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	England and Wales High Court (Administrative Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Administrative Court) Decisions >> Bottomley, R (on the application of) v General Commissioners Of Income Tax Pontefract Division & Anor [2009] EWHC 1708 (Admin) (25 June 2009) URL: http://www.bailii.org/ew/cases/EWHC/Admin/2009/1708.html Cite as: [2009] STI 2195, [2009] EWHC 1708 (Admin), [2009] BTC 358, [2009] STC 2532

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IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
THE ADMINISTRATIVE COURT

		Royal Courts of Justice Strand London WC2A 2LL
		25th June 2009

1. THE DEPUTY JUDGE:

Introduction

2. The claimant, Mr David Bottomley, brings this judicial review against the decision dated 11th January 2007 of the General Commissioners of Income Tax Pontefract Division ("the General Commissioners") taken after a two day hearing, first, to dismiss the claimant's appeals against Revenue assessments made pursuant to section 29 of the Taxes Management Act 1970 ("TMA 1970) for the tax years 1998/99, 1999/2000 and 2000/01 and, secondly, to dismiss appeals against the amendments made to the self-assessments by the Commissioners for Her Majesty's Revenue and Customs ("the Revenue") under section 28A(2)(b) TMA 1970 for the tax years 2001/02 and 2002/03.
3. The claimant alleges that the decision of the General Commissioners, who are the defendants to this claim, was vitiated by bias, real or apparent, in favour of the Revenue, who is the interested party in this claim. The amount of income tax at issue is about £12,500.
4. The claimant had a right of appeal by way of case stated under regulation 20 of the General Commissioners (Jurisdiction and Procedure) Regulations 1994 to challenge the relevant decision for an error of law, which would include any alleged material error in the procedure adopted by the General Commissioners that rendered the hearing unfair to the claimant. The claimant has not pursued that alternative course, but has, as I have mentioned, chosen to bring his claim against the General Commissioners by way of judicial review to this court.

Background

5. On 21st November 2002 the 2001/02 tax return of the claimant was submitted by the claimant's then agents, Messrs M Wesley Chapman & Co ("MWC"). This return contained entries in respect of the claimant's self-employment as sole proprietor of The Vintner Restaurant, 42a Flowergate, Whitby, North Yorkshire.
6. On 31st October 2003 the Revenue opened an inquiry into the return pursuant to section 9A of the TMA by writing to the claimant, with a copy to the agent, asking for information and production of business records. MWC submitted a copy of the business accounts, tax computations and analysis of private drawings together with business records for the year ended 31st March 2002. The Inspector examined the business records and information provided.
7. The Revenue had concerns over the accuracy of the records and the amount of recorded cash drawn by the claimant and available for private spending. The Revenue held a meeting with the claimant and MWC. No final agreement was reached and the inquiry continued. The Revenue requested production of private bank accounts, which MWC provided for a sample period, with an explanation that deposits into the account included amounts paid in by the claimant's partner who was living with him and contributing towards household expenses.
8. On 15th December 2004 the Inspector wrote to the agent stating that the onus of proving the source of the deposits into his private bank account lay with the client and, in the absence of verification, the Revenue would treat the deposits as unrecorded business takings. The Inspector also indicated that he would need to see further documents. However, as an alternative to requiring production of further documents, the Inspector put forward some proposals for additions to profit on a without prejudice basis not only for 2002, but also earlier years and for 2003. These proposals were not accepted.
9. On 8th February 2005 the Revenue issued a notice requiring the production of documents and other information under section 19A of the TMA 1970.
10. On 28th March 2005 Dr Milton of Milton & Co wrote to the Inspector to tell him that that firm now acted for the claimant in respect of the inquiry. According to the oral evidence which he gave to this court, Dr Milton has both considerable expertise in tax law and practice and very substantial experience gathered over many years of advocacy on behalf of appellant tax payers before the General Commissioners. Further correspondence followed between Dr Milton and the Revenue, and on 17th April 2005 Dr Milton asked for the case to be listed before the General Commissioners for a closure notice.
11. At a hearing on 6th September 2005 the General Commissioners directed the closure of the enquiries for the 2001/02 and 2002/03 tax years. In accordance with that direction on 15th September 2005 an Inspector issued the requisite notice in a letter to Dr Milton.
12. The notice proposed an increase in profits of £12,453 for 2002 and an addition of £8,000 for 2003. The Revenue also raised assessments to bring into charge additional profits in respect of the tax years 1998/99, 1999/2000 and 2000/01 of £6,000, £8,000 and £10,000. The total additional tax charged was £12,551.75. Appeals and applications to postpone payment of all additional tax were lodged by Dr Milton in his letter of 26th September 2005.
13. The hearing of the General Commissioners was originally set for 22nd November 2006. Dr Milton was served with two volumes of documents by the Revenue, including copies of correspondence, documents, legislation and authorities and two witness statements, one from the Revenue case worker, Mr Francis Tostevin, who had carried out the inquiry, and one from an employee of Scarborough Council who provided information about the date the former partner moved out of the home shared with the claimant. Dr Milton accepted the truth of the second statement and agreed that that witness need not attend the hearing. On arrival at the hearing venue the hearing was cancelled due to illness of one of the tribunal members. It was later re-listed for hearing on 8th and 9th January 2007.
14. The Revenue posted a supplementary bundle to the Clerk to the Commissioners and Dr Milton, comprising mainly the correspondence between November 2006 and the hearing date and a witness statement from a second Revenue officer in the light of Dr Milton's criticisms of that officer's conduct in the case. The claimant served no witness statement before the hearing and none was produced at the hearing.
15. The course of the hearing on 8th and 9th January 2007 was, in very broad outline, as follows. Dr Milton, on behalf of the claimant, was invited to open his case by the Chairman. He opened and called the claimant to give evidence and the claimant was cross-examined by the Revenue. Dr Milton concluded his case on the second day. The Revenue then presented their case and called its witness, Mr Francis Tostevin, who was cross-examined by Dr Milton. Dr Milton did not wish to cross-examine the second Revenue witness.
16. After the two day hearing the Commissioners dismissed the appeals, stating in their decision letter as follows:

