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United Kingdom VAT & Duties Tribunals (Excise) Decisions
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URL: http://www.bailii.org/uk/cases/UKVAT/Excise/2002/E00238.html
Cite as: [2002] UKVAT(Excise) E238, [2002] UKVAT(Excise) E00238
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Excise duties ¾ seizure of passengers' goods¾seizure of driver's car and goods¾non-restoration of goods and car¾whether Commissioners' decisions reasonable
LONDON TRIBUNAL CENTRE
PAUL ROBERT KERSLAKE and ELAINE BARBARA GREEN Appellants
- and -
THE COMMISSIONERS OF CUSTOMS AND EXCISE Respondents
EVELYN DAWN SCHRADER Appellant
- and -
THE COMMISSIONERS OF CUSTOMS AND EXCISE Respondents
Tribunal: JOHN CLARK (Chairman)
Mrs ELIZABETH MACLEOD
Mrs JANET SMITH
Sitting in public in London on 8 April 2002
The Appellant Evelyn Dawn Schrader in person; the Appellants Paul Robert Kerslake and Elaine Barbara Green did not appear and were not represented
Ms Zoe Taylor of Counsel, instructed by the Solicitor's Office of H.M. Customs and Excise, for the Respondents
© CROWN COPYRIGHT 2002
DECISION
1. These two appeals arose from the same circumstances, and it had been agreed that they should be heard together. On the day of the hearing we were informed that Mr Kerslake was ill and unable to attend and that Ms Green was not attending. As we had no advance notice of Mr Kerslake's illness, and no medical certificate had been submitted, we decided in accordance with Rule 26(2) of the Tribunals Rules to proceed with the hearing. Ms Schrader was ready to proceed with her appeal, and we did not consider it appropriate to adjourn the hearing for reasons outside her control. In accordance with Rule 26(3) Mr Kerslake and Ms Green have fourteen days to give notice if they wish to have this decision set aside and request a new hearing of their appeal.
2. The appeal of Mr Kerslake and Ms Green is against a review decision dated 23 August 2001 confirming a decision not to restore excise goods seized on 26 May 2001 at the UK Control Zone, Coquelles, France. The appeal of Ms Schrader is against a review decision, also dated 23 August 2001, confirming a decision not to restore excise goods and a car seized at the same time and place.
The legislation
3. The jurisdiction of the Tribunal arises under Section 16 of the Finance Act 1994. It includes any decision on a review by the Commissioners under Section 15 of that Act. Under Section 16(4)¾
"(4) In relation to any decision as to an ancillary matter, or any decision on the review of such a decision, the powers of the Tribunal are confined to a power, where the tribunal are satisfied that the Commissioners or other person making the decision could not reasonably have arrived at it, to do one of the following, that is to say¾
(a) to direct that the decision, so far as it remains in force, is to cease to have effect from such time as the tribunal may direct;
(b) to require the Commissioners to conduct, in accordance with the directions of the tribunal, a further review of the original decision; and
(c) in the case of a decision which has already been acted on or taken effect and cannot be remedied by a further review, to declare the decision to have been unreasonable and to give directions to the Commissioners as to the steps to be taken for securing that repetitions of the unreasonableness do not occur when comparable circumstances arise in future."
Sub-section (8) provides¾
"(8) . . . references in this section to a decision as to an ancillary matter are references to any decision of a description specified in Schedule 5 to this Act which is not comprised in a decision falling within section 14(1)(a) to (c) above."
The decisions not to restore the goods and the vehicle fall within a description specified in Schedule 5 to the Finance Act 1994, but do not fall within Section 14(1) to (c) of that Act. They are therefore ancillary matters, and the powers of the Tribunal are limited as set out above.
The power of the Commissioners to restore anything forfeited or seized arises under Section 152(b) of the Customs and Excise Management Act 1979 ("CEMA"). This provides:
"The Commissioners may, as they see fit¾(b) restore, subject to such conditions (if any) as they think proper, any thing forfeited or seized under those Acts."
The power to seize goods arises under section 139 of CEMA.
The power to seize a vehicle arises under Section 141 of CEMA:
"Where anything has become liable to forfeiture under the Customs and Excise Acts¾
(a) any ship, aircraft, vehicle, animal, container . . . or other thing whatsoever which has been used as a carriage, handling, deposit or concealment of the thing so liable to forfeiture, either at a time when it was so liable or for the purposes of the commission of the offence for which it later became so liable, and
(b) any other thing mixed, packed or found with the thingis also liable to forfeiture."
Background
4. At about 18.25 hours on 26 May 2001 Ms E Lewis, an officer of the Respondents at the UK Control Zone, Coquelles, France, stopped a car with the registration number F 477 SME. It was being driven by the Appellant Ms Schrader. Mr Kerslake and Ms Green were passengers. The following quantities of excise goods were in the car:
4.7kg hand rolling tobacco
29.25 litres wine
15 litres beer
5375 cigarettes
20 cigars.
