E01141

EXCISE DUTY RESTORATION OF VEHICLE – conditions – dismissed on facts. 

MANCHESTER TRIBUNAL CENTRE

RICHARD DEREK VARLEY
		Appellant

-and-

             HER MAJESTY’S COMMISSIONERS OF
             REVENUE AND CUSTOMS
			Respondents

Tribunal: Richard Barlow (Chairman)
      Peter Whitehead (Member)						

Sitting in public in Manchester on 11 July 2008.

The Appellant in person.

Ms Katie Jones of counsel, instructed by the Solicitor for HM Revenue and Customs for the Respondents 

© CROWN COPYRIGHT 2008

DECISION

1.	The appellant appeals against the respondents’ decision, given on 8 June 2007, that they would restore to him a Toyota Lucida Estima motor car number L857 RHL only on payment of a restoration fee of £900.  That vehicle had been seized at Dover on 29 April 2007 on its return from a short visit to France and Belgium because excise goods consisting of hand rolling tobacco had been seized from some of its occupants.  The goods were seized on the grounds that they were being imported for a commercial purpose.  The appellant was not in the vehicle and had not travelled to the Continent in it.

2.	A vehicle is liable to seizure and forfeiture under sections 139(1) and 141(1) of the Customs and Excise Management Act 1979 if it is used for the carriage of any thing which is liable to forfeiture.

3.	The Commissioners have a discretion, under section 152(b) of that Act, to restore “as they see fit” any thing forfeited or seized under the customs and excise Acts and to do so “subject to such conditions (if any) as they think proper”.

4.	 The appellant requested a review of the decision to make it a condition of restoration of his motor car that he should pay £900 and that request was made within the time allowed by statute.  The review was carried out within the time allowed by statute so this appeal is an appeal against that review decision which is dated 9 July 2007 communicated in a letter from the reviewing officer Mr David Harris.

5.	We heard evidence from the appellant and Mr Harris and we read the notes of officers who had interviewed the occupants of the motor car at Dover and correspondence between the appellant and the respondents.

6.	The conduct of this appeal was not assisted by numerous errors in the Statement of Case and the review.  For example, the Statement of Case refers to a Mr S Brier.  If any such person exists he certainly played no part in the events relevant to this case.  The review refers to a Mr Stuart but one officer’s note book refers to Mr Stuart Jeffrey and another to Mr Jeffrey Stuart.  The review also refers to the non-existent Mr S Brier as well as Mr Stuart.  The reference to Mr S Brier in the Statement of Case turned out to be intended to be references to Mr Stuart Jeffrey or Mr Jeffrey Stuart.  The appellant knew that person as Stuart Jeffrey and we assume that is his correct name.  The review wrongly states that Mr Evans did not have goods over the guideline amount.

7.	We find the facts to be as follows.  

8.	Mr Varley agreed to lend his car for the weekend to Mr Arthur Evans, who was a friend of his whom he saw in a local public house near his home in Keighley two or three times a week, on the understanding that he would have the use of Mr Evans’ car for the weekend and that they would each pay for the petrol they used during that period.  Mr Evans told Mr Varley he wanted the car to go to the Continent to buy tobacco and alcohol and that he wanted to borrow it because it carried more passengers than his own car and he was going with other people.  

9.	Mr Varley also agreed to pay for Mr Evans’ ticket for the cross Channel journey on his credit card as Mr Evans did not have a credit card.  He was reimbursed for the cost.  When he booked, Mr Varley was asked for the names of the passengers and so he had to find out from Mr Evans who was going on the trip.  Those who travelled were Mr Evans, Mr Roger Dent, Mrs Jean Dent, Mr Philip Brier, Mr Stuart Jeffrey and Mr Leo Kus.  Mr Varley knew the people concerned except for Mr and Mrs Dent.   

10.	Mr Evans was driving the car when it returned to Dover from the short trip to France and Belgium and all six occupants had tobacco goods in their possession.  Mr Evans, Mr and Mrs Dent and Mr Kus all had six kilograms each of hand rolling tobacco with them which was seized by the respondents.  Although Mr Brier also had six kilograms of hand rolling tobacco with him and Mr Jeffrey had three kilograms of hand rolling tobacco and 3,200 cigarettes their goods were not seized.  The goods that were seized were all seized on the basis that an excise duty point had been reached, without payment of the duty due, because the goods were held for a commercial purpose. 

11.	The commissioners were not required to commence condemnation proceedings by any of the persons from whom the goods had been seized (including the appellant so far as the car was concerned) and so the goods and the car were condemned as forfeit.  That does not affect the appellant’s right to request restoration or to challenge the terms on which it is offered.

12.	The appellant said that when he was told the names of the people who would be travelling and realised he did not know two of them he asked who they were and Mr Evans said they were good friends of his so he did not take it any further.  He also admitted that initially he had made no enquiries about who would be travelling and that it was only when it turned out that the names were needed to make the booking that he asked Mr Varley who would be travelling.

13.	Mr Varley said in evidence that he did not envisage that the car would be seized although he did admit that he knew there was a risk.  Ms Jones asked him if a reasonable person would not have taken steps to see that he would not lose his car.  His reply was “I did not realise the car came into the question of being seized.  I am not a solicitor or a barrister.  I don’t know the law.  It is just something you do not think about”.  Later he said he did not read the papers so he wasn’t aware people’s cars were taken.  Finally he said “I thought only the person who owned the car could have it taken if they were carrying the cigarettes.  I did know people’s own cars could be taken if they were carrying cigarettes and I have seen that on the news”.

14.	Our finding is that Mr Varley allowed Mr Evans to use the car in circumstances where he was at least recklessly indifferent as to whether Mr Evans would bring excise goods back for commercial purposes.  His lack of concern may have been engendered by his own mistaken belief that a third party’s car could not be seized but the very least that can be said is that he was morally indifferent to the use to which his car might be put and thereby took the risk that it would be used illicitly.  Having taken that risk he now complains that his car should be returned free of charge.

15.	The commissioners’ policy about restoration of third parties’ cars as explained in the review is that they will only be restored if the third party is innocent and blameless of the smuggling attempt and has taken reasonable steps to ensure the car is not used for illicit purposes.

16.	In our view that policy is one that it is reasonable for the commissioners to adopt and that it is reasonable to apply it in the circumstances of this case.  Having decided to apply it we hold that they were also fully justified in concluding that Mr Varley was not blameless in the sense that he had adopted the attitude that it did not matter if the car was used for smuggling because he did not think it could be taken from him as a third party who would not be present at the importation.  We do not go so far as to find that he knew the car would be used in that way but we do find that he was recklessly indifferent to whether it would be used in that way and in our view the commissioners’ decision and the review upholding it is reasonable.   

17.	We would add that the commissioners’ decision was based on an underestimate of the car’s value, at least according to the appellant’s own estimate of its value.  The restoration fee of £900 is not disproportionate to the value of the car which he gave as £4,500 or thereabouts.  Nor is it disproportionate to the duty sought to be evaded which was £2,729.76.

18.	The mistakes made by the respondents’ in their Statement of Case and review, whilst unhelpful to the Tribunal in hearing this appeal, have not in any way adversely affected the appellant and are in that respect irrelevant to his case.

19.	The appeal is dismissed.  The respondents did not seek their costs and we make no order.  The review decision is upheld without the need for further review.

Richard Barlow
CHAIRMAN

Release date: 7 October 2008

MAN/07/8096