HUMPHREY (Surveyor of Taxes) v PEARE

• Jurisdiction: Ireland
• Judgment Date: 05 June 1913
• Date: 05 June 1913
• Court: King's Bench Division (Ireland)

NO. 344.-HIGH COURT OF JUSTICE, IRELAND (KING'S BENCH DIVISION).-

HUMPHREY (Surveyor of Taxes)

and

PEARE

. - An Agent assessed to Income Tax Schedule D in respect of fees payable for successful negotiations of sales of estates in Ireland, claims that a portion only of the fees, viz., a sum equal to¹/₂per cent. of the purchase money, is payment for work done as

Held, that the whole of the fees was paid as commission incident to services performed in relation to the carrying out of a contract for sale, and was therefore part of the annual gains and profits of the Agent for the purposes of assessment to Income Tax.

1. At a meeting of the Commissioners for the Special Purposes of the Income Tax Acts, held at the Court House, Clonmel, Co. Tipperary, Ireland, on the 12th day of September, 1912, C.H. Peare, of Carrick-on-Suir (hereinafter called the Respondent) appealed against three several assessments under Schedule D of the Act 16 & 17 Vic., cap. 34 respectively made upon him, namely (1) an assessment hereinafter referred to as No. 1 assessment, in the sum of £148; (2) an assessment, hereinafter referred to as No. 2 assessment, in the sum of £261; and (3) an assessment, hereinafter referred to as No. 3 assessment, in the sum of £11. Of these three assessments, No. 1 had reference to the year ended the 5th day of April, 1910; No. 2 to the year ended 5th April, 1911, and No. 3 to the year ended 5th April, 1912, and all three were in respect of the profits or gains which had been derived by Mr. Peare, the Respondent, from fees earned by him and payable to him under Section 23(12) of the Irish Land Act, 1903, and by virtue of three several agreements, for his successful negotiations of the sale of certain estates in Ireland, under the provisions of the last-mentioned Act, for which estates he was employed as Agent by the Vendors concerned.

2. In the case of "No. 1" estate, the Vendors were Mrs. Frances Russell Mulcahy and others. In the case of "No. 2" estate and "No. 3" estate full details have not been supplied by the Respondent, but the estates are known, No. 2 as the "Sadleir" estate, the Vendor of which estate was Miss Annie M. Sadleir, and No. 3 as the "Bradshaw" estate, the Vendor of which estate was Mr. Robert Armstrong Bradshaw.

3. In the case of the estates numbers 1 and 3, the amounts of the assessments, namely, £148 and £11 were the sums put upon the Allocation Schedules by the express authority of the Vendors, and sanctioned by the Estates Commissioners, being 2¹/₂ per cent. of the purchase money in each case respectively; and in the case of the No. 2 estate the amount of the assessment, namely £261, was arrived at in a precisely similar manner save only that the Estates Commissioners sanctioned in this case a negotiation fee calculated at 3 per cent. of the purchase money.

4. The Respondent claimed that the full measure of his liability to assessment to Income Tax in respect of the class of profits or gains sought to be charged with Income Tax by the said three assessments was to be found in three sums to be ascertained by calculating at the rate...