5. As these quantities were in excess of the Minimum Indicative Limits, Ms Lewis interviewed the passengers. She asked Mr Kerslake to satisfy her that the goods were not held for a commercial purpose. He identified as his half the Benson and Hedges ("about 15 cartons"), the Drum Light and 2 of the Drum tobacco and the Winston and Camel. He said that he had paid for some of the goods and his girlfriend (Ms Green) had paid for some. He had got it from different places to try different types of tobacco. He had spent £70 and Ms Green had paid for the rest by credit card. He was off sick. He would not get payment for any goods from other persons. He smoked about 200 cigarettes a week and two pouches of tobacco a week. Ms Green smoked about the same. The Driver (Ms Schrader) was a friend. They had won the [travel] ticket in a raffle. The goods would last about six months. He had about £75 per week incapacity benefit and income support. His girlfriend [Ms Green] was the same and they lived together. They spent £30 per week each on food plus the usual bills; their rent was paid for them. He had had about £160 in savings and had £50 remaining. He had used some savings to buy the goods, Ms Green had used her credit card and they would settle up when they got home.
6. He stated to Ms Lewis that he had not seen a Notice 1 before. He knew of the guidance levels for cigarettes only because of what he had read in the paper. He stated that he had not been stopped by Customs before. From information available to her, Ms Lewis was aware that he had been stopped previously and had had goods seized; she asked him why he had denied this. He said that this was to avoid hassle as it was not his car and that [on that occasion] he had just been paid to sit in the car. He knew it was an offence to sell excise goods without payment of duty. He had last travelled to France on that occasion when he was stopped. He had last travelled to Belgium in April and on that occasion he had bought 2 packets of Drum and 200 cigarettes; he had 3-4 packets of Drum left. He had travelled towards the end of April. He had travelled about six times to France and Belgium in the last twelve months. He smoked either 200 cigarettes or 2 pouches, not both, it was a combination. He would get 50-60 cigarettes from a pouch and it would be 200 [a week] regardless of whether it was cigarettes or roll-ups. Ms Schrader had paid for the petrol and he would give her something when they got back. He signed the Officer's notebook as a true account and Ms Lewis also signed the notebook.
7. Another officer, Mr L Brown, interviewed Ms Schrader. He read the commerciality statement to her and required her to satisfy him that the goods were not for a commercial purpose. She said that 5 packets of Superkings and some wine belonged to her. They had been to "Tobacco City" just over the Belgian border. She handed over the cash at the till for her goods. She did not pay for anyone else's. No one had helped her pay for the goods and she did not expect to receive any such payment or favours. The cigarettes would last her about a month. She was an electronic engineer repairing office equipment for Geerings, a firm in Ashford. Her take-home pay was £450 a month, which went straight into her bank account. With Working Families' Tax Credit she had a total income of £1076. Her outgoings included rent of £350, gas and electricity £20 each, water £5 and £7.50 and Council Tax £45 per month. No one else in her household contributed. She had savings of about £5,000 and a savings plan. She had not seen Notice 1 for a long time. She was vaguely aware of the guidance levels and thought that if you paid French tax you could buy as much as you liked for your own personal use. She had not had contact with Customs before. The trip had been planned a couple of weeks before; it was Mr Kerslake's idea. She had had no money from him but was thinking of asking for some money for petrol. He had said that he had a ticket for a car and 5 passengers; she had a car. She had not travelled in the previous twelve months. No one else drove her car. The car had been packed jointly. (At the hearing, Ms Schrader challenged the record of the latter statement; we return to this later in this decision.) Ms Schrader signed the notebook as an accurate record of interview.
8. Ms Green was interviewed by another officer, Ms H Levitt. Ms Green stated that Mr Kerslake was her partner and that Ms Schrader was a friend of his whom she had met a few times previously. Ms Green said that her goods were all the Benson and Hedges, 21 packets, and the Winston, which she had bought to try. She usually smoke Mr Kerslake's Drum and he had bought one or two Winston. The rest of the Winston was hers. Two of the Golden Virginia were hers as she had decided to try it. They had bought the wine between them. 3 or 4 of the Drum were hers. The beer was between Mr Kerslake and her. She had spent just over £400. She had paid for her cigarettes and tobacco. No one had lent her money towards the goods. She did not expect to receive any money or favours for the goods. The goods were for her. She swapped and changed tobacco all the time and could not roll her own so used a machine, but she would not go out with a roll-up. She was unemployed and had been for about two years; her income was from Income Support. They were on Incapacity Benefit amounting to £166 per fortnight for the two of them. She had no other income, but before that day had had savings of just over £500. They had been saving for more than a few weeks. Her financial commitments were the regular household bills. She smoked about 30 cigarettes in a day and hoped that her goods would last about a year. She had only just started smoking roll-ups; using a machine, two pouches of Drum gave her about 100 cigarettes. She smoked cigarettes when she went out. With the machine she would make 100 cigarettes at a time and would just smoke them; they both smoked them. She did not intend to supply others. She would smoke and drink her goods. She had last travelled the previous summer. She usually bought cigarettes and tobacco in supermarkets in Folkestone. She had travelled abroad only once previously in the last twelve months. She thought that on that occasion she had bought 5 Benson and Hedges and 3 packets of Drum. The Drum was for her. The officer pointed out that Ms Green had said that she had only just started smoking tobacco. Ms Green said that the one in the can was meant to be cigarette tobacco rather than Drum; she did not like it much, which was why she had some left. She had bought more Drum because she had got used to it. She had not seen Notice 1 before. She was not aware of Mils (Minimum Indicative Limits). She was aware that it was an offence to sell excise goods without paying the duty on them. She had just read that excise goods were liable to duty. She had not had contact with Customs before. She had won the travel ticket at Eltham fair the previous year. She signed the officer's notebook as true and accurate.
