Customs & Excise v Jack Baars Wholesale & Ors

On 11^th September 2002 Lawrence Collins J., overturning an Order made by Deputy Registrar Lawson on 6^th or 8^th September, ordered that the Official Receiver should be appointed interim receiver of the property of Mr and Mrs Baars but upon terms that such appointment was not to take effect until presentation of (individual) bankruptcy petitions against Mr and Mrs Baars. Severe restrictions were prospectively applied to the Baars as to their access to their assets and the use to which they might be put and requirements were made as to the delivery up to the Interim Receiver of papers relating to their assets.

On 12^th September 2003, as early a date as practicable if the Statutory Demands of 23^rd August were to be relied on, the Customs presented bankruptcy petitions against each of Mr and Mrs Baars. Debts, each of £1,641,223, were asserted. There were thus, by then, the three Petitions which are now before me.

On 12th September also, the Official Receiver as, by then, the Interim Receiver of Mr and Mrs Baars, applied for the appointment of a Special Manager. Mr Goldfarb, already the Provisional Liquidator of JBW, was appointed. Miss Shekerdemian appears for him in both his capacities.

On 14^th October 2002 Miss Registrar Derrett ordered the five matters now before me to be heard together and a great deal of evidence has since been filed.

It will have been noted that the Customs seeks the winding up of JBW without having obtained any judgment for any sum against JBW and without even having served any statutory demand upon JBW. As to the individual petitions, the Customs seek bankruptcy orders without having obtained any judgment in any sum against Mr or Mrs Baars and, whilst they rely on statutory demands in their cases, there are applications, as yet unruled upon, for them to be set aside, applications made before the bankruptcy petitions were presented. Moreover, appeals to the appropriate Tribunal against the alleged underlying debt have already subsisted for over a year and the Customs are not blameless should culpability for any of the delay be relevant.

In such circumstances, what are the principal questions for the Court at this stage? Mr Bompas Q.C., who, with Miss Markham, appears for Mr and Mrs Baars, argues that it suffices to obtain a dismissal of all three Petitions if the respective respondents can shew either that S and S (as to the indebtedness in respect of which JBW is said to be jointly and severally liable along with S and S) or JBW has, on the pending appeals before the Tribunal, a real as opposed to a fanciful or illusionary prospect of success. In the ordinary way, argues Mr Bompas, insolvency proceedings are recognised as not being the proper forum in which to determine issues in relation to disputed debts; if there is an issue which can be described as a "genuine triable issue" then that ought to be resolved by a trial before the insolvency process is invoked – see Turner –v- Royal Bank of Scotland [2000] BPIR 683 at p. 692 per Chadwick L.J.. The test most frequently applied, in my experience, is whether the petition debt is bona fide disputed on substantial grounds. Mr Bompas, though, draws my attention to Everard and Ors –v- Society of Lloyds per Laddie J., 18^th July 2003 [2003] EWHC 1890 (Ch). In Everard the "real as opposed to frivolous appeal" test seems to have been adopted but there the petitioner, Lloyds, already had judgments against the respondents. That, one might think, would conduce to a more stern test being applied to the respondents’ cases rather than, as the "real as opposed to frivolous appeal" would seem to be, if not a test synonymous with the usual one, then an easier one. I thus have some unease about adopting that Everard test as exclusive guidance; I shall fall back instead on the more familiar test; is the debt bona fide disputed on substantial grounds? That I shall take to be the first principal question which I need to address but, as a second one, there may be this; even if no such dispute appears, are there circumstances such that in my discretion (which all accept I have) it would be more appropriate nonetheless either to dismiss or adjourn the Petitions? I leave aside, for the moment, the applications to set aside the statutory demands.

The first principal question cannot be answered without a closer look at that European and domestic legislation as to excise duty on alcohol which I have, so far, only touched upon.

