EXCISE DUTY Restoration Vehicle Seized When Used by the Appellant S Son to Import Excise

E01037

EXCISE DUTY – Restoration – Vehicle seized when used by the Appellant’s son to import excise goods held for a commercial purpose – whether the vehicle was owned by the Appellant, or by his son, or jointly – Found that the vehicle was owned by the Appellant – appeal allowed

LONDON TRIBUNAL CENTRE

NEIL IVAN WIGLEYAppellant

- and -

THE COMMISSIONERS FOR HER MAJESTY’S

REVENUE AND CUSTOMSRespondents

Tribunal:JOHN WALTERS QC (Chairman)

MRS. NORAH CLARKE

Sitting in public in Cardiff on 15 February 2007

The Appellant in person

Ms. Fiona Darroch, instructed by the Acting Solicitor for HM Revenue and Customs, for the Respondents

DECISION

The Appellant, Mr. Neil Wigley, appeals against the Commissioners’ decision on a review under sections 14 and 15 of, and Schedule 5 to the Finance Act 1994, not to restore a BMW 318i Convertible motor car, registration number N513 NOW, to him. The vehicle was seized at Dover Eastern Docks on 7 December 2005. The Appellant’s son, Gyles Wigley (who was 23 at the time) was driving the vehicle when it was stopped by Customs officers. Ms. Rebecca Davies was a passenger in the car at the time.
The travellers, Gyles Wigley and Rebecca Davies, had with them in the car a quantity of excise goods (tobacco and alcoholic products). They were interviewed by Customs officers. As a result of the interviews the responsible Customs officer was satisfied that the tobacco products were held for a commercial purpose and they were seized under section 139(1) Customs and Excise Management Act 1979 (“CEMA”). Other excise goods were seized under s.139(1) CEMA, as being liable to forfeiture under s.141(1)(b) CEMA, because they were mixed or packed or found with goods liable to forfeiture. The car was seized under s. 139(1) CEMAZ as being liable to forfeiture under s.141(1)(a) CEMA, because it was used for the carriage of goods liable to forfeiture.
This appeal is not concerned at all with the seizure of tobacco and other excise goods.
On 9 December 2005, the Appellant made a written request to the Commissioners for the return of the vehicle. He enclosed with his letter a copy of the V5 registration document, which showed him as the registered keeper of the vehicle for the purposes of vehicle registration. The Appellant stated in the letter that he needed the vehicle to attend cancer treatment. At the Commissioners’ request, the Appellant completed a questionnaire, providing further details, such as that Gyles Wigley was the Appellant’s son, and that he had borrowed the car for two days, and that the Appellant had not been aware that the car would be used for the trip abroad. The Appellant also indicated that there was another car available for his use. On 24 January 2006, a Customs officer (S. Quinn) replied, refusing restoration of the vehicle. The Appellant wrote on 1 March 2006, requesting a review of this decision. He stated that he had purchased the car on 11 April 2003 for £8,000. It had been purchased with £5,000 of the Appellant’s own money and with £3,000 loaned by Gyles Wigley. No receipt for the purchase of the car was produced. The Appellant stated that he had subsequently repaid Gyles Wigley £6,000, which he had used to purchase a boat. Insurance documents were included to demonstrate that the Appellant, his wife and Gyles Wigley were insured to drive the car. The Appellant stated that he had paid for the insurance, the servicing, the maintenance and the MOT for the vehicle throughout the time that he had owned it, without any contribution from his son, Gyles.
Officer R. Brenton (who gave evidence to the Tribunal) carried out the review. He wrote to the Appellant on 18 April 2006, informing him of his decision to confirm the original decision of Officer Quinn, not to restore the vehicle.
Officer Brenton’s reasons, stated in his letter of 18 April 2006, for not restoring the vehicle to the Appellant pursuant to that part of the Commissioners’ policy which envisages the possibility of restoration at their discretion and subject to such conditions as they think proper, to a third party owner who was not present at the seizure and was either blameless or had taken reasonable steps to prevent smuggling in the vehicle, were as follows:
He stated that during his initial questioning on 7 December 2005, Gyles Wigley had stated that the car was registered “to” the Appellant, but that he, Gyles Wigley, had owned it for three years. Later, during his interview, he had said that it belonged to the Appellant. The Officer had then asked Gyles Wigley why he had initially claimed to be the owner of the car. He had stated “I paid for it”. He had then said that the Appellant used it sometimes and that the Appellant owned another vehicle, that the Appellant was aware that he had been using the vehicle that day and had been aware where he had been. These statements had been at variance with the information which the Appellant had subsequently provided to the Commissioners.
Officer Brenton went on in his letter:

“your son is 23 years of age. He is a driver in full time employment with little outgoings but has no vehicle registered in his name. He stated to a uniformed Customs Officer that he had owned the vehicle for three years and he had paid for it. I am fully aware that it is common practice for parents to register and insure vehicles on behalf of their children to keep the premium affordable. This is especially so in cases where a vehicle such as a BMW convertible would attract an astronomical and financially prohibitive premium for a young driver. I have considered all your submissions with regard to your claim of ownership. However I cannot accept that you would have purchased a car for £8,000 without a receipt, even though it was a private sale. The receipt is proof of ownership and I believe that you would be fully aware of this. With your son’s admissions and the absence of the receipt, I am led to doubt your claim that you were the owner of the BMW, particularly when you are also the owner of a 02 registered Nissan Almera.

