Whiteway Wilkinson v HMRC: High Court strikes out brewery's claims over tax enforcement

The High Court has struck out claims brought by the owners of London Fields Brewery against HMRC, finding no real prospect of success in allegations of negligence, misfeasance in public office, and malicious prosecution. Mr Justice Freedman's judgement in Whiteway Wilkinson & Ors v The Commissioners for HMRC [2025] EWHC 2773 (KB) provides significant guidance on the limits of HMRC's duty of care and the threshold for establishing malicious prosecution in tax enforcement cases.

The claimants, Jules and Rosie Whiteway Wilkinson alongside London Fields Brewery, alleged that HMRC officers had given oral assurances permitting them to trade before obtaining formal registration for beer duty purposes. They contended that HMRC subsequently failed to process their registration applications properly, asked excessive questions beyond the statutory scheme, and ultimately acted with malice in executing a search warrant and pursuing criminal prosecution.

Central to the court's analysis was what Mr Justice Freedman characterised as an "artificiality at the heart of every aspect of the case". Whilst the claimants' narrative concentrated on registration difficulties and beer duty matters, the judgement emphasised that the search warrant and prosecution concerned something entirely different: the non-payment of over £727,000 in VAT and other taxes accumulated over nearly two years.

The court found that HMRC had made numerous attempts to obtain accounts and payment during this period. The claimants repeatedly provided assurances that information would be forthcoming, citing an incompetent accountant and poor management systems. However, these explanations lost credibility when the former accountant indicated the problems originated with the claimants themselves, and no urgent remedial action was taken to address what should have been resolvable issues for a small-to-medium brewery operation.

On the question of duty of care, the judgement reinforced established principles that HMRC does not generally owe a duty of care to taxpayers in the exercise of its statutory functions. Any alleged oral representations regarding VAT were found to be "far too general and unspecific" to create an assumption of responsibility that would constrain HMRC's ability to take civil or criminal enforcement action.

The malicious prosecution claim similarly failed to meet the required threshold. The court concluded there was reasonable and probable cause for both the search warrant and the criminal proceedings, given the substantial unpaid tax liabilities and the pattern of unfulfilled promises to resolve the matter. The judgement noted that when beer was seized, tens of thousands of pounds were immediately found to secure its return, yet no payment was made towards the hundreds of thousands owed in VAT and other taxes.

Mr Justice Freedman rejected arguments that the case represented a developing area of law requiring a full trial. The established case law, particularly at Supreme Court level, provided clear frameworks that, when applied to these facts, offered no basis for the claims. The attempt to construct novel duties of care was found to be "very fact dependent" and unsuccessful given the overwhelming significance of the unpaid VAT.

The judgement also addressed the lengthy procedural history, noting that despite multiple adjournments and amendments since the strike-out application was first made, the fundamental weaknesses could not be cured. The court was satisfied that no further amendments could save the claims.

This decision reinforces that HMRC's enforcement powers, when exercised in response to substantial tax non-compliance, receive robust judicial protection against claims of negligence or malice, particularly where the factual matrix demonstrates clear grounds for action.