Her Majesty's Revenue and Customs v Carrington

An appellate court with statutory jurisdiction may permit a new point of law to be raised, including on a second appeal. It should not do so where this would be unfair to the other party, require further fact-finding, or otherwise place the court in an untenable position.

The court should consider prejudice, the adequacy of the factual findings, the point’s potential decisiveness and continuing importance, and whether the opposing case can be properly presented. Appropriate undertakings and the appointment of an advocate to the court may remove procedural unfairness and enable an important point to be determined according to law.

HMRC decided that Wendy Carrington had been overpaid child benefit after her family moved permanently from the United Kingdom to Spain. The First-tier Tribunal dismissed her appeal. On her further appeal, the Upper Tribunal held that article 7 of Regulation (EC) 883/2004 applied and that the provisions relied on by HMRC did not displace it: [2019] UKUT 289 (AAC).

HMRC brought a second appeal. It sought permission to advance points of law concerning articles 7 and 10 which had not been argued below. The immediate issue was whether the Court of Appeal should allow those new points to be raised and adjourn the substantive appeal.

Unanimously, the Court granted HMRC permission to raise the new points in grounds 1 and 3 and adjourned the substantive appeal. It did not determine whether child benefit was exportable or finally construe articles 7 or 10 of Regulation (EC) 883/2004.

1. Under section 14 of the Tribunals, Courts and Enforcement Act 2007, the Court had jurisdiction to entertain a point of law not raised in the tribunals below. Following Miskovic v Secretary of State for Work and Pensions [2011] EWCA Civ 16, the discretion should not be exercised if it would be unfair to the other party or put the court in an untenable position. The Court will be extremely reluctant to permit a point requiring further factual findings.

2. The relevant factual finding was that Mrs Carrington had permanently moved to Spain. If HMRC’s legal analysis was correct, no further facts were required. The new issues could be decisive and were important points of principle with potential consequences beyond this appeal.

3. Allowing the points caused no unfairness to Mrs Carrington. HMRC undertook not to seek costs or repayment of benefits and to continue payments regardless of the appeal’s outcome. Although she was unrepresented, the Court could secure effective opposing argument by appointing an advocate to the court.

4. The Court also considered that the questions retained practical significance after the end of the EU transition arrangements. It was sufficient for this procedural decision that the citizen-rights provisions of the Withdrawal Agreement appeared to preserve the application of the 2004 Regulation in relevant circumstances.

5. The appeal was therefore adjourned for an advocate to the court to be appointed and for further directions to ensure an effective hearing.

• Court of Appeal (Civil Division): Granted HMRC permission to raise new points of law in its second appeal and adjourned the substantive appeal: [2021] EWCA Civ 174.
• Upper Tribunal (Administrative Appeals Chamber): Held that article 7 of Regulation (EC) 883/2004 applied and that articles 68 and 59 did not displace it: [2019] UKUT 289 (AAC).
• First-tier Tribunal (Social Entitlement Chamber): Dismissed Mrs Carrington’s appeal against HMRC’s overpayment decision.