Minister of Finance v AD

• Jurisdiction: Bermuda
• Judge: Baker P,Kay JA,Bernard JA
• Judgment Date: 12 June 2015
• Court: Court of Appeal (Bermuda)
• Docket Number: Civil Appeal 2015 No AD
• Date: 12 June 2015

[2015] Bda LR 52

In The Court of Appeal for Bermuda

Before:

Baker P; Kay JA; Bernard JA

Civil Appeal 2015 No AD

Between:

The Minister of Finance

Appellant

and

AD

Respondent

Mr D Kessaram for the Appellant

Mr J Elkinson for the Respondent

The following cases were referred to in the judgment:

Ministry of Finance v E, F, H and OBDLR [2014] Bda LR 54

R v Secretary of State for the Home Department, ex parte SimmsELR [2000] 2 AC 115

Morgan Grenfell & Co Ltd v Special Commissioners for Income TaxELR [2003] 1 AC 563

Jackson v Attorney GeneralELR [2006] 1 AC 262

Evans v Attorney General [2015] UKSC 21

Al Rawi v Securities ServiceELR [2012] 1 AC 531

R v Lancashire County Council, ex parte HuddlestonUNK [1986] 2 All ER 941

Larsen v Comptroller of Taxes [2015] JRC 104

R (on the application of B Sky B Limited) v Central Criminal CourtELR [2012] QB 785

Production order — Tax Information Exchange Agreements — Disclosure of documents which had been before the Court in ex parte application — Right of review — Common law principles to have access to evidence

JUDGMENT of Kay JA

Introduction

1. International agreements to which Bermuda is a party provide for the rendering of assistance by Bermuda to the tax authorities of other countries which seek information about persons present in Bermuda. The assistance is now in the form of a production order whereby the Minister of Finance (the Minister) serves upon a person an order requiring the production of information. The system is governed by the International Cooperation (Tax Information Exchange Agreements) Act 2005 (the 2005 Act), as amended by the International Cooperation (Tax Information Exchange Agreements) Amendment Act 2014 (the 2014 Act), which came into force on 8 December 2014. In the present case, the Minister received a request for assistance from the French tax authorities. On 30 December 2014, he applied to, and obtained from, the Supreme Court a production order in relation to AD. This appeal is concerned with what transpired following the making of the production order.

The statutory provisions

2. The procedure for obtaining a production order is set out in sections 5 and 6 of the 2005 Act in the following terms:

‘5 (5) An application for a production order under this section may be made ex parte to a judge in Chambers and shall be in camera.

(6) A person served with a production order under subsection (1) who is aggrieved by the service of the order may seek review of the order within21 days of the date of service of the order.’

3. The amendments introduced by the 2014 Act now add the following into section 5 of the 2005 Act:

‘(6A) A person served with a production order under subsection (1) who seeks information from the Minister pertaining to the production order, must first file an application with the court to review the production order.

(6B) Upon the application under subsection (6A) having been filed with the court, the court shall decide whether to grant the person a right of review.’

The issue

4. The question at the heart of this appeal is whether a person upon whom a production order is served is entitled to disclosure of the documents which were placed before the judge by the Minister in support of his ex parte application for the production order. In accordance with general common law principles, the subject of the production order was entitled to such disclosure: Ministry of Finance v E, F, H and OBDLR[2014] Bda LR 5 We are told that, following that judgment, the Minister informed all those against whom production orders were made of their right to receive disclosure of the documents which had been before the court on the ex parte application.

5. The present dispute results from a change in the stance of the Minister since 8 December 2014. His stance now is that, by reason of the amendments, he is no longer required to disclose the material which had supported his ex parte application. If the subject of the production order wishes to apply for a review under section 5(6A), he must do so without sight of that material. He is not even entitled to know the source of the originating request for assistance. The Supreme Court will then proceed to decide ‘whether to grant the person a right of review’. If a right of review is refused at that stage, the subject must comply with the order, which is supported by criminal sanctions, without ever having had the opportunity to see the material upon which the order was based.

The present case

6. AD did not accept the lawfulness of the Minister's stance. He sought disclosure of the relevant material so as to satisfy himself that the production order had been properly made and to decide whether or not to make an informed application for a review pursuant to section 5(6A). His case is that, at common law, there is a fundamental right to disclosure of the material upon which an ex parte order was based and a right of that importance can only be abrogated by a clear and...