DECISION
1. The
appellant, Mr Darren Caiels (“Mr Caiels”) appeals against a decision by a Review
Officer of the UK Border Agency (Mr Raymond Brenton, who made a Witness
Statement and gave oral evidence at the hearing), which was communicated to Mr
Caiels by a letter dated 25 November 2011, to uphold on review a decision of
the UK Border Agency dated 10 October 2011 not to restore to Mr Caiels two
mortar shell fuses which were seized at Gatwick Airport on 5 September 2011.
Mr Caiels had paid US$100 for the fuses and US$45 for shipping costs, total
US$145 converted to sterling as £90.75. This amount was paid from Mr Caiels’s
PayPal account.
2. Mr Caiels
was neither present nor represented at the hearing. However he had been
notified of it and we have seen a letter sent by the Tribunal Centre and dated
21 June 2012 in which it is stated that Mr Caiels had advised that he would not
be in attendance at the hearing of the appeal.
3. In these
circumstances (and on a formal application by Mr Jones in this regard) we
decided to proceed with the hearing of the appeal pursuant to rule 33 of the
Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009, considering
that it was in the interests of justice to do so.
4. We were
provided with a bundle of documents, including Officer Brenton’s Witness
Statement and exhibits, and we find the facts above and following from the
documents and Officer Brenton’s oral evidence.
The
facts
5. Mr Caiels was
notified of the seizure by a ‘warning’ notice dated 8 September 2011 sent to
him by the UK Border Agency at Gatwick Airport. He responded to this notice in
a letter dated 19 September 2011 addressed ‘to whom it may concern’ in which he
requested the return of the items, namely the two mortar shell fuses. In his
letter, he stated as follows (and we find facts accordingly):
‘I
am writing to request the return of my items which have been seized, reference
number: E2527451.
·
The two fuzes [sic] that
have been seized although causing safety concerns on the day were later found
to be inert and FFE (Free From Explosives) with no threat to the public, this
is mentioned in DC Ellarby’s (warrant no – CE471) report (139 – 5th
September), in fact these particular fuzes never contained any explosive at all
as they were made as “factory inert classroom training aids”. These were never
made to be used.
·
The fuzes were purchased
legitimately from the well-known online auction website eBay. The fuzes were
purchased for my own personal Militaria collection.
·
I am a researcher/collector of
inert military ordnance, although I collect all sorts (inert grenades, shells,
mortars, etc.) my main area of collecting and interest is shell fuzes. I have
around 80 inert fuzes in my collection. I have been collecting for some years
now and I am very passionate about my hobby. Ordnance collecting is now
considered a serious hobby within the UK among many. I am a member of an
online forum/resource for ordnance collectors called BOCN (British Ordnance
Collectors Network) at www.bocn.co.uk.
·
On the 5th September
2011 I had a visit from the police and the military EOD, throughout the day my
entire collection was checked over and there were no issues at all. Both the
police and the military EOD were happy that my collection was inert, safe and
legal to own within the UK. Police reference number for the visit – 139 – 5th
September (PC Mark Ellarby). This report details the whole incident.
·
The fuzes are for my personal
collection and are considered an important addition, the fuzes are also of
historical importance.
·
The fuzes are inert, FFE (Free
From Explosives) and therefore legal to own in the UK, as far as I am aware I
have broken no laws by importing these items for my collection. I see no
reason why I should not have my property returned to me.
I
look forward to hearing from you regarding the return of my property. I would
also like to ask what I can do/precautions I can take to prevent situations
like this happening again in the future when importing these type of goods.’
6. Mr Caiels
sent a statement by a Mr Martin Kay MIExpE AISEE, in support of his request.
That statement was with our papers. Mr Kay states that he is a professional
explosives engineer currently employed within the GB Firearms and Explosives
enforcement sector. He supports Mr Caiels’s request for the return of the
fuses to him.
