UT/2024/000031 - [2025] UKUT 00254 (TCC)

We must now consider whether we should strike out the appeal as an abuse of process or because the appeal has become academic as between the existing parties. In order for the appeal to serve any purpose, a new party would have to be substituted for Circleplane and a new respondent may also need to be substituted for HMRC. That is not a very encouraging foundation for Circleplane’s submission that we should not strike out the appeal.

Mr Eissa submits that we should hear the appeal because it is in the interests of justice that the underlying question of recusal based on the relationship between Counsel and the Judge should be resolved. It is said that the Judge recognised that this was desirable, and that is why she did not seek to place any constraint on the permission to appeal. There is no reason why, in appropriate circumstances, an academic appeal should not be determined. In any event, if the Company is substituted for the Appellant and if, in so far as necessary, the FTT is substituted for HMRC, then the appeal will no longer be academic. There is no sense in which the substance of this appeal has altered and there is nothing abusive about seeking a determination of the issue on that basis. Finally, Mr Eissa submits that it is striking that (if the Strike Out Application fails) HMRC does not object to the Cross-Application.

We accept that it may (in theory) be desirable for the question of whether the Judge should hear any cases in which Counsel is instructed to be resolved on this appeal. We understand that Counsel had been listed before the Judge on four occasions and invited her to recuse herself on the last two occasions. The Judge refused those applications and it is the last refusal which has led to this appeal.

HMRC submit that section 12 TCEA 2007 restricts the nature of the relief the Upper Tribunal can direct in the event of a successful appeal. It provides as follows:

Mr Simpson acknowledged that the Upper Tribunal could make a finding that the Judge erred in law in failing to recuse herself on the grounds of apparent bias. However, there would be no point in remitting the case to the FTT with directions for a reconsideration of the question. Nor could the Upper Tribunal give any declaration that there would be an appearance of bias in any future cases involving Counsel and the Judge. A finding by the Upper Tribunal that there was an appearance of bias in this case would not assist in relation to future cases.

It seems to us that if the Upper Tribunal were to hear this appeal and make a finding that there was an error of law, there would be no need to set aside the Recusal Decision. It is now academic as between Circleplane and HMRC. Nor could we give procedural directions because no purpose would be served by a reconsideration of the case by the FTT.

The question of apparent bias is highly fact sensitive and must be determined by reference to the circumstances that exist in a specific case at a specific time. However, in practical terms, a finding as to whether or not there was apparent bias in this case might assist the Judge and the FTT in determining whether future cases involving Counsel should be listed before the Judge. It would be unlikely to assist in other cases where Counsel is instructed which might be listed before other Judges who were in Chambers at the time of the dispute. We understand that there are presently two fee-paid Judges of the Tax Chamber who were in Chambers at that time.

Mr Eissa makes the point that the issue is likely to come back in a subsequent appeal and that it would save time and costs for the issue to be determined in this appeal. That appears to be a fair point, although we do not know how likely it is in the ordinary course that an appeal where Counsel is instructed might be listed before the Judge.

However, the fact that it might be useful for the Upper Tribunal to determine the issue in this case does not necessarily mean that it should be resolved in this case, given the procedural machinations required, as evidenced by the Cross-Applications. We must also consider whether, as a matter of discretion, we should permit the Cross-Applications.

We do not agree with Mr Eissa that we can read anything into the permission granted by the Judge. He submitted that when the Judge granted permission to appeal she did not seek to limit the scope of that permission by reference to the underlying dispute in Circleplane’s appeal. Mr Eissa seeks to infer from the fact that the Judge gave permission “with ease” that she was keen for the underlying matter to be resolved. We do not consider any such inference can be drawn from the permission to appeal. The Judge was being asked to consider the question of permission in the context of the case she was dealing with. She would have no jurisdiction to permit any appeal on grounds which went outside the confines of that dispute.

Mr Eissa submits that the Judge expressed a hope that the Recusal Decision would be appealed. However, that must be viewed in the context of an appeal which was proceeding before the FTT. We do not infer that the Judge was seeking to have the issue determined in isolation from the specific appeal of Circleplane.

