UT/2022/000131 - [2025] UKUT 00063 (TCC)

We consider first the issue of whether to accept this as a ground of appeal (Judge Jones having initially refused permission as set out at [13] above. This ground of appeal arises from a paragraph in Mr Rafferty’s original application for permission to appeal to the FTT which read as follows:

In his decision refusing permission, Judge Gemmell WS refused permission on this ground as not amounting to an error of law, without making any further comment on it.

Judge Jones in the Upper Tribunal also refused permission on this ground, saying it was “unarguable, amounts to an argument on the facts and does not give rise to any issue of law”. However, he made the further statement set out at [13] above, allowing the application to be renewed “if it is right that HMRC did not cross examine the Applicant at the hearing.” He expanded on this point as follows:

The ground being advanced refers to paragraph [45] of the FTT’s decision. It is necessary to set out that paragraph in full, in the context of the paragraphs immediately preceding it, in order to understand it properly:

This makes it clear that the “Tribunal hearing” being referred to in paragraph [45] was the earlier hearing on 21 January 2020 of Mr Rafferty’s application for a closure notice and appeal against an information notice penalty (several months before the issue of the closure notice and assessments which are the subject of the current proceedings). The last sentence of [45] is the one complained of in the application for permission to appeal. It is quite clear, by reference to the 17 February 2020 letter from HMRC (which was included in the hearing bundle) that this final sentence of paragraph [45] of the FTT’s decision does indeed contain an error – in their letter dated 17 February 2020, HMRC asked for a meeting with Mr Rafferty because he had been able to attend that hearing, and not because he had been unable to do so (by reason of mental health problems that were referred to at various stages). However, this error is minor and peripheral, and we do not see any basis upon which it could have influenced the FTT’s decision on the substantive issues before it.

There is some confusion in the application for permission to appeal around the date of the hearing being referred to in it. It asserts (see [17] above) that Mr Rafferty did attend “the 21.02.22 hearing”, but in fact there was no hearing on that date. The previous hearing had been held on 21 January 2020, and the hearing in the FTT in these proceedings took place on 24 February 2022. In context, the hearing being referred to in the application was clearly the earlier hearing on 21 January 2020.

However, when Judge Jones gave permission to renew the application “if it is right that HMRC did not cross examine the Applicant at the hearing”, he was clearly referring to the substantive hearing on 24 February 2022, and giving Mr Rafferty the opportunity to raise that point. He made clear the potential issues when doing so (see [19] above). However, the point was not raised on behalf of Mr Rafferty until the hearing before us.

In opening before us, Mr Quinn explained that Mr Rafferty was extremely upset when he gave his evidence before the FTT in February 2022 – to such an extent that the judge paused his giving of evidence for five to ten minutes to allow him to regain composure. Mr Quinn submits that Mr Rafferty was stood down by the hearing judge because of his emotional state, without HMRC having asked Mr Rafferty any questions. Ms Sheldon – who had not appeared before the FTT - told us that she was instructed that Ms O’Reilly, the officer representing HMRC before the FTT, had cross-examined Mr Rafferty. Mr Quinn’s response was that he was adamant that Mr Rafferty had not been cross-examined at the FTT hearing.

The FTT’s decision refers in a number of places to Mr Rafferty giving evidence. For example, at paragraph [12] it states

Although there is no express statement that Mr Rafferty was cross-examined in either the FTT’s substantive decision or in its decision to refuse permission to appeal (no doubt, in the latter case, because of the lack of clarity in the application for permission to appeal itself), it is clear from both the decision notices that the FTT did not believe Mr Rafferty’s oral evidence.

We note that nowhere in either of the applications for permission to appeal (both to the FTT and subsequently to the Upper Tribunal) was any submission made that the FTT erred in law because it failed to take into account the fact that Mr Rafferty’s evidence was unchallenged. Nor was this raised anywhere in Mr Quinn’s skeleton argument. HMRC were therefore, unfairly, taken by surprise when this was raised at the hearing.

As this issue was not raised in the application to the FTT for permission to appeal, we do not have the benefit of the view of Judge Gemmell WS (who presided at the FTT hearing) on this matter. But in any event, as this matter was not raised in either of the applications for permission, permission to appeal on this ground was not given, it would not be appropriate to grant it at this stage and we therefore decline to consider it.