7. We also
have with our papers a letter dated 24 September 2011 from Mr Steve McLean,
Detection Manager, Gatwick Cargo to the UK Border Agency post-seizure unit in Plymouth, detailing the circumstances of the seizure. The letter states (and we find
facts) as follows:
‘A
mail parcel travelling under reg number CP532U17292UA arrived at Gatwick Airport on 4th September 2011 on flight PS 501 from Kiev, Ukraine. The goods were described on the attached CN23 Customs declaration as ‘Auto detail’. The
package was addressed to [Mr Caiels at his address at Southampton].
Officer
Ryan Hibbitt selected the package for examination and found the box contained 2
items he didn’t recognise as ‘auto detail or car parts’. He therefore referred
the parcel to the Gatwick Freight Special Branch Officer, Mark Ellarby.
DC
Ellarby examined the package and found “2 x military detonators wrapped in
aluminium foil and placed inside two cut open beer cans, in turn these two
items were wrapped in foam. The package was then put inside a box that used to
contain a water pump for a car. This was then sealed and had the original
unmarked ordinance [sic] box taped to the outside of the water pump
box”. DC Ellarby’s view was that these were packed in a way that is ‘indicative
with attempts to avoid security screening’.
Once
DC Ellarby had removed the first item and realised it was a military detonator
for a bomb/missile he immediately evacuated the UKBA offices and British
Airways Cargo sheds. During the next hour he had the Gatwick Airport Senior
Security manager and Gatwick Division Police Inspector in attendance whilst the
service roads were closed. This involved utilising a large number of Police
and Gatwick Security Officers and caused disruption to the normal business of
the airport while a full examination of these detonators were conducted. They
were ultimately found to be void of any explosive materials.
The
goods had been misdeclared on form CN23 and had been ‘packed in such a manner
appearing to be intended to deceive an officer’. They were considered to be
parts of explosive devices and were therefore seized by UKBA and seizure paperwork
was posted to the importer. (The goods are currently stored locally at
Gatwick.)
We
have subsequently received a letter from Mr Caiels asking for the goods to be restored
to him.
Please
find enclosed copies of all associated paperwork.
Submitted
for your consideration.’
8. On 28
September 2011 the UK Border Agency National Post Seizure Unit (Officer Ms D Richards)
wrote to Mr Caiels acknowledging his letter dated 19 September 2011 and stating
that before consideration could be given to his restoration request, she
required proof of ownership of the goods, including an invoice and evidence of
payment. This was provided by Mr Caiels under cover of a letter dated 3
October 2011. It appeared from the eBay pages copied to the UK Border Agency
that the fuses were used World War II Russian projectile fuses model ДTM-75,
42-M, sold via eBay by a seller referred to on the pages as ‘chrysler300c10’,
with an email address: [email protected].
The payee was stated to be ‘Western Bid Europe’, which might be the name of the
selling entity.
9. On 10
October 2011, Mr Caiels wrote again stating that he did not wish ‘to continue’
with condemnation proceedings in the magistrates’ court and asking that ‘that
appeal’ be withdrawn, but confirming his request ‘for my property to be restored’.
10. This letter may have crossed
a letter of the same date from the UK Border Agency (Officer G A Wood) to Mr
Caiels giving a decision not to restore the goods. After stating that the
fuses had been seized under section 139 Customs & Excise Management Act
1979 (“CEMA”) and were liable to forfeiture under section 49(1)(e) CEMA
‘because they did not correspond with the entry made thereof’, the officer
stated that the general policy for the restoration of seized goods was that
‘goods seized because of an attempt to evade duty’ should not normally be
restored but that each case was examined on its merits to determine whether or
not restoration would be offered exceptionally. The officer concluded that
there were no exceptional circumstances that would justify a departure from the
policy of refusing restoration. He offered a departmental review of his
decision.
11. Mr Caiels wrote on 17
October 2011, a letter that was taken by the UK Border Agency as a request for
a review of Officer Wood’s decision. Mr Caiels’s letter contained the
following:
‘The
seizure notice states that my property was seized due to the sender writing a
different description on the customs declaration to the contents of the
parcel. While I appreciate that this caused concern, I had absolutely no
control on what was written. The items in the parcel were purchased by me
(please see receipts attached) legitimately from the auction website eBay. I
did not know the seller personally.
