The Gazette 1909-10

The Gazette of the Incorporated Law Society of Ireland.

JANUARY, 1910]

without fraud, is incorrect, is liable to the penalty of .{50, under Section 55 of the Income Tax Act, 1842. Decision of the Court of Appeal (25 The Times L. R., 342; [19091 1 K.B., 694; 78 L. /., K.B., 708) reversed. (See GAZETTE of April, 1909, p. 116). This was an appeal from an order of the Court of Appeal (the Master of the Rolls and Lords Justices Moulton and Buckley) dated February 17 last, which allowed the appeal of the respondent from the judgment of the Lord Chief Justice dated July 8, 1908. The question was, whether a person who negligently delivers an incorrect statement of his profits and gains renders himself liable to the penalties imposed by the Income Tax Act, 1842, s. 55. The short facts were that by a deed of assignment made in June, 1899, between Annie Coombs and the respondent,. the goodwill of a Solicitor's practice, which had been carried on at Dorchester by Thomas Coombs, now dead, the husband of Annie Coombs, was assigned to the respondent in consideration of an annuity of £200, to be paid by the respondent to Mrs. Coombs for 15 years. In June, 1901, the respondent married Mrs. Coombs, and thenceforward ceased to pay the annuity. Before his marriage Mr. Till deducted the annuity from his return for income tax, but as Mrs. Coombs paid the tax on the £200 no loss was sustained by the Revenue! For the years 1901-2 and 1902-3 the respondent again deducted the annuity, but it was added by the Commissioners. For the years 1903-4 and 1904-5 and 1905-6 the respondent again deducted the annuity from his profits. Inquiries were instituted by the local Sur veyor of Taxes, to which Mr. Till replied that he had made a deduction " For interest on capital. An annuity of £200 to Mrs. Till, my wife, on which income tax is assessed and paid by her." • This was incorrect. The Lord Chief Justice gave judgment for the Crown for £50 and costs. The Court of Appeal gave judgment for the respondent with costs. The Lord Chief Justice followed a Scottish decision, which the Court of Appeal declined to follow, holding that the penal Section only applied to non-delivery and not to inaccuracy in a statement. The Lord Chancellor.—I hold that this appeal should be allowed, and in view of the

dismissed, and that no collusion had been proved. Taking the whole of the evidence together, he could not say that the defendant had done anything from which the inference could be drawn that he was a party to a proceeding which he knew would be likely to deprive the plaintiff's Solicitor of his costs. Giving the widest meaning to the word " collusion," there was nothing to show that the defendant had any intention to deprive the plaintiff's Solicitor of his costs. He said, further, that not only was there no evidence from which to draw the conclusion that there had been collusion, but when he came to see what. had happened after the settlement between the parties, how the defendant had given notice to the plaintiff's Solicitor, and had drawn the cheque in such a way that it would have been perfectly easy for the Solicitor to enforce his lien upon it, he drew the conclusion, under those circumstances, that the defendant did not intend the plaintiff's Solicitor to lose his costs, but rather that .he should get them. In this connection he only wished to read the passage in the case of " The Hope "'(8 P. D., 144), where Lord Justice Lindley said this, on page 146 :—" There is no rule that the parties may not .compromise an action without the intervention of their Solicitors. They must, however, do so honestly, and not intend to cheat the Solicitors of their proper charges." The evidence in this case did not satisfy him that the defendant knew that the plaintiff would never pay his Solicitor's costs. In his judgment, therefore, the appeal failed. Lord Justice Buckley and Lord Justice Kennedy delivered Judgments, arriving at the same conclusion. (Reported The Times Law Reports, Vol. xxvi., p. 104). HOUSE OF LORDS. (Before Lord Loreburn, C., Lord Atkinson, Lord Gorell, and Lord Shaw). Attorney-General v. Till. Dec. 8, 1909.— 'income Tax—Statement of Income—Incorrect statement—Penalty — Income Tax Act, 1842 (5 and 6 Vie., c. 35), s. 55. A PERSON who has delivered a statement of his income chargeable with income tax which, through negligence or carelessness, although