HMRC vs MGH

Our own John Clark has been at the latest round of the battle of the EBTs.

His take on proceedings is below.

Day I of Court of Session Appeal

Today in Court 2 in Parliament House.
The teams:
For HMRC: Mr Julian Ghosh QC, Mr Thomson QC.
Sypported by 2 solicitors and a number of HMRC people.
For MG and Others, Mr Dunlop, QC and another bewigged person whose name I didn’t catch,supported by three solicitors.
On the bench , my lords Carloway, Menzies and Drummond-Young, bewigged or gowned.
Sadly, Mr Ghosh is very quiet-spoken and from 4 rows back and him with his back to us,I missed quite a lot through hearing only parts of what he said, usually the links of his argument!
Very briefly,Mr Ghosh gave an outline of the essence of the scheme.
He made much of the point that the Main Trustee knew from a ‘letter of wishes’ and the loan application how much was to be settled in a ny sub-trust.
He emphasised that this Trust money was part of the remuneration package earned for work done.The only reason it was deemed not taxable was that the money was not paid directly to the employee.
The employee was free to say ” don’t pay me, pay someone else..my wife, brother or whatever.”
In this case, the ‘someone else’ was the Main Trust, in the employee’s belief that loans would be obtained, that the Trustee’s discretion would be used in the right way.
That, said Mr Ghosh, is the principle involved. It would be catastrophic for the public purse if that was all that needed to be done to avoid tax.
The finding that it was a true exercise of discretion is unsound. The significance of that point was missed by the FTT.

Judge Menzies : It was not apparent.
Mr Ghosh said that it is that principle that this Court is to decide.
He then discussed the Main Trust (set up by MGL) documents, mentioned that were 5 different employers, and then a whole lot of sub-trusts. And subsequent variations . In one Trust only, Sir David Murray as Protector was given ‘absolute’ powers ( And here Mr Ghosh said that what SDM did in exercise of those powers ‘he simply could not do!)
[I kind of missed what it was he did, but apparently he had power to exclude future employees and/or include them, or maybe both]
Mr Ghosh said the scheme worked thus: communication between the Trust and the employer, communication between employer and employee, and communication by ‘letter of wish’ between the employee as Protector of his sub-trust and the Main Trust.
He selected three particular cases- Bain, McLean and McCann, and discussed relevant documents, (letters of wishes and side letters) showing the true nature of the Trusts, with the employer undertaking to make payment if a loan were ever to be refused. For example, in the McLean case the letter said ” In the event that the…..the CLUB will pay to you the balance….”
And the monies to be paid were in all footballer cases earned income, and in Bain’s case, bonus for good performance.
So,Mr Ghosh said, we have got to a place where cash payments were being made by the employer on terms where the money is being paid to someone else, in a diversion of earnings to avoid tax.
He then ran through how various sections of the Income Tax Act would apply to such earnings ( requirement on employer to deduct tax, even if payment made to an intermediary or to a person acting on behalf of the employer.
he moved on to consider whether these payments whether made by the employer to the Main trust or whether by the Main trust to a sub-Trust, were to be regarded as ’emoluments’.
He referred to a number of cases :A case involving a partner in KPMG who tried to assign his earnings { and, in parenthesis, he observed that Mr Thornhill had argued that it was an assignment of proprietary interest in his assets as a partner, in the only case that he had won: discreet smiles all round}
And the case of Collins, in which in the sale of shares part of the ‘consideration’ was to be paid to the Company to be held by someone else.
The overall argument, in Mr Ghosh’s submission is ‘YOU the employee are due the money. if was paid to someone else at your request, so what?
He went on to fillet the Defpra case, the EDwards and Roberts case, and showed that a true reading of these did not support any view that payments made by an employer into a Trust were anything other than remuneration.
in the present case, the footballers were given an unconditional guarantee that they would get paid, even if their Trust were to refuse a loan.
There was then discussion by Mr Ghosh of Lord Hodge’s judgement in a NIC case in which a distinction had been made by Lord H between earnings and emoluments in so far as National Insurance Contributions was concerned… The case of Mr McHugh, a company director who benefited because his Trust provided a pension for life ( when he was aged 54 , provided he lived to age 60).
There was no such contingency applying to the Trust loans: the football players had a very present hope and expectation of being paid here and now.
MR Ghosh’s position is that here we have the employee getting a payment of remuneration in a way that he is happy with..
Then Mr Ghosh gave his view of how Ramsay was to be understood.Basically, look at the true transaction, look at the partries, what is the transaction realistically.One is to assess the actual parties, and the relevant actions, and look at the provisions and then look at the actions realistically.
Is it part of a remuneration package?
Yes, it is! Thar’s what McLean got, and McCann…
He cited the SPI(?) case where they wanted to sell gilts to City Bank, and wanted them back commercially.To beat Ramsay, there was a contingency clause about there being a sale, and then a sale back.It is not good enough to builkd in artificial contingencies just to beat ramsay.
The true transaction was that there was no sale.
At this point Mr Ghosh explained that he was not attacking the findings of fact of the FTTT.
But we just have to accept that the payments made to the trust were the application of wages.
Ramsay, Edwards and Roberts tell us… the players were told if you get a loan we’ll pay you money, and the letter of wishes is what decides the settlement.
There followed a bit from Mr Ghosh about the ‘causal connection’ between the money paid into the Main trust and the the money paid to the Sub-trust and, subsequently to the player.
Lord Menzies remarked that if there was no causal connection between the employer and the Main Trust, isn’t the link broken?
Mr Ghosh replied that the causal chain doesn’t start until the money is paid to the player following receipt of letter of wishes and loan application. [ I think that’s what he said]
And in the case of non-players, if the money was not paid to the appellant as an employee, then on what basis would it have been paid?
And Mr Ghosh moved on to show that what was paid was ‘remuneration’ He used McMillan’s ( Group tax and pensions manager)letter in which he used words and phrases such as ‘footballer’s packge…and balance recorded in the side-letters’ ‘remuneration package, part opayable through the trust’
and ‘for non-footballers, payment in lieu of bonus earned’
Mr Ghosh again emphasised he was not attacking the Findings of fact. But he remarked that the it was annoying the way the Tribunal recorded the evidence)
He then itemised certain sentences and word in the evidence given by McCann’s agent, Naco Novo’s agent, Mr Bain’s side letters relating to his discussion with SDM about looking for payment in respect of 6grand tax that Bain had had to pay,
and then, on the question of ‘unreserved disposal’ he faulted the the arguments in the Sempra case as being quite wrong.
And criticised a number of the FTTT’s paragraphs ( 234 misses the point,it has nothing to do with entitlement), 235 is incorrect (nobody is talking about ‘absolute transfer of funds),237 is just rubbish or irrelevant- ‘absolutely and unreservedly is NOT the test.
And the Finding in Law number 4 is mistaken( This seems to be about Trust Law, and Lord Drummond-Young clarified what Mr Ghosh was saying, and then both agreed on the point (whatever it was)
Mt ghosh continued by saying that the FTTT had made several non-findings of fact
and non-findings of law, and arrive at ‘Accordingly..’
at which point Lord Carloway interjected that ‘accordingly is usually followed by a non-sequitur.!