9. Ms Lewis reviewed the interviews and took the decision to seize the goods and the vehicle. She recorded the reasons as over the Minimum Indicative Limits, income against expenditure (Kerslake, Green), consumption rate - won't last (Green), goods claimed did not tally with goods in car, Mr Kerslake aware of the law, inconsistencies in stories as to what Ms Green smoked, Mr Kerslake's failure to declare initial seizure in initial questions, and his false statements regarding previous travel. Ms Lewis issued Seizure Information and warning letters, Form C156 setting out the goods seized, and Form SEE004C, Seizure of Vehicle.
10. Mr Kerslake and Ms Green wrote on 27 May 2001 to appeal against the seizure of the goods and the vehicle, and to make a complaint against one of the Customs Officers. The Commissioners' response dated 31 May 2001 asked for clarification whether they wished to lodge a formal appeal against seizure, and explained the procedure for a claim against forfeiture, and the alternative procedure for requesting restoration; if they wished to follow both, the restoration request would not be considered until the conclusion or withdrawal of the condemnation proceedings. On 7 June 2001 Mr Kerslake wrote requesting restoration of the goods, explaining that they were for his and Ms Green's own use. We must point out that there was no copy of this letter in the Commissioners' Bundle for the hearing, although there was a copy among papers previously lodged with the Tribunal. In a letter dated 27 June 2001 the Commissioners wrote to inform them of the decision not to restore the goods. Again, there was no copy of this letter in the Commissioners' Bundle, although a copy had been lodged with the Tribunal. On 9 July 2001 Mr Kerslake wrote to request a review of the Commissioners' decision. The Commissioners' decision on review was set out in their letter dated 23 August 2001. This confirmed the contested decision not to offer restoration of the goods and the vehicle. We assume that the reference to the vehicle was for information, as the vehicle was owned by Ms Schrader. The letter set out the factual background given above, and extracts from the relevant legislation. The letter also gave details of the Commissioners' policy relating to restoration of goods. The normal policy relating to seized excise goods is that they are not restored. However, each case is examined on its merits to determine whether restoration may be exceptionally offered. The letter set out the factors militating against restoration. It pointed out conflicts between the answers given by Mr Kerslake and Ms Green at their respective interviews. It stated that the goods being carried were well in excess of the guidance levels; the goods declared by all three of those interviewed did not tally with the goods found in the vehicle. The letter referred to Mr Kerslake's previous trips abroad and to his being stopped by Customs in November 2000. It stated that his income was unlikely to support these regular trips, and that it was unlikely that he would incur such expense to purchase a small quantity on his last trip, as he maintained. It pointed out inconsistencies between answers given by Ms Green about her change in smoking habits and her chosen tobacco and her stated purchases on a previous trip.
11. Ms Schrader wrote to the Commissioners on 30 May 2001 requesting restoration of her car and her goods. She explained that she and her friends were purchasing items for their own use, and their purchases were made as individuals and not as a group. She listed her own purchases, and pointed out that she was seeking legal advice as to whether she should make a claim against seizure. The Commissioners' decision not to restore her goods and vehicle was set out in their letter dated 18 June 2001. (Only the first page of this letter was contained in the Commissioners' Bundle, although a full copy had previously been lodged with the Tribunal.) The reasons for the decision were that she and her travelling companion [sic] were found to be carrying goods in excess of the Guidelines, and the quantities of goods declared by her and her travelling companions during interview failed to tally with the goods contained in the vehicle. The letter set out the Commissioners' policy, and indicated that there were no exceptional circumstances in the present case which would justify a departure from it. Ms Schrader wrote on 8 July 2001 to appeal against the decision not to restore her car. She had never previously taken the car out of the UK. She was not aware of the guidelines. Her purchases were made independently of her passengers; they had all made individual purchases and loaded the car separately. She was totally unaware of what they had bought. She now realised that her own goods were within the guidelines apart from 200 cigarettes, for which she apologised. When questioned by Customs and Excise she had had nothing to hide, so her answers were accurate as to her own purchases. She was devastated by all of this, as she had no criminal convictions or points on her licence and had never previously been in trouble with Customs and Excise; as far as she was aware she was simply helping some friends out. She was a single parent of three children (ages 14, 8 and 6) and worked part-time. Not having the car was an enormous loss and inconvenience, as without it she could not get her children to school or get to work easily and it made it extremely difficult to get to appointments and get her shopping. She begged the Commissioners to treat her transgression separately from the other passengers and return her car.