In relation to the existing parties, the appeal is, in our view, properly described as academic. In appropriate circumstances there may be scope for the Upper Tribunal to determine an academic appeal. The Appellant relied on a decision of the Upper Tribunal (Administrative Appeals Chamber) in LS and RS v HMRC [2017] UKUT 0257 (AAC). In that case, HMRC made a decision in relation to tax credits which was appealed by the claimant. The appeal was dismissed by the FTT, however the claimant and the FTT were not aware that HMRC had by then made a further decision. The Upper Tribunal held that HMRC’s original decision had lapsed when they made their further decision. The FTT ought to have struck out the appeal against the original decision pursuant to Rule 8(2)(a) because it had no jurisdiction in relation to a lapsed decision. However, the Upper Tribunal held that it was not under a duty to strike out the appeal:

Mr Eissa submitted that LS and RS is directly applicable to the present circumstances. The Recusal Decision still exists and even if it does not now affect Circleplane, it falls within the Upper Tribunal’s jurisdiction.

We accept that the Upper Tribunal has jurisdiction to hear an appeal against a decision of the FTT which is academic. Whether it should do so is a matter of discretion.

HMRC’s position is that the appeal should be struck out. It accepts that if the appeal is not struck out then the Upper Tribunal does have jurisdiction to determine the appeal even if it is academic as regards the present parties. However, Mr Simpson referred us to Zuckerman on Civil Procedure 4^th ed at 25.260 as to the circumstances in which an appeal which is academic between the parties may be allowed to proceed:

In Hutcheson v Popdog Limited[2011] EWCA Civ 1580at [15] the Court of Appeal stated that these requirements had to be met save in exceptional circumstances.

Mr Eissa submitted that in substance all these conditions were satisfied. We do not agree.

On the Appellant’s own case, the appeal does not raise a point of general importance. In relation to the Cross-Applications, Mr Eissa himself described the issue as “an entirely private matter” between Chambers, the Judge and the FTT. Mr Eissa did suggest a public interest in the Upper Tribunal hearing the appeal because its outcome would affect any taxpayer who might wish to instruct Counsel on an appeal before the FTT. We can see that there is potentially some public interest in taxpayers being in a position to instruct their counsel of choice, and that the possibility of their case coming before the Judge might dissuade them from instructing Counsel because it might involve an application to recuse. However, we do not consider that this is appropriately described as raising a point of general importance.

HMRC as respondent to the appeal does not agree to the appeal proceeding and has no interest in the outcome of the appeal. If the appeal does proceed and it remains as a respondent then it seeks an indemnity as to costs. Circleplane will not offer any indemnity as to HMRC’s costs and it has not been suggested that the Company would offer an indemnity. Circleplane suggests that the appeal should proceed to determine the question of recusal with the FTT as respondent, alternatively without any respondent. As far as we are aware, no indemnity has been offered to the FTT in relation to its costs in the event it were to be substituted as a party and wished to participate in the proceedings.

In our view, if the appeal were to proceed, any respondent ought to have an indemnity as to costs.

Mr Eissa submitted that the appeal could proceed without a respondent. He relied on Rule 19 of the FTT Tax Chamber Rules which anticipates certain matters in that tribunal being determined without the involvement of a respondent. He submitted that, in such a case, any appeal to the Upper Tribunal would not have a respondent. However, he did not identify what sort of matters might proceed in the FTT without a respondent or whether they would be matters in respect of which there would be a right of appeal. We do not consider that the Upper Tribunal power in Rule 9(1) to remove a party as a respondent assists his submissions.

We make no observations as to whether it is always necessary for an appeal to the Upper Tribunal to have a respondent. However, we do acknowledge that a respondent in a recusal application or on appeal against a decision on a recusal application might legitimately take a neutral stance depending on the circumstances. In that case, there might only be submissions from the applicant or the appellant. Having said that, the presence of a respondent is often helpful to draw the attention of the court or tribunal to relevant matters of law or fact, consistent with counsel’s duty and the overriding objective.