And then it was home time, at 4.00 pm.
Court reconvenes at 10.30 tomorrow.

Trisidium

Trisidium

Trisidium is a Dunblane businessman with a keen interest in Scottish Football. He is a Celtic fan, although the demands of modern-day parenting have seen him less at games and more as a taxi service for his kids.

65 Comments
  1. Homunculus

    Homunculus


    JC

    Thanks for doing that, appreciated as always. As an aside, I was reading some basic stuff on trusts just a few days ago (totally unrelated to this honestly, just an onerous thing I had to do) and came across the concept of the letter of wishes. I copy this from the interweb by way of explanation.

    “A letter of wishes is a non-binding indication by the settlor of the manner in which he wishes the trustees to exercise their discretion in relation to a discretionary trust.”

    The settlor is the person / entity putting the money in.

    I believe, as I said the other night, that the crux of the matter is and always has been the lack of discretion with both the payments into the trust and the “loans” out. That is what makes the whole thing fail. You cannot have a discretionary trust when neither the settlor or the trustee has any discretion and it is in fact a contractual obligation between employer (settlor) and employee (beneficiary).

    With regard who the money can be paid to, are they suggesting that if I have my salary paid directly into my wife’s bank account (which would at least cut out the middle man) then there is no tax due. I’ll set that up tomorrow then, what a wizard wheeze.

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  2. John Clark


    Just spotted that I missed out a ‘not’- the judges were NOT bewigged and begowned!The QCs were.
    I also forgot to mention, or rather, forgot to clear with another poster on the blog who was present and with whom I lunched sumptuously (aye, okay, lentil soup and a wee hot baguette) that I could mention his blog name, so I won’t mention it at the moment.

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  3. easyJambo


    Great stuff JC – I will try to get along on at least one day this week.

    Quick question – who is McLean? or was it McClelland?

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  4. John Clark


    easyJambo says:
    Member: (689 comments)
    July 7, 2015 at 9:16 pm
    ‘…Quick question – who is McLean? or was it McClelland?’
    ———–
    My scribble reads ‘McLean’,as a reference to a former player.I haven’t checked with the names in the FTTT evidence, but I wondered myself if there had been a player with that name among the EBT lot. I’m actually struggling to remember whether there was a McLelland! But you might be right, I’ll try to check it.
    And thanks for your kind words, and I hope you manage along.
    McLean was referred to as having been a former player. The Mc

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  5. easyJambo


    JC – John McClelland was a former chairman of the club who received an EBT to the value of £225,000.

    I can’t find any other name in the EBT list that is similar to McLean

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  6. Johnbud78

    Johnbud78


    Fantastic work JC! Appreciate all the work you put into keeping all the bampots up to date. As per, nothing in the MSMS that I have seen!

    Looking forward to your next enthralling installment 😛 😛

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  7. jimbo

    jimbo


    Thanks for that JC. (&The other poster who was there) Good to hear EasyJambo is going too. A lot of it goes over my head but I get the jist of it.

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  8. AyeRightNaw


    Posted this in main blog but thought I’d stick it here too.
    The McLean Mystery
    Could it be that a new name was outed at the start of this final hearing?
    It may be possible that John Clark heard correctly and that the Tom McLean referred to is the former winger who ended a great playing career in 1982 and became Rangers’ assistant manager. He left after a couple of years but returned to Ibrox to become Under-19 coach at Rangers in the late 1990s. Tommy returned to Rangers in May 2001 as director of youth development, after he had held a similar post at Dundee United since October 2000.

    This seems to fit the EBT timeframe, however I could well be wrong, especially as some of the info comes from wikipedia.

    More power to you JC!

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  9. Danish Pastry


    Bravo JC! Read this late last night after a very active day so ma eyes wur swivilin 🙂 The introduction of a QC named ‘Ghosh’ is as stroke of unintentional comedy genius by someone.

    I notice certain fans bemoaning the whole appeal exercise as a shameful waste of taxpayers’ money :irony: + 😀

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  10. blu


    Ayerightnaw,

    Wouldn’t wish to malign Tommy McLean as a tax avoider but he was at Rangers at that time. Link to BBC report here: http://news.bbc.co.uk/sport1/hi/football/scot_prem/1324047.stm

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  11. buckfastswallier


    Taken me sometime to get clarity on this process, couldn’t have done without this blog and especially your accounts of court proceedings JC. Thanks.

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  12. AyeRightNaw


    blu on July 8, 2015 at 8:34 am

    I was reticent about posting the coincidence as I too am fearful of slighting anyone unfairly. That’s why I included the caveats but overall it does seem consistent with the Ibrox approach to paying taxes during his final spell at the club.

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  13. yourhavingalaugh

    yourhavingalaugh


    Interesting reading on McLeans club path’s and position’s but as with all that seemed involved at Auchenhowie very few have had success in producing top talent,Utd seem to continue to produce good talent continuing from Jim McLean’s days,maybe somebody got mixed up with the brothers.

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  14. zerotolerance1903

    zerotolerance1903


    Thanks for the summary, good stuff.

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  15. thequay


    The only other McLean I could think of is Brian, brother of ref Steven. He was a signed pro at the club from 2004 – 2006 however I can’t trace him playing for the first team so unlikely he was involved with EBTs. Seems to be Wee Tommy right enough.

    Credit due to the court reporter for the account of yesterday’s proceedings !

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  16. valentinesclown

    valentinesclown


    Thank you JC for taking the time to attend the appeal and then post on here. Concerning HMRC appeal I always recall RTC posted that HMRC will appeal and appeal to the highest level as the evidence is overwhelming. The truth will prevail.

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  17. toadinthehole


    Excellent work John Clark! Reading the evidence, it still astounds me that HMRC have had to take it this far.

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  18. AyeRightNaw


    valentinesclown on July 8, 2015 at 9:38 am

    I also recall from early days some speculation that HMRC wanted the decision made at the highest court possible to establish case law precedent. Suspect this might be a court one step further than anticipated.

    Wishful thinking might also be clouding my recollections!

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  19. Eddiegoldtop

    Eddiegoldtop


    John Clarke says

    I also forgot to mention, or rather, forgot to clear with another poster on the blog who was present and with whom I lunched sumptuously (aye, okay, lentil soup and a wee hot baguette) that I could mention his blog name, so I won’t mention it at the moment.