Council Directive 92/12/EEC is headed "on the general arrangements for products subject to excise duty and on the holding, movement and monitoring of such products". Its many recitals include:-

Without prejudice to the provision of Article 20, the liability of the authorized warehouse keeper of dispatch and, if the case arises, that of the transporter may only be discharged by proof that the consignee has taken delivery of the products, in particular by the accompanying document referred in Article 18 under the conditions laid down in Article 19."

When, in the course of movement, an offence or irregularity has been detected without it being possible to determine where it was committed, it shall be deemed to have been committed in the Member State where it was detected.

Without prejudice to the provision of Article 6 (2), when products subject to excise duty do not arrive at their destination and it is not possible to determine where the offence or irregularity was committed, that offence or irregularity shall be deemed to have been committed in the Member State of departure, which shall collected the excise duties at the rate in force on the date when the products were dispatched unless within a period of four months from the date of dispatch of the products evidence is produced to the satisfaction or of the place where the offence or irregularity was actually committed. Member States shall take the necessary measures to deal with any offence or irregularity and to impose effective penalties."

So much for Community legislation. In 2001 the Customs, empowered to prescribe the applicable regulations, made The Excise Duty Points (Duty Suspended Movement of Excise Goods) Regulations 2001 which came into force on 25^th September 2001. "Irregularity" is defined to mean "an irregularity or offence within the meaning of Article 20 of "the 92/12/EEC Directive", undeterred by Article 20’s failure to define "irregularity". There then follow three paragraphs or regulations crucial to the case, namely Regs 3, 4 and 7, which I shall set out in full. Thus Regs 3 and 4 provide:-

(1) Subject to paragraph (2) below, where there is an excise duty point as prescribed by regulation 3 or 4 above, the person liable to pay the excise duty on the occurrence of that excise duty point shall be the person shown as the consignor on the accompanying administrative document or, if someone other than the consignor is shown in Box 10 of that document as having arranged for the guarantee, that other person.

Any other person who causes or has caused the occurrence of an excise duty point as prescribed by regulation 3 or 4 above, shall be jointly and severally liable to pay the duty with the person specified in paragraph (1) above."

It is important to note that what triggers liability under Reg 7 (2) is not or not necessarily the causing of an irregularity but the causing of an "excise duty point". An understanding of the nature of an excise duty point is not helped by the fact that Reg 3 (2), 3 (3) and Reg 4 (2) seem more concerned to specify the time of the occurrence of the excise duty point rather than the characteristics of such a point but it would seem that if an excise duty point within Reg 3 is to be caused for the purposes of Reg 7 (2) then what has to be or to have been caused is an irregularity which has occurred or has been detected in the United Kingdom. Reg 4 requires there to have been someirregularity (Reg 4 (1) (d)), but not one such as to have amounted to an excise duty point within Reg 3. Where Reg 4 applies the excise duty point occurs only upon the goods being removed from the tax warehouse in the United Kingdom – Reg 4 (2) – so to cause such a point one presumably has to remove the goods or to instruct or require their removal in such a way that the instruction or requirement is acted upon. Reg 4 requires no particular intent to be behind the removal; in point of construction it would seem that a completely honest and innocent dealer who instructs his authorized warehouseman to move, say, 100 cases of the dealer’s whiskey to another authorized warehouseman in Italy, only to have the lorry driver robbed of all his goods in France, where the robbery is detected, would find himself liable for the duty lost notwithstanding that in the AAD he was not shewn as the consignor (usually the warehouseman of dispatch) or as guarantor. Absence of complicity would seem to be no defence if all that one is to look for is a causative rôle in the removal from the warehouse in the United Kingdom. If the poor driver is shot and killed in the robbery, is his estate to be liable if it transpired that without any complicity he drove into the tax warehouse and loaded the whiskey onto the lorry before driving off with it? It is notable, too, that although the effect – the removal from the warehouse - has to be in the United Kingdom, there is nothing that requires the causator to be here. Thus, in my example, if it is left to the Italian purchaser to telephone the warehouse to give the instruction for the removal he, too, may, as it would seem, be also liable for duty under Reg 7 (2).

