The County Council of Kildare v The King

• Jurisdiction: Ireland
• Judge: K. B. Div.
• Judgment Date: 18 May 1908
• Court: King's Bench Division (Ireland)
• Date: 18 May 1908

The County Council of Kildare

and

The King (1).

K. B. Div.

CASES

DETERMINED BY

THE KING'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.

1909.

Petition of Right — Grant from Parliament — Moneys of the subject in the hands of the Crown — “The King can do no wrong” — Irish Land Act, 1903 — Losses on the flotation of stock — Land Purchase Account — Constituent parts of Guarantee Fund — Development Grant — Death Duty Grant — Agricultural Grant — Order in which recoupment of flotation losses to be borne — Purchase of Land (Ireland) Act, 1891 — Local Government (Ireland) Act, 1898, ss. 48 (1) (2), 49 — Labourers (Ireland) Act, 1906, s. 15 — Lord Lieutenant — Treasury Rules.

Held, that the suppliants' right to the moneys was founded upon grant, and not upon contract, but that the moneys were, nevertheless, the moneys of the suppliants in the hands of the Crown, and were a proper subject of Petition of Right. The principle that the King can do no wrong is no answer to a Petition of Right to recover from the servants of the Crown moneys to which the suppliants are entitled under a grant.

Held, also, that section 6 (6) of the Purchase of Land (Ireland) Act, 1891, by which all questions arising as to the share of any county, &c., in any fund or sum dealt with in that Act shall be dealt with by the Lord Lieutenant, did not preclude the Court from determining the questions raised by the Petition.

Held, also, that none of the objections in the Petition could be sustained; that upon the meaning of the word “deficiency” in section 38 of the Irish Land Act, 1903, the entire capital loss incident to the issue of stock at a discount might be met by the creation of stock, instead of paying it out of the Irish Development Grant, so far as it would stand; that the deductions under the heads of “Unearned Dividends on Stock” and “Advance Dividends” were duly authorized; that under the head “Unproductive Balances,” if there were default by the servants of the Crown, the same could not be imputed to the Sovereign, so as to make them an appropriate subject-matter for a Petition of Right; that the objection to the validity of the Treasury Rules was not maintainable, and that the £50,000 payable out of the Development Grant for the financial year ending 31st March, 1907, was properly appropriated as part of the “working balances” specified in section 15 of the Labourers (Ireland) Act, 1906, and not as part of the income account of the Irish Land Purchase Fund.

Petition of Right presented by the County Council of the County of Kildare to raise certain questions as to the withdrawal of sums of money from the Local Government Taxation (Ireland) Account to meet losses in the working of the finances of the Land Purchase Acts.

The Petition of Right was as follows:—

1. Your suppliants, as County Council of the County of Kildare, are entitled to be paid or to receive each year the prescribed shares payable to the County of Kildare in (a) the Agricultural Grant payable out of the Consolidated Fund under sect. 48 of the Local Government (Ireland) Act, 1898 (61 & 62 Vict. c. 37); and (b) the Death Duty Grant, formerly termed the Irish Probate Grant, payable by the Commissioners of Inland Revenue, pursuant to the provisions of the Probate Duties (Scotland and Ireland) Act, 1888 (51 & 52 Vict. c. 60), as amended by sect. 19 of the Finance Act, 1894 (57 & 58 Vict. c. 30). The Death Duty Grant to the County of Kildare has hitherto amounted annually to the sum of £5914 16s. 6d. or thereabouts, and the Agricultural Grant to the sum of £15,740 10s.

2. For the financial years ending 31st March, 1906, and 31st March, 1907, there have been deducted from the grants to the County Councils of Ireland the sum of £73,218 12s. 5d., being (a) the sum of £65,677 12s. 4d. deducted from the Death Duty Grant; and (b) the sum of £7541 0s. 1d. deducted from the Agricultural Grant. From the shares in the said grants to which your suppliants are entitled the deductions are as follows:— For the year 1906, the sum of £1698 0s. 3d., and for the year 1907 £6766 12s. 6d., making together the sum of £8464 12s. 9d., whereof (a) the sum of £2957 8s. 3d. has been withdrawn from the Death Duty Grant; and (b) the sum £5507 4s. 6d. from the Agricultural Grant. These deductions have been made in alleged pursuance of certain statutory provisions of the Land Purchase (Ireland) Acts enabling deductions to be made from said grants for the purpose of recouping certain losses incurred in the working of the finance of said Land Purchase Acts. The grounds and reasons alleged for the making of said deductions are hereinafter fully set forth. Your suppliants submit that said deductions are illegal and not authorized or warranted by the Land Purchase (Ireland) Acts or any statutory of legal authority; and your suppliants have in this petition hereinafter set forth how far and in what manner they contend said deductions are illegal, and their reasons for so contending.