    ————————————————————————————–
    I hope you had money with you this time ! ? 😆

    Well done on the commentary and thank you very much.
    Unfortunately I couldn’t make it this time . Maybe next time at the Supreme Court !

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  20. Eddiegoldtop

    Eddiegoldtop


    AyeRightNaw says

    valentinesclown on July 8, 2015 at 9:38 am

    I also recall from early days some speculation that HMRC wanted the decision made at the highest court possible to establish case law precedent. Suspect this might be a court one step further than anticipated.

    —————————————————————–

    That is my recollection also and I may be wrong but I am sure if HMRC fail again here then the next step is the Supreme Court (London?) at which case will be the highest court possible (?) and which will pretty much give them legal precedent to challenge the ” big fish ” of the English league where the EBT’s are used extensively and the returns to the HMRC would be ” off the radar ” ( sorry ) !

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  21. AyeRightNaw


    Eddiegoldtop on July 8, 2015 at 11:25 am

    Yep – forgot about the Supreme Court as next stage. Legal folks will correct I’m sure but think this level (UTT) or Supreme Court both count for case law.

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  22. Homunculus

    Homunculus


    Eddiegoldtop says:
    Member: (6 comments)

    July 8, 2015 at 11:25 am

    I am aware that at least some tax matters can go as far as the European Court of Justice, though I can’t confirm whether the tax liability of an improperly run EBT would be one of them.

    It is often claimed that the UK has control over it’s own taxation matters, however this is simply not the case, or at least not totally so. VAT for example, it is easy enough to find cases where the ECJ has ruled on VAT as it relates to the UK.

    Just at random

    http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/11102419/European-court-adds-hundreds-of-millions-to-UK-bank-taxes.html

    The question is though, would HMRC, should it lose at the Supreme Court, really want to try to refer the matter to the ECJ, even if they could.

    I suspect that the Supreme Court is as far as they would want to go.

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  23. jimbo

    jimbo


    John Clark posted yesterday 8.40 am. that the Court of Session judges are sitting as Judges of the Supreme Court so no further appeals.

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  24. HirsutePursuit


    The inner house of the Cos is ostensibly the supreme civil court in Scotland. However the UK supreme Court is the final court of appeal for all UK civil cases – and criminal cases in England and Wales.

    So I believe either party can have a further appeal – but only if permission to appeal is granted.

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  25. Homunculus

    Homunculus


    HirsutePursuit says:
    Member: (94 comments)

    July 8, 2015 at 12:18 pm

    That was my understanding, and as stated in my last I don’t imagine HMRC would choose to go further, even if they could.

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  26. easyJambo


    I went along to the CoS today and an interesting day it eventually turned out to be.

    I’ll leave JC to do his usual transcript from his copious notes, but I will give brief summary.

    The morning started with a adjournment to fix an IT problem, but we were soon underway with (the almost inaudible) Mr Ghosh following on from where he finished last night.

    He reaffirmed his belief that the FTTT and UTTT had failed to consider remuneration and entitlement adequately and thus failed on a critical finding in Law.

    He focussed on the transfer of money from the employer to the main trust as being taxable at that point.

    He asked to Lords if they would consider some transcripts from the FTTT. After a 30 second discussion, the Lords decided not to, but would rely on the “Decisions” of the FTTT and UTTT.

    He then moved onto the jurisdiction of the CoS re English Trusts vis a vis tax law which is UK wide. I wasn’t clear on what point he was trying to make but he didn’t get any dissention from the Lords.

    His final arguments were about the roles, responsibilities and actions of the trusts’ Protectors, Trustees and beneficiaries. The main thrust of the argument was that both SDM and ultimately the employees could do what they wanted. The powers of SDM in particular were questioned and deemed to be in excess of what he should be allowed.

    Mr Dunlop opened with a little nugget saying that he was only acting on behalf of respondent 5 (I assume that to be Rangers). If I’ve understood what he said correctly, it could be that the other Murray group companies have abandoned the appeal now that they have been liquidated and dissolved.

    Dunlop then outlined the four areas that he would address during his submission.
    1. The Scope of the appeal
    2. Arguments against HMRC’s belief that the FTTT and UTTT had judged the case on the wrong test (funds unreservedly available to the employee)
    3. Redirected Payments
    4. The role of Protectors (SDM?)

    1) He argued that the court should not consider arguments from HMRC relating to matters that were not presented to the FTTT, e.g. the transfer on money from the employer to the main trust.
    He also argued that the FTTT and UTTT couldn’t be held responsible for their failing to respond to evidence that wasn’t presented to them
    He belied that the Lords should focus more on the UTTT decision than the FTTT.

    The three Lords pulled him up about the scope saying that it was agreed by both parties at a pre hearing in May and that Mr Ghosh had only raised issues that had been agreed at that meeting.

    2) Mr Dunlop then got himself into difficulty when arguing when payments or entitlements became taxable and what constituted an entitlement.

    There were some quizzical looks from the Law Lords and the HMRC representatives. Dunlop was questioned on various aspects of what he was claiming and I didn’t think he got his point across very well.

    However, his performance improved a little towards the end of the day when he started quoting from previous case judgements that appeared to support his position.

    Mr Dunlop expects to finish his submission around tomorrow lunchtime and it is possible we will get closing arguments completed by the end of the day.

    The appeal will be starting at 10am tomorrow to try and get it completed a day early.

    I’d give HMRC a win on points today, but I don’t know how positively the Lords will have taken Ghosh’s submission.

    Ghosh came across better than Thomson for HMRC at the UTTT, but I felt Dunlop was pretty poor compared to Thornhill.

    I’m sure that JC will correct me if I have interpreted or recalled things incorrectly.

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  27. John Clark


    HirsutePursuit says:
    Member: (94 comments)
    July 8, 2015 at 12:18 pm
    ‘..The inner house of the Cos is ostensibly the supreme civil court in Scotland. However the UK supreme Court is the final court of appeal for all UK civil cases – and criminal cases in England and Wales.

    So I believe either party can have a further appeal – but only if permission to appeal is granted
    _______
    There does appear to be a further right of appeal.
    You are quite right. I was quite wrong, I learned today. I clearly misunderstood what I had read about the appeal avenue from the UTTT. My apologies.

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  28. billyj1


    Test

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  29. Auldheid


    Looking ahead has anyone given any thought to what a decision in favour of HMRC would mean for the LNS Decision based on the premise that at that time the ebts used were not themselves irregular if it turns out they were?

    Additionally does evidence that LNS only reached his decision because the true nature of some ebts used, ie the early DOS ones, were irregular also impact on the validity of the Decision he reached?

    The fact that the SPFL, SFA and Harper MacLeod have not responded to the impact of the witheld evidence when it was presented to them suggests that they recognise that it does undermine the findings of the LNS Commission but are refusing to comment.

    If HMRC win their appeal is a no comment by them which is already questionable become untenable.