"We, the Commissioners, are of the opinion that the evidence admitted to us in support of the appeals cannot be relied upon to show the whole of the trading profit of the business and we accept that all of the assessments made by the Revenue were properly made."

The hearing before me

17. For the purposes of the hearing before me there were witness statements on behalf of the claimant from the claimant himself and from Dr Milton. The claimant and Dr Milton were cross-examined at the hearing on their statements by counsel for the General Commissioners. There were two witness statements from each of the tribunal members, that is the Chairman, Ian Bloomer, and the two wing members, Richard Gordon Smith and Paul Jervis. On behalf of the Revenue there were witness statements from Anne Aldridge, Head of the Revenue Appeals Unit based in Leeds, who acted as the Revenue's advocate at the relevant hearing, and from Francis Healey, a Senior Revenue Officer with the Appeals Unit, who attended the relevant hearing to assist Anne Aldridge.
18. On 12th June 2009 Dr Milton, on behalf of the claimant, confirmed that he did not wish to cross-examine any of the witnesses whose statements had been filed on behalf of the General Commissioners and the Revenue. Also before me were the notes of the relevant hearing, running to some 20 pages, made contemporaneously by the Clerk to the General Commissioners, Anne Caswell.
19. At the hearing of this claim I allowed Dr Milton to present the claimant's case, a course to which counsel for the General Commissioners and for the Revenue did not object.

The legal framework

20. As I have indicated, the claimant alleges bias on the part of the General Commissioners. The test for apparent bias was described in Lawal v Northern Spirit [2003] UKHL 35 as follows. The court must first ascertain all the circumstances which have a bearing on the suggestion that the judge was biased. It must then ask whether those circumstances would lead a fair-minded and informed observer to conclude that there was a real possibility, or a real danger, the two being the same, that the tribunal was biased. A judge may and commonly will begin forming views about the evidence as it goes along and he or she may legitimately give assistance to the parties by telling them what is presently in the judge's mind. It is not acceptable for the judge to form or to give the impression of having formed a firm view in favour of one side's credibility when the other side have not yet called evidence which is intended to impugn it: see Amjad & others v Steadman-Byrne [2007] EWCA Civ 625. In that case the court commented on the proper time to draw the attention of a tribunal to a clear manifestation of bias on its part, and I refer to paragraph 17 of that judgment:

