Jazztel Plc v HM Revenue and Customs

In taxation proceedings, an application for an interim remedy is judged by its substance, not its description. A provisional order requiring HMRC to pay money remains an interim remedy where claims have not been tried and unresolved points of law, including issues under appeal, affect entitlement. Finance Act 2013, section 234, therefore restricts the order even in group litigation. The exception for exceptional circumstances requiring relief in the interests of justice sets an unusual threshold. Group Litigation Order membership and delay in recovery, without claimant-specific exceptional circumstances, do not satisfy it.

Jazztel was the test claimant in stamp duty group litigation. After the Chancery Division’s substantive judgment, other claimants sought payment on equivalent terms while limitation issues remained subject to appeal. Roth J refused the application, holding that the proposed order was an interim remedy within section 234 of the Finance Act 2013 and that the statutory exception was not established: [2018] EWHC 1830 (Ch). The appeal concerned whether the order was interim and, if so, whether the affected claimants’ circumstances were exceptional and required payment in the interests of justice.

Appeal dismissed unanimously.

1. Characterisation of the remedy. Section 234 of the Finance Act 2013 applies to an application for an interim remedy, however described, where it is founded wholly or partly on a point of law not finally determined. The court must examine the substance of the relief. An order described as a contingent final order was provisional because the affected claimants had not proceeded to trial and factual and legal issues remained unresolved.
2. Unresolved appeals and summary judgment. The limitation issues remained live because permission to appeal had been granted. Section 234(9) treated appellate proceedings as part of the original proceedings. The reasoning in Six Continents Ltd v Revenue Commissioners [2015] EWHC 2844 (Ch) supported the conclusion that summary judgment was inappropriate where substantive issues depended on legal questions under appeal or sufficiently similar questions likely to be influenced by the appeal outcome. Although interim payments had been ordered in that case, section 234 plainly precluded such payment here.
3. Exceptional circumstances. The reference to exceptional circumstances in section 234(3)(b) was not a self-contained test, but indicated that interim relief would be justified only in an unusual case where the claimant’s circumstances were exceptional and relief was necessary in the interests of justice. No evidence addressed the circumstances of any particular affected claimant. GLO membership and delay in recovering the duty were insufficient. Interest was the normal compensation for loss of use of money.
4. The proposed relief would also require the GLO stay to be lifted. There was no application to lift it, and objections arose to doing so merely to facilitate relief which section 234 was designed to restrict.

1. Court of Appeal (Civil Division) — In [2019] EWCA Civ 1301, dismissed the appeal.
2. Chancery Division — Roth J, in [2018] EWHC 1830 (Ch), held that the proposed payment order was an interim remedy restricted by section 234 of the Finance Act 2013, and that the statutory exception was not satisfied.
3. Chancery Division — The earlier substantive GLO judgment, [2017] EWHC 677 (Ch), determined issues concerning limitation and restitution for the test claimant. The affected claimants sought equivalent payment while appeals on limitation remained pending.