Author Topic: The Case of John Lamberton  (Read 32 times)

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Offline QCChevalier

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The Case of John Lamberton
« on: October 08, 2020, 09:59:PM »
In September 2003, John Gardner Braes Lamberton (born 21st. October 1954) was convicted by a majority jury verdict of embezzlement and tax fraud at Edinburgh Sheriff Court.  The tax fraud conviction related to inheritance tax ('IHT').  The embezzlement conviction consisted of two counts: Mr Lamberton had misappropriate funds from his late aunt and had deprived his brother of his rightful share of an inheritance from his late aunt.

In Scots law, a majority verdict can be reached by a simple majority of the jury (in contrast to English law, which requires a super-majority, where a majority verdict is permitted by the judge).

Mr Lamberton runs a rival forum that takes a very negative view of Jeremy Bamber and his pleas of innocence.  In this thread, I would like to stick to discussing Mr Lamberton's case and, if there are posts, I would appreciate it if they could stick to the topic in hand.  In particular, please do not insult Mr Lamberton or make adverse comment about him here.

Mr Lamberton has chosen to make his case public.  He runs a website, claiming that he has suffered a miscarriage of justice, and part of his online forum is devoted to discussing it; and, he has expressly requested that people ask him questions about it (though as I will explain below, he seems reluctant to answer real questions).

This is, furthermore, a high profile case that was covered by the national media, has concerned the highest levels of the Scottish Government and was discussed by a UK parliamentary committee.  In two respects, the case was ground-breaking: it was one of the first intra-EU extraditions for tax fraud and it is also quite rare for the UK authorities to bring a criminal prosecution for IHT evasion.
« Last Edit: October 08, 2020, 11:11:PM by QCChevalier »

Offline QCChevalier

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Re: The Case of John Lamberton
« Reply #1 on: October 08, 2020, 10:03:PM »
I have not yet obtained any documents from the Scottish courts or elsewhere, so my sources on this case are entirely those published by John Lamberton, and include:

The sub-forum on his site: http://miscarriageofjustice.co/index.php?board=9.0

Mr Lamberton's own campaign website: http://www.justice4johnlamberton.com/  [There is also an old site that still appears at https://johnlamberton.webs.com/].

Press and media coverage of the case is not terribly helpful, as it doesn't go into any great depth.

Offline QCChevalier

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Re: The Case of John Lamberton
« Reply #2 on: October 08, 2020, 10:37:PM »
Based on information from the above sources published by Mr Lamberton, we can summarise the facts as follows:

1. Mr Lamberton had a close relationship with his aunt, Mrs Annie Paul, that went back to the 1970s and included shared holidays and visits to her home.

2. In 1987, Mr Lamberton purchased a house in Bo'ness to be near Mrs Paul.  Naturally he brought his wife and two children with him.  He obtained a position with Fife Council, and later moved his family to Fife in order to be nearer work.  By 1991, he had bought land near Luthrie and constructed a house on it. 

3. In 1991, Mr Paul (Annie's husband) died.  Mrs Paul then arranged her affairs as follows:

(i). Mr Paul's estate (or a large part of it) was placed in a trust managed by the Bank of Scotland.  No income was supposed to be paid from this trust, it was to accumulate capital only.

(ii). Mrs Paul's estate was also placed in a trust, also managed by the Bank of Scotland, but this would pay her income that she would live off.

4. During the early 1990s, the close relationship with Mrs Paul was maintained by Mr Lamberton and it was decided that he would inherit the whole of Mrs Paul's estate, which would mean cutting her other nephew, Mr Lamberton's brother, out of her will.

5. It also developed that the Bank of Scotland had acted negligently in the management of the late Mr Paul's trust, having set it up as an income trust.  Mrs Paul had also submitted a formal request to the Bank of Scotland for trust moneys to carry out maintenance on her home, which the Bank refused or did not act on, contrary to the terms of the trust.  Mrs Paul was extremely unhappy with all this and resolved to terminate both trusts managed by the Bank of Scotland.

6. Mrs Paul gave effect to these wishes in 1996, as follows:

(i). She asked the Bank of Scotland to terminate the trust of the estate of the late Mr Paul.  The Bank of Scotland refused or did not act on this request.

(ii). She terminated her own trust with the Bank of Scotland and liquidated the relevant assets, transferring the cash to Mr Lamberton.

(iii). She made a new will leaving the entirety of the remainder of her estate to Mr Lamberton and appointing him as her Attorney under the terms of a Power of Attorney.

7. At Mrs Paul's encouragement, Mr Lamberton took up early retirement from Fife Council in 1996 and became a stock market trader, using the funds given to him by Mrs Paul.

8. Mrs Paul died in June 1998.  At this point, Mr Lamberton as executor and trustee of the estate was responsible for the submission of an inheritance tax return to HM Revenue & Customs (then known as the Inland Revenue).  This was arranged in conjunction with his solicitor, Mr Gregor Robertson.

9. The Bank of Scotland immediately paid the inheritance tax due on the trust of the estate of the late Mr Paul.  It is not clear how or why this was done without reference to Mr Lamberton, as he claims, since this trust was part of Mrs Paul's estate and needed to be included in the IHT accounts. 

