[2025] UKUT 00315 (TCC)

Ms McArdle submitted that the FTT erred in law, committing a serious procedural irregularity, by deciding that HMRC had waived the time limit for the Appellant to make the drawback claim without first receiving oral submissions from HMRC during the hearing. She argued that during the hearing, following the Appellant making oral submissions on the issue as to whether the email of 27 December 2019 amounted to a waiver of the time limit condition, the FTT Judge stated from the bench to the Appellant’s representative: “You have won on that, you have won on the facts of that.”

She argued that the Judge announced in clear language that the email did consist of a waiver of the time limit. This was notwithstanding the fact that this determination had been made before HMRC had an opportunity to make any oral submissions on the issue. The point as to whether there was a waiver was strongly disputed. She submitted that this was a clear case of an issue being decided against a party before it was given the opportunity to be heard on it. Thus, there was a serious procedural irregularity. She contended that the Decision acknowledged that this pre-determination occurred, as it includes the following passage at [30]:

“In that regard, and as communicated during the hearing, we consider that ...”

Ms McArdle also submitted that the FTT’s refusal of permission on this Ground of Cross-Appeal also accepts that this occurred at [8]:

“It is correct that Ms Gable and I determined how, factually, the email of 27 December 2019 should be interpreted. We did so in the hearing, and after consideration of its terms…We carefully considered the correct interpretation of it and gave an ex-tempore decision of our factual finding, thus framing the basis for submissions on the effect of our finding.”

She contended that the FTT had not taken issue with the factual premise of this ground, and it was supported by the contemporaneous notes of HMRC: the matter was determined before the oral submissions of HMRC were made.

Ms McArdle argued that there is no good argument in defence of there being a procedural irregularity. The fact that HMRC had filed a skeleton argument could not cure the error. The FTT opted for an oral hearing, began hearing the Appellant’s submissions, and pre-decided the issue without giving HMRC the opportunity to be heard. At no time did HMRC “recommend” or otherwise endorse the FTT making a decision on any issue before hearing their oral submissions on the point.

She rejected the Appellant’s argument that there was no unlawfulness because HMRC had not objected during the course of the hearing. She accepted that an advocate should object when a Judge “is proposing to take an inappropriate course”. However, the FTT in this case gave no forewarning that it was planning to pre-determine the issue. The determination was simply announced, without any warning, during the hearing. She suggested that HMRC cannot possibly be expected to have anticipated that a breach of natural justice was about to occur and to have objected in advance. Had they known it was planned, they would have strenuously objected. In any event she did seek to change the mind of the Judge in submissions to no avail. The decision had already been made, before HMRC were heard on the matter orally.

Ms McArdle contended that, given this serious procedural irregularity, the decision on waiver of time limits should be set aside and re-made by the UT or remitted to a freshly constituted FTT.