Even if I were to believe that you were indeed the owner, which I do not, the Commissioners will consider restoring seized motor vehicles to owners who were not present at the time of seizure and can show that they were either innocent and blameless or innocent but blameworthy. However, Gyles Wigley was a frequent driver of the car and was insured to drive it. Therefore, to restore it to you would be tantamount to restoring it to him, the person involved in the attempt at smuggling. I therefore decline to restore the car to you as a genuine third-party owner.”

Officer Brenton went on to say that in his view the Appellant had not shown exceptional hardship. In particular his grounds for this conclusion were that the Appellant was the owner of the Nissan Almera car.
The Tribunal heard oral evidence from the Appellant and from Officer Brenton. Neither Gyles Wigley nor Rebecca Davies attended the hearing.
In evidence, the Appellant stated that the car belonged to him. He paid for it, he negotiated the price for it, and he went to London to purchase it (second hand). The log book is made up in his name.
He had not been able to find the receipt given on the purchase of the car. He thought it was in the car (which had been seized) with the car service records. He could not think where else it could be.
The second car in the Appellant’s household, the Nissan Almera, the Appellant regards as belonging to his wife. It replaces a car which she inherited from her father in 1990. The Appellant originally did not have a car, only a van. He then purchased a Ford convertible, and the BMW convertible was purchased to replace that, because the Ford leaked. The Ford had been purchased with money drawn down from the Appellant’s pension. The sale of the Ford had realised less than £1,500. The BMW had been purchased in April 2003 for £8,000.
The vendor of the BMW had been a private individual living in the London area. He would only accept cash. The car had been identified from an advertisement in Autocar magazine. A BMW convertible is not a very common car to acquire. There are not more than 3 or 4 in the whole of Pembrokeshire. On the day of the purchase, the Appellant only had £4,189 available to him in the bank. The rest of his money was in a bank account which required 28 days’ notice of withdrawal. He withdrew £4,000 in cash from his bank account to purchase the car. He had £1,000 left from the sale of the Ford, and Gyles Wigley lent the remaining £3,000 that was necessary to pay the purchase price of £8,000.
The Appellant did not discuss the question of the seizure of the car very fully with his son after the event. The reason for this was that he was very ill at that time (the beginning of December, 2005) and he was very angry with his son. Their relationship had suffered since the seizure of the car.
The Appellant did not know how much it would have cost to insure the car if his son had been the policy holder. The Appellant’s son, Gyles, had been 21 when the car was purchased.
In January 2004, the Appellant had assisted his son, Gyles, in the purchase of a boat. The boat had cost £6,000. The Appellant said that he had paid back the loan of £3,000 made to him by Gyles, when he had paid £6,000 for a boat for Gyles in January 2004. The receipt had been issued to Gyles. The balancing £3,000 had been regarded as a loan from the Appellant to Gyles, some of which he had paid back. The Appellant said there had been an understanding between himself and Gyles, that the £3,000 loan made when the car was purchased would be repaid when a boat was bought.
The Appellant explained the fact that his son, Gyles, did not attend the hearing by saying that he was in Cambodia, and had been there for a considerable time (since November 2006). He had given up his local job (he lived with his parents at their address in Pembrokeshire). The Appellant had not discussed with him the circumstances surrounding his trip to Cambodia.
On hardship, the Appellant said that he lived in a remote village. Although the family had another car, they needed two. When he used the car his wife was without the use of a car and vice versa. This caused exceptional hardship particularly bearing in mind his poor state of health and the need to make frequent hospital visits.
Officer Brenton, the reviewing officer, gave evidence that he had telephoned the Appellant and asked him whether he could produce the invoice for the car. The Appellant had said that he had been naïve and had not obtained a receipt. The Appellant denied this.
Officer Brenton stated that he himself had a son of similar age to Gyles Wigley. He registered a vehicle for his son and registered himself as the policy holder. In his case the vehicle was registered in his name even though he was not the owner of the vehicle (his son was).
Officer Brenton had been strongly influenced by Gyles Wigley’s statements at interview as follows:

Officer: Who does the vehicle belong to?

Gyles Wigley: To me.