10. Mr Lamberton did not include the 1996 transfer of Mrs Paul's liquidated assets on the IHT return and this was reported to the Revenue by Mr Robertson.

11. A tax investigation was opened into the Paul estate.  Both Mr Lamberton and his brother were subsequently interviewed by Revenue investigators. 

12. In 2000, Mr Lamberton moved to Spain and set up in business there as an international estate agent.  This business had its own office and staff.

13. In 2002, the UK authorities issued an extradition request to the Spanish authorities for Mr Lamberton, and he was detained by Spanish police, and after a period in the Spanish prison system, he was extradited back to Scotland.

14. Mr Lamberton was convicted in September 2003 of embezzlement (two counts) and tax fraud (relating to inheritance tax).  He was sentenced to seven years imprisonment, which was reduced on appeal to five.  He also appealed the conviction, but this appeal was refused in 2009.  He is the subject of a Proceeds of Crime order, which includes property in Northern Ireland.
« Last Edit: October 09, 2020, 10:50:PM by QCChevalier »

Offline QCChevalier

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Re: The Case of John Lamberton
« Reply #3 on: October 08, 2020, 10:51:PM »
Mr Lamberton maintains he was wrongly convicted.  He also argues that the extradition process from Spain to Scotland was unlawful, though that seems to me a peripheral issue and it cannot disturb his convictions, so we are not particularly concerned with it here.  I am also not concerned here with the Proceeds of Crime orders against Mr Lamberton, as they, too, are peripheral and arise due to the convictions.

The prosecution say that Mr Lamberton:

(i). misappropriated Mrs Paul's estate, which is embezzlement in Scots law;
(ii). misappropriated from his brother his share of Mrs Paul's estate, which is also embezzlement in Scots law;
(ii). evaded payment to the Revenue of inheritance tax on the 1996 transfer by Mrs Paul to himself, which is cheating the Revenue or tax fraud.

I am not clear on the facts that give rise to (i) and (ii), and unfortunately Mr Lamberton is vague about it and, as I will shortly explain, he has not answered my questions about it.

What we can say are that the defence arguments seem to be as follows:

In regard to (i) and (ii), Mr Lamberton asserts that he rightly inherited Mrs Paul's estate and he points out that the prosecution was not brought as a result of a complaint from his brother.

In regard to (iii), Mr Lamberton asserts that, as early as 1991, Mrs Paul intimated her intention that he should inherit her estate, which means that on her death in 1998, her transfer of that part of the estate to Mr Lamberton met the seven years requirement for exemption from inheritance tax, thus there was no requirement on Mr Lamberton to declare it.
« Last Edit: October 08, 2020, 11:35:PM by QCChevalier »

Offline QCChevalier

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Re: The Case of John Lamberton
« Reply #4 on: October 08, 2020, 11:05:PM »
I cannot comment further on the embezzlement convictions, as we have no further information.  What Mr Lamberton says about it completely contradicts the allegation of embezzlement and the whole thing makes little or no sense.  The only way to clear this up would be to examine a transcript of the trial or the sentencing remarks, or both.

One comment I would make is that Mrs Paul must have completed her will in the presence of at least one witness other than Mr Lamberton.  The Requirements of Writing (Scotland) Act 1995 states that in order for a will to be 'self-proving' in Scots law, it must (among other things) have been witnessed, otherwise the will can only be considered valid and provable if it can be demonstrated to the satisfaction of the court that the testator did make a will, having the necessary capacity and intention to do so.

If there was a witness, then where is this person?  Did Mrs Paul take professional advice on her position in 1996?  Did Mr Lamberton take advice?  I gather that on receiving the cash from Mrs Paul, he entered into quite complex tax minimisation arrangements.  Did he seek professional advice and opinion on this?

Turning to the tax fraud, the issues I have are as follows:

First, neither the Inheritance Tax Act 1984 nor the current HMRC Inheritance Tax Manual seem to allow for an expression of intent to amount to a 'disposition' for tax purposes.  In this respect, the Manual is unlikely to have changed radically since the 1998/99 tax year.  That being the case, it would appear that the relevant transfer ('disposition') date and taxable point for IHT purposes is 1996, and that being the case, Mrs Paul did not survive the requisite seven years for the transfer to Mr Lamberton to be considered exempt from IHT, thus the 1996 transfer should have been reported on the 1998/99 IHT return.

If Mr Lamberton disagrees and wishes to assert that the taxable point was 1991 not 1996, then the onus is on him to show this.  If he can't, then - unfortunately - it would appear he may be guilty of tax fraud (depending on further arguments about his state of mind and intentions).

Mr Lamberton mentions somewhere that his advocate produced at trial documentary evidence that the taxable point was 1991, but he says, this was dismissed by the judge in his summing-up to the jury because it was only in photocopied form (a mishap that Mr Lamberton blames on the prosecution for not accepting the original into evidence).  I think Mr Lamberton would have to explain this document further, and perhaps provide a copy, before we could fully understand what he is referring to.