12. The Commissioners' decision on review relating to Ms Schrader was contained in their letter to her dated 23 August 2001. This set out the factual background given above, and extracts from the relevant legislation. The letter also gave details of the Commissioners' policy relating to restoration. With effect from 14 July 2000 the policy regarding privately owned vehicles used for the improper importation of excise goods is that they will not be restored, even on the first occasion that they are so used. This policy applied at the time of seizure of Ms Schrader's vehicle. The policy relating to seized excise goods was stated in the same terms as in the letter to Mr Kerslake and Ms Green. The letter considered whether the excise goods and the vehicle were appropriately seized in the first instance. Because of the volume of excise goods being imported, Ms Schrader was required to satisfy the officer that the goods were for own use and rebut the presumption of commerciality. The review officer noted a number of points. The goods Ms Schrader's passengers were carrying were well in excess of the guidance levels. The goods declared by all three did not tally with the goods found in the vehicle. (We refer later to the dispute as to the amounts.) Ms Green stated that all the Benson and Hedges were hers and that she was the only one who smoked them, whereas Mr Kerslake claimed that half of them belonged to him. Mr Kerslake claimed that the Winston tobacco was his, whereas Ms Green claimed that most of it was hers. There were also inconsistencies as to the amount of Drum tobacco owned by Mr Kerslake and Ms Green and no one claimed to own the Gauloises cigarettes or the cigars. In the review officer's opinion, these inconsistencies indicated that the goods were not for personal use, since no one seemed to know which goods were theirs. In addition, Mr Kerslake initially said that he had not been stopped by Customs before, but the records showed that he was involved in the improper importation of 9980 cigarettes and 300 litres of beer on 9 November 2000. The excise goods and the vehicle had been seized. On that occasion Mr Kerslake and his fellow passengers had declined to answer any questions. He had since made at least six trips to Belgium to purchase tobacco goods. It was clear to the review officer that Mr Kerslake had prior knowledge of the guide levels and that his income was unlikely to support these regular trips. It also seemed unlikely that he would go to such expense just to purchase 200 cigarettes and 2 packets of tobacco on his last trip, as he had maintained. Ms Green had also admitted to a trip abroad the previous summer, when she purchased cigarettes and tobacco. However, she had stated earlier in her interview on 26 May 2001 that she had just started smoking "roll-ups". She had also said that she did not like Drum tobacco, yet she had purchased more on the trip in question. The review officer mentioned that in her interview Ms Schrader had stated that the car had been packed jointly, so she must have been aware of the quantity of goods that she was carrying. Mr Kerslake and Ms Green had failed to satisfy the officer (Ms Lewis) that the excise goods that they were importing were for their own use; for the reasons given in the letter (and as set out above) the review officer had come to the same conclusion. The seizure of the excise goods belonging to them was appropriate. The vehicle used to carry the goods which were improperly imported was also liable to forfeiture, and Ms Schrader's excise goods were liable to forfeiture as they were with the other excise goods. The restoration policies already mention applied to Ms Schrader's vehicle and excise goods. The passengers' goods had been seized because they were for a commercial purpose; the review officer agreed with this conclusion. As evidence of commerciality was a factor that militated against restoration, neither Ms Schrader's vehicle nor her excise goods would be restored. The review officer was satisfied that Ms Schrader had been treated equitably and in line with policy, and confirmed the decision not to offer restoration of her goods and vehicle.
The evidence
13. Ms Schrader gave evidence under cross-examination. She confirmed that it was her signature on the officer's interview notes. Asked whether this was an accurate record, she queried the definition of accurate. A sentence was missing. She had had to ask for it to be amended. At the bottom of the page, she was aware that a sentence had been omitted relating to the packing of the car. The reason that she had not asked for this to be corrected was that she was suffering from stress; she wanted to finish the interview, and was not aware of the implications. The sentence omitted was: "They packed their stuff, I packed mine." It was her vehicle; she had the keys and opened it, and Mr Kerslake and Ms Green had put their things in. Ms Schrader did not see what they were doing on all occasions; the goods had been purchased in a number of different places. Ms Schrader was there, but had had two young children with her; she could not recollect whether she took the children to the park. She was aware that she did not see the others pack everything into the car. The purpose of the trip had been a combined day out and to enable Ms Schrader to obtain cheap cigarettes for her own personal use. She knew which goods were hers; the others belonged to Mr Kerslake and Ms Green. Ms Schrader knew that they had much more than she did. She confirmed that as a smoker she had a preferred brand. Miss Taylor asked whether it seemed odd that the others had a number of different brands. Ms Schrader thought that people liked to try different brands of rolling tobacco. She knew that her own goods were for her own use. She had not known how much the others had brought back until the goods were seized, so she had not raised any questions. Miss Taylor asked how long she had known the others. She had met Ms Green a couple of times, and had known Mr Kerslake for between six months and a year. They used to go to a group weekly. Mr Kerslake had never previously asked her to go abroad. She believed him to be off sick. She did not think he was financially well off. Her recollection was not clear, but she thought she was aware that he had travelled before. On the journey, he had said that he had directions from a friend. Ms Schrader was not aware that Mr Kerslake had previously been stopped by Customs.
