Marshall (Inspector of Taxes) v Kerr: CA 7 Apr 1993

A variation of trusts in Jersey will be deemed to have been made by the deceased – no Capital Gains Tax arising. Interpretation of deeming Provisions. The taxpayer was not a settlor in an overseas trust. Deeming provisions should not generally be read to produce an unjust or absurd result.
Peter Gibson LJ said: ‘I take the correct approach in construing a deeming provision to be to give the words used their ordinary and natural meaning, consistent so far as possible with the policy of the Act and the purposes of the provisions so far as such policy and purposes can be ascertained; but if such construction would lead to injustice or absurdity, the application of the statutory fiction should be limited to the extent needed to avoid such injustice or absurdity, unless such application would clearly be within the purposes of the fiction. I further bear in mind that, because one must treat as real that which is only deemed to be so, one must treat as real the consequences and incidents inevitably flowing from or accompanying that deemed state of affairs, unless prohibited from doing so.’
Peter Gibson LJ, Lord Browne-Wilkinson
Gazette 07-Apr-1993, Ind Summary 26-Apr-1993, [1993] STC 360, (1993) 67 TC 56
Finance Act 1965 24(7) 24(11), Taxation of Chargeable Gains Act 1992 62(4) 62(6)
England and Wales
Appeal fromMarshall (Inspector of Taxes) v Kerr ChD 22-Jan-1992
A payment made from an estate which had been settled overseas by means of a deed of variation was deemed to have been a payment by the settlor, and taxable as such. In interpreting a deeming provision, the court musty consider carefully as between . .

Cited by:
Appeal fromMarshall (Inspector of Taxes) v Kerr HL 30-Jun-1994
A settlor by will was deemed to have had an interest as funds were passed to a Jersey Trust. The section merely made or allowed that a variation of a will would not be a taxable event in UK law. It had no other effects. A deed of family arrangement . .
CitedJenks v Dickinson (Inspector of Taxes) ChD 16-Jun-1997
Legislation which created a clear anomaly can be interpreted so as to avoid the anomaly if the words used are sufficiently ambiguous as to allow an alternative construction.
Neuberger J discussed the case of Marshall v Kerr, saying: ‘It appears . .
CitedRevenue and Customs v DCC Holdings (UK) Ltd SC 15-Dec-2010
The taxpayer had entered into a ‘repo’ loan to its bank, agreeing to purchase a block of gilt edged securities, and to resell them at a later date at a fixed figure. The profit and figures included an allowance for the interest payments to be made. . .

Lists of cited by and citing cases may be incomplete.
Updated: 23 October 2021; Ref: scu.83430