    In short could the LNS Commission be allowed to stand if HMRC win, especially if evidence exists that the Commission was misdirected and so misconstituted in the first place?

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  30. Smugas


    Hate to pee on the parade but there is an alternative finding, where the appeal gets chucked, deservedly or otherwise!

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  31. Homunculus

    Homunculus


    Thanks for that EJ, as with JC the efforts are much appreciated.

    I would pick up specifically on one point you bring from the hearing.

    “He focussed on the transfer of money from the employer to the main trust as being taxable at that point.

    And say, not to you, to the World in general … “No ships, Shylock” who would have thunk it.

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  32. Auldheid


    Smugas

    After the original decision which supports the view that RFC properly arranged its tax affairs under the tax laws at the time but laws that have changed so that subsequently such an arrangement would be illegal, then anything can happen.

    It’s like using Time Shift to validate a wrongdoing or closing the stable door.

    Brysonesque in approach.

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  33. Smugas


    Sorry auld heid you’ve lost me with that one! I was merely reminding the blog that the decision could still go against HMRC in which case prepare for an onslaught of how we all had it ‘infamy’ and how the old company should never have gone down, reducing debt etc etc ya de blumin ya. of course one interesting twist from such an outcome is that it would make Kings CVA stance very questionable. But then it was only the holding company wasn’t it?

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  34. Danish Pastry


    Smugas on July 8, 2015 at 6:53 pm

    Hate to pee on the parade but there is an alternative finding, where the appeal gets chucked, deservedly or otherwise!
    ——

    To be honest, it’s very hard to believe in an HMRC victory. Recent high-profile cases I’ve followed have left me with very little faith in the ‘Scottish’ judiciary to do the right thing. How many of those currently sitting in judgement on this case are members of a secret society? Is it public knowledge? If not, it should be.

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  35. John Clark


    I cannot usefully add anything to Easyjambo’s brilliant general summary of how things went.

    Except maybe to say that Mr Ghosh seemed to have a friend in Lord Drummond-Young on the matter of his views on English trust law:

    Mr Dunlop produced a not entirely gruntled ” are we not the specialists in the law?” when he clumsily expressed the view that the specialist FTTT tribunals are best placed to examine the commercial facts and the application of taxation law:
    and Mr Dunlop drew a certain amount of fire from all three judges on his somewhat startling proposition that ‘there is no entitlement until payment is made”.

    It was a relief to be able to hear every word of Mr Dunlop loud and clear after straining to hear Mr Ghosh.
    I’d agree with Ej that Ghosh had a points victory,but perhaps that came more from his low-key, incisive, matter-fact-style [and his reputation and standing] as from his view of the law.
    We’ll see what tomorrow brings!

    [And I should make a correction to my previous report: Mr Thomson is not a QC, ‘just’ an advocate. And Mr Dunlop’s side-man is Mr Richardson, who is also ‘just’ an advocate.]

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  36. Homunculus

    Homunculus


    JC / EJ

    Is the chap appearing for the respondent.

    http://www.axiomadvocates.com/advocate/17/roddy_dunlop_qc

    If so he is clearly a clever and talented man, however going by the webpage this isn’t really his field. I’m not saying he isn’t more than capable, it just seems his expertise may be in other areas.

    “His expertise covers media law, professional negligence, professional discipline, insurance law, commercial disputes, procurement, intellectual property, human rights, prescription and limitation, and judicial review.”

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  37. gunnerb


    Auldheid says:
    Blog Writer: (475 comments)
    July 8, 2015 at 6:47 pm

    Looking ahead has anyone given any thought to what a decision in favour of HMRC would mean for the LNS Decision based on the premise that at that time the ebts used were not themselves irregular if it turns out they were?
    ——————————————-

    Did LNS not state in his closing remarks that the decision would not be revisited regardless of any final judicial outcome with regard to EBT use ? If so then the rubber ear will once again be reached for, as they batten down the hatches and wait for the storm to clear.

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  38. Auldheid


    Smugas says:
    Member: (870 comments)

    July 8, 2015 at 7:44 pm

    Sorry auld heid you’ve lost me with that one! I was merely reminding the blog that the decision could still go against HMRC in which case prepare for an onslaught of how we all had it ‘infamy’ and how the old company should never have gone down, reducing debt etc etc ya de blumin ya. of course one interesting twist from such an outcome is that it would make Kings CVA stance very questionable. But then it was only the holding company wasn’t it?
    ———————-
    Oh that! Well to save us from the “we did nothing wrong” claims

    1. Why hide full player registrations details for 10 years?

    2. Why lie in 2005 about the side letters that were part of the registrations when specifically asked by HMRC if side letters existed for two players paid by DOS ebts?

    3 Why conceal the evidence of the wrongdoing at 2 from the SPL lawyers contained in one HMRC letter charging negligence or fraud by RFC in order for HMRC to justify pursuit of payment of the £2.8M (wee) tax bill?

    4. Why lie to UEFA in 2011 about the status of the wee tax bill?

    5. Why not provide the actual wee tax bill to the SFA in 2011 to meet UEFA FFP requirements for retaining the 2011 UEFA licence along with another revealing HMRC letter accompanying the bill

    6. Why keep the same documents at 5 from the SPL lawyers in 2012?

    7. Why walk away from the millions of non tax debt using insolvency law and try to carry on as before as an SPL club?

    If they protest innocence I think it can be shown they protest too much although I would not expect the above to be pointed out by mainstream media even if they had the evidence.

    If HMRC do win however much of the foregoing dwindles in comparison to robbing the UK taxpayer of the £50M plus (?) tax evaded.

    The shame of admitting that however might play its part in the judicial proceedings, if it hasn’t already.

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  39. Castofthousands


    Auldheid says:
    Blog Writer: (476 comments)
    July 8, 2015 at 6:47 pm

    “Looking ahead has anyone given any thought to what a decision in favour of HMRC would mean for the LNS Decision based on the premise that at that time the ebts used were not themselves irregular if it turns out they were?”
    ———————-
    I was reading something or other a while back which trespassed into legal territory and which made me think that if EBT’s were found irregular then there was a parallel with the consequences of LNS.

    From this vague imprecise stance I think that the LNS findings would need to be subject to judicial review to have them overturned. The LNS commission was a one off and not part of some kind of disciplinary continuum operated by the SFA/SPL. Therefore there will be no instituted mechanism for his decision to be revisited should it transpire that the basis for his decision was flawed.

    I doubt judicial review is a straightforward process. You’d need an interested party with sufficient funds to have eminent lawyers babbling with each other for weeks on end to have any chance of success. It’d be way beyond SFM financial resources. I can’t see the likes of Celtic taking an interest either since they have stood at a barge poles length from the whole farrago.