3. According to a statement made in the House of Commons on 23rd April, 1907, by the Financial Secretary to the Treasury, the deductions from the said grants made to the Irish County Councils (amounting as stated by him to £70,996) were made on the ground that under sect. 29 (2) of the Irish Land Act, 1903, the Guarantee Fund is liable to make good any deficiency in the income account of the Irish Land Purchase Fund, and that so far as these deficiencies are caused by the issue of Guaranteed Land Stock at a discount, the Irish Development Grant, as one of the constituent parts of the Guarantee Fund, was first to be charged, under section 38 of the said Act of 1903, so long as it is able to meet them, but that there were other deficiencies on the income account with which the Local Taxation Grants, as constituents of the Guarantee Fund, were directly chargeable, and that these deficiencies arose from the following causes:—

(1)	Arrears from the payment of Purchase Annuities,	£9,119
(2)	Unearned Dividends on issue of Stock,	23,750
(3)	Advance Dividends,	13,650
(4)	Interest due but not received,	15,500
(5)	Unproductive Balances,	8,977
		£70,996

4. The first item of the said deductions from said grants to which your suppliants take exception is the said item, “Unearned Dividends on issue of Stock, £23,750.” This is explained by the Treasury as follows:— Under sect. 28 (1) of the Irish Land Act, 1903, for the purpose of raising the money required for the Irish Land Purchase Fund, the Treasury may, by warrant addressed to the Bank of England or Bank of Ireland, direct the creation of a new capital stock (to be called “Guaranteed two and three-quarters per cent. Stock”), consisting of perpetual annuities yielding dividends at the rate of 2³/₄ per cent. per annum on the nominal amount of the capital; and it is further provided (sect. 28 (2)) that the said annuities shall be payable by equal half-yearly or quarterly dividends at such times in each year as may be fixed by the warrant first creating the stock. The stock issued in pursuance of these provisions is issued as entitled to a full half-year's dividend on the first following dividend day, although the subscribers to the stock are allowed to pay up their subscriptions by instalments which may extend up to or even beyond the dividend day. It is contended on the part of the Treasury that the loss thus incurred is under and by virtue of section 29 of the Irish Land Act, 1903, to be made good out of the Guarantee Fund, which, under section 5 (1) of the Irish Land Act, 1891, and section 40 of the Irish Land Act, 1903, comprises, inter alia, the said Irish Death Duty Grant and the Agricultural Grant.

5. Your suppliants submit that said contention is not well founded, and that the said deduction is erroneous and illegal. Your suppliants submit (1) that no claim for dividends on stock is chargeable against the Irish Land Purchase Fund except in respect of sums raised by stock and carried to the credit of the capital account of the said fund; and they submit that no statutory or other powers exist enabling such advance dividends to be charged against the said fund or paid out of the income account of the said fund. They further submit (2) that no dividends on the said stock were during the financial years aforesaid paid out of the Consolidated Fund of the United Kingdom as a temporary advance to the Irish Land Purchase Fund under section 29 of the Act of 1903, and that the Guarantee Fund is accordingly not liable to make good any such payments. Your suppliants further say that the loss incurred as “unearned dividend on issue of stock” is an expensive issue within the meaning of section 28 (4) of the Irish Land Act, 1903, and should under that section be provided for before any sums raised by means of the stock are carried to the capital account of the Irish Land Purchase Fund. (4) In the alternative your suppliants further submit that the said loss or deficiency is a deficiency arising by reason of the issue of stock at a discount within the meaning of section 36 (6) of the Irish Land Act, 1903, and that the said deficiency within such section is to be made good out of the Guarantee Fund, that section 38 of the Irish Land Act, 1903 (which allocates portion of the Irish Development Grant to the Guarantee Fund), provides that so far as any portion of the Irish Development Grant credited to the Guarantee Fund is required for the purpose of making good any deficiency in respect of the issue at a discount of stock, such portion shall be applied for that purpose before the Death Duty Grant and (by section 40 of the said Act) before the Agricultural Grant, and that accordingly they submit that the said loss or deficiency should have been made good out of the Irish Development Grant available for the purpose of land purchase, which was more than sufficient to meet said loss...