XL Insurance Company SE v IPORS Underwriting Ltd & Ors

XL Insurance Company SE v IPORS Underwriting Ltd & Ors

The court held that XL Insurance has an arguable claim against HMRC for recovery of misappropriated funds paid as tax, as the statutory self-assessment regime does not necessarily preclude third-party claims where no genuine liability existed, and the proprietary and unjust enrichment claims are sufficiently arguable to warrant joinder and amendment of pleadings.

Parties
Claimant/applicant: XL Insurance Company SE; First Defendant: IPORS Underwriting Limited; Second Defendant: Paul Alan Corcoran; Third Defendant: Cheshire Prestigious Cars Limited; Proposed Fourth Defendant/respondent: Her Majesty’s Revenue and Customs
Jurisdiction
England and Wales
Judgment Date
04 March 2021
Procedural Posture
Commercial Court Claim / Application for Joinder and Amendment of Pleadings
Outcome
Application granted
Legal Topics
Joinder of Parties, Constructive Trust, Unjust Enrichment, Self Assessment Tax Regime, Bona Fide Purchaser, Subrogation
Civil Procedure Equity Tax Law Joinder of Parties Constructive Trust Unjust Enrichment Self Assessment Tax Regime Bona Fide Purchaser +1 more

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Parties

XL Insurance Company SE

Claimant/applicant

IPORS Underwriting Limited

First Defendant

Paul Alan Corcoran

Second Defendant

Cheshire Prestigious Cars Limited

Third Defendant

Her Majesty’s Revenue and Customs

Proposed Fourth Defendant/respondent

Procedural Posture

Commercial Court Claim / Application for Joinder and Amendment of Pleadings

Legal Issues

  1. 1 Whether HMRC can be joined as a defendant to claims for recovery of misappropriated funds paid as tax
  2. 2 Whether XL Insurance has an arguable proprietary or unjust enrichment claim against HMRC for funds paid by Mr Corcoran
  3. 3 Whether the statutory self-assessment regime precludes third-party claims to tax payments made by a taxpayer using misappropriated funds

Ratio Decidendi

The court held that XL Insurance has an arguable claim against HMRC for recovery of misappropriated funds paid as tax, as the statutory self-assessment regime does not necessarily preclude third-party claims where no genuine liability existed, and the proprietary and unjust enrichment claims are sufficiently arguable to warrant joinder and amendment of pleadings.

Court Disposition

Application granted

Orders

  • HMRC is joined as a party to the proceedings
  • Claimant is permitted to amend its statements of case to include claims against HMRC