QB-2020-004171 - [2025] EWHC 2773 (KB)

It is now necessary to consider the law in respect of the torts of malicious prosecution and misfeasance in public office. The Court has been assisted by the respective detailed submissions from the parties on the ingredients of the torts. It is necessary to set out the law before seeking to apply the law to the facts of the case.

The elements of the tort of malicious prosecution are that the Claimants (a) were prosecuted by the Defendant (b) that the prosecution was determined in their favour, (c) the prosecution was without reasonable and probable cause, and (d) the prosecution was malicious: see Lord Keith of Kinkel in Martin v Watson [1996] 1 AC 74 at 80C (citing the then edition of Clerk & Lindsell on Torts).

There is no difficulty in this case in establishing that the individual claimants were acquitted. The issue as to whether HMRC was the prosecutor has been referred to above. The issues to consider are whether the prosecution was without reasonable and probable cause and whether the prosecution was malicious.

The case of the Claimants is that the decision to prosecute was made by HMRC and not by the CPS. In the alternative, if the decision was made by the CPS, they say that the CPS was not able to exercise an independent judgment to prosecute C1 and C2 since the decision whether to prosecute was based wholly or materially upon the evidence provided to the CPS by HMRC. They say that the decision of the CPS to prosecute the claimants was overborne and/or perverted and/or manipulated by HMRC who deliberately did not provide material evidence or documentation to the CPS: see RRAmPoC para. 97.

It is alleged by the Claimants that HMRC did so by deliberately not providing material evidence/documentation to the CPS, which directly addressed and undermined any credible case against C1 and/or C2. Specifically, it was about whether C1 and/or C2 possessed the required mens rea which were essential elements of the criminal offences with which C1 and C2 were charged and subsequently indicted. These were the various counts of fraudulent evasion of tax (count 1-3: cheating the public revenue contrary to common law in relation to the fraudulent evasion of VAT due to LFB / LFCB, employees' PAYE, National Insurance and student loan contributions; and counts 4 and 5: the knowing and fraudulent evasion of income tax by C1 and/or C2 contrary to s106A TMA 1970). It is not alleged that this was the case of malicious prosecution on the part of the CPS either by itself or with HMRC.

HMRC's case is that the CPS and not HMRC was the prosecutor and/or the will of the CPS was not overborne or perverted or manipulated as alleged or at all. The CPS took the prosecution to trial and was aware of all the material relevant to the prosecution. With this knowledge, the CPS has confirmed that it was the prosecutor and its decision to charge and maintain the prosecution was not perverted or overborne by any action of HMRC.

In the ordinary course of events the CPS, in discharging its statutory functions under s.3 of the Prosecution of Offences Act 1985, is the prosecutor. Section 3(2) provides that it is the duty of the DPP: (i) “where it appears to him appropriate to do so, to institute and have the conduct of any criminal proceedings…relating to a criminal investigation by” [HMRC] (s.3(2)(bb)), and (ii) “give, to such extent as he considers appropriate, and to such persons as he considers appropriate, advice on matters relating to: - (i) a criminal investigation by [HMRC]; or (ii) criminal proceedings …relating to a criminal investigation by[HMRC (s.3(2)(ee)).

In exceptional cases, an individual or individuals other than the CPS may be treated as the prosecutor where Brooke LJ in Mahon v Rahn [2000] EWCA Civ 185 at [269] stated that:

In H v B [2009] EWCA Civ 1092, in deciding that an alleged victim of rape was not the prosecutor, Sedley LJ stated at ([47] emphasis added): “Even if she had gone directly to the authorities, the professional responsibility for the case assumed first by the police and then by the CPS would prima facie have made the latter for all legal purposes the prosecutor. It would have been necessary to establish that she had deliberately manipulated them into taking a course which they wouldnot otherwise had taken if, pursuant to Martin v Watson, she was to be regarded in law as the prosecutor.”

In agreeing with Sedley LJ, Moore-Bick LJ stated that “this was not a case in which the prosecutingauthorities were deprived of the ability to exercise independent judgment” […], and Wall LJ said [59]:
“In my judgment, provided the CPS makes an independent decision to prosecute, and its process is not overborne or perverted in some way by the complainant, the complainant is protected.”

In addition, Moore-Bick LJ emphasized that: “…the Court should be very cautious before reaching the conclusion that the authorities were unable (or even, as Mr Warby emphasized, virtually unable) to exercise independent judgment.”