14. Miss Taylor referred to the request in Ms Schrader's letter asking for a review that she should be treated separately. Did she suspect that they had done something wrong? Ms Schrader said that doubts had been raised in her mind. She had taken advice. The car was far more valuable to her. She knew about personal use and thought that the others were bringing goods for that purpose. She would not have suspected them for one minute of doing otherwise. She had bought the car 8 to 10 months previously with the intention of keeping it for 10 years. Asked whether she suspected the others now, she said that she did not know what to think now. In relation to Mr Kerslake's interview, Miss Taylor referred to his answer to the question whether he had ever been stopped by Customs before. He had replied "No". She asked Ms Schrader whether this was a lie. Ms Schrader said that although he had not lied earlier to the question whether he had been stopped in the last 6 months, this did appear to be a lie. (We have some reservations as to how much weight to place on the views of one witness after the event as to the statements of another party in circumstances where the latter is not at the hearing.)
15. Miss Taylor asked about the day trip; after going to the shops, had they come straight back? Ms Schrader said that they had travelled, purchased goods, bought more, and the children had played in the park. They had taken photographs during the day. They had then been stopped by Customs. Ms Schrader had no complaints about the Customs officers, although the officer apparently in charge appeared to have an aggressive and abrupt manner at times. She did not recollect any shouting. She did not know that Ms Green was drunk. She did not know whether Mr Kerslake could drive; she had never seen him do so. Miss Taylor asked whether she had not thought it sensible to ask Mr Kerslake and Ms Green what they had and what use they would put it to. Ms Schrader had automatically assumed that being friends they would not do anything to compromise her, her car or her children. She assumed that what they had would be for their own personal use. Asked whether she had been too trusting and taken a risk, Ms Schrader said that there was no way in which she would have taken a risk.
16. In response to questions from the Tribunal, Ms Schrader said that the initial questioning had taken place in or around the vehicle, then in separate rooms. Ms Schrader had not received any payment for the trip. The weekly club that she and Mr Kerslake had attended was a "stress club", a mutual support group. The statement in the Notice of Appeal that an officer told her that if she appealed she would get her car back was what she had understood. The goods purchased were in similar packaging to ordinary shopping. The goods were not all put into the boot. Some bottles were put in the footwells. Wine, beer and cigarettes were in the boot. The items taking up most of the space were the wine and beer. The car was not "sagging". The two children were aged 6 and 8. There would be more in the car when she bought her weekly shopping. The car was not overloaded.
17. Miss Taylor asked about the packaging of the goods. They were in bags and boxes; Ms Schrader did not recall how many. There were 6 bottles of wine in carriers containing 2. She thought the others bought 2 boxes of wine, beer in another box, there were souvenirs, a carrier bag of cigarettes, and tobacco, possibly one other box. She had no idea whether the 5 kilos of hand rolling tobacco was in a box or bag. There was a dispute as to the quantity of beer.
18. In her evidence, Hilda Marshall, the reviewing officer, explained that there had been a discrepancy between the information on the P&O Job Product Sheet and the goods tallied. The Seizure Information Sheet showed the amounts before they were tallied. She had compared the figures with the Customs computer record, which she considered the most accurate. P&O had miscalculated; the figure should have been 15 litres, and she used this figure in her letter. She had concluded that there was evidence of commercial use. The variety of brands was unusual if the goods were for one person (or here two). The combined income was £166 a fortnight, which would mean difficulty saving. The amounts were in excess of the guidance levels. Mr Kerslake and Ms Green had not contested the seizure, but merely asked for the goods to be restored. Mr Kerslake had travelled more than 6 times in the last 12 months, so that there would be no need for such quantities if he travelled regularly. She had also taken into account (but did not rely on) the previous stoppage. The reference to being paid to sit in the car suggested that Mr Kerslake had been implicated in the smuggling attempt on that occasion. His consumption rate was inconsistent with the amount he had bought; the goods would have lasted longer. Ms Green had stated her consumption as 30 a day. In his letter requesting the review, Mr Kerslake had said that the guidelines were not limits; this would have been correct if the goods were for his own use, but she did not accept on the evidence that they were. There was nothing in the officer's notebook suggesting that the officer might have been aggressive; she thought it highly unlikely. She would have expected Mr Kerslake to refer to being stopped by Customs at a point 6 months and a couple of weeks beforehand. She felt he was trying to mislead the officer. On his statement that he had not seen the leaflet, she felt that he could not fail to have seen a notice or a leaflet on one of his trips. It was not the case that Mr Kerslake and Ms Green were being persecuted for being unemployed, as questioned in the request for review. She had applied the guideline policy relating to restoration, a factor being the previous involvement in a smuggling attempt, and taking into account commercial purpose. She had not been presented with any exceptional circumstances leading her to depart from the policy. She had not had a case involving exceptional circumstances in relation to goods.
