I do not consider this appeal to have been frivolous or vexatious. Furthermore the notice of the application for costs was very late. The Witness Statement by Mr Wald with 13 exhibits was only served on the day before the hearing, giving the Appellant no chance to consider its contents. It was only provided to Counsel for Customs on the morning of the hearing. No consideration was given by Customs to the letter of 18 June 2008 referring to a Ukrainian/Court of Justice decision; Mr Rowell had no instructions as to this and could give me no help.

	Finally I repeat that the remedy for excessive delay is judicial review in the High Court. A two year delay is a long time, however it is not the function of this Tribunal to decide whether it is excessive.

	Before the written direction with reasons was finalised, I received from the Appellant copies of the judgment of the European Court of Human Rights dated 9 January 2007 in Interslav v Ukraine (application No 803/02) and the judgment of the Court of Justice dated 10 July 2008 in Sosnowska v Dyrektov Izby Skarbowej we Wroclawiu Osrodek Zamiejscowy w Walbrzychu (Case C-25/07).  Both cases concern delays by the tax authorities in meeting repayment claims.   I do not consider that either case affects the jurisdiction of the Tribunal as opposed to the High Court in cases where no decision has been given.

	Accordingly I confirm the oral directions 

1.	That the appeal be struck out;
2.	That there is no order as to costs.

THEODORE WALLACE
CHAIRMAN
RELEASED: 21 August 2008

LON/2008/1073