Portland Gas Storage Ltd v HM Revenue & Customs

An appellate court should generally decline to determine an appeal once the underlying dispute has ceased to exist, even where the issue has wider ramifications. Such questions are ordinarily best resolved through proper adversarial argument between parties with a real interest in the outcome. A limited exception may arise where another suitable appeal would be extremely difficult to bring. The mere general importance of the issue, or the availability of an amicus, is insufficient where a suitable future case is likely and adversarial argument is absent.

Portland entered into a land transaction, paid Stamp Duty Land Tax and later sought repayment after the transaction was varied. HMRC rejected Portland’s attempt to amend its return as out of time under the Finance Act 2003. The First-tier Tribunal struck out Portland’s appeal for want of jurisdiction. The Upper Tribunal held that HMRC had issued a closure notice within paragraph 35 of Schedule 10 and set aside the strike-out.

Permission was granted for a second appeal. Portland then withdrew its repayment claim, leaving no live issue concerning the time limit or the First-tier Tribunal’s jurisdiction. HMRC sought to continue the appeal because of the wider significance of the jurisdiction question.

The Court of Appeal unanimously refused HMRC’s application and declined to continue hearing the appeal. Portland’s withdrawal of its claim meant that there was no longer any live dispute about its entitlement to amend the land transaction return. The court therefore did not determine the underlying statutory issue, including whether the relevant HMRC decision fell within paragraph 35(b) of Schedule 10 to the Finance Act 2003.

1. In Don Pasquale v Customs & Excise Commissioners [1990] 1 WLR 1108, the court had recognised that an appeal concerning private rights should not ordinarily be heard merely because the decision might have widespread ramifications. The present court applied that principle. Issues of this kind are generally better decided through adversarial argument where both parties have real opposing commercial interests.
2. The earlier case was exceptional because technical circumstances made it extremely difficult for another appeal to reach the court. The present case was the opposite. If the jurisdiction point had the general significance asserted by HMRC, a suitable future appeal was likely to arise. Portland’s withdrawal was an unusual event unlikely to recur in the same way.
3. The court considered appointing an amicus to argue the opposing case. That course was possible, but it was an unsatisfactory substitute for proper inter partes argument where the result mattered to both sides. HMRC’s willingness to meet the cost did not justify continuing the appeal.

HMRC remained entitled to raise the jurisdiction question in a suitable future case. The application was refused.

1. Court of Appeal (Civil Division): After Portland withdrew its repayment claim, the court refused HMRC’s application to continue the academic appeal.
2. Upper Tribunal (Tax and Chancery Chamber): Set aside the First-tier Tribunal’s strike-out and remade the decision so that Portland’s appeal could proceed to consideration of whether its amendment was out of time.
3. First-tier Tribunal: Struck out Portland’s appeal on the ground that it had no jurisdiction to determine the matter.