Important judgment on the interpretation of HMRC’s standard guarantee for deferred tax payments

News Rebecca Drake 27th July 2022

Rebecca Drake represented the successful claimant in Commercial Court proceedings concerning the interpretation of HMRC’s standard guarantee for deferred tax payments.

In a judgment dated 25^th July 2022 Philip Marshall QC, sitting as a Deputy Judge of the High Court, found for the Claimant on both issues tried, holding that the demand made by HMRC under its standard Guarantee was a valid demand, and so Euler was correct in complying with that demand.  The Court further held that, even if that demand was incorrect as contended for by the Defendants, the Defendants were in any event obliged to indemnify the Claimant under the relevant indemnity. The Court paid particular attention  to the meaning of the “conclusive evidence” clause of the Indemnity.  The Court also made important findings in relation to the meaning of “manifest error”, upholding the decision in Flowgroup Plc v Co-operation Energy Ltd [2021] EWHC 344.

The judgment will be of wider significance for the interpretation of HMRC’s standard guarantee for deferred tax payments, as well as having important implications for the interpretation of indemnities and guarantees more widely.

Rebecca Drake was instructed by Gateley Plc and appeared against Iain Quirk QC for the Defendants.

Click here for the full judgment in Euler Hermes SA v Mackays Stores Group Ltd [2022] EWHC 1918 (Comm).

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Rebecca Drake