S v S (Disclosure to Revenue)
| Jurisdiction | England & Wales |
| Judgment Date | 1997 |
| Year | 1997 |
| Date | 1997 |
| Court | Family Division |
WILSON, J
Evidence – ancillary relief proceedings – finding of tax evasion – Revenue learning this from person improperly obtaining transcript – whether Revenue would be given leave to retain transcript and have access to evidence and documents in proceedings.
Procedure – ancillary relief proceedings – tax evasion – disclosure of documents and evidence to Revenue – principles to be applied.
Following the hearing of a wife's application for ancillary relief, judgment was delivered in chambers. The judgment was in writing and copies were given to the parties. There was a postscript that if a transcript was needed for any formal purpose, application should be made to the Mechanical Recording Department of the Royal Courts of Justice.
The judgment included a finding that the husband had wrongfully evaded payment of taxes.
The wife showed her copy of the judgment to her brother who held a grievance against the husband. Through solicitors the brother applied to the Mechanical Recording Department for a transcript of the judgment. As the brother was not a party to the proceedings he was not entitled to a transcript without the court's permission: r 10.15(6) of the Family Proceedings Rules 1991. Nevertheless, by an administrative error, the Department caused a transcript to be supplied to the brother.
The Inland Revenue obtained a copy of the transcript. The Revenue did not want to disclose the source of its transcript but there was no doubt that it was the brother. The Revenue accepted that its possession of the transcript was irregular and it sought permission under r 10.15(6) to keep it and to bespeak a transcript of the evidence given at the hearing. It also sought leave under r 10.20(3) to inspect and take copies of documents which had been filed or lodged in court at the substantive hearing.
Held – The application of the Revenue fell to be decided by the balance of the public interest that in the administration of justice truth should out. On the one hand it was in the public interest that all tax due should be paid and that in serious cases evaders of tax should be convicted and sentenced. On the other hand it was in the public interest that in proceedings for ancillary relief the parties should make full and frank disclosure of their resources. Were it to be understood that candour would be likely to lead to exposure of under-declaration to the Revenue, the pressure wrongfully to dissemble within the proceedings might be irresistible to many litigants. False representation by respondents in ancillary proceedings had two repercussions, both seriously contrary to the public interest. First, either the Judge remained deceived, when the award was likely to be inaptly
low; or he perceived the deception and drew necessarily broad inferences of hidden wealth which could make the award inaptly high or leave it still inaptly low. Second, applicants were seldom minded to compromise their claims on the basis of declarations which they believed to be materially false and their instance, if justified by the court's findings, would often be upheld in relation to costs. Yet the family justice system depended upon the compromise of all but a few applications for ancillary relief. The individual circumstances must be weighed between these two opposing public interests. In this case relevant factors included the fact that the finding of tax evasion was of the most general character and none of the documents and no line of transcripts of the oral evidence would establish evasion nor help the Revenue identify it with the necessary particularity. It was also relevant that the evasion took place at least nine years ago. In all the circumstances the applications of the Revenue would be dismissed.
Statutory provisions referred to:Family Proceedings Rules 1991, rr 10.15(6) and 10.20(3).
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