UT (Tax & Chancery) UT-2022-000134 UT-2022-000135 UT-2022-000137 - [2025] UKUT 00214 (TCC)

There was no contemporaneous record of the occasions on which Mr Urra or Mr Sheth deployed the strategy. They were not recording, or sharing with each other, the clients where they decided to test the strategy, or the outcomes (including, eg, where the cancellation decision was driven not by having reached a conclusion on whether the client was splitting its order but by market events). This was in circumstances where their evidence was that they were not collaborating and were each operating independently, both tested the strategy against ICBC and Sigma, and Mr Sheth was expecting to ask for Mr Urra’s help to exit the position if the Large Order traded and he was not able to unwind it himself within a few seconds.

The lack of any documentation in relation to the operation (and any results) of any strategy is illustrated by the fact that Mr Urra was not able to provide any evidence based on recollection or contemporaneous notes of the trade on 12 May 2016 on which Mr Sheth relied, the three occasions on which his Large Orders in the Instance Pool traded in part, or the three Non-Instance large orders which traded (two in part, one in full). The Tribunal considers it reasonable to expect that, if these were examples of the successful implementation of the strategy – or at the very least those on 12 May 2016 and where the Non-Instance large order traded in full – Mr Urra might have written down, or shared with others at the time, the identity of the relevant clients or triggers for the use of the strategy.