SKAT claim struck out on issue estoppel: Ali Malek KC and Adam Temple succeed in the Court of Appeal

The Court of Appeal handed down its judgment in SKAT v MCML today, allowing the appeal and striking out SKAT’s £56 million claim. Ali Malek KC and Adam Temple represented the successful appellant (instructed by Rosenblatt Law).

SKAT issued proceedings in 2018 against several defendants, including MCML. It claimed tax vouchers misrepresented entitlements to tax refunds. Andrew Baker J dismissed the claim based on the ‘Revenue Rule’. While that decision was overturned against other defendants, SKAT did not appeal that point against MCML.

In 2022, SKAT issued new proceedings against MCML with different alleged causes of action but relying on the same tax vouchers, plus five additional ones. MCML applied to strike out the new claim, relying on abuse of process and issue estoppel. Bright J refused that application and MCML appealed.

The Court of Appeal’s judgment focuses on the limits of issue estoppel. Nugee LJ concluded that the earlier ruling on the Revenue Rule bound SKAT, insofar as it relied on the same tax vouchers. In his view, SKAT could proceed with its claim limited to the five new tax vouchers.

Newey and Popplewell LLJ went further. They concluded that issue estoppels can arise from pure principles of law. As between SKAT and MCML, the Revenue Rule barred the entire current claim.

Accordingly, SKAT’s current proceedings have been struck out.

The judgment can be read here.