I was delighted to read about Mr Neil Martin, a builder being allowed to sue the revenue for negligence.
The case revolved around Mr Martin’s application for a sub contractor’s tax certificate when his company expanded in June 1998 but the correct paperwork did not arrive until 3 months later. Without that paperwork he could not be paid by the main contractors who employed him. As a result of the delays he suffered overall losses of half a million pounds and faced a tax bill of £250,000.
Three appeal court judges ruled that there was no policy or legal grounds barring a taxpayer who suffered financial loss through the revenues negligence from suing.
This takes me on to case that I am running at the present time.
Out of the blue a client received a letter from HMRC in Charles House, Kensington, saying they had a judgment in the West London County Court for £60,767.50 plus £600 costs and asking for a payment of £61,367.50 now.
That was in June of 2007. The lady came to see me, very distressed, as she had no idea what it was all about. I then obtained her instructions and faxed a 64-8 form to Charles House saying I was instructed to act.
That was on the 11th June and, as is my wont, I telephoned Charles House on the 27th June to see if the letter had arrived.
I spoke to a lady who could find no trace of it so later that day I sent her a copy of the letter of the 11th June together with a copy of the 64-8.
I then received, by fax, a summons that indeed had been taken out against my client and another person who was her partner at the time.
The funny thing is that on the court summons my clients address was stated as being unknown so it was obvious to everyone that she had never received a summons.
On the 12th July I wrote asking for full copies of Schedule D assessments, copy accounts, computation of penalties, computation of interest, copies of all correspondence within the parties, etc to try and establish what the claim was. I also advised HMRC that my client had no idea there were any outstanding assessments and indeed these assessments actually went back to 1991 which seemed extraordinary.
I received a telephone call from a young lady saying that she had taken over the case and she would be dealing with it in due course. I had pointed out to her that I was instructed to apply to have the judgment set aside in the West London County Court and asked her whether or not HMRC had any objections to that.
If they had objections then it was going to be necessary to instruct counsel to attend the West London County Court and I had already had an indication of a sum of £3,000 to do so.
She was unable to help me on that.
On the 7th August I rang the young lady dealing with it and spoke to another lady. I impressed upon her how important it was that now we had the judgment drawn to our attention it was absolutely necessary to apply to have the judgment set aside as early as possible and were they able to deal with the request in my letter of the 12th July giving me all the information I required.
Earlier I had been given two other tax offices where the file might be by another lady in Charles House but they had been unable to help me and referred me back to Charles House saying that the file of papers would be with them.
I explained this again to the two young ladies I was speaking to but I was getting nowhere.
They seemed to take the position that I was making a complaint and if it was a complaint then it should be dealt with in writing, would I write in?
I pressed the young lady who said she had taken over the case for an answer. I said I didn’t need to write in; she could give me an answer. It was straight forward; did they object to the judgment that I wanted to have set aside?
Now events later on indicated to me, because at that time I had no knowledge, that the judgment in the West London County Court referred to in the letter from HMRC was in fact a lie.
Obviously the lady I was speaking to knew there was no judgment but she didn’t tell me there was no judgment. She persistently kept telling me to write in but this, to me, seemed to be totally unhelpful. I pointed out to her that she said she had taken over the case and she was going to be dealing with it but she wasn’t dealing with it so there we are, it ended up with me being totally frustrated in not getting passed the person who was supposed to be dealing with it in HMRC.
I then received a letter after we tried to contact the other people in the office without success from a debt manager.
The first thing she said was that in actual fact there is no judgment against your client in the West London County Court.
She said the lie was an error. Now you either tell the truth or you don’t but in this case it was an error and she apologised for that but to me it was astounding. Here was HMRC writing to a person about a very serious debt saying they had a county court judgment against them in the court which they wanted to expedite, and all along that letter was a total fraud, it was a pack of lies. They had not got a judgment and if my client hadn’t come to me how long would the HMRC have kept up the fraud of saying there was a judgment when in fact there wasn’t and chasing my client for monies that clearly she didn’t owe?
The debt manager went on to say she knew that the HMRC actions had caused me to do unnecessary work and had caused me a lot of frustration but then went on to complain about speaking to a member of the staff in an aggressive and insulting manner.
Well for the second time I was astounded but I understood now why the lady who was supposed to be handling the case had got frustrated and upset.
She knew that the revenue was telling lies.
She knew there was no judgement in the West London County Court.
She knew what I was asking for was perfectly reasonable but because somebody had lied within the system at HMRC she was stuck with it and she didn’t know how to handle it.
That was why she was embarrassed.
That was why she was upset.
That was why she was totally unequipped to handle that sort of inquiry, and who would be?
Well the matter has now gone further than that in so far as another debt manager has written to my client complaining about the response I made to that particular letter because you can imagine that I wasn’t very happy at all with it and the other chap has said that my letter is unprofessional, which he spelt using 2 f’s of course, and went on to say that they may not be able to correspond with me, well I have never read anything so ridiculous in forty years of corresponding with the revenue and I have written to him telling him the facts as I see them and as I have stated here.
This lady was upset, embarrassed and quite frankly put in an awkward position by the revenue telling deliberate lies to my client about a judgment that was never obtained against her and as far as I was concerned it was an abuse of power and I still think it is an abuse of power and we are now looking at other ways of dealing with this.
I have also sent them under the Freedom of Information Act 2000 Section 8 a demand to produce the documentation within twenty days or face further procedures.
But there you are; the Revenue, this huge machine, has to resort to tactics that are totally unbecoming and if in any other walk of life you belong to a professional body or you are an ordinary person you would either be prosecuted or you would be dragged up before the professional body for misconduct or whatever. But the Revenue seem to go around doing exactly what they want to do, but now perhaps this case of the builder will give tax payers some recourse.
Something needs to be done. It’s just totally wrong that these sort of procedures can be taken by people and then when they are queried and they are found out they then take a stance that they have been abused, it is just ridiculous.
Needless to say my client now has instructed me to write to her member of parliament making an official complaint and I will let you know what happens.
Keep plugged in here but the moral of this tale is very simply don’t believe everything you read in a letter from HMRC, check it, double check it, and treble check it because somewhere down the line there might be monkeys in the system.
All the best for now, speak to you soon.