    The best you could do would be to strip the facts back to the bare bones and expose the inconsistencies on SFM and elsewhere and hope that some memory of the reality settled in the collective consciousness. Scant reward for much effort perhaps but I’d certainly take it onboard.

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  40. Auldheid


    Castofthousands says:
    Member: (238 comments)

    July 8, 2015 at 10:46 pm

    The best you could do would be to strip the facts back to the bare bones and expose the inconsistencies on SFM and elsewhere and hope that some memory of the reality settled in the collective consciousness. Scant reward for much effort perhaps but I’d certainly take it onboard.
    ============================
    Thanks for your thoughts. Pretty near mine, I don’t fancy putting the LNS skulduggery per se to that legal confubulation and I’m not sure who would benefit anyway.

    I think the LNS Decision is discredited already in the minds of most football fans by the interpretational gymnastics which ruled on player eligibility and so no title stripping.

    However if it can be further discredited by the footballing public knowing that the Commission’s Decision was only made possible because of deception by RFC I think I’ll settle for that, although I would expect questions to be asked by the SFA and SPL as to why key documents were not supplied as required and requested, given it has happened more than once and possibly at the hands of the same individual/s.

    I mean should whoever is responsible, if still in the game in any position of authority, lose their place in Scottish football?

    Thumbs Up for Yes. Thumbs Down for No

    View Comment
  41. John Clark


    Auldheid says:
    Blog Writer: (477 comments)
    July 8, 2015 at 11:27 pm
    ‘..I mean should whoever is responsible, if still in the game in any position of authority, lose their place in Scottish football? ‘
    ________
    Hitler has gone. The gauleiters will plead the Eichmann defence ‘obeying orders’.
    The rottenness in the Executives of the SFA/SFL ( at the time)will be punished in that the individuals serving on those executives will feel a growing chill, as they are progressively removed from elected or appointed office as having presided over the most disgraceful episode in Scottish Football history.
    What is of fundamental importance though, is that, if the actions of SDM’s Rangers in the field of social taxes ARE declared by the Courts to have been illegal,the sporting triumphs ‘won’ by the illegality as well as by the football cheating implicit in the breaking of the rules requiring declaration of all payments made to players, must be unceremoniously stripped from the record of the liquidated club..
    Other sports know how to deal with cheating.
    Scottish football should not be allowed to be different.

    View Comment
  42. ekt1m

    ekt1m


    Homunculus at 8.32pm. I’ll take a punt at this. MGH being liquidated meant that Mr. Thornhill QC ( a first rate legal mind) no longer had anyone to represent, so decided he did’nt need the hassle of further appeals. The money needed to pay a QC must have come from somewhere, so Mr. Dunlop QC got the gig, even when tax litigation is not forte. This tells it’s own story to my way of thinking. Looking forward to tomorrow’s episode.EDIT, should have typed “his forte”.

    View Comment
  43. John Clark


    Homunculus says:
    Member: (108 comments)
    July 8, 2015 at 8:32 pm
    ‘..If so he is clearly a clever and talented man, however going by the webpage this isn’t really his field. I’m not saying he isn’t more than capable, it just seems his expertise may be in other areas.’
    ________
    I would say that he seemed to me to be not fast enough on his feet to ‘feel’ the import of the questions and interjections from the bench, or to foresee what the bench might ask.
    And, it seemed, he had not quite realised that his side ( whether he was involved or not) had agreed to the note of what was to be raised by Mr Ghosh, the note that allowed Mr Ghosh to refer to, and invite the Court to look at, the transcript of the First Tier’s decision..
    So he got off to a bad start as obviously not having fully briefed himself.
    Looked at realistically,and in the round,I would say that Mr Dunlop has still to acquire , in this field, the street-fighter edge that Mr Ghosh so clearly has.

    View Comment
  44. HirsutePursuit


    John Clark on July 8, 2015 at 5:32 pm
    ______________________________________
    No worries. I haven’t been able to keep up with every comment and my own contributions have had to be somewhat curtailed. Apologies if my interjection seemed a little abrupt. You are doing a fine job. More power to your pencil. 😎

    View Comment
  45. Danish Pastry


    JC & easyJ

    Bravo. Love the reporting. You’ve now got me once again hoping against hope that natural justice will prevail 😮

    View Comment
  46. easyJambo


    I’m afraid that I couldn’t make it this morning so we will just have to wait for JC’s account of today’s proceedings.

    View Comment
  47. Christyboy

    Christyboy


    John Clark says:
    Member: (972 comments) July 9, 2015 at 12:05 am

    Bloody marvellous.

    View Comment
  48. tykebhoy

    tykebhoy


    ekt1m says:
    Homunculus at 8.32pm.
    =======================
    Weren’t BDO paying some of the costs at the UFTT. If MGH or its liquidators are not contributing is Mr Dunlop representing BDO in the hope of not further diluting the creditor pot?

    Edit UTTT Doh!

    View Comment
  49. Eddiegoldtop

    Eddiegoldtop


    I see that John Clarke has posted over on the other thread at 4.58pm and still not an update on here yet……! 😉
    Can he not hear the noise of my Impatient fingers drumming on the table ?

    On another pedantic note :

    Is there any merit to now changing the name of this post to HMRC v RANGERS , given John’s information from the first day which states that MHG are not being represented ?

    Just a thought , and it would be a truer reflection of the overall picture ?

    View Comment
  50. Trisidium


    Update on the fund raising. Since I left on holiday I haven’t been able to update the running total. I will be back in Blighty at the weekend where I can do that. There haven a couple of extraordinarily generous donations which will be added😊

    View Comment
  51. easyJambo


    Eddiegoldtop says: July 9, 2015 at 6:32 pm

    On another pedantic note :

    Is there any merit to now changing the name of this post to HMRC v RANGERS , given John’s information from the first day which states that MHG are not being represented ?

    Just a thought , and it would be a truer reflection of the overall picture ?
    ========================
    That info was only mentioned yesterday. More accurately it should be HMRC v RFC 2012(IL)

    View Comment
  52. Danish Pastry


    Eddiegoldtop says:
    Member: (9 comments)
    July 9, 2015 at 6:32 pm

    Can he not hear the noise of my Impatient fingers drumming…
    ———-

    Ha ha, me too. But I’ve just managed to activate the BBC MW stream of Dons match… 0-0 in Aberdeen, Super Saintees 1-0 up #Yes

    View Comment
  53. castaway


    Auldheid says:
    July 8, 2015 at 6:47 pm

    Looking ahead has anyone given any thought to what a decision in favour of HMRC would mean for the LNS Decision based on the premise that at that time the ebts used were not themselves irregular if it turns out they were?

    Additionally does evidence that LNS only reached his decision because the true nature of some ebts used, ie the early DOS ones, were irregular also impact on the validity of the Decision he reached?

    —————————–

    Auldheid,

    You’ve already made an excellent case for setting aside LNS.