How insignificant does the causative rôle have to be before the person causing the occurrence of the excise duty point is beyond attack? Mr Girolami asserts that the test is not a "but for" one; it does not suffice, he says, to make a person liable that but for his act or omission the removal from the warehouse (if the case is within Reg 4) would not have occurred. Rather, he says, one should look for the effective cause. However, despite the Customs having framed the regulation in an area notorious for the need of some explanation (should the person charged, for example, have been the "predominant", "primary", "effective", "substantial", "real" or "not insubstantial" cause of the excise duty point), Reg 7 (2) is blunt; it provides no description of how large or small the causative rôle has to be, and in any event, the wholly uncomplicit dealer and driver in my example could surely be described as effective causators of that removal from the warehouse which, rather than the armed robbery, would have proved to be the material excise duty point for the purposes of Reg 7 (2).

However, JBW and Mr and Mrs Baars are, if liable, to be liable pursuant to Regulation and according to its terms and not as the Regulation may be qualified or not by Counsel in argument; if a regulation as framed is excessive it is not to be saved by such concession. As a further gloss Mr Girolami says that if a participant is to be made liable under Reg 7 (2) then his participation has to be a knowing one. Again, Reg 7 (2) provides no warrant for introducing a study of states of mind or of knowledge. For the purpose of testing whether Reg 7 (2) is excessive I shall take Regs 3 and 4 to mean only what they say and that in a Reg 4 case any rôle that can be fairly be said to be causative of the relevant excise duty point is a rôle which satisfies Reg 7 (2). There is, though, no warrant for a view that it suffices to make a person liable thereunder (as the assessment on JBW suggests) merely for him to be owner of the goods.

It is against the background of such questions as to Reg 7 (2) that Mr Bompas mounts an attack; it is, he argues, in breach of Community law and unenforceable. The Directive, he says, leaves Member States to fix criminal liability where they choose but prescribes an exhaustive list of those who may be held civilly liable to pay excise duty when the goods under suspension of duty go astray. Thus the authorized warehouse keeper of dispatch may be liable as guarantor, as may, also, as and if guarantors, both the consignor and the transporter – Article 15 (3) supra. So also may the transporter or owner be liable, but, again, as guarantors, where either or both have given a guarantee in place of that otherwise provided by the warehouse-keeper of dispatch. The consignee, too, may be required to provide a guarantee and hence to become potentially liable as guarantor – Article 15 (3). All liability contemplated in Article 15 is, argues Mr Bompas, qua guarantor. That seems to me to be right. Nor, despite Mr Girolami’s response, can I construe the reference in Article 15 to warehouse-keepers of dispatch being enabled to be relieved from giving guarantees in the case of mineral oil moved by sea or pipeline as an indication that the Directive contemplated Member States being entitled to impose liability on persons other than guarantors even in relation to mineral oil, let alone as to alcohol moved by road.

Equally, Article 20 (1) provides that it is to the guarantor that the Member States should look for payment. It is easy to see why that should be so. Where a load of alcoholic drinks, moving under a suspension arrangement, are stolen or are dissipated or vanish without obvious explanation it will plainly be very often difficult, if not impossible, to say when and where the irregularity occurred and who was responsible for it or complicit in it. To avoid that sort of problem the Directive provides instead for liability upon guarantee. Simultaneously it created clear liability irrespective of culpability and a powerful incentive upon the guarantors to do their best to ensure safe arrival without irregularities. For a Member State to add a civil liability not based on guarantee but on some form of causation or culpability (and perhaps on a knowing participation) would be to revert to the very forms of liability which one can assume had proved or were likely to prove so difficult to bring home that the Directive (it would be argued) had replaced them or had never employed them. Moreover, if some only of the Member States did revert to causation or culpability as a test for liability even absent such a person’s liability qua guarantor or were provisions on the point differing from one state to another to emerge, it would not be difficult to espy a restriction on that freedom of movement of goods which Community law so strives to achieve and protect. To revert to my example of the 100 cases of whiskey, the English dealer, rather than putting himself at risk by selling to someone as far off as Italy, submitting the goods to the risk of irregularity over so long a journey, may prefer to sell within the United Kingdom (perhaps without the goods even leaving the warehouse) and the Italian purchaser, not a guarantor, may prefer not to deal with a United Kingdom vendor so as to avoid the risk of liability that Reg 7 (2) introduces. He would seek instead to purchase within Community jurisdictions which rely only on the guarantees which the Directive provides for or which otherwise would not put him at risk.