"For reasons which we do not doubt are sound, a plea of waiver has not been pursued on the claimants' behalf. We would, however, stress that the time to draw the attention of a tribunal to a clear manifestation of bias on its part is ordinarily when it occurs. There is no reason why a judge to whom it is courteously pointed out that he or she may have overstepped the mark should not accept that it may be so and stand down. Equally, however, it is only in a clear case that an advocate can responsibly take this course and a judge accede to it, both because such applications have been known to be made opportunistically and because of the expense that a recusal will inevitably throw upon one or both parties, neither of whom will ordinarily be to blame for what has happened. The law of waiver is not simple, but appellate and reviewing courts tend not to look favourably on complaints of vitiating bias made only after the complainant has taken his chance on the outcome and found it unwelcome. In the present case, however, there is no criticism of the course adopted at trial by the defendant's counsel."

21. Any waiver must be clear and unequivocal, made with full knowledge of all the facts relevant to the decision whether to waive or not. As to the meaning of "full facts", the Court of Appeal in Jones v DAS Legal Expenses Insurance [2003] EWCA Civ 1071 stated the following:

"Waiver would never operate if 'full facts' meant each and every detail of factual information which diligent digging can produce. Full facts relevant to the decision to be taken must be confined to the essential facts. What is important is that the litigant should understand the nature of the case rather than the detail. It is sufficient if there is disclosed to him all he needs to know which is invariably different from all he wants to know."

22. It is also convenient to set out paragraph 15(1) to (5) of Part III of the General Commissioners (Jurisdiction and Procedure) Regulations 1994 under the heading, "Procedure and evidence of hearing":

"(1) At the beginning of the hearing of any proceedings the Tribunal shall, except where it considers it unnecessary to do so, explain the order of proceedings which it proposes to adopt.

(2) The Tribunal shall conduct the hearing in such manner as it considers most suitable to the clarification and determination of the issues before it and generally to the just handling of the proceedings and, so far as it appears to it appropriate, shall seek to avoid formality in its procedure.

(3) The parties shall be heard in such order as the Tribunal shall determine and shall be entitled -

(a) to give evidence,

(b) to call witnesses,

(c) to question any witnesses including other parties who give evidence, and

(d) to address the Tribunal both on the evidence and generally on the subject matter of the proceedings.

(4) In assessing the truth and weight of any evidence, the Tribunal may take account of its nature and source, and the manner in which it is given.

(5) Evidence before the Tribunal may be given orally or, if the Tribunal so directs, by affidavit or a statement made or recorded in a document, but at any stage of the hearing the Tribunal may, on the application of a party or of its own motion, require the personal attendance as a witness of -

(a) the maker of an affidavit, or

(b) the maker of such a statement, or

(c) in the case of an oral statement recorded in a document, the person by whom the statement was recorded."

The allegations of bias

23. I shall examine in turn each of the points upon which the claimant relies to establish bias on the part of the General Commissioners.
24. First, it is contended that as soon as Dr Milton completed his opening address at the hearing before the General Commissioners, the Chairman of the tribunal said: "Well, I believe that Mr Tostevin [the Revenue official who had conducted the inquiry into the claimant's tax affairs and who was to be the Revenue's principal and in the event only witness] is telling the truth". At paragraph 10 of the grounds the claimant avers:

"In so doing he [that is the Chairman of the General Commissioners] rendered the whole point of the appeal hearing moot as he confirmed he believed HMRC and not the appellant; this took place 20 minutes into a 2 day hearing."

In his witness statement at paragraph 6 Dr Milton describes the effect that the alleged observation of the Chairman had on him and the claimant:

"this completely destroyed my confidence in the impartiality of the commissioners and caused me to feel that we would not receive a fair hearing; these words had the same effect on Mr Bottomley."