19. The review officer then referred to the review decision concerning Ms Schrader. The figures given in the letter for goods seized had been taken from the departmental computer records. The goods were to be used for a commercial purpose; her reasons were the same as for the other review. Miss Taylor asked the review officer how she had considered Ms Schrader's position. The review officer took into account that Ms Schrader was asked by a friend to make the trip, and that she would have been aware of the goods purchased when they were loaded into the vehicle; the notes that the review officer had at the time said that they loaded the goods jointly. Asked whether Ms Schrader was involved in the enterprise, the review officer felt it unlikely that Ms Schrader would not have known about it. However, Ms Schrader was not implicated; she had not paid for any of those goods. In making the review, the officer had followed the policies set out in the letter. For the goods, the factors were as in the previous case concerning Mr Kerslake and Ms Green; there was evidence that some of the goods were for a commercial purpose. In relation to vehicles, the officer gave examples of exceptional circumstances. In one case, a person had misunderstood the regulations in relation to gifts. In another, a van owner had taken adequate steps, requiring the signing of a contract, and the driver had been dismissed; the vehicle had been restored. In the present case there were no exceptional circumstances warranting restoration of the goods. In relation to the car, the officer had considered the work and school reasons for needing the car, but these were not exceptional as the position was the same for most people. The making of the trip for friends had not influenced the decision; the information was available to travellers, and there was nothing exceptional. The officer was satisfied that, as Ms Schrader had said in her letter requesting the review, she had made her purchases herself. However, the officer was not convinced that Ms Schrader would not have known what her passengers had purchased, given the quantities. The officer felt that Ms Schrader could not have failed to see their purchases. They would have taken up a considerable space. Asked whether she had considered proportionality, the officer had been aware that the duty involved was over £1,200, a substantial loss. The vehicle was not very new. The policy was aimed at deterring the use of cars. The car would have been worth considerably less than the duty involved, about £300 or £400 at the time. In cross-examination by Ms Schrader, the officer said that the value of the car was a consideration, but that she had estimated the car to be worth considerably less than the duty. The position would not necessarily have been different if the vehicle had been worth £10,000. She did consider proportionality, but this would not have made a difference in the present case. The Tribunal asked whether a disclaimer letter would have affected restoration in the present case; the officer said that it would not. In the other exceptional case, the owner had not been present. Here, Ms Schrader had been travelling. In relation to condemnation proceedings, the Tribunal asked whether failure to take them had affected the decision; the officer replied that reluctance to take them would not affect the decision.
Ms Schrader's arguments
20. Ms Schrader referred to the initial reasons given for the seizure; these were the failure by Mr Kerslake to declare the previous seizure, and that the excess was more than the minimum guidelines. At the initial interview the first question was: "Have any of you been stopped in the last six months?" Mr Kerslake had been stopped six months and two weeks beforehand; this had not been taken into consideration. On that occasion he had been a passenger and had had no goods, so did not feel that he was lying. On the question of the excess over the guidelines, Ms Schrader pointed out that the importer had to be able to show that the goods were for the importer's personal use. As Mr Kerslake and Ms Green were a couple, their purchases were for joint use; this led to confusion as to who they were bought for. The relationship had not been taken into account in looking at the purchases. It had been mentioned in the Notice of Appeal submitted by Mr Kerslake and Ms Green that Ms Green had been intoxicated. Ms Schrader was unsure about this. Mr Kerslake had also mentioned in the notice that the statements had been taken under duress; the officer was shouting and screaming at him. In the note of interview with Ms Schrader, it had been recorded that Ms Schrader had stated that the car had been packed jointly. Ms Schrader said at the hearing that the officer's note had been abbreviated. She had packed her things, they had packed theirs. On reflection, jointly was not the correct word. On the question whether the goods tallied with what had been declared, the officer had said that Customs were not interested in wine or alcohol, just tobacco. There were differences in the figures as to what was seized, as shown respectively in the documents and in the officer's notes. On another reason given by the officer for seizure, expenditure being inconsistent with income, this took no account of savings. The ticket had been obtained some months before.
The Commissioners' arguments
21. Miss Taylor referred to the facts as set out in the Statement of Case. The officers formed the view that the goods were not for own use in accordance with the Order. All three appellants requested restoration. The Commissioners have a discretion under section 152(b) of CEMA. Under the Excise Duties (Personal Reliefs) Order 1992 as amended by the Channel Tunnel (Alcoholic Liquor and Tobacco Products) Order 2000) excise goods are liable to forfeiture where the requisite conditions are not fulfilled. Here the officer took the view that the goods were held for commercial purposes.
22. The basis for the seizure was section 141 of CEMA. The Commissioners are required to give notice of the seizure of any thing liable to forfeiture and the grounds therefor to any person who at the time of the seizure is to their knowledge the owner or one of the owners of it. This had been done by the officers for all three persons involved in the present case.
23. Schedule 3 to CEMA provides a mechanism whereby the legality of the seizure by the Commissioners of any thing liable to forfeiture can be challenged. Any person wishing to bring such a challenge can, within 30 days of the notice of seizure, enter a notice of claim. Where no claim is entered within the proper time, the thing concerned is deemed to have been duly condemned as forfeited. Here no such notice of claim was entered. As a result, the sole issue for consideration in these appeals was the Commissioners' decisions not to restore the vehicle and the excise goods to the respective Appellants.