To counter Mr Bompas’s argument, which it is fair to say emerged only late in the hearing, Mr Girolami was able to find only two cases which, as he saw them, supported an argument that where a Directive prescribed certain detailed requirements that, of itself, does not prohibit a Member State prescribing yet further to the same end and, by implication, that Member States may do so, at all events unless prohibited. In some respects such a proposition would be irresistible; in employment law, for example, it is common to find that a Member State may lawfully prescribe as to, say, the health and safety of workers, to a degree greater than a Directive shall have required. In some other areas one finds Community legislation specifically indicating that Member States may impose stricter requirements than does the relevant directive (the very fact that one finds such express provisions itself indicating that there is no general automatic implication to such effect). But the suggested proposition is too wide to be capable of universal applicability and, in my view, Mr Girolami’s two authorities, which I next turn to, do not support it.

The first authority cited was Honig –v- Stadt Stadig CaseC-128/94 [1995] ECR I-3389. Article 3 (1) (a) of Council Directive 88/166/EEC required cages for hens to afford each laying hen "at least 450 square cms" of floor area. A recital described the provisions "as a first step". Germany, though, required areas of 530 or 550 sq. cms. Herr Honig, a German poultry farmer, claimed that the German requirement was in breach of Community law and created unequal conditions of competition in the sector, contrary to the purpose of the Directive. The German Court referred a question to the ECJ which held that the Directive had not merely one object – reducing competitive disparities – but also that of providing protection to farm animals, the latter being the Directive’s first objective – paragraph 14 – and, fastening on the words "at least" and "as a first step", that the Directive specified only a minimum standard, which Member States were contemplated as entitled to improve upon in the direction of better animal protection. In the circumstances equality of competition had to yield to better protection. There is, though, no equivalent to "at least" or "as a first step" in the Directive as to excise duty and duty-suspended arrangements nor anything in it which confers primacy on duty-collection (beyond the contemplated guarantees) over the free movement of goods.

Mr Girolami’s second authority was G van de Water –v- Staatssecretaris van Financien, Case C-325/99 [2001] ECR I-2729. Mr van de Water held in his shed, which was not a tax warehouse, some alcohol on which duty had not been paid. It was not covered by any customs documents or suspension certificates. He was assessed. In the course of his appeal the Dutch Court itself raised the question of whether the mere holding of a product subject to excise duty but on which duty had not been paid could be regarded as a release for consumption within Article 6 (1) of 94/12/EEC. When the case reached it the ECJ drew attention to Articles 11 (2) and 12 which provided, inter alia, that the holding of alcohol, where duty had not been paid, had to be at a tax warehouse, which the shed was not. The holding in the shed was thus a "departure" from the arrangements within Article 6 (1) and it was thus clear that duty had become chargeable – paragraph 36, page I-2756. No question arose of whether the domestic Netherlands legislation had gone further than the Directive and was pro tanto unenforceable and in that respect the case does not assist the Customs. The ECJ did, though, speak of the levying and collection of excise duty being left to Member States to determine and as being subjects which were not therefore harmonised – paragraph 40, page I-2757. At the same time, though, chargeability (unfortunately, a term used ambigiously) was identified as a subject on which the rules throughout the Community were to be the same – paragraphs 39 and 40 – and the Court did not appear to espouse the Commission’s argument that from whom duty was to be claimed was left to Member States to determine, at any rate where the Directive itself so specified, as it does in Articles 15 and 20 – contrast the unspecific provisions of Article 6 and paragraph 41 of the Judgment.

