Mark Gadsden v The Commissioners for HMRC
Decision date: 31 July 2026
Neutral citation: [2026] UKFTT 1112 (TC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
The appellant, Mark Gadsden, sought costs under Rule 10(1)(b) after winning a substantive appeal that his failure to pay Class 2 NICs was through ignorance or error. He alleged HMRC acted unreasonably in preparing and presenting witness evidence (notably Ms Crawford) and in continuing to defend the appeal. The Tribunal found significant evidential weaknesses in HMRC’s case but no dishonesty, bad faith or deliberate misleading, and held those weaknesses did not meet the high threshold of unreasonable conduct under Rule 10(1)(b). The costs application was refused.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: high
The Tribunal’s ratio is that Rule 10(1)(b) requires an objective assessment of the conduct of bringing, defending or conducting proceedings, not merely an assessment of the substantive correctness of the underlying decision; substantial evidential weaknesses exposed at trial do not automatically establish unreasonable litigation conduct, and persistence in a position is only unreasonable where its lack of merit ought reasonably to have been apparent so as to render continued reliance untenable.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The Tribunal observed (obiter) that cross-examination commonly exposes assumptions and limitations in witness evidence without itself proving unreasonable conduct; that explanations about pre-service enquiries can be material when a costs application identifies specific evidential deficiencies; and that Rule 10 is exceptional and should not be used to make costs routinely follow the event.