There is also an overarching inconsistency in Mr Lamberton's account of things, which links both the embezzlement and the tax fraud. Mrs Paul decided to cut Mr Lamberton's brother out of her will in 1996, yet Mr Lamberton claims that she decided to leave all her estate just to him as early as 1991.  Both cannot be true.  Mrs Paul would not have delayed five years before changing her will accordingly.
« Last Edit: October 08, 2020, 11:37:PM by QCChevalier »

Offline QCChevalier

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Re: The Case of John Lamberton
« Reply #5 on: October 08, 2020, 11:22:PM »
This is a post I submitted about the case a few days ago on the Red Forum.  It remains in moderation and has not been posted.  You will see the post includes some questions for John Lamberton that I think are relevant to a further understanding of the case:

Quote
Hello John,

This case interests me.  I don't know if you are still fielding questions, but in any event, I wish to thank you for having the courage and integrity to open it up for discussion.

I have quite a few queries and observations.  Apologies because this is quite lengthy.  I certainly don't expect a quick answer as I appreciate you are busy and have other priorities.

I would just start with the comment that I am not entirely clear about what precisely you were convicted of.

I have found a 2019 judgment from the High Court of Northern Ireland, which states that in 2003 you were convicted of fraud and embezzlement.  Does this include tax fraud?  Here's the link: https://judiciaryni.uk/sites/judiciary/files/decisions/John%20Gardner%20Braes%20Lamberton%27s%20Application.pdf

Ideally, as a starting point, you should post up here a copy of the certificate of conviction (which I assume Scottish courts issue) so that we know precisely what you were convicted of and under what laws and/or statutes.  Reports from different sources seem to vary, and I'm afraid without official confirmation, or clearer information from yourself, I'm somewhat in the dark and have to rely on making assumptions - which is always dangerous.

Turning to the law, first I am completely baffled by the charge of embezzlement - assuming that was included - in that it does not seem to tally with the facts as reported by you.  Could you please explain how the Crown came to that allegation?  I don't want any more of your side of it, as I now have that (unless something new has happened); I mean could you explain it from the prosecution point-of-view? What's their reasoning?

The tax aspects are a bit easier to understand.  For now, I am assuming one of the convictions was for tax fraud, and if that is the case, then it would appear the basis of the conviction is that:

(i). you did not report the 1986 transfer to the Revenue, or you withheld information about it from your advisor and/or the Revenue;

(ii). this transfer was within seven years of Mrs Paul's death and therefore was not an exempt transfer, so should have been reported; and,

(iii). you intentionally or recklessly did not pay the inheritance tax due to the Revenue on this transfer.

In a different thread, you explained this and defended yourself by arguing that the 1996 transfer was intimated some years earlier, in 1991 (at the same time as the establishment of the corresponding Bank of Scotland trust for the late Mr Paul's estate), thus you assert that the relevant taxable point is in 1991, not 1996, therefore the 1996 transfer was not reportable.

Obviously I'm not expert, and I know you won't be relying on my view, but I'm afraid I don't personally see any basis for this part of your defence in the relevant statute - which is the 1984 Act - or the Inheritance Tax Manual (at least, as it exists now, in 2020).  The Manual in particular defines a 'disposition' quite clearly as the point of transfer or disposal (or in like terms), and I doubt it would have been much different back in 1998/99.

Putting that aside, and taking what you say at face value, do you have evidence of a disposition of the relevant part of the late Mrs Paul's estate by June 1991 at the latest?

Alternatively, do you have evidence of an expression of intent of the late Mrs Paul drawn-up by or before June 1991 to dispose of her assets at a future point, and in addition, evidence or legal opinion that supports your view that such an expression of intent amounts to a 'disposition'?  If you do have such evidence, what form does it take?  Is your legal opinion (if you have one) written by an experienced Scots advocate specialising in private tax? 

Another question I have, more a point of clarification, is regarding what the 1996 transfer exactly involved.  It appears that Mrs Paul authorised the sale of certain shares and then transferred the cash to you personally.  Is that correct?  Did she actually transfer the money into a bank account (or other facility) in your name?  Or was the money transferred to a company or other legal personality or third party?  If so, who and why and on whose authorisation?  If the transfer was to you personally and you then subsequently transferred money or assets elsewhere, was there a considerable time gap between these events?  In any case, could you describe the sequence of events?

Finally - for now - at the time of the criminal prosecution for embezzlement, did the Crown offer any explanation for why the late Mrs Paul or others connected to her did not report you to the authorities at the time of the 1996 transfer?  I assume your advocate at trial cross-examined Crown witnesses, especially Revenue investigators, on this point?  What was the explanation given? 

Did Mrs Paul explain the 1996 transfer to anybody else, expressing her wish for you to have the money?  I know you mentioned somebody was called over to witness the grant of the Power of Attorney and new will, but did that person or some other person also witness Mrs Paul's intentions regarding the liquidation and disposition of the private trust earlier that year?  If there is such a witness, was that witness called at trial and examined?  Was the evidence favourable and in support of your version of events?

Thank you very much.

« Last Edit: October 08, 2020, 11:23:PM by QCChevalier »