25. If this allegation were well-founded, one could hardly conceive of a more serious case of bias. The tribunal had used language that could only reasonably be construed as showing that it had already made up its mind in favour of one of the parties before it had heard the evidence of the other party and before that other party had had an opportunity to cross-examine his opponent's principal witness. However, each of the witnesses on behalf of the General Commissioners and the Revenue denies that such language was used by the Chairman. Furthermore, the notes of the Clerk, Mrs Caswell, do not in any way support the allegation, nor do the contemporary notes of the two Revenue witnesses in this court, Anne Aldridge and Francis Healey, which were made available for the hearing before me. As I have already mentioned, the claimant, through Dr Milton, did not seek by cross-examination to challenge the evidence given by these witnesses in their statements.
26. In any event, I find this allegation inherently improbable. The Chairman had been a Commissioner of the Pontefract General Commission for 35 years and had acted as its Chairman from 2001. He would have known that the language imputed to him was wholly improper and would fundamentally undermine the fairness of the hearing. Each of the other commissioners was also very experienced: Mr Richard Gordon Smith had been a Commissioner for more than 15 years and Mr Paul Jervis for nearly five years. If the Chairman had used such language, each or both of them could have been expected to intervene immediately with a view either to bringing the hearing immediately to an end or to seek, if possible, to correct any impression of bias that had been given. Both Mr Smith and Mr Jervis accept that the Chairman made some reference to witnesses giving truthful evidence, but they state that the reference was in the context of the willingness of the claimant and the Revenue's witnesses to give evidence on oath and that it could not be interpreted in that context to mean that the Chairman or the other Commissioners were predisposed to believe the Revenue's witnesses or to prefer, if there were any conflict, that witness' evidence to evidence given on behalf of the claimant.
27. The Chairman, in his witness statement, states that he believes that he referred to a specific point, which he could not now recollect, in Mr Tostevin's statement, but he did not indicate thereby that he was accepting the Revenue's case and rejecting the claimant's case.
28. Dr Milton sought to buttress his evidence on this matter by the production on 24th February 2009, that is more than two years after the claim was filed, of four pages of typed up contemporary notes that he said he had made of the hearing. On the first page of the notes there is an entry:

"Chair - WELL I BELIEVE REVN TELL TRUTH". However, I am not satisfied that these notes were in fact made contemporaneously. First, the judicial review claim form makes no mention of such contemporary notes. Secondly, the witness statement of the claimant does not mention such notes, although by that time the claimant had and refers to Mrs Caswell's notes of the hearing, and the claimant accepted in his oral evidence to this court that he did not have such notes before him when he outlined the points for inclusion in his witness statement. Of even greater significance is the failure of Dr Milton to mention such notes in his own statement dated 22nd February 2007. At paragraph 5 of that statement he said:

"I have read a 21 page document purporting to be notes of the said hearing prepared by Ms Anne Caswell, Clerk to the Commissioners; this does not truly reflect the facts of the said hearing."

I find it simply incredible that Dr Milton, particularly with his litigation experience, would not have mentioned in this paragraph, where he is expressly challenging the completeness of Mrs Caswell's notes, that he himself had made a contemporary note that corroborated the serious allegation of bias under present consideration. Under cross-examination Dr Milton sought to explain this failure by saying that the notes, containing as they did strong language, including expletives, were not appropriate for production. However, I do not find this explanation convincing. On their face the notes had evidential value. The strong language used in the notes would, if anything, give even greater credence to their contents, and it was open, in any event, to Dr Milton to explain, if that were the case, that the notes were made hastily and under some emotion.

