Planning analysis: Once a planning inquiry closes, there may be several months before the decision is determined by the Secretary of State. New matters not raised at the inquiry but material to the appeal may arise or be discovered within such time. The Court of Appeal confirmed that in those circumstances a decision may be irrational, and therefore unlawful, should the decision maker fail to consider any such matter which is ‘so obviously material’. In other words, the matter is one that no reasonable decision maker would have failed to take into account in the circumstances. The irrationality may arise even when the consideration was not drawn to the attention of the decision maker. Written by Brendon Lee, partner at HCR Hewitsons.

Planning analysis: In Charlesworth v Crossrail Ltd, the Court of Appeal determined that Berkeley Fifty-Five Ltd (B55) had a Qualifying Interest in land which was acquired by Crossrail for the purpose of building a subterranean station and tunnels at Woolwich, meaning that Crossrail was entitled to sell the land on the open market under its C10 Land Disposal Policy (Policy C10). The decision confirms when the Crichel Down Rules (CD Rules) apply in the case of a voluntary sale during negotiations for compulsory purchase.

Dispute Resolution analysis: on 27 November 2014, the Court of Appeal allowed an appeal against an decision of Mr Justice Bean (also on appeal) that the claimant’s High Court action must be struck out on the ground of issue estoppel due to an earlier employment tribunal’s decision that it had no jurisdiction to hear the claimant’s time-barred application. In this article, we discuss the Court of Appeal’s decision which distinguished the Court of Appeal’s previous decisions in Barber and Lennon.

IP analysis: The Court of Appeal has dismissed an appeal against the IPEC’s decision that Aldi’s gin-based flavoured liqueur product sold in a decorated bottle containing gold flakes and an LED infringed certain UK registered designs owned by M&S. This case highlights that registered designs can be a useful tool in the fight against lookalike products, especially when the lookalike product is marketed under a different brand name. Written by Milena Velikova, Chartered Trade Mark Attorney at Lee & Thompson.

Tax analysis: In Haworth and others v HMRC, the Court of Appeal dismissed the taxpayers’ appeal, upholding the First-tier Tax Tribunal (FTT) and Upper Tribunal decisions that the place of effective management (POEM) of Mauritian trusts remained in the UK, meaning that HMRC’s assessments for capital gains were therefore effective. POEM may be distinguished from ‘central management and control’ (CMC) and, as a tie-breaker provision in international tax treaties, only one POEM is to be expected.

Tax analysis: In Mitchell and Bell, the Court of Appeal found that HMRC had discretion to disclose documents pertaining to one taxpayer to another taxpayer.

Tax analysis: In MedPro Healthcare, the Court of Appeal overturned one aspect of the Upper Tribunal (UT) decision, holding that the UT has authority to issue guidance to lower courts giving particular weight to specific issues when exercising statutory powers of discretion. The approach to late appeals given by the UT in Martland, which emphasises adherence to time limits, should be followed, and the First-tier Tax Tribunal (FTT) should only depart from that guidance in special circumstances.

Tax analysis: In The Tower One St George Wharf Ltd v HMRC, the Court of Appeal held that the distribution-related exception from the SDLT connected companies market value rule, found at section 54(4) of Finance Act 2003 (FA 2003), applied to prevent the market value rule in FA 2003, s 53 from operating on the land transaction in question. However, HMRC succeeded in its alternative argument under the SDLT anti-avoidance provisions contained at FA 2003, s 75A. The Court found that the scheme in question gave rise to a higher SDLT charge on the notional transaction than on the actual steps implemented, meaning FA 2003, s 75A was engaged and the imposition of a market value SDLT charge was ultimately upheld. The taxpayer’s appeal was therefore dismissed.

Tax analysis: Brown v HMRC concerned a stamp duty land tax (SDLT) avoidance scheme. That scheme relied on the application of the (now repealed) sub-sale relief in section 45 of Finance Act 2003 (FA 2003) to avoid any charge where a company purchased a property for full consideration and subsequently made a distribution in specie of that property to its shareholders. The Court addressed what is meant by consideration being provided indirectly, an issue which applies more generally in the SDLT context. It also permitted HMRC to raise an argument as to the effect of a reference to connected persons in the section, the effect of which, the taxpayer conceded, meant the scheme was ineffective. Finally, the Court addressed the vexed question of how the assessment machinery operates in the context of a notional transaction provided for by the anti-avoidance provision in FA 2003, s 75A. Written by Rory Mullan KC, barrister at Old Square Tax Chambers.

Tax Analysis: In Northumbria Healthcare NHS Foundation Trust, the Court of Appeal ruled that the NHS Trust was not acting as a taxable person when it operated car parks at hospitals and other healthcare facilities. The Court found that the car parking facilities concerned were supplied in the context of activities in which the Trust was engaged as a public authority. In addition, HMRC had failed to demonstrate that if VAT was not charged it would lead to a significant distortion of competition.

Family Law analysis: The Court of Appeal allowed the husband’s appeal against an order under which 70% of his overall award, but only 30% of the wife’s, was comprised of the value of illiquid and risk-laden shares. It held that Wells sharing is neither a remedy of last resort nor necessarily confined to a minority element of an award; the appropriate division depends on the facts and must distribute risk and illiquidity fairly. The first-instance judge had also impermissibly relied on the husband’s failure to consult the wife after rejecting her case on conduct. Practitioners should assess liquid and illiquid assets together and identify a cogent, principled basis for any unequal allocation, particularly where the parties’ needs are broadly equivalent. Produced in partnership with David Wilkinson of Slater Heelis.

Tax analysis: The Court of Appeal has held that, where a taxpayer appeals a civil tax penalty on the grounds that the underlying tax liability is wrong, the burden falls on the taxpayer to prove that the underlying liability is wrong. Reversing the UT’s decision, the Court of Appeal rejected the taxpayers’ argument that because penalty appeals are ‘criminal’ proceedings for the purposes of Article 6 ECHR (which protects the right to a fair and public hearing) (Article 6), there is a presumption of innocence that HMRC must displace. Instead, the Court of Appeal found that the presumption of innocence does not require HMRC to prove the underlying tax position where that component can be severed from the ‘criminal’ aspects of the penalty. The result is that the taxpayer bears the burden as to the underlying tax issue and HMRC retain the burden with respect to any bespoke penalty conditions. The decision provides important clarification on the scope of Article 6 in relation to penalty appeals. Written by Gideon Sanitt (partner at Macfarlanes LLP) and Victoria Braid (associate at Macfarlanes LLP).