Jersey Unreported Judgments

[2010]JRC009

royal court

(Samedi Division)

13^th January 2010

Mr Roger William Bisson representing himself.

Advocate C. R. Dutot for the Respondent.

judgment

the deputy bailiff:

1.             This is an application by Bissons Limited for leave to bring a judicial review in relation to two matters arising out of the application of the Goods and Services Tax (Jersey) Law 2007 in respect of the sale of the business by 3B Holdings Limited (in liquidation) to Bissons Limited.

2.             The first of the concerns relates to a direction originally made by the Comptroller under Article 46(2) of the Goods and Services Tax Law 2007, that the Applicant provides security as a condition of making taxable supplies and the second concerns a decision under paragraph 6, Schedule 6 as the Applicant puts it, for a denial of the Applicant's claim for input tax. 

3.             If leave were to be granted the prayers for relief from the Applicants include an order that the proceedings before the Commissioners of Appeal, which have already been started, should be stayed until such time as these matters have been resolved by the Royal Court.  In fact I understand that the matters before the Commissioners of Appeal have been subject to a de facto stay for the time being; secondly an order that the Comptroller of Income Tax disclose all communications made by telephone between the Comptroller and the joint liquidators of 3B Holding Limited; thirdly an order the direction and decision referred to above are quashed on the grounds that they were unreasonable, irrational, ultra vires or unlawful and there then follows requests for damages, costs and sundry other relief. 

4.             Mr Roger Bisson appeared on behalf of the Applicant as the director of the company and I would like to say immediately that I have been very much impressed with the way in which Mr Bisson has put the paperwork together and in the application which is put forward which has been clear and helpful and is appreciated.  I would also like to thank Advocate Dutot who has been helpful in putting forward information on behalf of the Comptroller.

5.             It was suggested by Advocate Dutot that the test be applied by me on the leave application is as set out by the Royal Court In the Matter of the Curatorship of X [2002] JLR 259 and in particular she referred me to paragraph 17 of that decision where there was a reference to Lord Clyde's comments that in the Scottish case:-

"It is to be observed that it is the function of the courts to decide only live, practical questions and that they have no concern with hypothetical, premature or academic questions, nor do they exist to advise litigants as to the policy which they should adopt in the ordering of their affairs".

Advocate Dutot submitted therefore that these were in part academic or hypothetical questions.

6.             I should say straight away that I am not entirely satisfied it is necessarily the right test on an application for leave for judicial review because sometimes in judicial review cases, administrative cases, real questions do arise in relation to an administrative decision which is spent and these cases should nonetheless be heard and resolved in the public interest, but what the Court did say in Re X is that the Court should take a broad and flexible approach to applications for declaratory relief, which is of course sometimes narrower than judicial review applications, and that is what I have tried to do here.

7.             I have resolved not to give leave to bring judicial review proceedings in this case and I will now set out the reasons why.

8.             In the case of the requirement or direction to provide security under Article 46(2) it is clear that the actual direction has been withdrawn and it is also clear from some of the cases which Mr Bisson has helpfully put forward, that the review by a court of directions under the comparable provision in the English VAT statute show that the review is very much fact based.  Accordingly, I do not think it is going to be very valuable to have a full argument on the facts here where the directional requirement has been withdrawn.  It was said by Mr Bisson that we should also look at the policy which he referred me to and I should say straight away that I can see that while there may well be potential cases where it might be useful to see a challenge to the policy which has been set down so that challenge can be made and adjudicated upon, I am not convinced that there is a sufficient public interest to merit taking that decision here because it is a case in which it would be hypothetical, in the sense that the Comptroller has withdrawn the direction.  I also take the view that the cases which Mr Bission has helpfully produced will need to be considered by the Comptroller and it may well be relevant to look again at the policy in the context of those cases - maybe they have been considered already - I do not need to decide that but simply to give that signal that the Comptroller may wish to look at those cases.  But I am not giving leave because I am not satisfied that in the round there is a sufficient public interest to do so in this case.  If the policy is to be challenged, it should be in the context of a live case. 

9.             On the decision itself the starting point is that leave for judicial review proceedings is not given where there is an alternative remedy and the position here is that under the Income Tax (Jersey) Law 1961 and the Goods and Services Tax Law there is an alternative remedy which is available to the applicant.  Subject to being satisfied that the process before the Commissioners of Appeal is going to be conducted appropriately, there is no reason why the Court should interfere at this stage in that process and therefore we should start from the premise that we should not give leave to bring judicial review proceedings at this point. 

