Key Facts
- •Appellants applied for a protective costs order (PCO) in relation to their Inheritance Tax (IHT) appeals.
- •Appeals concern arrangements made by Mr. Linington in 2010 to reduce IHT liability.
- •The FTT held that the reversionary interest was not excluded property and that a transfer of value had occurred.
- •Approximately £500,000 in IHT and interest is in dispute.
- •Appellants argue the case has wider implications and could benefit other similar cases.
- •HMRC estimated their costs at approximately £20,000 + VAT.
Legal Principles
Principles for granting a PCO, as established in Corner House and refined in subsequent cases.
Drummond v HM Revenue & Customs [2016] UKUT 221 (TCC)
Jurisdiction of the Upper Tribunal to make a PCO or similar orders (ACO, CCO).
Drummond v HM Revenue & Customs [2016] UKUT 221 (TCC) and HM Revenue & Customs v TGH (Commercial) Limited [2016] UKUT 0519 (TCC)
Criteria for a Costs Capping Order (CCO) under CPR 3.19.
CPR 3.19
Criteria for an Appeal Costs Order (ACO) under CPR 52.19.
CPR 52.19
Outcomes
Application for a PCO refused.
Absence of issues of general public importance, significant personal interest of the appellants, and the context in which the issues arise.
Application for ACO also refused.
Significant sum involved (£500,000 IHT dispute), substantial personal interest of Appellants, and the lack of compelling reason to warrant an ACO.