29. Fourthly, the notes themselves have a particularly curious feature. They are not simply a record of the proceedings, but include also an unusual and extensive running commentary on events, with remarks such as, in relation to a proposed procedural step, "NO WAY be a right row". In respect of the very allegation under consideration is the entry, "F**k - WEVE HAD IT". Then at another point is the reference, "AGES WASTED - CANT GET WORD IN", "WE HAVE NO CHANCE" and so on. The style of the notes bear, in my view, the indelible hallmark of a record of the proceedings not made contemporaneously but at a substantially later date when they have been tailored, even if based on the writer's attempted recollection of events, to reflect and to strengthen the points relied upon in the claim. As such I cannot safely rely upon those notes to undermine the conclusion that I have reached on the other evidence and to which I have already referred, namely that the claimant has not satisfied me that the Chairman made the highly improper observation alleged against him.
30. I would add two further points in this context. First, if the Chairman had made the observation in question I would have expected Dr Milton, with his litigation experience, immediately to have raised with the tribunal the propriety of the hearing continuing. On his own evidence the alleged observation completely destroyed his confidence in the impartiality of the Commissioners, and the notes, for what they are worth, state in stark terms already quoted, "F**k - WEVE HAD IT". Yet there is no evidence that Dr Milton sought to raise directly with the General Commissioners the serious situation that, on his account, had arisen. The absence of any such step, in my view, tends strongly to corroborate the contrary evidence of the witnesses for the defendant and interested party that no such observations were made by the Chairman.
31. Secondly, assuming, contrary to my finding, that the Chairman did make the highly improper observation in question and that Dr Milton appreciated the very damaging implications for his case, Dr Milton simply allowed the hearing to continue without making strong protest and without raising the pressing question whether the hearing could properly continue. No explanation has been offered for this putative failure at the time to seek to address the situation that had on this account arisen. The only reasonable inference would be that Dr Milton chose, with full knowledge of the relevant facts, nonetheless to take the chance on a favourable outcome for his client.
32. On that basis, and on the alternative hypothesis, which I reiterate I reject as a matter of fact, I would have held that the claimant, through Dr Milton, had waived the right to raise in later proceedings the issue of bias on the part of the General Commissioners by reason of the alleged observation made early on in the hearing by the Chairman.
33. Most of the other points of alleged bias I can take more shortly.
34. Before the hearing on 8th January 2007 the Revenue had sent to the Clerk to the General Commissioners and to Dr Milton a supplementary bundle of documents. According to the unchallenged evidence of Anne Aldrige, the supplementary bundle contained correspondence between the Revenue and Dr Milton, as well as a one-page summary of the adjustments and assessments for the relevant tax years and a document relied on by Dr Milton at an earlier meeting with the Revenue. This supplementary bundle was produced by the Revenue on the second day of the hearing. Dr Milton explained that he had not received the bundle. According to the witness statements filed in these proceedings by each of the General Commissioners and by the Revenue's witnesses, the supplementary bundle was then copied and made available to Dr Milton, who agreed that it could be put before the tribunal. In these circumstances the introduction of the supplementary bundle could not in any way suggest bias on the part of the General Commissioners. Indeed, no explanation was offered as to how the Revenue's reliance on the supplementary bundle, given the circumstances in which it was produced, could have unfairly prejudiced the claimant or why, if Dr Milton thought that late receipt of the bundle was seriously prejudicial, an adjournment was not asked for.
35. Next, at paragraph 10 of Dr Milton's statement this appears:

"With some semblance of order at last I tried to revert to some cheque analysis pads relating to a 500 deposit - the chairman, in a singularly unpleasant manner snarled 'its unhelpful when you mention things you spoke of this morning; all our evidence had been touched on that morning and so I could not now present it; as I tried to explain this to the Chairman he again snarled 'this is no good, I want specifics' - the specifics were in our bundle of evidence and the chairman's own conduct and words prevented us adducing same."

There is no record of this alleged incident in the Clerk's notes of the hearing or in the notes of the Revenue's witnesses. The Revenue witnesses do not recall any such incident. The Chairman in his witness statement states that he did not prevent Dr Milton from presenting any evidence on behalf of his client and adds: "I did point out that the issue of the £500 had been referred to by Dr Milton in his opening address and that by doing so again Dr Milton was simply repeating a point that did not, in the opinion of the Commissioners, need to be addressed again".

36. On this evidence it does appear that some question arose at the hearing concerning a £500 deposit into the claimant's bank account and that Dr Milton felt aggrieved that he had not been able to present his case as he wished. However, first, the explanation given by the Chairman appears to me reasonable: the tribunal was seized of the point in issue and it did not need repetition. Secondly, the Chairman's handling of this evidential questioning, even if misguided, which I am not prepared to accept, could not begin to establish a case of bias. Thirdly, even if there had been some procedural irregularity regarding the exclusion of evidence, the claimant's correct course was to challenge the relevant decision on appeal on the grounds that the General Commissioners had wrongly excluded evidence that materially assisted the claimant's case.
37. The next point is put in the following way at paragraph 15 of Dr Milton's statement, where he says:

"When I began to cross examine Mr Tostevin the chairman quickly snarled 'where is this going?' to which I replied 'clearly somewhere you don't want' to which he replied 'I don't want you making general statements' - I had been trying to establish that Mr Tostevin had not fully examined Mr Bottomley's books and that his estimates were thus flawed, the chairman had made several sarcastic comments as I began my cross-examination but now he had managed to completely wreck it, as he had done with the presentation of our case."