    Surely that stands on its own merits, independent of any interpretations at CoS?

    Once again huge thanks to JC. Marvellous.

    View Comment
  54. Eddiegoldtop

    Eddiegoldtop


    Anyone know what time John Clarke goes to bed ? 😆

    And btw , unless I’m mistaken , I have not seen much reportage of the HMRC v RFC 1872 (il) tax case in the SMSM have you ?

    The SFM is definitely the place to go for the real news ….

    View Comment
  55. Long Time Lurker

    Long Time Lurker


    I am hoping the silence from our Court reporter is due to a busy and detailed session in the CoS and that he will shortly have typed up his notes!

    View Comment
  56. John Clark


    Today in Court 2:
    Mr Dunlop opened proceedings by going back to the point he tried to make yesterday, namely that ‘Income Tax’ equals ‘tax on income’, and ‘income’ means ‘money or money’s worth’.Neither Income Tax nor PAYE obligations attach unless there are earnings in the sense of money or money’s worth.What about the McCann letter, some ask? That letter was not a ‘contract of employment’. There are difficulties in precise .??.. That was the job of the First Tier Tribunal, whose decision, upheld by the Upper Tier, was that there was no tacit agreement to pay earnings.
    The Tribunal below ruled that there were no ‘earnings’ over and above salary.
    There were payments, Mr Dunlop continued, but they were not payments which the employees were entitled to, and not payments in respect of which they had any proprietary interest. That’s why they were not earnings. And if one looks at the Forde& McHugh case one can see that is correct.
    The facts in the that case were that there was a payment of Treasury stock into Trust, and the question was whether they were earnings.Were they to be deemed as such? It was clear that they were not. And because this Statutory innovation did not apply for NIC purposes the Court had to consider the notion of earnings.
    Mr Dunlop then referred to the judgement of Lord Reimer (?), who had looked at the Streatham case in which it was decided that there was a need to look at the true nature of the arrangement that had been made.[And here Mr Dunlop pointed out that the First Tier Tribunal did consider the true arrangements and had agreed that they did not amount to an agreement to pay earnings].
    Then Reimer had looked at the Edwars and Roberts case in which Edwards in addition to salary, was to receive a sum from a fund set up by the employer.It was ruled that it could not be said that the employee had accrued a vested interest..
    Mr Dunlop said that there was no proper distinction between those funds in that case and the funds presently in issue.And in the Forde & McHugh case ( my note: it took me a while to understand that the abbreviation ‘FML’ was used in referring to this case, because the employer in the case was Forde and McHugh Limited!]it was decided that ‘such payments form no part of the emoluments….because they cannot be converted into money.Mr Dunlop said that Lord Justice Reimer’s conclusion was that the ordinary meaning of ’emoluments’ was defined, and that the payments involved here do not fall within the definition.
    Therefore, according to Mr dunlop,any monies paid into the Main Trust , OR sub-trusts in the present case were not emoluments because they could not be turned into money. And in the Words of the Edward’s judgement the employees have no ‘vested interest’ in the monies in the trust.
    Mr Dunlop further remarked that since then, Parliament had filled such gap as there was:Part 7 of the new regulations of 2011, which specifically mentions arrangements between parties and ..awards, loans..”
    [At this point, Lord Drummond-Young complained about the illegibility of the copy he had been given.
    Mr Ghosh volunteered that was prepared to accept what was on the copy, Mr Dunlop assured Lord D-Y that better copies would be obtained]
    Continuing,Mr Dunlop went on to say that the new regulations will deem such arrangements,loans etc to be earnings..
    My learned friend, said Mr Dunlop, says we should not be looking at this new legislation.But I think Parliament thought it necessary to fill the gap.Why was there a gap? because payments like this cannot be turned into money by the employee.
    Mr Dunlop made another reference to the Supreme Court ‘ ..as FML accept….but did FML pay earnings when McHugh had only a cntingent interest. The revenue argued that what was paid was earnings because
    McHugh benefited from the hope of…’
    In the present case the only thing my learned friend refers to is the ‘package’……..[????]
    He referred to Lord Hodge’s pronouncement on ‘double taxation’
    where he cites another case in which the double-taxation is considered, the Dextra case.
    ” Mr Thornhill points out the double taxation when money is paid into the fund and then when payments are made out of the fund.’
    We prefer the Thornhill view, and so did Lord Hodge.What my learned friend asserts would make no sense of what Lord Hodge said.
    Mr Dunlop said then that he would turn back to the Forde case..
    At this point Lord Carloway interrupted to express his disquiet at the faulty ‘bundle’ [ i.e. the whole collection of material being used in the appeal.There was a whole sentence missing from the report of one of the cited cases]
    Mr Ghosh expressed his readiness to accept that he was happy if the court accepted what Mr Dunlop said was the missing sentence.
    Lord Carloway said he was anxious to ensure that what they had on paper was indeed the official transcript of the report of the case.
    Mr Dunlop gave him the proper reassurances, and continued:
    There are three reasons why muy learned friend’s submission is wrong
    1. the man on the underground … payment into the fund was NOT earnings and NOT taxable, payment out of the fund are.In Forde, the money was placed FOR Mr McHu.That is not the case here.
    2.”…only by looking at what the earner received”
    3. The Revenue by treating the payments into Trust as earnings failed to see the contingency of funds and failed to deal with what the employee received at the time.
    Mr Dunlop then returned to the ‘accrued interest’ cas, and stressed the approbation of what the Master of the Rolls said about ‘vested interest’.

    lord Drummond-Young asked ” What does ‘vested interest’ mean? It can be a very ambiguous word.
    Mr Dunlop vaguely acknowledged but related it to ‘money’s worth’ you can sell it, profit from it.
    In this case, he asked, was there vested interest? NO
    is it money? NO
    He said it was interesting that the ‘Smith and(?)case ,which did not make the cut to be included in the cited references, was used by his learned friend..it smelled of afterthought.
    Dunlop then went back to the Edwards case and the agreement between the company and Edwards: “the company shall pay salary and an additional fund…under the provisions the following payments will be made to the account of Mr Roberts in the form of shares..”
    and that is the case.If my learned friend is right, edwards should have gone the other way.
    Likewise, going back to Dextra case, which was only a Special Commissioners’ decision, but there was no appeal against it, no demurral
    we have “..the chronology of events of the setting up of EBT……on 21.12.98 various contributions to EBT..” then [ and this is where I began to lose the thread]
    my learned friend cas his basis for distinguishing was based on the fact that the Trust was set up in 1998, but not paid till 1999.
    The question before the Special commissioners was ‘ were these payments earnings?’
    Lord Drummond-Young interjected ” ‘earmarking’ is ambiguous
    Mr Dunlop: my learned friend used ‘earmarking’, look, defined amounts paid into trust for nominated people…
    with great respect 1998/99 is a specious distinction
    And Dunlop read again from the Special commissioners’ judgement.He then said ‘I submit that this is directly applicable to this case.My learned friend does not argue that Dextra is wong, and his basis of distinction does not work.In my submission, this approach is consistent with that of the Aberdeen Asset case. In Aberdeen, the taxable payment was the transfer of shares in the money box companies to the employee.If my learned friend is right,that conclusion is wrong.if he is right, the true taxability arose on the anterior funding of the trust.
    I will cite one last authority,the UTTT judgement in the UBS case. In that case, there are certain parallels:
    ‘none of the employees was entitled to..’
    none of the relevant employees became entitled to immediate payment..
    that never happened because sums were put into shares..”
    The same idea, identified bonus, part as shares..

