Anna Wierzbicka v The Director of Border Revenue
[2024] UKFTT 566 (TC)
Paccar Financial Polska Sp z oo v Director of Border Revenue
18 July 2024
[2024] UKFTT 642 (TC)
First-tier Tribunal
A company's vehicle was seized for smuggling. Even though the company did some checks on its customer, it didn't do enough checks on its customer's customer. A judge said the company had to pay a fee to get the vehicle back because it could have done more to prevent smuggling. The judge considered whether the company had done what it should have, not just whether the fee was fair.
Key Facts
- •PACCAR Financial Polska SP. Z O.O. (Paccar) appealed a decision to restore a seized vehicle (Vehicle 1) for a £2,500 fee.
- •Vehicle 1 was seized due to unpaid duty on cigarettes found during transport by a sub-lessee, Limonka.
- •Paccar argued the fee was unreasonable and disproportionate.
- •Paccar's lease agreements prohibited subleasing without consent, yet they consented to Truck Care's sublease to Limonka.
- •A similar case (Vehicle 2) resulted in a £2,500 restoration fee initially, later waived.
- •Paccar's due diligence on Truck Care was extensive, but none was shown on Limonka.
- •Previous seizures involving Paccar's vehicles were a factor in the decision.
- •The Tribunal considered Paccar's argument that due diligence on sub-lessees was impractical given the scale of their operations.
Legal Principles
A decision is unreasonable if there was an error of law, irrelevant factors were considered, relevant factors were ignored, or no reasonable decision-maker could have reached it.
Customs and Excise Commissioners v J. H. Corbitt (Numismatists) Limited [1981] AC 22 at [60]; John Dee Limited v Customs and Excise Commissioners [1995] STC 941 at [952g-h]
The burden of proving unreasonableness lies with the appellant.
McGeown International Limited v HMRC [2011] UKFTT 407(TC) at [46]
The Tribunal's role is to assess reasonableness, not substitute its judgment for the decision-maker's.
Case Law Discussion
Restoration of seized goods is governed by s.152 CEMA and review/appeal procedures under FA 94. The Tribunal's jurisdiction is limited to considering the reasonableness of the review officer's decision.
Customs and Excise Management Act 1979 (CEMA), Finance Act 1994 (FA 94)
A restoration fee imposed under Article 1 of Protocol 1 of the European Convention on Human Rights must be proportionate to the legitimate aim of preventing excise duty evasion.
John Lindsay v Customs and Excise Commissioners [2002] EWCA Civ 267
Outcomes
Paccar's appeal was dismissed.
The Tribunal found that Officer Collins' decision to impose a £2,500 restoration fee was reasonable. Paccar had not demonstrated that the decision-maker considered incorrect factors or failed to consider relevant ones, particularly regarding their limited due diligence on the sub-lessee, Limonka, despite having the contractual power to influence sub-lessee selection. The fee, significantly reduced from £5000, was deemed proportionate.