DILLON, J. - (1.) GROUP Lotus Car Cos plc and Lotus Cars Ltd. (the taxpayer companies) appeal against a decision of Sir Nicolas Browne -Wilkinson V -C (1987) 2 All ER 674), given on 18th December, 1986 whereby on a case stated at the request of the Crown under s. 56 of the Taxes Management Act, 1970 by the General Commissioners for the Wymondham division of Norfolk the Vice -Chancellor directed that the matter be remitted to the Special Commissioners for rehearing with liberty to each party to adduce fresh evidence.
(2.) THE issues debated in argument before the Vice -Chancellor and in this court have been essentially issues of procedure and onus of proof. What lies behind them, however, is the desire of the Crown to get in, if possible, certain fresh evidence which the Crown obtained for the first time after the commissioners had given their decision and which could not have been obtained with reasonable diligence for use at the hearing before the commissioners. Since the only appeal to the High Court against a decision of the commissioners, Special or General, in a tax case is an appeal by case stated on a question of law, it is accepted by the Crown that new evidence cannot in general be received in the High Court or in this court on a tax appeal, even if the three well -known conditions laid down in Ladd vs. Marshall (1954) 3 All ER 745 : (1954) 1 WLR 1989 are satisfied. It is submitted, however, for the Crown that if it can be shown that there has been error of law on the part of the commissioners such that the matter should be remitted for rehearing then it may be appropriate, and would in the present case be appropriate, for new evidence to be admitted on the rehearing. The particular error of law relied on in the present case is, it is said, and the Vice -Chancellor held, that the commissioners misdirected themselves in law in relation to the onus of proof on the questions which they had to consider. In the years down to 1978 the taxpayer companies had been engaged with some success in the manufacture of high quality sports cars and in building specialised cars designed for the racetrack. The driving force behind the taxpayer companies, until his death on 16st December, 1982, was a Mr. Colin Chapman, who, according to the case stated had virtually complete control of the companies and had built up an international reputation as a designer and for the development of motor cars in all their aspects, with particular reference to cars of a sporting nature. Mr. Chapmans right hand man for many years was a Mr. FR Bushell. Mr. Bushell is one of Mr. Chapmans executors, and on Mr. Chapmans death he became managing director of Lotus Cars Ltd. At the time of the hearing before the commissioners he was chief executive of the taxpayer companies, though he is not now, and he was one of the principal witnesses for the taxpayer companies during that hearing.
(3.) IN 1978 the taxpayer companies became involved in the notorious affair of the De Lorean motor car. There were three relevant agreements, all date 1st November, 1978. The first was an agreement between De Lorean Research Ltd. Partnership of America, De Lorean Motor Cars Ltd. of Northern Irland and a company called GPD Services Inc (GPD), GPD agreed to provide its services for design, test and calculation work for the purpose of developing a sports car, the DMC 12, and it was provided that Lotus Cars Ltd. and Mr. Chapman himself would be engaged in doing the work. The second was a letter of agreement whereby Lotus Cars Ltd. warranted and guaranteed to De Lorean Research Ltd. Partnership and De Lorean Motor Cars Ltd. the timely and full performance of each and every obligation of GPD under the first agreement. The third was an agreement between GPD and Lotus Cars Ltd. agreed to carry out research, design and development work in connection with the DMC 12 prototype sports coupe which was to be manufactured by De Lorean Motor Cars Ltd. Under this third agreement a good faith deposit of Pounds 2m was paid to Lotus Cars Ltd. on 6th November, 1978, but was refunded in April, 1979.;