O'Byrne v Minister for Finance and Attorney General
Constitution - Revenue - Income tax - Super-tax - Sur-tax - Remuneration of judge - Whether deduction of income tax from judge's remuneration a diminution of such remuneration - Whether such deduction prohibited by Constitution of Saorstt ireann ireann or the Constitution of ire ire - Whether income tax a non-discriminatory tax - Constitution of Saorstt ireann ireann,Articles 68 and 73 - Constitution of ire ire, Article 35, 5, and Article 50.
Cur. adv. vult.
This case involves a question of public importance. It is whether the constitutional provisions designed to secure and safeguard the independence of the judiciary in the exercise of their functions include an immunity from taxation of that portion of their income consisting of their judicial remuneration.
The plaintiff is the widow and personal representative of a deceased judge, the late John O'Byrne. He was appointed a judge of the High Court in 1926 and continued in that office until 1940 when he was appointed to the Supreme Court and he continued a member of the latter Court until his death early in 1954. The High Court to which he was originally appointed was that set up by the Courts of Justice Act, 1924, pursuant to the provisions of the Constitution of Saorstt ireann ireannhereinafter, for convenience, referred to as the Constitution of 1922. On the coming into operation of the present Constitutionhereinafter, for convenience, referred to as the Constitution of 1937on 29th December, 1937, he made and subscribed the declaration set forth in s. 5 of Article 34 of that Constitution. The effect of this, under Article 58one of the "Transitory Provisions" of the Constitution of 1937was that he continued to be a member of the High Court and to hold office by the like tenure and on the like terms as theretofore. That Article provided that, until otherwise determined by law, the Courts in existence immediately before the coming into operation of the Constitutionwhich Courts included the High Court and the Supreme Courtshould continue to exercise the same jurisdictions respectively as theretofore. This these Courts have continued to do, for the seventeen years or so that have since elapsed, as it was never "otherwise determined by law" and the new Courts, presumably contemplated by Article 34 of the Constitution of 1937, were never established. Consequently, the constitutional issue in this case falls to be decided by reference to the provisions of the Constitution of 1922, so far as they prescribed the tenure and terms of office of the late judge.
During all the years in which he held office, Judge O'Byrne suffered deduction from his judicial remuneration, at the times of payment, of income tax assessed on the basis of including that remuneration in his total income. During the same years he paid super-tax (since 1929, sur-tax) on the same basis. After August, 1951, such deductions were suffered and payments made under protest. The plaintiff claims that these deductions and payments were made or exacted in violation of a constitutional prohibition and that his estate is entitled to be repaid the amount involved. For the purposes of this judgment, I do not propose to draw any material distinction between deduction of tax at the time of payment of remuneration and payment of tax after receipt of the remuneration. It has been more than once judicially pointed out, and it was conceded in argument, that deduction is mere machinery to facilitate the collection of tax. The essence of the transaction is the same in each casethe perception of tax.
The net question in this case is whether such collection of tax in respect of judicial remuneration is a diminution or reduction of that remuneration within the meaning of the constitutional prohibition of diminishing or reducing that remuneration. No question arises of any immunity from taxation of any income a judge may have other than the remuneration attached to his office.
This question arises under Article 68 of the Constitution of 1922. That Constitutionlike that of 1937ascribed the derivation of the powers of government and all authority as being from the people of Ireland and provided for their exercise through the organisations established by or under, and in accord with, the Constitution. These organisations were the legislative, the executive and the judicial. Each had defined functions and a different sphere of activity. The principle adopted was not that of a complete or rigid separation of the powers of government, although each had a measure of independence within its own sphere. In the terms of political theory, the system adopted was that of the sovereignty of the Legislature (or, in final recourse, the people)within, at that time, the terms of the Treaty of 1921combined with the rule of law. The Constitution itselflike that of 1937belonged to the type known as rigid or controlled, in that its provisions, after a limited period of transition, were only to be capable of amendment in a special and formal manner, involving, as an essential feature, submission of the proposed amendment by a referendum to the people. Thus, principles embodied in the Constitution as being of fundamental importance or value, safeguards for the rights of the individual, restrictions on the full powers of the Legislature or of the executive, considered to be in the public interest or dictated by considerations of public morality or social justice, and, indeed, any provision of the Constitution, while not made incapable of alteration, were intended to be protected against hasty or arbitrary change. During the limited period of transition fixed by Article 50 as eight years from the coming into operation of the Constitutionthe special and formal manner of amendment was not obligatory and amendments could be made by way of ordinary legislation. Although probably designed for a different purpose and to meet exceptional circumstances existing in 1922, this concession was availed of, by means of the Constitution (Amendment No. 16) Act of 1929, to extend the transitory period itself to sixteen years. This Act was held to be a valid amendment of the Constitution by the majority judgment of the Supreme Court in (1).In the result, therefore, the Constitution of 1922 continued, during the whole period of its operationthat is, until it was superseded by the Constitution of 1937to be a flexible Constitution, capable of amendment by way of ordinary legislation. As a corollary, the power entrusted to the Courts of determining whether any law was or was not in conflict with the Constitution never became really effective. The Constitution of 1937, while also permitting amendment in a less formal manner for a limited period, did not repeat the error of allowing this period to be extended informally. In consequence, since the expiry of this period in July of 1941, the Constitution of 1937 has only been capable of amendment in the special manner prescribed therein. The effect of this is reflected by the comparative frequency with which since then, as compared with the earlier period, constitutional questions have come before the Courts. In some of the cases, the particular legislation in question has been held to be valid; in others, it has been held to conflict with the Constitution and to be, therefore, invalid.
By the Constitution of 1922 (Article 64) it was provided that the judicial power of the State should be exercised and justice administered in the public Courts established by the Oireachtas by judges appointed in manner thereinafter provided. These Courts were to comprise Courts of First Instance and a Court of Final Appeal to be called the Supreme Court. The Courts of First Instance were to include a High Court invested with full original jurisdiction in and power to determine all matters and questions whether of law or fact, civil or criminal; and (Article 65) the judicial power of the High Court was to extend to the question of the validity of any law having regard to the provisions of the Constitution.
This power of deciding whether any particular law is or is not constitutional is an important and onerous part of the duties of the High Court and Supreme Court; but the main work of the Courts is, of course, the decision of disputes, whether of a civil or a criminal nature, between citizen and citizen or between a citizen and any branch or departmentof the organised aggregate of individuals known as the State. To decide justly between citizens, or to preserve impartially the delicate balance, in a modern democracy, between the legitimate needs of the State and the inherent rights of the individual, is a task that is rendered easier and more likely of fulfilment by the existence of a judiciary free in the exercise of its functions from control or influence not only by the executive or the Legislature but also by any citizen or group or class of citizens.
After a long, and at times bitter, struggle, between the different organs of government in England, a practical solution was found of the problem of securing as great a measure of independence as possible for the Courts while preserving the ultimate sovereignty of the people through their parliamentary representatives. Two principles were establishedsecurity of tenure of office and fixity of remuneration. These were embodied in the Act of Settlement, 1700, which provided that the salaries of the judges should be ascertained and established and that the judges should hold office during good behaviour and be removeable only upon the address of both Houses of Parliament. The two conditions, of protection from arbitrary suspension or removal and of protection from arbitrary interference with remuneration, are complementary and both are necessary to achieve...
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