This was not argued before me but it occurs to me, as Member States are left free to specify differing criminal penalties as to excise evasion and may do so notwithstanding, presumably, that that might impede the free movements of goods, that therefore (it would be said) that freedom is not sacrosanct and may be entrenched upon. But civil liability is one thing, criminal another. Firstly, no crime could be specified as loosely as is Reg 7 (2), which, as I read it, can impose liability on the wholly honest dealer or customer in his ordinary course of his business. Secondly, no criminal process would be tolerated if it could lead to a finding of serious guilt without the accused having an opportunity either to cross-examine his prosecutors or to vindicate his own case by his giving oral evidence. Thirdly, a criminal burden of proof and protection against self-incrimination would apply. In such very different circumstances it would be easy to see the Community as entitled to prefer to allow Member States to deter crime even at the expense of inhibiting free movement of goods. I would thus not take the possibility of differential criminal sanctions from state to state to undermine a view that in the area of civil liability for excise evasion the Community would be likely to regard intrusion by the domestic civil law upon that free movement (such as by Reg 7 (2)) as not to be permitted.

Given the short time afforded for research to Mr Girolami and Mr Smith it would be unfair to regard their two authorities as necessarily the last word on the point but I do not regard either authority as meeting Mr Bompas’s argument which, in my view, raises a "genuine triable issue". It confers upon the appeals to the Tribunal the description of their being "real as opposed to frivolous" appeals and even amounts, in my judgment, to a bona fide dispute on substantial grounds which, moreover, goes to the whole debt asserted (on the conceded basis that failure as to excise duty involves failure also as to VAT).

Mr M.A. Stone’s evidence was that in relation to the 42 consignments the guarantee "was always provided by [S and S] - pages 2-5 of MAS 2". In fact that exhibit identified not S and S but Hermes Credit and Guarantee plc as the guarantor (to a maximum aggregate of £250,000). Whether Hermes have been called on and to what effect I am not told. However, it does appear that in all 42 cases Box 10 of the respective AADs identifies S and S as the giver of the appropriate guarantee. Amongst the arguments raised by S and S in its appeal to the Tribunal is an argument that under Council Regulation 2719/92 the only persons who can be identified in Box 10 are the consignor, the transporter and the consignee and that it is therefore not open to Reg 7 (1) to impose a liability, as it purports to do, on whomsoever’s name is shewn in Box 10 but only on whosoever is both named in Box 10 and is a consignor, transporter or consignee. S and S’s Notice of Appeal asserts that that company was not, nor was shewn in any material AAD as being, consignor, transporter or owner, nor was it a person who " arranged for the guarantee" within Reg 7 (1), presumably with a view to arguing that it was Hermes who so arranged. I have not been taken to Regulation 2719/92 nor have I received evidence or submissions from S and S but I mention S and S’s grounds of appeal in case 2719/92 does, indeed, furnish a genuine triable issue in S and S’s favour because, if it does, then, of course, it furnishes also one in favour of JBW and of Mr and Mrs Baars to the extent that its and their liabilities depend upon the validity of the assessment of 14^th August 2002 on S and S.

Having held as I have as to the existence of a bona fide dispute as to the Petition debts upon substantial grounds I cannot make any winding up or bankruptcy order but before I turn to whether the Petitions should be dismissed or adjourned I should first deal with a further three arguments raised by Mr Bompas.

