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    Mark LeeMark Lee

    It’s a long time since I was fascinated by a tax case. With thanks to John Kavanagh whose Linkedin post alerted me to Mullens v Revenue and Customs. The Tribunal decision was published earlier this month. I’ve just posted a short piece about it on TAN’s Linkedin page.

    I have also skimmed through the case report which contains some astonishing insights into the COP 9 and CDF process (managed for Mr Mullens by BDO). Like John I’m surprised HMRC didn’t go for a criminal prosecution.

    I may write more about this on TAN’s blog/Knowledge bank and quote some of the Tribunal’s astonishing and frank comments and conclusions – including how UNreliable they found Mullen’s testimony. He was a tax lawyer and the top billing partner of Marriott Harrison every year after 1986/7 until his departure in 1999. “His average profit share at Marriott Harrison in the three years ending April 1999 was approximately £760,000, which was about double the average profit share of the next highest earning partner. His profit share in the year ending April 1999 was £957,392. Against these figures, it is simply not credible that an individual of Mr Mullens’ stature and ability would have left Marriott Harrison for an agreement to earn £400,000 a year.”

    Are there are any relatable lessons from this case beyond the obvious? (Don’t lie to HMRC or the Tribunal)

    Bill StevensonBill Stevenson

    We recognise that not calling witnesses can be a legitimate tactical move in our adversarial system of litigation, but a person who makes that move cannot complain if the court draws from the facts which have been disclosed all reasonable inferences as to what are the facts which that person has chosen to withhold: see Lord Diplock in Herrington v British Railways Board [1972] AC 877 at 930F et seq.
    This says it all and this hearing brings to mind another recent one where failure to back up asserted facts by evidence/witnesses is fatal to a “fair result” in the appellants eyes.

    Clearly we can only assume that there was no creating of false documents or telling lies during the COP9 investigation – or at least without the tribunal decision HMRC could not prove matters to criminal standards.

    Whoever was doing the COP9 report either badly misjudged what the absence of evidence from the payers or was under instructions that could have no other outcome but massive fees for all concerned. Big firms don’t always make the right decisions in COP9 cases.

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