24. Miss Taylor referred to the nature of the Tribunal's jurisdiction. It was confirmed by the Court of Appeal in Lindsay v Customs and Excise Commissioners [2002] STC 588 at [68] to [70] that the jurisdiction is limited. The powers of the Tribunal are limited to ordering a fresh review. The Tribunal must consider whether it is satisfied that the Commissioners could not reasonably have arrived at the decision on the review. "Reasonably" in this context is to be construed in the wider sense used in the Wednesbury case: Bowd v Customs and Excise Commrs [1995] V & DR 212 at paragraph 57. The question in the present case was whether the Appellants had shown that the decision was unreasonable. It was not for the Tribunal to look at the actual seizure. The reviewing officer had applied the Commissioners' policies on the restoration of vehicles used in the improper importation of excise goods and on the restoration of goods that had been improperly imported. The Commissioners were entitled to have such policies. These pursued the legitimate aim of deterring the importation of goods for commercial purposes without payment of duty and encouraged compliance. They enabled consistency in the decision-making of Customs and Excise. The only issue was whether the Commissioners had fettered their discretion by refusing to listen to an application that the policy should not be applied in any given case. Miss Taylor cited British Oxygen Co Ltd v Minister of Technology [1971] AC 610 at pp 624 to 625. Here the Commissioners had applied the policy after due consideration of all the facts and matters surrounding the seizure of the vehicle and the representations made by the Appellants. The reviewing officer had concluded that there were no reasons to depart from the policies and the Appellants had not made out a case to do so. In all the circumstances, the decision was one that the Commissioners reasonably arrived at.
25. Miss Taylor argued that Lindsay had no bearing on the appeal of Mr Kerslake and Ms Green. Their appeal related solely to the decision not to restore their goods. The policy examined in Lindsay was that relating to the restoration of vehicles. The policy relating to the restoration of goods was set out in the review decision letter. The general policy is that seized excise goods are not restored. However, each case is examined on its merits to determine whether or not restoration may be exceptionally offered. The presence of any of a number of factors listed militates against restoration. The officer had found a number of these factors. Both Mr Kerslake and Ms Green had signed the respective interview notes confirming that these were true accounts. Some of the points in their Notice of Appeal were new matters not before the review. It was clear from the review that the officer took into account all matters before her. The conclusion was that there was ample evidence that the importation of the goods was for commercial purposes. There were no exceptional circumstances and no reasons advanced by Mr Kerslake and Ms Green to depart from the Commissioners' policy. The decision was reasonable in all the circumstances.
26. In relation to Ms Schrader's appeal, she had signed the interview notes and confirmed that they were an accurate record. Miss Taylor referred to the seizure documentation. As the copy in the bundle was incomplete, not showing the reverse of the document, we asked for a copy to be supplied to us. Ms Schrader provided this. It sets out the procedures to be followed to apply for return of seized items and to challenge the seizure. Miss Taylor referred to the policy relating to restoration of vehicles, as set out in the review letter sent to Ms Schrader. The review officer had considered at length whether the goods were for a commercial purpose. A number of factors supporting this had been taken into account. It was clear from Lindsay that the reviewing officer should consider afresh whether there was evidence of commercial use. She argued that the Commissioners' policy could not be criticised, and referred to Lindsay at [63]. She argued that it was only where the goods were not for commercial use that a number of factors needed to be considered. The policy was not flawed where the goods were for commercial use; it did not lead to a disproportionate result. The Tribunal could not reach its own decision on commerciality. This meant that it could not take account of any new matters. It was for the Appellant to put forward matters for review; this was relevant to matters raised by Mr Kerslake and Ms Green in their Notice of Appeal.
27. Miss Taylor reviewed the evidence. The question was whether the decisions not to restore the goods and not to restore the vehicle were ones that the Commissioners could not reasonably have arrived at. The evidence supported the review officer's decision. The importation was commercial in the general sense referred to in Lindsay at [63], smuggling goods in order to sell them at a profit. The officer had taken into account the volume of goods, the variety of goods, the level of income of Mr Kerslake and Ms Green, and the frequency of trips taken by Mr Kerslake; they had failed to satisfy the Commissioners that the goods were for personal use. There had been manifest inconsistencies between the answers given by Mr Kerslake and those given by Ms Green. It was not plausible to explain these away.
28. In relation to Ms Schrader, it was appropriate to take into account the volume and appearance of the goods being carried. Bags and boxes had been squeezed into a Ford Fiesta carrying 3 adults and 2 children. Ms Schrader had sought to add wording to her statement. It was not plausible to suggest that she would correct one error and leave one uncorrected. Miss Taylor argued that Ms Schrader's letter did not explain this. The letter said that they had all made separate purchases and loaded the car separately. Miss Taylor submitted that the car was loaded in front of all three present. The conclusion must be that the vehicle was packed with Ms Schrader's knowledge; it was implausible to suggest that she was not aware. There was ample evidence for the officer to come to her conclusion. The Tribunal could only look at the reasonableness of her conclusion.
