HMRC internal manual

Appeals reviews and tribunals guidance

First - tier and Upper Tribunals: Preparing for tribunal: Groups of related cases: Lead cases - lead case direction (Rule 18)

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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 ARTG8553 for more information about Rule 5.

Any party may apply to the tribunal for a direction under Rule 18, or the tribunal may give a direction under Rule 18 on its own initiative. As a general rule, the tribunal will respond to applications rather than give a direction on its own initiative.

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 This could be relevant where, for example it is likely that the case identified as the lead case may be withdrawn, and so litigation may continue in relation to the other lead case(s).

Although any party may make an application to the tribunal for Rule 18 to apply, and the tribunal may hear their application notwithstanding the other party’s objections, Rule 18 will be most useful in cases where all parties agree that the rule should apply. If the tribunal agrees, it may give a direction identifying one or more cases as a lead case(s) under Rule 18(2)(a) and suspending (staying) related cases under Rule 18(2)(b).

When considering whether to give a Rule 18 direction, tribunal judges will generally

  • look at each group of cases included on its own merits, and
  • look for agreement from HMRC and the lead and related parties within the group, but
  • will consider cases where one party makes an application.

Direct tax appeals - parties cannot apply to the tribunal for a Rule 18 direction if the customer has appealed to HMRC but has not notified their appeal to the tribunal.

Effect of a rule 18 direction

Following a Rule 18 direction the tribunal will consider the common or related issues in the context of the lead case(s) and will stay any action on the related cases until it has made its decision on the lead case(s). The tribunal will send its decision on the common or related issues to all parties and the decision will bind them all. However, any of the related parties may apply for a subsequent direction that the decision does not apply to, and is not binding on them under Rule 18(4). Any application for a direction under Rule 18(4) must be made in writing within 28 days of the date the tribunal sent a copy of its decision to the parties.