The first may be described as a quasi-demurrer. It is this: by the Petition presented on 22^nd August 2002 (then the only relevant petition) the Customs sought the winding up of JBW under article 7 of the Insolvent Partnerships Order 1994 which provides for the case (as then it was) in which no petition is presented by the petitioner against any partner or former partner as such. Within that case a number of the provisions of Part V of the Insolvency Act apply as amended in Parts I and II of Schedule 3 to the Order. The amendments leave it open to a creditor to present a petition (albeit at his risk) even if he has no judgment nor has served a statutory demand; he is free to attempt otherwise to prove the insolvency. Thus the Petition against JBW was not improperly presented. Then, as plainly was the Customs’ intent, as witnessed by its completion on 22^nd August 2002 of the Statutory Demands served on Mr and Mrs Baars the next day, the Customs presented petitions on 13^th September, as soon as the 21 days had elapsed, against Mr and Mrs Baars as members of JBW. That, says Mr Bompas, takes the case out of article 7 of the IPO 1994 ("where no concurrent petition presented against member") and into article 8 ("where concurrent petitions presented against one or more members"). In an article 8 case some provisions of the Act apply but with amendments which are different to those prescribed in article 7 cases. Amongst the modified provisions applicable in paragraph 8 cases is section 267.

As amended, section 267 appears to prohibit the presentation of a petition in respect of a joint debt (which I take to mean of both the firm and the member) if there is, at the time of presentation, an outstanding application to set aside a statutory demand in respect of the debt relied on. Of course, by 12^th September there were current applications (of 9^th September) to set aside the Statutory Demands made against Mr and Mrs Baars. However, at worst I would see a presentation during the pendency of an application to set aside the Statutory Demand as not automatically invalidating a petition regardless of surrounding circumstances but rather as an irregularity which might be waived – consider In re a Debtor (No. 22 of 1963) [1994] 1 WLR 46 (albeit its dealing with the different case of a presentation before the 21 days of the Statutory Demand had elapsed).

Whatever strength Mr Bompas’s arguments in this area may have had in September 2002 (as to which I have not needed to set out all of Mr Girolami’s counter-argument) they do not, in my judgment, amount, in relation to the individual petitions, to an irresistible demurrer by December 2003, after several intervening Court Orders (including that of Miss Registrar Derrett of 14^th October 2002 supra, unopposed by the debtors), after many volumes of evidence, 5 witness statements from Mr Baars and upon the point first being taken in oral argument after Mr Girolami had sat down after his opening. Still less do the arrangements provide reason to halt process on the JBW petition. No consequential prejudice of any real weight to the Baars or JBW is or could be alleged. I shall not attempt to deal with all the procedural ramifications of the argument in this area, consideration of which is made no easier by reason of there being no one print available in which one can read the legislation in its amended form in one consecutive sequence. I am, however, clear that to dismiss any Petitions on these procedural accounts would represent a triumph of form over substance which I would not wish to countenance.

The second of these two arguments raised by Mr Bompas asserts that Reg 7 (2) is ultra vires the rule making power conferred by section 1 of the Finance (No. 2) Act 1992. Section 1 (4) provides:-

For a relevant deemed debt to have arisen from JBW to the Customs there needs to have been both an assessment of and notification to JBW. But no form EX 601 addressed to JBW was served on it. However, Mr Girolami tells me on instructions that no form is prescribed for assessments and that Form EX 601 is thus not so prescribed as an essential component of a proper assessment. That being so, I see no reason why the letter of 14^th August 2002 to JBW should not stand as both a good assessment and a good notification. This third objection from Mr Bompas thus fails.

Even if I had not found the Petition debt to be bona fide disputed upon substantial grounds I would, in exercise of my discretion, have been reluctant to make the bankruptcy and winding-up Orders sought, for a number of reasons.

Further persuasive of my not making the Orders sought by the Customs ahead of the underlying debt being ruled upon by the Tribunal is that by reason of the Customs’ successes in achieving the appointment of a Provisional Liquidator, an Interim Receiver and a Special Manager they are very unlikely to suffer material prejudice should the Petitions be adjourned, a factor to which, in one respect, I shall revert below.