Officer: Is it registered to you?

Gyles Wigley: No, it’s registered to my dad.

Officer: How long have you had the car?

Gyles Wigley: Three years.

Officer: Do you have any paperwork for the car?

Gyles Wigley: No, I haven’t, sorry.

and later

Officer: Is it actually your vehicle?

Gyles Wigley: It’s not registered to me, no.

Officer: Is it your father’s vehicle?

Gyles Wigley: Yes.

Officer: Why did you say it was your car?

Gyles Wigley: I paid for it.

Officer: Does your dad use it?

Gyles Wigley: Sometimes.

and later, after the car had been seized, the Officer attempted to explain Gyles Wigley’s onward travel options

Gyles Wigley: Let’s have it for comedy value

Officer: There’s no need to be like that. I am just trying to help and explain available options.

Gyles Wigley: You take my car and you expect me not to be angry.

Officer Brenton regarded it as not credible that the Appellant should not have a receipt for an £8,000 car. He recalled that there was no reference to service documentation in the list of goods taken out of the car at seizure. He told the Tribunal that he thought Gyles Wigley had bought the car and that his name is on the receipt, just as it is on the receipt for the boat, although in both cases the purchases had been funded by the Appellant.
The Appellant insisted that the car had been owned by himself solely. He was the registered owner. He made the point that non-one but he could sell the car.
Miss Darroch, for the Commissioners submitted that on the evidence it was possible to conclude that the car was owned by Gyles Wigley, or by Gyles Wigley jointly with the Appellant. It was not possible to conclude that it was owned by the Appellant alone. She submitted that the absence of the receipt was not the critical question and that she was making no allegations of mendacity against the Appellant. Miss Darroch submitted that the Appellant had not made out any exceptional hardship.

Decision

Having regard to the Commissioners’ policy on the restoration of vehicles in cases of this kind, the main issue which we have to determine is: who owned the car which was seized at Dover on 7 December 2005?
The burden of proof is on the Appellant, to show that Officer Brenton’s decision not to restore the vehicle to him was unreasonable (section 16(6) Finance Act 1994).
The evidence is incomplete. Leaving aside the issue of whether there was a receipt for the purchase of the vehicle, Gyles Wigley, whose answers at interview were relied on by the Commissioners, but disputed as being untrue or misleading by the Appellant, was not available for cross-examination.
We consider that Officer Brenton, in coming to his conclusion, placed too much emphasis on the absence of a receipt – Miss Darroch having submitted that this was “not the critical question”. The Tribunal finds that a receipt, if one was issued, was either mislaid, or kept in the vehicle. We also consider that Officer Brenton in reaching his decision had regard to the arrangement in his own family, whereby he had registered a car for his son in his own name, when the car actually belonged to his son. This is of course an irrelevant consideration and one apt to affect his judgment on the facts of the different case before him.
The answers given by Gyles Wigley in interview must be approached with caution, particularly having regard to the lack of cross-examination. He said both that the car belonged to him and, later, that it was his father’s vehicle. He said “I paid for it”, an answer to which Officer Brenton attributed much significance, but on the Appellant’s evidence he did make a significant payment (£3,000) when the car was bought and that could have been the basis on which he gave his answer.
We notice that the Appellant made a written request to the Commissioners for the return of the vehicle on 9 December 2005, only 2 days after the seizure. This is indicative that his immediate reaction to the seizure was that the Commissioners had seized a car that was his. This also has some probative value.
On the balance of probabilities we accept the Appellant’s evidence and conclude that he was the owner of the car when it was seized.
On that basis, and particularly bearing in mind the Appellant’s assertions during the course of the hearing that his son would never be permitted to use the vehicle again, it would be an unreasonable infringement of the Appellant’s rights of ownership to refuse to restore the vehicle to him simply because there was a possibility that Gyles Wigley might drive it again and that therefore such restoration would be tantamount to restoration to the person involved in the attempt at smuggling. It has to be borne in mind that such a possibility is always there when the owner of the vehicle is different from, but known to, the person involved in the attempt at smuggling.
On the issue of hardship, we uphold Officer Brenton’s conclusion that no exceptional hardship has been shown.
We therefore allow the appeal and direct that the Commissioners conduct a further review of the original decision not to restore the car to the Appellant, having regard to the findings of fact made by the Tribunal. Such review shall take place within 42 days of the release date of this Decision and shall be undertaken by an officer with no previous connection with the case.

At the conclusion of the hearing we established that should we decide the appeal in the Appellant’s favour, an award of costs in the sum of £100 would be regarded as reasonable by both parties. We accordingly direct the Commissioners to pay that amount on account of costs to the Appellant within the said period of 42 days.

JOHN WALTERS QC

CHAIRMAN

RELEASE DATE: 10 April 2007

LON/2006/8039