The Secretary of State for Business, Energy and Industrial Strategy v Zafar Ali Khan

When deciding whether to adjourn a disqualification trial, the court must exercise its case-management powers in accordance with the overriding objective. The assessment includes the parties’ ability to participate fully and give their best evidence, fairness, expense, efficient use of court resources and the public interest in prompt disqualification proceedings. Where tax liabilities underpin the alleged unfitness, the specialist tax tribunal’s primary jurisdiction may justify sequencing the disqualification claim after the tax proceedings. A public authority aware of a party’s disability must undertake an open-minded and conscientious assessment of the impact of proceeding and consider reasonable adjustments. Expedition does not require expedition at all costs where fairness and effective participation would be compromised.

The Secretary of State brought disqualification proceedings against the defendant, the sole director of Anderson Security and Trading Limited, alleging fraudulent VAT claims and deliberate under-declaration of PAYE and national insurance. The allegations substantially overlapped with personal liability notices being challenged by the defendant in tax tribunal proceedings.

The trial had been repeatedly relisted while those proceedings continued. The defendant applied to vacate the trial listed for February 2023, relying on the outstanding tax issues, the successful appeal against the national insurance notice and a severe deterioration in his mental health, including a history of suicidal ideation. The central issues were whether the trial should proceed despite those matters and how the court should exercise its case-management discretion.

1. Application granted. The trial was vacated and the claim was directed to be listed for an attended directions hearing on the first available date after June 2023, with permission for updating witness statements.
2. Under CPR 3.1(2)(b), the court had power to adjourn the hearing. That discretion had to be exercised afresh in accordance with the overriding objective in CPR 1.1. Relevant considerations included equal footing, full participation, the ability of parties and witnesses to give their best evidence, saving expense, appropriate allocation of court resources and fair expedition.
3. The defendant had a disability within section 6(1) of the Equality Act 2010 and was experiencing a severe mental-health crisis. On the evidence, he was not fit to participate fully or give his best evidence, and permitting the trial to proceed would be irresponsible pending further psychiatric assessment.
4. The Secretary of State had known of the disability since at least 2020. The public sector equality duty in section 149 of the Equality Act 2010 required an open-minded and conscientious enquiry into the impact of proceeding. The duties concerning reasonable adjustments and the parties’ duty to assist the court also imposed responsibilities on the claimant, not solely on the defendant.
5. Parliament had intended the First-tier Tribunal to have primary jurisdiction over tax matters. Since the tax liabilities were at the heart of the alleged unfitness, determining them first was likely to shorten or even dispose of the disqualification proceedings, avoid duplicated evidence and reduce the risk of inconsistent outcomes. The successful national insurance appeal was particularly relevant to the PAYE and national insurance ground.
6. The public interest in prompt disqualification proceedings and the need to use allocated court time efficiently were relevant, but expedition was required to be both expeditious and fair. The circumstances justified postponement, and the practical risk to the public from delay was limited because the defendant was not involved in managing any active company and offered an undertaking if required.

Not stated in the judgment.