For the reasons I have given I shall not make the Orders sought. Should I, though, dismiss the Petitions or adjourn all applications? So far I have studiously said little about the facts; in the circumstances of my not making the Orders sought I see the proper place for the finding of facts as being before the Tribunal where it is hoped that a hearing of adequate length, with oral evidence, can be obtained early in 2004. I would not wish to be coming to any conclusions here that could be taken to colour the Tribunal’s own conclusions of fact but it has to be said that, on evidence not yet tested by cross-examination, the Customs present a strong prima facie case as to JBW’s and Mr Baars’ involvement in dealings difficult to explain outside their being in fraud of the Customs. Although not a single bottle or can of the goods within the 42 consignments has been identified as sold on the black market or illicitly in the United Kingdom or elsewhere and although no sums seen to have been received by JBW or Mr and Mrs Baars have been demonstrated as greater than could have been received in the course of legitimate sales, the Customs present a powerful, albeit circumstantial case, against JBW and Mr and Mrs Baars. On the written evidence I found the dealings with cash, in particular, as so unlike anything one could expect of an honest business that a convincing explanation to the contrary was required. None, in my view of the written evidence, has yet been given. The massive increase in JBW’s turnover and the change in the nature of its trade also will, I would expect, put difficulties of explanation in the Baars’ way. However, it is, though, one thing to prove an involvement in a dishonest trade and another to prove an indisputable debt deriving from the 42 consignments. Moreover, if I am wrong in regarding any causative rôle in causing a relevant excise duty point fairly describable as such as sufficing to satisfy Reg 7 (2) and if, instead, what needs to be shewn is that the acts or omissions of the person involved, for him to be liable thereunder, have to be, for example, the "effective", "predominant" or "substantial" cause of the duty point, or if a knowing state of mind is required of the person sought to be charged, then the burden on the Customs becomes only heavier.

Even so, where there is a real possibility of fraud on the part of JBW and Mr and Mrs Baars being found, I should be reluctant to dismiss the Petitions at this stage, at any rate unless I find myself categorically certain that no view but mine of there being a bona fide dispute as to the debt is possible. It may be that the Customs, given more time, will be able better to rebut Mr Bompas’s argument or otherwise demonstrate to the Tribunal that my view is wrong. It may be that the Tribunal, entirely of its own volition, would wish to raise questions to be referred to the ECJ either before or after examining into the facts. I do not aspire to the level of conviction I have described, and thus find myself pointing towards adjournment. It is not said that my finding as to a bona fide dispute of itself demands a dismissal and bars an adjournment and in my view in the circumstances an adjournment to enable the Tribunal to hear the appeals is the proper and preferable course. If it assists the parties before me, I would certainly commend the hearings before the Tribunal (perhaps also of S and S’s appeal should that not delay matters) for as early a hearing as is possible, the appeals having already hung over the parties for 15 months.

I leave in place the Provisional Liquidator, the Interim Receiver and the Special Manager. Where there is a possibility of fraud or, perhaps, dissipation or concealment of assets, it seems right that over the adjournment the Customs should be protected against it by such officers. Their continuing in office will incur, of course, further costs but not, I would think and hope, on the massive scale so far incurred. I am told, for example, that there has been a detailed professional separate analysis of each of some 4000 telephone calls identified from the records obtained from the Baars’ phone company. It may be unlikely, given the seriousness of the allegations made, that the rôle of the officers I have described can be reduced by the framing of undertakings but should the parties find that is a possibility the matter can be restored.

Should either side be thought to be dragging feet in arrangements for the hearing of the appeals before the Tribunal, the matters can be restored to me on not less than 2 clear days’ notice. Indeed, I give general liberty to apply. Otherwise, for the reasons I have given above, I adjourn generally all five of the matters before me (to be restored preferably to me, but not necessarily to me should restoration to me risk prolonging their disposal).