Sylvia Hook v HMRC: Tribunal Refuses Cost Application, Highlights Importance of Procedural Compliance

Citation: [2023] UKFTT 960 (TC)
Judgment on


The case of Sylvia Hook (trading as Sylmis Puppies, also known as Sylml Puppies) & Anor v The Commissioners for HM Revenue and Customs (HMRC) illustrates the considerations within the UK First-tier Tribunal (Tax Chamber) regarding applications for costs relating to procedural issues. This detailed analysis explores the key facts, applied legal principles, outcomes, and consequent judicial reasoning behind the decision to refuse the appellants’ cost application.

Key Facts

Sylvia Hook, the appellant, sought to recover costs incurred due to the postponement of a substantive hearing initially scheduled for November 2022. Reasons for the adjournment stemmed from HMRC’s identification of omitted documents in the hearing bundles, an error discovered shortly before the hearing. HMRC’s application for adjournment was agreed upon by both parties. Subsequent to the adjournment and a case management hearing, Hook applied for recovery of costs totaling £6,596.60, claiming HMRC acted unreasonably in their preparation of hearing bundles. HMRC challenged this assertion, maintaining that their conduct was not unreasonable.

The legal assessment focused on the rules and tenets outlined in the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009, particularly Rule 10 which governs the awarding of costs. The appellant’s cost application rested on asserting that HMRC had acted unreasonably. The standard of “reasonableness” was derived from Upper Tribunal decisions such as Mori v HMRC [2015] UKUT 0012 and Distinctive Care Limited v HMRC [2018] UKUT 155, which emphasize that unreasonableness involves a value judgment dependent on the specific facts and circumstances of the case.

The First-tier Tribunal (FTT) applied the objective standard of what a reasonable person in the same position as the party concerned would have done or refrained from doing, underpinning the standard with the principle that errors or omissions during proceedings do not necessarily equate to unreasonable conduct.

Further, the tribunal underscored the requirements of Rule 10(3)(b), which mandates that a written application for costs must be accompanied by a detailed schedule, facilitating a summary assessment of the claim.


The FTT, presided over by Tribunal Judge Bailey, concluded that HMRC did not act unreasonably in their defense or conduct of the proceedings. The Tribunal found that the error in the bundles was genuine and accidental, and it was deemed a rational response to seek an adjournment to correct these errors. Consequently, the FTT denied the appellants’ application for costs.

Additionally, the Tribunal noted the appellants failed to comply with Rule 10(3)(b), as they did not provide a sufficiently detailed breakdown of claimed costs. Had HMRC’s conduct been considered unreasonable, the only recoverable cost might have been a train ticket refund due to Mr. Millett, a consultant employed by the appellant, which was properly itemized.


The FTT’s decision in Sylvia Hook & Anor v The Commissioners for HMRC elucidates the threshold for proving unreasonable conduct by a party within the Tax Chamber and emphasizes the importance of detailed cost scheduling. Despite procedural setbacks, an adjournment resulting from genuine, albeit careless, errors does not constitute unreasonable behavior warranting a costs order. It sets a precedent for future litigants to thoroughly substantiate and detail their claims for costs with due attention to procedural compliance as mandated by the Tribunal Rules.

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