Revenue and Customs v Jones & Anor

Where an owner does not pursue the statutory procedure for challenging the legality of a customs seizure, the goods are deemed duly condemned as forfeited under paragraph 5 of Schedule 3 to the Customs and Excise Management Act 1979. A tribunal hearing a restoration appeal must accept that deemed state of affairs. It cannot find that the goods were lawfully imported for personal use.

This division of jurisdiction is compatible with Article 6 and Article 1 of the First Protocol. The owner had access to a court to contest the seizure and may challenge a refusal to restore before the tribunal on judicial review principles. The statutory deeming provision therefore admits no judge-made exception based on abuse of process.

HMRC seized excise goods and the respondents’ vehicle, believing that the goods had been imported commercially. The respondents gave notice challenging the seizure but withdrew it on legal advice. HMRC refused restoration.

The First-tier Tribunal allowed the respondents’ appeal and found that the goods had been imported for personal use. It directed HMRC to conduct a new review: [2009] UKFTT 133 (TC). The Upper Tribunal dismissed HMRC’s appeal: [2010] UKUT 116 (TCC).

The issue was whether the First-tier Tribunal could contradict the deemed condemnation arising under paragraph 5 of Schedule 3 to the Customs and Excise Management Act 1979 by determining that the importation was lawful.

Appeal allowed unanimously. Mummery LJ gave the judgment, with which Moore-Bick and Jackson LJJ agreed.

1. The statutory scheme assigns condemnation to the ordinary courts. An owner claiming that seized goods were not liable to forfeiture may give notice requiring HMRC to bring condemnation proceedings. The First-tier and Upper Tribunals have no original jurisdiction to condemn goods or determine the legality of their seizure.

2. The respondents initially invoked that procedure but then withdrew their notice. Paragraph 5 of Schedule 3 to the Customs and Excise Management Act 1979 consequently required the goods to be treated as duly condemned and forfeited. Statutory deeming creates a binding legal state of affairs and carries with it the facts inherent in the deemed conclusion.

3. The First-tier Tribunal therefore had to proceed on the basis that the goods had been illegally imported for commercial use. Its restoration jurisdiction was confined to reviewing HMRC’s discretionary refusal to restore the goods and vehicle. It could consider whether that decision was one which HMRC could reasonably have reached, including questions of reasonableness and proportionality, but could not find that the goods had been lawfully imported for personal use.

4. This allocation of jurisdiction was compatible with Article 6 and Article 1 of the First Protocol. The respondents had a Convention-compliant opportunity to contest the seizure in court but chose, on legal advice, not to pursue it. Their Convention rights did not require the same issue to be reopened in the restoration appeal.

5. The domestic-law analysis in Gora v CCE [2003] EWCA Civ 525 was approved. The tentative obiter observations in Gascoyne v CCE [2004] EWCA Civ 1162, suggesting a Convention-based power to reopen deemed condemnation subject to abuse-of-process considerations, were rejected. Resort to abuse of process was unnecessary because the statute itself conclusively fixed the state of affairs which the tribunal had no power to contradict.

The First-tier Tribunal had erred in law, and the Upper Tribunal should have allowed HMRC’s appeal.

1. Court of Appeal (Civil Division): Allowed HMRC’s appeal unanimously. It held that the First-tier Tribunal lacked power to reopen the legality of the importation: [2011] EWCA Civ 824.
2. Upper Tribunal (Tax and Chancery Chamber): Dismissed HMRC’s appeal, holding that the First-tier Tribunal had applied the abuse-of-process approach correctly: [2010] UKUT 116 (TCC).
3. First-tier Tribunal: Allowed the restoration appeal and directed HMRC to conduct a new review taking account of its finding that the goods were imported for personal use: [2009] UKFTT 133 (TC).