Mr Eissa submitted that the Upper Tribunal in this case would have the benefit of the Company’s submissions and the Judge’s reasons for the Recusal Decision. That is true. We do note however that a significant aspect of the grounds of appeal is that the Judge failed to take into account that she was privy to contemporaneous emails concerning the dispute. It is said that Counsel confirmed during oral submissions to the Judge that she had been copied in to the emails. We understand that the Judge was not provided with copies of the emails at the hearing or before she issued the Recusal Decision. We do not know why that was the case because clearly the emails may have refreshed the Judge’s memory of events. Circleplane appears to have concluded that the Judge deleted the emails. That is not what the Judge said, and it is not something the Upper Tribunal would be prepared to assume. It is just the sort of issue where HMRC as a respondent might be expected to assist the Upper Tribunal as to what happened at the hearing before the Judge.

In our view it would be highly undesirable for the appeal to proceed without HMRC as a respondent.

The position of the FTT is that it did not wish to make representations on the application to join it as a respondent and it did not wish to attend the hearing before us. It considered that there was nothing it could or should say beyond what was said by the Judge in the Recusal Decision. We can quite understand why the FTT took that position. Further, it has not been offered any indemnity as to costs and we do not know what its position would be in relation to the substantive hearing if such an indemnity were to be offered.

An issue also arose at the hearing before us as to whether the Company is the appropriate party to substitute for Circleplane. That issue was not satisfactorily resolved. The Company trades under the name Chancery Court Tax Chambers of which Counsel is a member and Head of Chambers. Counsel holds at least 75% of the shares in the Company and he is the sole director. However, the recusal issue does not appear to go further than Counsel. It is not clear to us therefore why the Company should be substituted as the appellant. Mr Eissa told us that Counsel had incorporated his practice as a limited company and that his instructions in relation to the appeal were from Circleplane to the Company. He also said that the class of persons centrally affected by the alleged bias would be the Company’s clients. However, there was no evidence before us as to the relationship between Counsel, the Company and Chancery Court Tax Chambers.

In summary, the Appellant seeks to have the issue of recusal determined either without any submissions from a respondent or, if there were to be submissions, without any indemnity as to costs. Even if the appeal cannot be described as an abuse of process, it is academic as between the parties. The conditions for determining an academic appeal are not satisfied. On any view, it would not be consistent with the overriding objective to allow the appeal to proceed with the present parties.

Having found that we do have jurisdiction to strike out the appeal, we are satisfied for the reasons given above that it is in the interests of justice for us to refuse the Cross-Applications and to strike out the appeal.

We are conscious that this leaves Counsel and possibly the FTT with something of a dilemma in relation to future cases that may be listed before the Judge and potentially before two other fee paid Judges in the Tax Chamber. However, we do not consider that the question of recusal in the present circumstances would resolve the question for future cases. It is the appearance of bias at the time of the hearing that is relevant. For example, in three years’ time it will be apparent, if it is not already, whether Counsel still considers that he has a cause of action against the Chambers and its members in relation to the dispute in 2018. The dispute will be even more historic than it already is and that might be a relevant factor in determining whether recusal is necessary at that time.

An alternative might be for Counsel to seek to persuade the President of the Tax Chamber that no cases in which he has been instructed as counsel should be listed before the Judge and possibly before certain other fee paid Judges. If the FTT was unwilling to agree such a proposal, and we can think of various reasons why that might be the case, then Counsel could seek judicial review of the decision if he really thinks such a course is appropriate. We should emphasise that we are not advocating that approach.

It is most unfortunate that these issues have arisen. Counsel believes that there is an appearance of bias. We have no reason to think that his belief is not genuinely held. There is also what appears to be an implicit suggestion of actual bias in an allegation that several of Counsel’s appeals have been listed before the Judge and that this is not simply a matter of coincidence. At the hearing before the Judge, Counsel described this as “inexplicable” and “statistically implausible”. The matter was put as follows in the application for permission to appeal:

It is difficult to see what relevance the “statistical anomaly” would have to a perception of bias said to arise out of the dispute in Chambers. If the suggestion is that someone has engineered the anomaly, the fair-minded and informed observer would regard that suggestion as fanciful. If Counsel is alleging that the fair-minded and informed observer would consider this to be anything more than a statistical anomaly, then no evidence whatsoever has been adduced to support the allegation at any stage of the appeal. Nor does it appear that Counsel has raised the matter with the President of the Tax Chamber.