The
items in the parcel that have been seized were purchased for my personal
Militaria collection to complete part of a set. These items are a pretty rare
addition to my collection and the chance of me being able to get a set of these
again is pretty much none.
I
had no control over what description was written on the customs declaration. I
would not have known that the description was different to what was in the
parcel until the parcel had arrived with me in the post. I feel that I am
being wrongfully punished for something that was completely beyond my control.’
12. This letter was acknowledged
by the UK Border Agency (Officer J Lewis) by a letter dated 25 October 2011.
He stated that an independent Review Officer would conduct a review by
examining and considering ‘all the information we have about this case’ and
would write with a fresh decision. The Review Officer would not have been
involved in either the seizure or the original decision. Officer Lewis’s
letter went on to request that any further evidence of information should be
sent and that this was Mr Caiels’s last opportunity to provide the Review
Officer with such information, and that if he did not provided it ‘now’ it
could not be taken into account in the review.
13. Review Officer Brenton’s
decision letter to Mr Caiels was (as mentioned above) dated 25 November 2011.
He summarised the UK Border Agency’s restoration policy for seized goods as
follows:
‘The
general policy is that seized goods should not normally be restored. However,
each case is examined on its merits to determine whether or not restoration may
be offered exceptionally.’
14. Review Officer Brenton
stated in his letter that he was guided by the restoration policy but not
fettered by it and that he considered every case on its individual merits. He
had taken into account all the representations and other material available to
the UK Border Agency both before and after the time of the (original) decision
(of 10 October 2011).
15. Review Officer Brenton
explained in great detail that he had not considered the legality or
correctness of the seizure itself, giving citations from Commissioners for
HM Revenue & Customs v Jones and Jones [2011] EWCA Civ 824.
16. Review Officer Brenton’s
letter insofar as it concerned the matter of his consideration of restoration
of the goods stated that he had looked at all of the circumstances surrounding
the seizure and was of the opinion that the application of the policy in this
case treated Mr Caiels no more harshly or leniently than anyone else in similar
circumstances and that he had not found sufficient and compelling reasons to
deviate from policy. He invited Mr Caiels to send any fresh information that
he would like the Review Officer to consider and included information about an
appeal to this Tribunal.
17. In response, Mr Caiels wrote
again on 3 January 2012. He gave additional information (which we accept and
find facts accordingly) as follows:
‘The
seizure notice states that the ONLY reason that my property was seized
was “because the goods do not correspond to the entry made by the sender”
·
The goods are of very low value,
there was no intention of evading tax/duty, if there are any tax
charges/holding fees I will be more than happy to pay those to have my property
returned.
·
The goods are not for re-sale,
there was no intention of profiting from these goods. The goods were purchased
for my own use to display in my personal hobby/collection.
·
There was nothing to hide, after
my online auction purchase I expected the goods to be safely packaged,
correctly addressed and labelled with accurate information and sent to me with
no issues.
·
I am fully aware that it was my
responsibility to make sure that the customs declaration was completed
correctly, however I am sure that you will understand that it was not possible
for me to physically be there to check this. The mistake was made by the
sender, I had absolutely no control over what was written on the customs
declaration.
I
have since been in contact with the head office of the Ukraine postal service requesting information on their international posting policy and
have had a reply by email. Reply received from: (I. Chumak, Head of Quality
Control and Consumer [sic] Relations Department). In their reply email
I have been advised that all mail being sent international (airmail) from the Ukraine MUST be presented at the post office counter open for inspection by the post
office staff.
It
is clearly at that point that the mistake/error has been made, the
sender/postal staff are responsible for tis mistake of customs information
being incorrect. It was obviously not checked properly and overlooked.’
