ARTG8553 - First - tier and Upper Tribunals: Preparing for tribunal: Groups of related cases: Lead cases - Rules 5(3)(b) and (j)

Where there are a large number of related cases and a single consolidated hearing is not appropriate, the rules provide for one or more cases to be treated as lead cases with other follower cases stood behind them.

There are two different rules. Both refer to lead cases but they have quite different consequences. We distinguish between them by referring to Rule 5 lead cases and Rule 18 lead cases. See ARTG8554 for more information about Rule 18.

Rule 5 lead cases are likely to be seen most often.

Either party may apply for a direction that a case be treated as a lead case under Rule 5(3)(b) of the tribunal rules, or the tribunal may make a direction on its own initiative.

Either party to a related case may apply for a direction that their case be suspended (stayed) pending the outcome of the lead case (Rule 5(3)(j)), or the tribunal may make a direction on its own initiative.

If either HMRC, the customers, or the tribunal identify a case at an early stage as being suitable to be stayed, they should make an application (if appropriate) to the tribunal for the case to be stayed. All parties should assume that the tribunal will follow the normal procedures for categorising the case and arranging a hearing unless and until the tribunal agrees that the case should be stayed.

If the tribunal agrees that the case should be stayed, then the tribunal will not allocate it to a category, see ARTG8350 until the outcome of the lead case is known, and no statement of case will be required until then.

HMRC can, if appropriate, make an application for more than one case to be identified as a lead case. This could be relevant where, for example it is possible that the case identified as the lead case may be withdrawn, and so litigation may continue in relation to the other lead case(s).

Once the tribunal has made a lead case direction under Rule 5 in relation to a particular group of cases the litigator should, when making applications for further cases to be covered by that direction/bound by that direction, include a copy of the application for the lead case (altered as necessary to remove any confidential information identifying the other related cases) together with the tribunal’s direction on that lead case.

Effect of a direction under Rule 5(3)(b) and (j)

When the tribunal gives a direction that a case is a lead case under Rule 5(3)(b), the decision given on the lead case is not binding on any stayed cases. However, the decision may be persuasive, and customers whose appeals are stayed may decide to settle their appeals if the tribunal’s decision on the lead case is not appealed further. Customers with stayed appeals who do not accept the decision in the lead case do not have a right of appeal against that decision, but they cannot be prevented from taking their own cases forward.

If the lead case decides to appeal the decision of the tribunal further, then it may be appropriate for the stayed cases to continue to be stayed pending the final outcome of the litigation.