38. As to this, Mr Healey recalled in his witness statement that Dr Milton's first question to Mr Tostevin, the Revenue's witness at the hearing, was whether he regarded the accountancy firm of MWC as a pre-eminent agent. Mr Tostevin's reply was that he could not comment on such a question, and it was at this point that the Chairman requested that Dr Milton did not ask such general questions. Mr Smith, one of the two wing members of the General Commissioners, also recalled that at times Dr Milton's cross-examination of Mr Tostevin appeared to take on a general criticism of the Inland Revenue and their policy as a whole rather than a cross-examination of the witness, adding that the Chairman did ask Dr Milton to ask Mr Tostevin specific questions.
39. This thrust of Dr Milton's case is in fact vividly corroborated by the Clerk's notes of his opening address, which began with a strong attack on the Revenue's motives for seeking to extract more tax from self-employed tax payers like the claimant who were known to the Revenue and who kept trading records that could be examined in detail.
40. On this matter I accept the unchallenged evidence of Mr Healey and Mr Smith and conclude that the Chairman, in his control of Dr Milton's cross-examination of Mr Tostevin, was doing no more than ensuring that witnesses were asked questions that (a) were relevant to the issues that the General Commissioners had to decide, and (b) were of a nature that the witnesses could reasonably be expected to answer.
41. There was then a more general complaint that the Chairman had treated Dr Milton with sarcasm and antipathy throughout the hearing. None of the witnesses for the General Commissioners or the Revenue accepted that this was the case. In particular, Mr Smith, one of the General Commissioners, stated emphatically: "There was no antipathy towards Dr Milton or Mr Bottomley during the two days of the meeting. The Chairman conducted the meeting with the utmost professionalism and integrity and was only concerned with hearing evidence relating to the appeal".
42. The general allegation about sarcastic treatment and antipathy is a serious one and again appears to me to be inherently improbable. Given the witness statements on behalf of the defendant and on behalf of the interested party, which were not challenged in cross-examination, I cannot be satisfied that such a general, serious and improbable allegation has been proven.
43. The penultimate point, not specifically raised in the grounds but relied upon at the hearing, was that the comprehensive dismissal of the appeal by the General Commissioners did not reflect a concession that it is alleged was made by the Revenue in respect of an adjustment to the assessment in respect of private use of the business premises.
44. It appears that the exact amount of the adjustment turned upon the date on which the claimant moved into the premises, and Ms Aldridge in her witness statement accepts that at the hearing she said that if the Revenue had used an incorrect date the amount might need amendment. Put at its highest, the General Commissioners may have overlooked this matter when they dismissed the appeal comprehensively. Such a slip could not begin to support a case of bias. The correct procedure would have been in the first instance to raise the matter with the Revenue, who would no doubt have accepted the point if the Revenue believed that it had validity, or if the Revenue would not agree to pursue an appeal by way of case stated against the General Commissioners' decision on the ground that the comprehensive dismissal of the appeal did not reflect an admission that the Revenue had made during the hearing of the case.
45. The final point is set out at paragraph 7 of Dr Milton's witness statement as follows:

"Ms Caswell does not point out that ... the chairman said 'I want HMRC to respond to points being made so they can intervene during the examination', these comments were made just after Mr Bottomley gave evidence on oath, which caused Mr Bottomley's evidence in chief to degenerate into a 5 way squabble with all the dignity of a rugby scrum."

46. It does appear from the evidence that those attending the hearing on behalf of the Revenue, that is the advocate, Ms Aldridge and the Revenue officials, Mr Healey and Mr Tostevin, were given permission to intervene during the examination-in-chief of Mr Bottomley, who of course was the appellant tax payer before the General Commissioners and is the present claimant in these proceedings.
47. Mr Smith, in his witness statement, says this:

"It was agreed that at times the HMRC could query points raised in Mr Bottomley's witness statement. There were some interjections during the witness statement but the Chairman stopped this fairly quickly as it was preventing Mr Bottomley giving evidence."

Mr Healey in his statement said as follows:

"My recollection of events is that Mr Bottomley gave his evidence mainly without interruption and the only times the statement was interrupted was when clarification of a specific point was requested by one of the Commissioners. At such a time HMRC, with the Commissioners' leave, assisted in clarifying the point to the Commissioners. I would not describe this action as 'each of HMRC's representatives would leap in' ... I do not recall Dr Milton raising any objection to the way in which his client was allowed to give evidence during the hearing."

