This was HMRC’s unsuccessful appeal to the Upper Tribunal against the FTT’s decision that a paddock was not part of the grounds of a dwelling house for SDLT mixed-use purposes. In relation to HMRC’s challenge, the UT said:
“41. Mr Cannon submitted that HMRC’s challenges in this ground were ‘island hopping’ against which Lewison LJ warned in Fage. He accepted that it was perfectly possible that another FTT in another case with similar facts might have reached a different conclusion to that reached by the FTT in this case. He maintained that the test was not whether it was possible to come to a different view to the FTT but whether the FTT’s decision was so irrational in the judicial sense that no rational judge or tribunal could have reached that conclusion. Mr Cannon contended that the FTT found the necessary facts, drew appropriate inferences from them, gave reasons in sufficient detail and reached a conclusion that it was entitled to reach. The facts found by the FTT were rationally supported by the evidence and the FTT did not make any error of law in its evaluation of those facts or the conclusions that it reached. In short, the FTT was entitled to decide the case as it did whether or not a different FTT may have decided things differently and we should not interfere with that decision.
42. We accept Mr Cannon’s submissions on this point. ….”
The UT therefore confirmed the decision of the FTT in favour of the taxpayers. Although not necessary for its decision, the UT said that the FTT should have applied the reasoning of the UT in Ladson Preston to the timing of the entry into the grazing lease over the paddock because it is the nature of the chargeable interest acquired at the precise moment of completion on the day that should determine a particular SDLT treatment or relief. In this regard it should be remembered that in Harjono & Santoso the FTT thought that a grazing agreement signed before completion and dated by their solicitor at the same time as the land transfer on the day of completion meant that the property was encumbered by the grazing agreement at the point of completion.
You can read the decision here.