    On the quesion of ‘the year they were earned/year they were paid’ it is difficult to reconcile the Revenue’s position with that of the argument in …..(?)
    In my submission, it’s impossible to square the circle.
    The fact is, in this case there are no earnings and that’s what lord Doherty found, and that’s what my learned friend has to show is wrong.
    My learned friend’s assertion about it being ‘catastrophic for the public purse’is overstated. If any payment is made out of the Trust, it is taxable.If paid to family, that’s section 201.
    The challenge on re-direction of earnings fails.
    Lord Drummond-Young: You haven’t mentioned the Hatton (?) case?
    My Lord, that was straightforward.
    What has to be attcked is the notion that under the law of England the Protector could take absolute entitlement. I note the Revenue’s introductory remark ” the employee could wind up the trust fund”
    On ‘unreserved disposal’, Garforth is the authority
    Here, the Trusts are genuine, there is genuine discretion, and we are a long, long way from ‘unreserved disposal’.
    It’s odd that the Revenue would take 27 days of argument to discover ‘unreserved disposal’. This court is entitled to query the correcftness of an argument only ?….?
    The decision in Dextra…. and similar in Sempra(Special commissioners decision, but not appealed or subsequently challenged)
    ” discharge of employer”s obligations” trustee not a cypher’
    If there is a genuine discretion in play…
    On the role of the Protector, the First Tierfound that the Protectors were in a position resembling trusteeship ( para 103). That denotes a fiduciary position, so could not do what my learned friend said they could do.The Main Trust protector is not the point. it is the power of the protectors of the sub-trusts. in Mr Bain’s case, my learned friend says the power was absolute.That is simply not true.
    [Mr Ghosh interjects [but i couldn’t here what he said]
    lord Drummond-Young : fiduciary duties cover a vast tract of law.Protector is there to ensure that the wishes of the benficiaries are carried out
    Mr Dunlop: yes, my lord. You can’t act in your own interest.
    Lord D-Y: even that is not an absolute rule..
    Mr Dunlop: On the question of whom the Protector is there to protect, we can look at the Jersey case “… protector will be to protect the beneficiary’, and in my submission the Protector is there for the beneficiaries.
    lord menzies: What’s the purpose of the protector if the Trustees are….
    Mr Dunlop: The protector is much more limited’
    Lord D-Y: well, it means so many things…
    Mr Dunlop: There is a text book..
    Lord D-Y: aimed at different jurisdictions- West Indies, Caynman Islands..
    Mr Dunlop read from a passage’
    Lord D-Y : I wrote that…
    Mr Dunlop continued, saying that under Scots law, protectors role is fiduciary in part, and in part to protect the trust.He referred to copies of Logan Henderson encyclopedia ”( fiduciary is bound to…) and to Stair Memorial , all to the effect that protectors can not do what they like even when the protector is not fiduciary.
    Lord D-Y: who is the donor of the power?
    Mr Dunlop: The Trustee of the main trust.
    the only argument is tht the protector was given the power to amend..
    But the ‘settlor’……
    more references ‘..if the holder of the power is also an object or the power’
    The beneficial class does not include the trustee, there is a prohibition on emoluments. therefore it is not right to say that the trustee could turn the whole thing into an emolument.
    trustees are to give written consent to amendments when their interests are involved. the trustee cannot stand by and let the protector do what he likes.
    And a final point, says Mr Dunlop,, applying only to the Bain trust, ” the protector cannot (then follows clause 2)
    therfeore there is no ‘unreserved disposal’ on the Garforth test.
    The protector cannot do what my learned friend suggests.Unreserved disposal is not made out,therefore the Tribunal followed the right test: correctly held there were earnings, and correctly held there was no unreserved disposal.
    Therefore, the Court should refuse the appeal, and Lord Doherty’s decisions should stand.
    End of Mr Dunlop’s submission.

    _______
    Once again, Mr Ghosh was a bit of a problem. He speaks fast and low, so it’s difficult to get either the opening words of what he says ( to get an idea of what he might be about to say, or the end of his sentences so that you can fit what he has said into context.
    My scribbles of what he said are hard for even me to decipher, let alone understand, but I’ll try to get some of what he said at least paraphrased tomorrow.
    The submissions finished at about 3.15 this afternoon, with Lord Carloway saying it will take them a wee while to reach a decision.

    View Comment
  57. theoldcourse


    I am guessing no decision today else we would have heard from one side or t’other

    View Comment
  58. Long Time Lurker

    Long Time Lurker


    theoldcourse says:
    Member: (26 comments)
    ———————

    I am no expert, will in not take 3 – 4 months for their Lordships to write up the decision? Or do they give a verbal outcome, with written judgement to follow?

    View Comment
  59. Eddiegoldtop

    Eddiegoldtop


    Long time Lurcker .
    Theoldcourse.

    It looks like there may not have been anyone ( JC or EJ ) at today’s proceeding ?

    I don’t remember any of them saying one way or t ‘ other ?

    I’m sure we will read about it in the MSM tomorrow !

    View Comment
  60. Long Time Lurker

    Long Time Lurker


    Eddiegoldtop says:
    ——————
    I was planning to go in today – last minute change, don’t know about tomorrow if case is still going on.

    View Comment
  61. Tincks

    Tincks


    Eddie,

    JC has posted on the main thread.

