The Attorney-General v Rev. Canon John Joseph Robinson and Annie Henrietta Robinson

• Jurisdiction: Ireland
• Judgment Date: 18 June 1900
• Date: 18 June 1900
• Court: Queen's Bench Division (Ireland)

The Attorney-General

and

Rev. Canon John Joseph Robinson and Annie Henrietta Robinson (1).

Q. B. Div.

CASES

DETERMINED BY

THE QUEEN'S BENCH DIVISION

OF

THE HIGH COURT OF JUSTICE IN IRELAND,

AND ON APPEAL THEREFROM IN

THE COURT OF APPEAL,

AND BY

THE COURT FOR CROWN CASES RESERVED.

1901.

Revenue — Finance Act, 1894, ss. 1, 2, sub-s. (d); s. 7, sub-s. 5 — Estate duty — Agricultural property — Principal value — Land in the occupation of a tenant — Policies of insurance — No part of the premiums paid by the deceased — Property passing at the death.

In estimating, for the purpose of Estate Duty, the principal value of agricultural land in the occupation of a tenant, where no part of such principal value is due to the expectation of an increased income, the proviso to section 7, sub-section 5, of the Finance Act, 1894, applies, and the tenant is entitled to have the principal value limited, as therein provided, to “25 times the annual value, as assessed under Schedule A of the Income Tax Acts, after making such deductions as have not been allowed under that assessment, and are allowed under the Succession Duty Act, 1853, and, making a deduction for expenses of management, not exceeding 5 per cent. of the annual value so assessed.”

R., upon the occasion of his marriage in 1843, assigned four policies of insurance, and his wife assigned a sum of £3500, to trustees. Under the provisions of the settlement the policies were kept up, and the annual premiums paid, exclusively out of the income of the moneys of the wife, until the death of R. in 1898, when the moneys secured by the policies became payable:—

Held, that the moneys payable under the policies were liable to Estate Duty

under section 2, sub-section (d), of the Finance Act, as being an “interest purchased or provided by the deceased, either by himself alone, or in concert or by arrangement with any other person, to the extent of the beneficial interest accruing or arising by survivorship or otherwise on the death of the deceased,” and therefore property “deemed to pass” within the meaning of the section.

This case came before the Court by information on the Revenue side.

John Robinson, late of Uplands, Delgany, in the county of Wicklow, died on the 17th December, 1898, having made his will, dated the 30th September, 1897, whereby he appointed the defendants his executors.

In the Inland Revenue affidavit leading to the grant of probate to the defendants, the lands of Blainroe were included in the return of his property coming within section 1 of the Finance Act, 1894 (57 & 58 Vict. cap. 30). The lands were described as “part of the lands of Blainroe, containing 166¹/₂ acres Irish plantation measure, in the barony of Arklow, and county of Wicklow, held underlease dated the 15th of October, 1874, from Lord Fitzwilliam to William Newland, for thirty-one years, from the 25th of March, 1874, subject to the yearly rent of £207, reduced by order of the Irish Land Commission, dated the 13th of June, 1891, to a judicial rent of £170. For the purposes of assessment of Estate Duty under sect. 1, in respect of the lands of Blainroe, the defendants estimated the principal value as follows:—

Tenement valuation, £180 15s.
Principal value (gross), pursuant to Finance Act, 1894, sect. 7, sub-sect. 5, £180 15s. × 25,	£4519 0 0
Less twenty-five years purchase of headrent, £170 × 25,	£4250 0 0
Like of management expenses (5 per cent. on £180 = £9), £9 × 25,	225 0 0
Average poor rate on £10 at 2s.,	£1 0 0
Like county cess at 3s .,	1 10 0
£2 10 0 × 25 =	62 0 0
	£4537 0 0

In this estimate of the principal value the defendants treated the lands of Blainroe as coming within the proviso of section 7, sub-section 5 of the Finance Act, 1894, as being “agricultural property where no part of the principal value is due to the expectation of an increased income from such property,” and therefore entitled to have the principal value limited to “twenty-five times the annual value as assessed under Schedule A of the Income Tax Acts, after making such deductions as have not been allowed in that assessment, and are allowed under the Succession Duty Act, 1853, and making a deduction for the expenses of management not exceeding 5 per cent. of the annual value so assessed.” Upon the basis of their calculation under the proviso, the defendants claimed that the net principal value of the lands of Blainroe, for the purposes of Estate Duty, was of no assessable value, and that no Estate Duty was payable in respect of these lands. The informant submitted that the defendants were not entitled to make these deductions upon the ground that the proviso of section 7, sub-section 5, of the Act had no application to land in the occupation of the deceased, and that the principal value was ascertainable only as prescribed in section 7, sub-section 5, by the price which, in the opinion of the Commissioners, the property would fetch in the open market, without any deductions under the proviso.

