Shiner & Anor, R (on the application of) v HM Revenue & Customs

Where overlapping European and human-rights challenges concern retrospective legislation, the Court of Appeal may, in appropriate case-management circumstances, permit judicial review rather than proceed by an appeal against an earlier procedural decision. This is particularly appropriate where a statutory tribunal can determine one issue but lacks jurisdiction over the other. The court may extend time for a direct challenge to the legislation and list the review with related proceedings. Such an order is confined to the unusual circumstances making it appropriate and does not determine the substantive compatibility of the legislation.

The applicants established tax arrangements and later challenged HMRC’s letters stating that retrospective legislation made them chargeable to tax. They sought judicial review, including declarations concerning Article 56 of the EC Treaty and Article 1 of the First Protocol to the ECHR, and an order quashing HMRC’s decision.

Stanley Burnton LJ held that the claim was in substance a late challenge to section 58 of the Finance Act 2008, and that the statutory tax appeal route was appropriate for the EC issue. The ECHR claim was stayed pending related proceedings in Huitson, reported at [2010] EWHC 97. The central issue before the Court of Appeal was whether the EC point should proceed by judicial review alongside the ECHR point and the Huitson appeal.

The court’s decision was unanimous. Waller LJ gave the judgment, with which Rix LJ and Wilson LJ agreed. The court made a case-management order and did not determine the substantive merits of either compatibility challenge.

1. The court recognised an important jurisdictional distinction. The Tax Tribunal could consider the EC point through the statutory appeals procedure, but it had no jurisdiction to determine the ECHR point. That distinction supported hearing both issues together by judicial review, particularly because the underlying issue in each was the retrospective effect of the legislation.
2. In the peculiar circumstances, the appropriate course was not to grant permission to appeal the earlier procedural decision. Instead, under CPR 52.15(3), the court granted permission to apply for judicial review and directed that any necessary extension of time be granted, so that the proceedings could amount to a direct challenge to section 58 of the Finance Act 2008.
3. The review was to be retained in the Court of Appeal and listed with the appeal in Huitson, reported at [2010] EWHC 97. The hearing was to be confined to the EC and ECHR points insofar as they affected section 58. The court emphasised that this was a case-management decision based on the unusual circumstances and did not consider it fruitful to examine the earlier judgment’s reasoning.
4. The parties’ correspondence did not amount to an enforceable compromise as to the form of order. It remained for the court to determine the appropriate order, including whether the proceedings should be listed with Huitson. A short case-management hearing was therefore considered appropriate.

1. Court of Appeal (Civil Division): Permission to appeal was not granted. Permission to apply for judicial review was granted under CPR 52.15(3), with any necessary extension of time, and the review was retained for hearing with the Huitson appeal.
2. High Court of Justice, Queen’s Bench Division, Administrative Court: Stanley Burnton LJ dismissed the EC judicial review claim as out of time, held that HMRC’s letter merely conveyed the effect of section 58 of the Finance Act 2008, and considered the statutory tax appeal route preferable for the EC issue.