29. Lindsay had no bearing on the case; even if it were to, the importation was commercial, so that the Commissioners' policy was properly applied. This would follow from Lindsay at [63]. Only where evidence of commerciality was lacking, such as where goods were to be sold on at cost price, was it appropriate to look at [64]. The factors listed there did not need to be considered in the present case; the policy was not flawed. The officer had considered all matters in the context of the evidence as a whole. Those subsequently raised in the Notices of Appeal were not before the officer; they were not relevant to her decision. She had explained the inconsistency in the figures. There was no evidence of any interview being under duress. An abrupt manner was a long way short of what Mr Kerslake had contended. The claim that Ms Green had been drunk was not plausible; it had not been recorded in the officer's notes, nor was Ms Schrader aware of it. Miss Taylor asked the Tribunal to find that the claim was lacking in credibility. She submitted that both decisions were reasonable; nothing unreasonable had been taken into account, nor had any factor been given too much weight. There had been no error of law. Both appeals should be dismissed.
Ms Schrader's reply
30. Ms Schrader argued in relation to the frequency of Mr Kerslake's trips that someone on a limited income will do what they can to limit costs. Small trips with small purchases would help them to get by. If they purchased larger amounts, they would make fewer trips. On proportionality, she had purchased the car for £1,500 some months previously. She would not have contemplated putting that value of the car against even twice the amount of goods. On the question of the ability of Mr Kerslake and Ms Green to save, she maintained that this was possible. In her own case, she was able to save; she received Working Families' Tax Credit and had three children, a house and had had a car. She thought it not unreasonable to expect Mr Kerslake and Ms Green to save. She explained that she no longer had a car.
Reasons for decision
31. The statutory limitations on our jurisdiction are set out at paragraph 3 above. For the respective Appellants to succeed, they must satisfy us that the Commissioners could not reasonably have arrived at the review decision relevant to them. To show unreasonableness, it must be demonstrated either that the Commissioners did not take into account all relevant considerations, or that they did not leave out of account all irrelevant considerations. This follows from Bowd as cited by Miss Taylor; see paragraph 24 above.
32. We accept that there was ample evidence to support the review decision relating to Mr Kerslake and Ms Green. All the factors taken into account by the review officer supported the conclusion that the goods were not for their personal use. There was nothing to suggest that the importation was for anything less than commercial purposes. We can see no reason to question the reasonableness of the decision. There is no evidence to support the contention that any of the interviews was under duress. There was no evidence to show that any Customs officer was shouting and screaming. It may have open to argument that Mr Kerslake's initial answer concerning being stopped by Customs within the previous six months was strictly correct. However, this became irrelevant in the light of his subsequent denial in the interview when he was asked whether he had ever been stopped. The review officer confirmed that Mr Kerslake and Ms Green were not being penalised for being unemployed. In relation to the claim that Ms Green was under the influence of alcohol and incoherent, we should first point out that this was not a matter raised at the time of the review, and it is therefore not strictly within our jurisdiction to consider it. We do find, in the light of the evidence before us, that it lacks credibility.
33. The review decision relating to Ms Schrader raises other questions. The review officer accepted that Ms Schrader was not implicated in the importation by Mr Kerslake and Ms Green so far as payment for any of the goods was concerned. However, she regarded Ms Schrader as involved in the enterprise. We consider that the use of a car belonging to another person raises questions of proportionality. Lindsay deals specifically at [63] with smugglers using their own cars for commercial smuggling; the references in that paragraph are to "their cars". The position is not so clear for cases where the car belongs to someone other than the smuggler, whether the smuggling is "commercial" or on the lesser scale referred to at [64]. The seizure of the vehicle involves an interference with the owner's entitlement to peaceful enjoyment of his possessions. This needs to be justified by reference to the actions of the smuggler. Article 1 of the First Protocol of the Human Rights Convention, incorporated into United Kingdom law by the Human Rights Act 1998, provides:
"Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided by law . . .The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties."
34. It is clear from the case of Air Canada v UK (20 EHRR 150) that interference by a state must achieve a fair balance between the demands of the general interest of the community and the requirements of the protection of the individual's fundamental rights. There must be a reasonable relationship for the proportionality between the means employed and the aim pursued. Applying this to Ms Schrader's case, the review officer considered the extent to which Ms Schrader was party to the importation by her passengers of the excess quantities of excise goods. Ms Schrader disputed whether it was correct to say that the goods had been packed in the vehicle by her and her passengers jointly. Whatever the view on this, the review officer considered that Ms Schrader must have been aware of the quantities of goods in her vehicle. We consider that the review officer did take into account the extent to which Ms Schrader was a party to the importation, and that this fulfilled the requirement of balance between the means employed, the seizure of the car, and the aim pursued, to deter smuggling. The policy is harsh, and we have some sympathy for Ms Schrader; however, our jurisdiction is limited to determining whether the review decision was one which the Commissioners could not reasonably have reached. The review officer took into account all relevant considerations, and did not take into account any irrelevant considerations. It follows that the decision on review must stand.
35. We dismiss both appeals. The Commissioners did not ask for costs. We would like to thank both Ms Schrader and Miss Taylor for the clear presentation of their arguments, and acknowledge the stress that Ms Schrader had to undergo in presenting her appeal. We remind Mr Kerslake and Ms Green of the strict time limit within which they may apply to have the decision relating to them set aside.
JOHN CLARK
CHAIRMAN
RELEASED:
LON/01/8189
LON/01/8192