48. The claimant had not provided a witness statement before the hearing and no witness statement was made available to the General Commissioners and to the Revenue on the day of the hearing. Neither the General Commissioners nor the Revenue knew for certain in advance what the claimant would say in his evidence-in-chief, although the general thrust of the claimant's position was no doubt known to the Revenue through earlier correspondence and meetings. I find it understandable in these circumstances that the General Commissioners might wish to allow the Revenue's representatives at the hearing to intervene for the purpose of explaining the Revenue's position on particular matters raised by the claimant in his evidence so long as the Commissioners retained a tight control over the procedure to ensure that the appellant's evidence-in-chief did not descend into a tripartite dialogue between him, the Revenue and the tribunal.
49. On the evidence it appears that Dr Milton did not at the time object to this procedure, and in cross-examination the claimant frankly accepted that at the time he had agreed to it. The procedure might have held some advantages for the claimant insofar as it could allow the General Commissioners to ascertain the common ground upon which there was agreement, to identify the relevant issues in dispute and to understand the respective cases on those issues.
50. In these circumstances, I am satisfied that the General Commissioners proposed the relevant procedure, and the parties assented to it, with a view to facilitating the efficient and expeditious conduct of the appeal. I am also satisfied that, given the context and the purposes for which the procedure was adopted, no fair-minded and informed observer would have concluded that there was a real possibility, or a real danger, that the tribunal was biased in favour of the Revenue.
51. The claimant rests his claim solely on bias. He does not claim that the procedure adopted in the present context was, in itself, such as to deprive him of a fair hearing. I should perhaps make clear that, even if the claim had been formulated in that way, I would nonetheless have rejected it for the following reasons.
52. I see force in the argument that, as a general rule, the tax payer appellant before the General Commissioners should be permitted to give his evidence freely without interruption or interjection, save insofar as is strictly necessary, by the Revenue's advocate or by Revenue officials attending the hearing. It is likely to be unsettling for a witness if he or she is interrupted in this way. The witness may also feel in certain circumstances that he is being cross-examined twice, once when he is seeking to give his evidence and a second time when actual cross-examination takes place, and the procedure is at risk of turning a judicialised hearing into a disputatious talking shop, both prolonging its duration and obfuscating, rather than clarifying, the matters that must be decided. It certainly is not a course that I would wish to endorse as a good practice.
53. However, I remind myself, firstly, that the General Commissioners have, under paragraph 15 of the regulations cited earlier, a very broad power to regulate their own procedure. It was within the power of the Commissioners to adopt the relevant procedure, so long as they retained a control over its exercise and ensured that the appellant tax payer was fairly treated. In this case there was an understandable rationale for the General Commissioners to invite the Revenue to intervene. There were possible advantages to the appellant in the procedure adopted. He agreed to it at the time, and his representative, an experienced advocate before the tribunal, did not object on his behalf. Furthermore, as is made clear by Mr Smith in his evidence referred to earlier, the examination-in-chief reverted to the normal pattern once it became apparent that interjections were impeding the witness from giving his evidence in a fair and effective manner.
54. Taking into account these matters in particular and the evidence generally about the hearing, I am satisfied that the claimant was able to put his case fairly to the General Commissioners and that the General Commissioners were able fairly to decide his appeal. I also note that a case along the lines that I have explored, based on a putative procedural irregularity resulting in unfairness, could have been raised on an appeal by way of case stated, and I see no good reason why, if such a case limited to this specific issue had been mounted rather than the case based on bias, the statutory appellate route, rather than judicial review, would not have been the appropriate one for remedying any injustice to the claimant.
55. Having considered each of the points in turn, none of them, in my judgment, taken either alone or collectively, establish a case of bias. For those reasons, I dismiss this judicial review.
56. MR SACHOLEVA: I have an application for costs on behalf of the defendant.
57. THE DEPUTY JUDGE: Yes.
58. MR SACHOLEVA: Might I hand up an attendance note -- unless you have already had it -- of my solicitor's conversation with Dr Milton yesterday.
59. THE DEPUTY JUDGE: No, I do not believe I have that.