    P.S. Thanks for your own efforts, thwarted though they were by the indifference of others

    View Comment
  62. John Clark


    While it’s still reasonably fresh in mind, I have spent the last hour or so trying to make some sense of my notes.
    Mr Ghosh in exercising his right of reply was of course briefly defending his earlier submissions against what Mr Dunlop was saying today in his submissions.
    my problem is that because I couldnae hear him yesterday, I gave up trying to record what he was saying. the result of that is that what I have recorded of what he said today ( and he was punchy, one-line dismissive of the respondent’s case) can only be properly understood in the context of the arguments he put forward fully yesterday!
    _____
    Mr Ghosh: First,The question of whether payments into the Main trust or, alternatively, into sub-trusts were ‘earnings’ is a matter of LAW, not of fact.[It was]the observations or findings of fact [in the lower tribunals] that found no payment of earnings.
    Second, I have not conceded that there was no entitlement to anything. I accept there was no entitlement for cash to be paid them, the employees. There was a present, contractual obligation on the employer to pay the Main trust on terms…. being informed by ‘letters of wishes’and loan applications. This was accepted as a contractual entitlement in the lower tribunal (para 139).
    The only question is whether given the entitlement the identity of the payee makes any difference.
    If Rangers had not paid into the Main Trust, actions could have been raised.
    ‘An application of my wages in a particular way’:- the respondent [Mr Dunlop] did not answer the point.
    ‘if you are going to pay me a bonus, don’t pay me- pay someone else’
    clearly re-directed earnings.
    Lord Carloway: the finding that payment to sub-trusts was in lieu of bonus to executives, no finding of payment of contractual bonuses.
    Mr Ghosh: but ‘instead’ .
    ‘remuneration’ not once dealt with by Respondent, not a single case from the respondent..
    mis-description by Mr Dunlop of what I said.
    I don’t want to raise the temperature. i am annoyed.
    Procter and Gamble [case]?.. ach!
    The Dextra case. Mr Dunlop said ‘earnings’ had not been argued by First tier. It had! I don’t blame him ( Dunlop) [ my note: I think he was having a swipe at the rubbishy rubbishy way the First Tier had recorded their findings] [ directed payments]
    power of protectors ( First tier decision , paras 116, 117, 138), an express observation. the pointv was raised.
    UTTT directed payments argument -para 22, para 24 (last sentence) para 40, para 69, 70.
    Powers of protector, paras 36, 47, 79, 80
    Is my argument unprecedented? NO. it was argued in 1904.’Benefit in kind’ provisions
    the notion that ‘don’t pay me, pay him’….

    The new Regulations brought in in 2011?So what? We shouldn’t construe legislation by reference to future legislation.The new legislationhas nothing to say about the present case.
    ‘Causal connection’ informs payment into the main trust, on terms to give the beneficiaries what they want..
    causal chain… letters of wishes, loan application..
    and my learned friend stayed away from talking about side-letters
    Dextra? double tax? I have said there would not be double tax.
    It’s quite simple.
    Lord Carloway:( smiling) it’s only him that made it complex [ no idea who he was referring to, and I might have misheard].
    Mr Ghosh: ” my learned friend took his eye off ‘entitlement’ on to the trust, that’s why he was so careful to stay away from the Hatton (?) case, in which it was decided that ‘income is the product of their personal exertion’..
    THAT’S the principle. If my salary is applied in a particular way that I am happy with, it is still my salary.
    As for the Aberdeen Asset case, in relation to MGML trust only, employees were excluded from Main trust.The Main trust had to be an entity acting on behalf of the employer.
    on the protector, whose wishes was he to protect-it has to be the ‘settlor’-the employer who puts the money in.
    And a reference to the 2nd May Trust (MGL only) affecting or involving SDM, with references to paras 71 in the First tier’s decision.
    then Dextra? Sempra? simply not relevant to any of this, paras 78, 79..
    Lord D-Y: loans were repayable on demand after 10 years?

    Yes, para 103.
    End of Mr Ghosh’s right of reply.
    Mr Dunlop told the Court he would hand in the proper print of the page that had the missing sentence. And then asked the court to note that in the Kirkness case in 1956 it was held that ‘subsequent legislation may be looked at if there is ambiguity in earlier legislation”

    And that was that. Lord Carloway thanked Counsel for their submissions, and observed that it would them a wee while to arrive at their judgement.

    —————–
    I can add that Mr Ghosh was really seriously annoyed at what he saw as Dunlop’s misrepresentation of something he said.

    And it was clear that he thought the First Tier had made an arse of how they went about their recording of findings of fact and findings in law.
    The Bench didn’t show in any obvious way that they thought the same, but I think we all felt that they agreed.

    I suspect that the President of the Tribunals might get a wee note suggesting that the ‘majority’ of that FTTT tribunal should be told that they will not be called upon again.

    Because we don’t need to be lawyers to see how badly and disjointedly the two had tried to put together their findings of fact and how they related those findings to the legislation and to case law.
    And we don’t need to be trained lawyers to appreciate how much more professionally and skilfully presented was Dr Poon’s dissenting judgement.It is easy to see her line of reasoning and how she understood the facts as they were established and how the law,in her opinion, applied to the facts.
    She made the other two look like rank amateurs.
    Only very,very wicked people would suggest that their amateurism was contrived.

    View Comment
  63. easyJambo


    John Clark says: July 10, 2015 at 1:35 am
    ====================
    Thanks for you update on the summing up.

    Once again I think the decision will depend on their Lordships willingness to set precedents. The usual cases quoted in EBT type tribunals, Sempra, Dextra, Garforth, Edwards, AAM and now Forde & McHugh were raised by Mr Dunlop, all of which helped his arguments, while Ramsay which seems to be the only case to counter those listed above was barely mentioned.

    I believe that HMRC’s position was not helped by Mr Thomson’s performance in the original FTT, who appears to have missed an open goal, while Mr Thornhill was able to appeal to two of the three judges using arguments based on nuances of the aforementioned case precedents.

    I don’t know how Lords Carloway, Menzies and Drummond Young will approach their decision. Drummond Young, while appearing to be sympathetic to Mr Ghosh’s arguments, also appeared to be extremely knowledgeable about the finer details of the case precedents, while the other two appeared to have a more practical approach and interpretation that would probably be closer to a common sense interpretation of the facts.

    I do hope that the common sense view of the purpose of EBTs and how they are operated does prevail and that the appeal is ultimately successful. My fear however is that it is far easier for the Murray Group companies to defend a two goal lead with the decisions of the FTTT and the rubber stamp of the UTTT behind them, rather that what HMRC have to do to overturn the weight of the previous decisions.

    In general terms, I think HMRC does badly needs a victory in one of these cases, otherwise they are going to continue to struggle against the weight of previous case precedents.

    Note: The minority decision (Dr Poon’s) was mentioned briefly during Mr Gosh’s submission on Wednesday. I think it was related to Mr Ghosh’s request for the Lords to consider the transcripts from the FTTT (which was turned down).

    View Comment
  64. highways


    Dear JC and others, I had thought that it was going to be a four day hearing. Just to let you know that all your work is very much appreciated. Is there any more coverage, or is that it?

    View Comment
  65. Bartin Main


    Does anyone have any idea as to when the learned Judges may arrive at a decision, and publish judgment, on HMRC’s appeal?

    View Comment
  66. Massive support from Clumpany Towers, which I know will be echoed everywhere. https://t.co/DYGVxqksu1

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    Please share folks, especially with those who still don't get it.

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