Prior to, and upon the occasion of the marriage of the deceased with Isabella Robinson in 1843, the deceased was possessed of four policies of insurance on his life for the respective sums of £1000, £500, £500, and £500, and the intended wife was possessed of a fortune of £3500. By a deed executed on the marriage, dated the 8th June, 1843, the four policies of the deceased, and the wife's fortune of £3500, were assigned to trustees upon trust as to the moneys secured by the policies (when received) to pay the income thereof to the intended wife for life, and after her death as to the principal moneys for the children of the marriage, and upon trust as to the wife's fortune of £3500, to apply, after the marriage, so much of the income thereof as might be necessary to pay the premiums on the four policies of insurance, and to pay the residue to the deceased for life, and after his death to the wife for life, and after the death of the survivor, in trust for the children of the marriage. From the date of the marriage the policies of insurance were kept up as provided in the deed out of the wife's moneys exclusively. Isabella Robinson predeceased her husband, and the husband by his will appointed the moneys which should become payable on the policies in the following manner:—As to £500, to his son, Henry L. Robinson, and the balance in equal shares to his son, the Rev. Canon John Joseph Robinson, one of the defendants, and his daughter, Mary Isabella Ovendem The trustees appointed by the deed to carry out the trusts of the settlement being dead, the defendants on the death of John Robinson, undertook the collection and distribution of the policy moneys, and the liability for Estate Duty (if any) payable thereon. The information claimed that Estate Duty was payable in respect of the policy moneys, as settled property, passing on the death of the deceased within the meaning of section 1 of the Finance Act, 1894 (57 & 58 Vict. c. 30). In the argument, however the claim of the informant was rested mainly upon the contention that the policy moneys were property which should be “deemed to pass” upon the death of the deceased under section 2, sub-section (d) of the Act as being “any annuity or other interest purchased or provided by the deceased either by himself alone, or in concert, or by arrangement with, any other person, to the extent of the beneficial interest accruing or arising by survivorship or otherwise on the death of the deceased.” The defendants contended that no Estate Duty was payable in respect of the policy moneys either under section 1 or section 2, and it was pointed out in their answer that no life estate was reserved to the deceased in any of the four policies, and that he was not in any way liable for keeping up any of the policies, and did not covenant to pay the annual premiums thereon. Further, that as the deceased had parted absolutely with all his interest in the policies of insurance on the 8th June, 1843, and as he had, at the time of his death, no general power of disposition over them, the policies were not property which passed on the death of the deceased, under section 1, or which should be “deemed to pass” under section 2 of the Finance Act, 1894.

The Solicit or General (Wright, Q.C).) (with him Ronan, Q.C., and Charles Mac Dermot), for the informant:—

By sect. 1 of the Finance Act (57 & 58 Vict. c. 30), Estate Duty is payable upon the principal value of all property passing on the death, to be ascertained in the manner provided. The section, which mainly prescribes the way in which the value is to be ascertained is sect. 7 of the Act and by sub-sect. 5 of that section:—“The principal value of any property shall be estimated to be the price which, in the opinion of the Commissioners, such property would fetch if sold in the open market at the time of the death of the deceased: provided that, in the case of any agricultural property, where no part of the principal value is due to the expectation of an increased income from such property, the principal value shall not exceed twenty-five times the annual value as assessed under Schedule A of the Income Tax Acts, after making such deductions as have not been allowed in that assessment, and are allowed under the Succession Duty Act, 1853, and making a deduction for expenses of management not exceeding five per cent. of the annual value so assessed.” The proviso in the sub-section does not apply at all to cases like the present. The expression “expenses of management” cannot be applied to the case of a man who is managing his own farm. It relates rather to estate agent's fees and matters of that description. Again, the expression, “where no part of the principal value is due to the expectation of an increased income from such property” refers only to cases where leases can fall in, and has no reference to the case of an agricultural holding in the occupation of a tenant. The reference to Schedule A of...