In Rees and others v. Commissioner of Police for the Metropolis [2018] EWCA 1587, a case concerning the deliberate provision of tainted evidence to the CPS by the Senior Investigating Officer, McCombe LJ stated at ([59] emphasis added):

“This is not to say, as Mr Johnson submitted it was, that the mere provision of false information to a prosecuting authority leading to a prosecution makes the provider a prosecutor. I accept that the test is, as he argued, “drawn more restrictively”. However, the cases are fact specific: see in this respect the very different results reached in not entirely dissimilar cases in Martin v Watson and in AH(unt) v AB. This present case was one in which DCS Cook took it upon himself to present to the independent prosecutor for a prosecution decision a case which he knew included an important feature procured by his own criminality. There is nothing morelikely to have “overborne or perverted” the decision to prosecute. The CPS were deprived of theirability to exercise independent judgment.” (emphasis added)

In Rees the parties accepted that there could in principle be more than one prosecutor in an individual case [40]. However, in Rees the Court of Appeal held that the officer in the case was the prosecutor (his malicious acts having “overborne and perverted” the CPS decision to prosecute [58]).

In a case where the claim was struck out in Hughes v Revenue and Customs Commissioners [2024] EWHC 1765 (KB), the claim had been predicated amongst other matters on an allegation that, due to non-disclosure at the charging stage, HMRC had become the prosecutor, Mr Justice Jay emphasised that a focused approach should be taken in identifying the prosecutor (emphasis added):

“87.

In Commissioner of Police for the Metropolis v Copeland [2014] EWCA Civ 1014, the Court of Appeal, Moses LJ giving the sole reasoned judgment, held that the "simple quest" is to identify the person who is responsible for the prosecution (para 27). In my opinion, that formulation does not permit the kind of wide-ranging and unprincipled inquiry urged on me by Mr Bowers. What Moses LJ said was in the context of applying Lord Keith's reasoning and conclusion. Further, it is implicit in Moses LJ's judgment that there could be only one prosecutor.

…

90.

In the instant case, there is no evidence of any deliberate manipulation of the CPS by HMRC, or that the former's decision to prosecute was overborne and perverted by the latter. As I have already said, in early 2015 the CPS was fully aware of the state of the investigation vis-à-vis HSBC and the progress, or lack of it, in relation to disclosure. In any event, it is extremely difficult to see how omissions in these respects could possibly amount to deliberate manipulation…”

It is also useful to refer to Jay J at para. 107 who said that a premature decision to charge did not have the hallmarks of an improper motive. Further, not being to satisfy the Full Code test did not mean that there could not be a belief that there was a case that was fit to be tried, still less that there was a case to answer in malice. Jay J said as follows:

“Given my conclusion that the Claimant has no real prospect of establishing that the prosecutor did not have reasonable and probable cause for beginning and then maintaining these proceedings, the issue of malice does not arise. Even so, I consider that I should comment on just two matters. First, there is force in the Claimant’s case that a charging decision was made prematurely in December 2015 because the CPS believed that the undertaking given in the related judicial review proceedings applied to them. However, although relevant to the fulfilment or otherwise of the Full Code Test, this factor is not relevant to the issue of malice. A rushed decision does not have the hallmarks of a decision taken with an improper motive. Secondly, although there is some indication that the reluctance to pursue lines of inquiry against HSBC was generated by a perception in the CPS, at least at one stage, that to do so would be a “political hot potato”, I do not believe that the Claimant has a real prospect of showing an improper motive. Not merely did the reasoning and motives of the CPS (and, indeed, HMRC) fluctuate on this issue, proof of an improper motive would require showing that relevant officers believed that an investigation of HSBC would be likely to help the Claimant and for that reason was not pursued. That is not the state of the evidence.”

In further amplification that the “fit to be tried test” is not the same as the Full Code test, Jay J at para. 96 said the following with reference to Lord Devlin in Glinski:

“The …fit case to be tried” is capable of being misunderstood. Lord Devlin was not of course referring to the Full Code Test which did not exist in the early 1960s. The test was, and is, sufficiency of evidence; and “fit case to be tried” is another way of making the same point.”

It follows that a knowing failure to comply with the Full Code Test does not prove malice in pursuing the prosecution. The only caveat to this is in respect of the tort of misfeasance in public office in that “the claim in the tort of misfeasance in public office cannot succeed forthese present purposes unless, in relation to the case against the person underconsideration (whether it be Mr Lewis, Mr Millington or whomever), that individualknew that the criminal prosecution failed the Full Code Test when it began and thatthere was a real risk that it never would or could meet that test, and was at the very leastrecklessly indifferent as to that state of affairs” per Jay J at para. 120.