Unlucky opt out

The issue before the Court of Appeal was whether the First-tier Tribunal had jurisdiction to make an order that the costs of preparing hearing bundles for an appeal by Eclipse Film Partners should be shared equally between the taxpayer and HMRC.

At that stage HMRC did not question the jurisdiction of the First-tier Tribunal to make the order.

After the taxpayer’s appeal was dismissed its solicitors sent HMRC a schedule of its costs in preparing the bundles seeking a contribution of £108 395.48. HMRC applied to set aside the order.

In May 2012 the First-tier Tribunal ruled that it did have jurisdiction but subsequently the Upper Tribunal ruled that the first tribunal had no such jurisdiction.

The taxpayer appealed.

Lord Justice Moses said that the appeal had been classified as complex. As such the First-tier Tribunal had power to make an order for costs...