18. Review Officer Brenton
acknowledged this letter on 20 January 2012. He stated:
‘Having
considered your further submissions I must inform you that my decision
contained in the letter to you dated 25th November 2011 stands.
Appealing Against My Decision
If
you had wished to contest my decision you had, 30 days from the date of that
letter, to lodge an appeal with a Tribunal that is independent of
Customs/UKBA …
However, as the legality of the seizure of the goods can only be
decided by the Civil Courts, should you appeal my decision to the Tribunal, the
UKBA will request that that [sic]
the appeal be struck out as the Tribunal has no jurisdiction to consider
legality.
…’
(original emphasis)
19. Mr Caiels’s appeal was in
fact lodged on 6 December 2011 and thus in time. He stated the content of the
bullet points appearing in his letter dated 3 January 2012 as his grounds for
appeal in his Notice of Appeal.
20. There was also in evidence
a letter dated 2 May 2012 from Mr Caiels, recapitulating the evidence set out
above, adding further photographs of the fuses and enclosing a copy of the
email sent by Mr I Chumak.
21. In his oral evidence, Review
Officer Brenton stated that it was a buyer’s responsibility to make sure that
goods imported into the UK were declared properly. He suggested that Mr Caiels
could, and should, have taken precautions to ensure that this was done. The
need to do this was more pronounced when goods of a sensitive nature, such as
the fuses in this case, were sought to be imported. Mr Caiels could and should
have contacted the seller before purchasing the goods to ensure that they would
be packaged and described in conformity with the requirements of UK law. There was no evidence that he had taken any such precautions.
22. Review Officer Brenton
compared Mr Caiels’s obligation to take such precautions to the obligation on a
haulier to ensure that systems were in place to check and prevent the illegal
importation into the UK of tobacco products by the drivers of the haulier’s
vehicles.
23. Review Officer Brenton said
that there was no issue about evasion of duty because matters had not
progressed to the point of any decision being made as to whether the
importation attracted any duty or VAT. Therefore, he said, Mr Caiels’s points
about his not having intended to evade duty or VAT were irrelevant in his
consideration.
24. Review Officer Brenton told
the Tribunal that if the goods had been declared properly, they would have been
inspected on importation and a decision taken as to what duty or VAT ought to
be assessed and then they would have been delivered to Mr Caiels on payment of
any amount(s) due.
25. Review Officer Brenton
accepted that there was no evidence that Mr Caiels had been involved in any
collusion to misdeclare the goods or to do anything else contrary to CEMA and
that if there had been any such evidence there was a possibility that a
prosecution would have been considered. He confirmed, however, that his
evidence was not that a prosecution would have followed. A prosecution would
(or might) have followed if the fuses had not in fact been inert.
The
law
26. By section 49(1)(e) CEMA, if
‘any imported goods are found, whether before or after delivery, not to
correspond with the entry made thereof’ those goods shall be liable to
forfeiture.
27. By section 49(1)(f) CEMA, if
‘any imported goods are concealed or packed in any manner appearing to be
intended to deceive an officer’ those goods shall be liable to forfeiture.
28. It is plain from the
evidence that the fuses in this case were found not to correspond with the
entry made of them, and that therefore, pursuant to section 49(1)(e) CEMA, they
were liable to forfeiture. They may also have been liable to forfeiture
pursuant to section 49(1)(f) CEMA. However, the issue of whether the goods
were or were not liable to forfeiture is outside our consideration on this
appeal as the Court of Appeal in Jones and Jones has made clear. Our
function, as Mr Jones submitted, is to consider whether Review Officer
Brenton’s decision not to offer the goods for restoration was reasonable in the
sense that it was one which a reasonable Agency acting on a correct view of the
law and taking into account all relevant matters known to it and not taking
into account any irrelevant matters could have made.