60. MR SACHOLEVA: He was threatening to send in some costs submissions to the court yesterday, I do not know if any such submissions have made it. He is alleging that he has not had notice from the court of the hand down today, but my solicitor rang him yesterday to tell him. He says both of Mr Bottomley and he would have wanted to attend, however Dr Milton was fully booked with clients today and Mr Bottomley is business running his pub, although I am not sure what the pub would be doing at 10 in the morning. They do wish to make representations about costs. That is the e-mail from Dr Milton. There is also an attendance note of a conversation following up the e-mail sent by my solicitor, in similar terms, would not be attending the hearing as he has to draft documents for five different cases, obviously he has a fair amount of litigation on the go, but none of them are court hearings. I specifically asked my solicitor to find out whether today's commitments were court hearings or not, and they are not.
61. THE DEPUTY JUDGE: Yes.
62. MR SACHOLEVA: He said Mr Bottomley could not attend the hearing either.
63. On the basis that the claimant has had notice of this hand down, although I do not know if the court's communication has got through, what I would ask for is an order for costs but which could be set aside within seven days if submissions are received by Dr Milton and those are found to be persuasive by the court. The reason I ask for costs is -- obviously it is an unusual type of case in the first place, but it has become, as your Lordship will have seen, rather adversarial, it is not the typical situation of a tribunal's decision being impugned and the tribunal playing no part and there being no costs liability either way. It has been fought in an extremely aggressive manner. I do not want to trouble the court with the amount of correspondence and the tenor of it, but it has been an unusual case, and we say it was actually hopeless from the beginning. Collins J thought because there was a factual issue that was somehow a reason to grant permission, and, although obviously permission was granted, there was no remotely compelling factual evidence that the version of events given by the claimant was in fact the correct version. There was a contemporaneous note from the clerk and no whisper of any contemporaneous note from the claimant. So in those circumstances I ask, first of all, for an order for our costs in principle, and I do have a schedule but --
64. THE DEPUTY JUDGE: Yes, I have seen the schedule.
65. MR SACHOLEVA: Mr Bottomley may wish to make representations as to the quantum of that, and I fully understand that, although frankly he should have turned up today, it is a discourtesy to the court at the very least, I would have thought, to not attend. He has had this schedule as well, I think yesterday morning, so 24 hours ago, hence representations, and you will see the e-mail that Dr Milton was saying that that he would be sending representations on costs to the court, so he has had his chance.
66. THE DEPUTY JUDGE: What I would propose, rather than make an order, would be to indicate -- which you can record obviously -- that I have rejected each and every one of the points put forward in the claim and that on the material presently before me I am not able to see any basis upon which an order for costs against the claimant could be resisted, and having had a chance to look at the schedule of costs and taking account of the nature of the claim, that amount would not at the moment appear to me to be unreasonable. However, I have not had the opportunity to hear from the claimant and therefore I would allow the claimant a time of 14 days to make written submissions both on the question as to whether he should pay the costs and, secondly, as to the quantum of the costs. You probably want to have then a period to respond to that?
67. MR SACHOLEVA: Perhaps another 14 days.
68. THE DEPUTY JUDGE: Another 14 days for you to respond to that. I will make that order, that if there is to be any submissions by the claimant on costs they should be received within 14 days, with you an opportunity to reply within 14, and then I will determine that on the papers without the need for any further hearing in this matter. You are at liberty to report my provisional indication on both principle of costs and the quantum.
69. MR SACHOLEVA: My Lord, I am grateful.
70. There is one other matter, and that is for a declaration that the claim was wholly without merit. Obviously permission has been granted, but there is jurisdiction certainly, I would submit, to make such a declaration because, having heard the case, you are in a far better position than Collins J, having seen perhaps a quarter of the papers that are before the court, to say that actually this case was wholly without merit and I seek that declaration from the court. The court may or may not feel it is able to give such a declaration, my main difficulty being that there is an order by the lead judge of the Administrative Court that it is an arguable claim. There is one other thing, and that is Judge Pelling obviously thought it appropriate to permit both parties to cross-examine the other side's witnesses. As I say, notwithstanding all of the above, it was wholly without merit.
71. THE DEPUTY JUDGE: I see force in your argument. The one matter that would, I think, hold me back from going that far, and the only matter, would be that relating to the interjection procedure. It would seem to me that it would just be about arguable as a foundation for bias and it could have been pleaded alternatively as a procedural irregularity, although I would have also gone on to hold then that the wrong procedure was used, but I think it is that aspect, and that aspect alone, that would inhibit me from making the declaration that you require. Had it not been for that aspect, then I believe that I would have been prepared to do so in relation to the other points.
72. MR SACHOLEVA: My Lord, thank you very much indeed.