Cooke, R (on the application of) v Revenue and Customs

Where a notice under section 20(3) of the Taxes Management Act 1970 is given by the Board to a barrister, advocate or solicitor under section 20B(3), the statutory safeguards expressed to apply to notices given by an inspector do not apply unless the legislation says so. Section 20B(3) is a referential drafting provision, not a deeming provision. The Board’s notice need only satisfy the requirements applicable to the Board under the substituted wording.

Article 8 does not require prior judicial authorisation or the importation of the inspector safeguards. High-level administrative decision-making, together with an effective opportunity for judicial review, can provide adequate protection. Judicial review must nevertheless permit appropriate examination of the Commissioners’ reasons, and the breadth of any delegation remains open to challenge.

The claimant, a solicitor, sought judicial review of a notice requiring him to produce documents concerning a taxpayer for whom he had acted. The notice was issued by an authorised senior official for the Commissioners under sections 20(3) and 20B(3) of the Taxes Management Act 1970.

The claimant argued that the notice was invalid because the Commissioners had not complied with the precursor-notice, commissioner-consent, taxpayer-copy and written-reasons requirements applicable when an inspector issues a notice. The central issue was whether those safeguards also applied when the notice was given by the Board to a solicitor.

1. The application was dismissed with costs. The notice was not invalid merely because the inspector-specific safeguards had not been complied with.
2. Section 20B(3) performs three functions: it prevents an inspector from giving a notice to a barrister, advocate or solicitor; provides that any such notice may be given only by the Board; and substitutes references to the Board for references to the inspector in the specified provisions of section 20(3).
3. The substitution expressly applies to section 20(3), but not to sections 20(7), 20(8E), 20B(1) or 20B(1A). Those provisions remain framed in terms of an inspector and therefore do not apply to a notice given by the Board. Section 20B(3) is not a deeming provision and does not create a statutory fiction under which the Board is treated as an inspector.
4. The statutory scheme uses safeguards graduated according to the intrusiveness of the power. A notice under section 20(3) is less intrusive than entry and search under section 20C, and a recipient of a notice can seek judicial review before complying. Prior judicial sanction is therefore not required.
5. Article 8 is engaged, but the statutory scheme is accessible, foreseeable and sufficiently protective against arbitrary interference. The combination of senior administrative decision-making and effective judicial review satisfies the Convention requirements. Article 8 does not require the inspector safeguards to be imported into section 20B(3).
6. The court accepted the observations in R v Inland Revenue Commissioners ex p Davis Frankel & Mead (a firm) concerning delegation, but left open how widely the Commissioners may lawfully delegate the section 20B(3) power. A delegation to every inspector might be unlawful if it enabled inspectors to evade the statutory requirements or amounted to an abuse or collateral use of the power.
7. Judicial review must be an effective remedy. Because no General or Special Commissioner has scrutinised a Board notice, the presumption of regularity is weaker and the Commissioners may bear a heavier evidential burden. They may be required to explain their reasons and must observe the high standards of candour and disclosure applicable in judicial review.