Frankice (GG) Ltd. v Customs & Excise

An appellate court reviewing refusal to extend time must decide whether the lower court arguably erred in exercising its discretion; it does not rehear the proposed appeal as a matter of course. The merits may be assessed where the arguments for and against an extension are otherwise evenly balanced. Fresh evidence should not be admitted if it could have been produced below with reasonable diligence. A tribunal officer’s administrative communication, based on a mistaken factual assumption, is not thereby a tribunal decision and cannot be treated as irrevocable without a legal basis.

The Commissioners assessed the applicant for gaming machine licence duty. The applicant appealed to the VAT and Duties Tribunal, where an unless order required Customs to serve specified documents. A tribunal letter stated that the appeal stood allowed when the documents appeared not to have been received. Customs later established that the documents had been faxed in time, and the Tribunal restored the appeal after finding compliance.

The applicant challenged that restoration. Mr Wallace dismissed the challenge. Lindsay J refused an extension of time for an appeal to the High Court. The applicant then sought permission to appeal, permission to adduce further evidence, and an extension-related challenge based on alleged perversity, non-compliance with the unless order, and reliance on the Tribunal’s letter. The central issues were whether the lower court had arguably erred and whether any compelling reason justified allowing the appeal to proceed.

1. Fresh evidence. The application to adduce further evidence was refused. The evidence could have been produced before Lindsay J with reasonable diligence. The first requirement identified in Ladd v Marshall [1954] 1 WLR 1489 was therefore not satisfied. The court should not admit such evidence when reviewing whether the court below erred in law.
2. Scope of review. The court was not deciding the merits afresh. It had to consider whether Lindsay J arguably reached an erroneous conclusion in exercising his discretion to refuse an extension of time.
3. Merits and delay. Under Sayers v Clarke Walker [2002] 1 WLR 3095, the merits of a proposed appeal may be evaluated where the arguments for and against extending time are otherwise evenly balanced. Lindsay J was entitled to conclude that the balance was not even. The applicant had offered no adequate explanation for a delay of about 14 weeks, apart from the period attributable to the late delivery of the Tribunal’s full reasons.
4. Alleged perversity. Perversity requires a showing that no reasonable tribunal in the relevant position could have reached the decision made. Mr Wallace had evidence supporting his finding that the documents were faxed and received in time. The weight of that evidence was for the Tribunal of fact. There was no arguable perversity.
5. New argument. The argument concerning the list of documents had not been raised before Lindsay J and could not be raised for the first time in this court. In any event, Mr Wallace’s finding on compliance was not seriously challengeable.
6. Tribunal letter. The letter from the Proper Officer was not a decision of the Tribunal. It communicated the apparent consequence of expiry of the unless order on an incorrect factual basis. Once receipt of the documents was disputed, the factual issue was properly determined by the Tribunal through a Chairman. There was no legal basis for treating the letter as irrevocable, and Customs did not need to appeal it.
7. Disposition. None of the proposed grounds had a real prospect of success, and no other compelling reason justified allowing the appeal to proceed. The application for permission to appeal was refused. Sir Martin Nourse agreed.

• Court of Appeal (Civil Division): On 22 March 2005, the application for permission to appeal was refused.
• High Court of Justice, Chancery Division: Lindsay J refused an extension of time for appealing the VAT and Duties Tribunal’s decision.
• VAT and Duties Tribunal: Mr Theodore Wallace, sitting alone, found that Customs had complied with the unless order and directed that the appeal should proceed.