Mr
Jones’s submissions
29. Mr Jones submitted that
Review Officer Brenton’s decision should be upheld on this basis. He submitted
that the officer had acted reasonably in applying the general policy of
non-restoration of goods liable to forfeiture and in concluding that there were
no exceptional circumstances justifying a departure from the policy. He
further submitted that if the evidence had been that Mr Caiels had checked, or
attempted to check, with the seller that the declaration would be correct, then
that would or might have been an exceptional circumstance justifying a
departure from the general policy, but the evidence was clear that Mr Caiels
had not done this.
Discussion
and Decision
30. It is entirely reasonable
for the UK Border Agency to have a policy on restoration of goods liable to
forfeiture and for its officers to follow it. It is also entirely reasonable
for the policy to be a general policy of refusal to offer such goods for
restoration but for each case to be examined on its merits to determine whether
or not restoration might be offered exceptionally.
31. The issue in this case is
whether or not Review Officer Brenton’s decision that no such exceptional
circumstances arise in this case is unreasonable in the sense indicated above
at paragraph 28.
32. We approach this question by
seeking to establish the rationale for the general policy of refusal to offer
goods liable to forfeiture for restoration and in this way seeking to establish
the rationale for determining exceptional circumstances in which the general
policy should not be followed.
33. We note that the general
policy was in fact stated differently by Officer Wood in his letter conveying
the original decision (see above, paragraph 10) and by Review Officer Brenton
in his letter conveying the review decision (see above, paragraph 13).
34. Officer Wood described the
general policy as one whereby goods seized because of an attempt to evade
duty should not normally be restored (our emphasis), whereas Review Officer
Brenton described the general policy as one whereby seized goods should not
normally be restored (again, our emphasis).
35. Officer Wood’s statement of
the policy links the policy not normally to offer seized goods for restoration
to an attempt to evade duty having been made, whereas Review Officer Brenton’s
statement indicates that the policy is not normally to restore seized goods
whatever the reason for the seizure.
36. Section 49(1) CEMA provides
for forfeiture in six different cases which all involve either attempted
evasion of duty or of a prohibition or restriction on importation, or
alternatively some specified form of deception in the manner of importation.
37. The evidence in this case establishes
that there was no attempted evasion of duty or of any prohibition or
restriction on importation, but that there was a form of deception in the
manner of importation, which was perpetrated by the sender in the Ukraine and
not by the UK importer (Mr Caiels), who had no knowledge of or collusion in the
deception.
38. There is a clear reasonable
basis for a policy of not offering goods for restoration to an importer who is
in any way reasonably culpable for the evasion or deception which has given
rise to the forfeiture.
39. But we consider that there
is no obvious reasonable basis for a policy of not offering goods for
restoration to any importer who is not in any way reasonably culpable for the
evasion or deception which has given rise to the forfeiture.
40. Mr Jones did not suggest any
reasonable basis for such a policy (which might perhaps, for example, have been
a policy based on an aim of deterrence). Indeed, by accepting that if Mr
Caiels had carried out the extra precautions which Review Officer Brenton
suggested in evidence that he should have carried out (see above, paragraph
21), then the goods would or might have been offered for restoration on the
basis of exceptional circumstances, it seems to us that the logic of the UK
Border Agency’s position is that restoration should be offered to importers who
are not culpable in respect of the relevant evasion or deception and who have
taken reasonable care to ensure that no such evasion or deception occurs.
41. We regard that formulation
as covering at least some of the cases where it would be reasonable to
recognise (or unreasonable not to recognise) exceptional circumstances in which
the UK Border Agency should reasonably (or would act unreasonably if it did
not) depart from its general policy of refusing restoration of goods liable to
forfeiture. We also regard that formulation as relevant to the facts of this
case.
42. The question for us,
therefore, becomes whether Mr Caiels was culpable in respect of the
deception(s) in issue – the evidence establishes that he was not – and whether
he took reasonable care to ensure that the deception(s) in issue did not occur.
43. The issue of whether Mr
Caiels intended to evade duty or VAT was therefore a relevant issue in
determining whether there were exceptional circumstances in this case
justifying a departure from the general policy of non-restoration and Review
Officer Brenton’s evidence (see above, paragraph 23) was that he had regarded
it as irrelevant.