10.          Several things arise, however.  The first of them is these:-

(i)        In the light of the statements which have been made by the Comptroller and the undertakings which have been given by the Comptroller it does seem to me that the Applicant is going to want to consider very carefully whether it actually wants to proceed with the appeal to the Commissioners of Appeal.  It is not at all clear that there is going to be any downside or damage to the Applicant whichever way the appeal is resolved and in those circumstances I am sure that the directors of the Applicant will want to think more carefully about that.  I, in particular, have noted the Comptroller's undertaking in respect of Article 17(6) of the Goods and Services Tax Law that there will be no liability of 3B Holdings Limited which will be transferred to Bissons Limited, the Applicant, as a result of the sale of the undertaking to Bissons Limited, the sale itself being zero-rated and, as I understand it, there being no other liabilities which would be transferred.  So that point, I would have hoped, will give some comfort to Bissons Limited. 

(ii)       Nonetheless if the appeal does go ahead, there is an issue about document discovery which we have looked at this morning.  It is, I think, important to reiterate that, notwithstanding the oath which the Comptroller takes under the 1961 Law, if there are any documents where the document contains information which relates to the matters under appeal, the appellant, in this case the Applicant, should have those documents.  Furthermore, as canvassed during the course of the morning, if in fact there are documents which exist and are requested by the appellant, where the Comptroller thinks that they do not relate to the matters under appeal and contain confidential information about other tax payers which therefore should not be disclosed, it is always open to the appellant, before the Commissioners, to ask the Commissioners to examine those documents and to determine for themselves whether or not the documents should be disclosed to the appellant in order that there is a fair hearing of the appeal before the Commissioners.  And of course, if the Commissioners take a wrong decision on that point, that would be a wrong decision on a point of law which would be reviewable by the Royal Court.  As a matter of practice I take the view that it would often be helpful for the Comptroller to provide a list of documents, which he thinks are relevant to the matters under appeal, to the appellant before cases go to the Commissioners.  As I understand it, the Comptroller does go through that process but some degree of formality in providing a copy of that list might also be of assistance.  Ultimately the question of disclosure of documents is going to be one, in the first instance, for the Commissioners of Appeal and if they decide that they are not going to allow a disclosure to be made and if there are grounds upon which that decision can be reviewed as a point of law in this Court, that is the time to do it and not, as it were, in advance, on judicial review. 

(iii)      The last point I wish to make in that respect is that in the context of the claim for judicial review and in the skeleton argument that has been put forward, the Applicant claimed that the Comptroller had "committed acts of collusion, fraud, deceit, perjury and perverting the course of justice".  As I put to Mr Bisson, in the course of the hearing this morning, these words are very easily bandied about but they represent extremely serious allegations indeed; a party has privilege in Court for what is said in court documents and the corollary of that is that before any allegations of this kind are made they must be fully particularised, such that the Court which is examining them can decide whether the criticisms are justified.  No court is going to refuse to look at allegations of this kind simply because they are serious.  Courts are there to look at such allegations but it is essential, and in fairness to both parties, that, if they are to be said, they must be fully particularised. It is also relevant to point out that had Bissons been professionally represented that it is a matter of professional discipline for a lawyer to ensure that no claim is made as to alleged acts of fraud or deceit or perjury and perversion of the course of justice unless in his professional opinion they can be justified.  There is no doubt at all, in my view on the documents to which I have been directed, first of all that there has been no particularisation of why it is said that fraud, deceit, perjury and so on does arise, and secondly, on pressing Mr Bisson to give me examples of why he said that, what he said goes nowhere near suggesting or establishing that that is the position  Now if documents subsequently were to come out that would support such a claim then of course it is open to Bissons Limited to consider that further but on the strength of what I have seen so far there is nothing like that.  One has to accept that even though mistakes may be made, that is a long, long way from saying that somebody has deliberately fraudulently tried to extract tax which they should not have; and the straight forward answer to that allegation is that as the Comptroller is saying, and has said openly today, that as far as he is concerned the GST which has been paid by the Applicant can be returned to the Applicant, it seems to me to be pretty clear from that that there cannot be any fraudulent attempt to obtain GST to which the Comptroller is not entitled.

11.          For these reasons I am not going to give leave for judicial review. 

12.          The last thing I want to say is that the Comptroller has applied for costs against Bissons Limited.  Normally costs would follow the event in a circumstance such as this.  However the Applicant has raised a number of points where there might have been some confusion or misunderstanding and the hearing today came about because, on reading the papers, I wanted to hear from the Applicant as well as from the Comptroller and in my discretion I am not going to award costs against the Applicant in this case. 

Authorities

Goods and Services Tax (Jersey) Law 2007.

In the Matter of Curatorship of X [2002] JLR 259.

Income Tax (Jersey) Law 1961.