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Procedure.Tax
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M25: Substituting parties
Power to substitute
“(1) The Tribunal may give a direction substituting a party if--
(a) the wrong person has been named as a party; or
(b) the substitution has become necessary because of a change in circumstances since the start of proceedings.” (FTT Rules, r.9(1)).
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Substitution of a partner where partnership no longer wishes to appeal
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“I have not heard any evidence as to whether there was a 75% vote of members to authorise the proceedings. Nor have I heard evidence as to whether, in the light of subsequent events, the members may have ratified or acquiesced in the bringing of the appeal. Notwithstanding the absence of such evidence it seems to me that there has been a change in circumstances. The Notice of Appeal was lodged by a Mr Stephen Marsden who at the time it was lodged appears to have been a Designated Member. No doubt he at least believed he had authority to commence the appeal. Even if he did not have authority, a subsequent finding that he was acting outside his authority under the Partnership Agreement would amount to a change in circumstances. Similarly the resignation of the Board and the lack of internal consensus amongst the members would also amount to a change in circumstances. I am satisfied therefore that there has been a change in circumstances so as to engage Tribunal Rule 9(1)(b).” (MCashback Software LLP v. HMRC [2013] UKFTT 679 (TC), §50).
Substitution is possible even after the decision
“I consider that the First-tier Tribunal’s power to consider an application for joinder after judgment must be derived from a process of interpretation of rule 9 of the Tribunal Procedure Rules. I am satisfied that it is permissible to interpret rule 9 as permitting joinder following judgment. It seems to me that such an interpretation may be reached either by relying on the Court of Appeal’s decision in Prescott as persuasive authority from a higher court on a matter of procedure, or by praying in aid the overriding objective in order to achieve fairness and justice in the circumstances of the case, as did Judge Warren in Corke.” (Razzaq v. Charity Commission [2016] UKUT 546 (TCC), §12, Judge McKenna).