44. We regard the analogy drawn
by Review Officer Brenton in his oral evidence with a haulier being required to
ensure that systems were in place to check and prevent illegal importation of
tobacco by the haulier’s drivers (see above, paragraph 22) as a false analogy.
45. Such a haulier can
reasonably be required to take steps to prevent an obvious danger of duty
evasion by persons over whom he has some control.
46. The position here is not
analogous to such a haulier’s position in two respects.
47. First, the danger of the
deception which in fact occurred was not, in our judgment, obvious. On the
evidence before us we cannot see that Mr Caiels, or indeed the seller of the
goods, can have derived or hoped to derive any advantage from the deception.
If the goods had been properly declared, the evidence is that they would (after
a search) have been delivered to Mr Caiels on the duty and/or VAT due being
paid by him. We accept that Mr Caiels was at all times ready to pay such duty
and/or VAT.
48. Secondly, we do not accept
that Mr Caiels in any reasonable sense had any control over the seller.
49. We consider (and find as a
fact) that Mr Caiels reasonably expected the goods ‘to be safely packaged,
correctly addressed and labelled with accurate information and sent to [him]
with no issues’ (compare the third bullet point in his grounds for appeal). We
regard Mr Caiels’s request in his letter dated 19 September 2011 (see above,
paragraph 5) for advice as to what he could do/precautions he could take to
prevent similar situations occurring in future as a further indication that
there were no obvious relevant procedures which he might reasonably have been
expected to carry out which he did not in fact carry out.
50. That being the position, we
do not accept Review Officer Brenton’s suggestion that taking reasonable care
to ensure that the deception(s) in issue did not occur would have necessarily
involved Mr Caiels communicating with the seller (either before or after the
sale was concluded) to remind him of his obligation to make a correct
declaration of the goods and not to conceal or pack them in any manner appearing
to be intended to deceive an officer.
51. We find that there was no
additional procedure which Mr Caiels could have adopted, over and above what he
did in fact do, which was necessary to establish that he had taken reasonable
care to ensure that the deception(s) in issue did not occur. We find that he
took reasonable care to ensure that the deception(s) in issue did not occur.
52. We reject the suggestion
that the nature of the inert mortar fuses in issue was of such sensitivity that
any additional procedure, beyond what Mr Caiels actually did, was necessary to
establish that he had taken reasonable care to ensure that the deception(s) in
issue did not occur. We regard the nature of gauging the sensitivity of goods
sought to be imported as too vague to determine the relevant question of what
constitutes reasonable care.
53. In the result, for all the
reasons given above, we find that Review Officer Brenton’s decision was
unreasonable in the matter of his conclusion that there were no exceptional
circumstances in this case justifying a departure from the general policy of
non-restoration. We allow the appeal and direct the UK Border Agency to conduct
a further review of the original decision (of Officer Wood, dated 10 October
2011) taking what we have said in this Decision into account. A review officer
hitherto not involved in this case should undertake the review. We make this
direction pursuant to section 16(4) Finance Act 1994.
54. Finally, we point out that
the text of Review Officer Brenton’s letter dated 20 January 2012 (see above,
paragraph 18) was ill-considered and potentially misleading. The passage in
bold type suggested that any appeal to the Tribunal was liable to be struck out
for want of jurisdiction, which is not, of course, the case. Care should be
taken that in future letters from the UK Border Agency are not misleading in
this way.
55. This document contains full
findings of fact and reasons for the decision. Any party dissatisfied with this
decision has a right to apply for permission to appeal against it pursuant to
Rule 39 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules
2009. The application must be received by this Tribunal not later than 56
days after this decision is sent to that party. The parties are referred to
“Guidance to accompany a Decision from the First-tier Tribunal (Tax Chamber)”
which accompanies and forms part of this decision notice.
JOHN WALTERS QC
TRIBUNAL JUDGE
RELEASE DATE: 19 September 2012
