UT/2023/000084 - [2024] UKUT 00382 (TCC)

We agree with Mr Brown that it would be wrong as matter of principle for the FTT to rely on evidence which it had earlier ruled should not be admitted: that evidence, by definition, would not be before the tribunal.

But, on closer analysis, that is not what the FTT did. It did not rely on the content of the evidence. Rather its criticism of Mr Orton flowed from it attributing a purpose to Mr Orton’s application to adduce the evidence. However, this too was an error of law. Before concluding this point against the appellant, the FTT should as a matter of fairness have given Mr Orton the opportunity to explain the purpose of his application, and not simply inferred it.

It is true, as Mr Puzey said, that the FTT Decision records that Mr Orton could nevertheless give further oral evidence regarding the e-mail exhibits (see [21(3)]), and we have assumed that this concession was given orally at the time of the hearing. However, it does not address our concerns, because:

Having decided that the FTT’s reliance on the purpose it attributed to Mr Orton without giving the appellant an opportunity to explain was an error of law, we went on to consider whether we should exercise our discretion under s12(2)(a) Tribunal Courts and Enforcement Act 2007 to set aside the FTT Decision. That in turn raises the issue of whether the error is material to the decision. For the error to be considered material, it is enough if we consider the decision might have been different if the error were corrected (Footnote: ³).

Beigebell’s case is that the error was material. Mr Brown submitted that it clearly had an effect on the FTT’s finding that Mr Orton was neither credible nor reliable, and he highlighted the FTT’s description of Mr Orton’s purpose in making the application as “disturbing”. Mr Puzey by contrast depicts that statement as:

“essentially a passing comment…of minor importance compared to the remainder of the findings on Mr Orton’s credibility and it cannot be said to be determinative or even influential in the conclusion.”

We consider Mr Puzey’s characterisation the better one. At [245] the FTT said that there were numerous inconsistencies” in Mr Orton’s evidence, and then set out at (1) to (7) “one cohort” of those inconsistencies which “serv[ed] well for illustration”. Those illustrative examples included the differences between Mr Orton’s evidence and his earlier exchanges with HMRC; his lack of knowledge as to Mr Patel’s employer, and his failure to ask for copies of the deal documentation. The FTT also noted Mr Orton’s changing accounts as to the insurance position for the goods ([246]); the lack of documentation in relation to Beigebell’s contract arrangements with the freight forwarder; contradictions in his evidence on whether a deal or deals had been set up by Mr Patel ([248]), and the fact the e-mail communications with the trading partners and freight forwarder indicated that Mr Orton “was firmly in the driving seat moving the transactions forward; he was not a passenger being carried along in these deals allegedly already set up by [Mr] Patel.” The FTT’s criticism at [249] came some way after this list of numerous inconsistencies.

Mr Brown also referred us to [267], where, in relation to its understanding that Mr Orton was trying to dissociate his reverse charge enquiry from the fraudulent transactions, the FTT said:

“As Mr Puzey submits, it goes to the heart of Mr Orton’s credibility whether such an assertion of complete ignorance of MTIC fraud is credible.”

However, read together with the earlier section dealing with Mr Orton’s evidence ([245] to [251]) where, as we have said, the point about his purpose appeared some way down the catalogue of inconsistencies as an additional reason, we do not think the point was central in the way [267] appears to make out.

We are confident that if the FTT’s error in making the adverse comment it did at [249] were corrected (by removing it), the outcome would be the same. Thus, although there was an error of law, it was not one that was material to the outcome: we have no doubt the FTT would have reached the same conclusion on Mr Orton’s credibility and reliability without taking into account the calls to the helpline. This is therefore not a case where the FTT might have reached another decision on that issue.