References: Times 05-Jul-1994, Gazette 03-Aug-1994, Ind Summary 18-Jul-1994, [1994] STC 148, [1995] 1 AC 148
Coram: Lord Browne-Wilkinson
Ratio: 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 can be a chargeable event for foreign settlements. Though the House allowed the appeal, it approved the CA’s approach to the interpretation of deeming provisions.
Lord Browne-Wilkinson summarised the law: ‘In English law the rights of a testamentary legatee in the unadministered estate of a testator are well settled: see Lord Sudeley v. Attorney-General [1897] AC 11 and Commissioner of Stamp Duties (Queensland) v. Livingston [1965] AC 694 . . A legatee’s right is to have the estate duly administered by the personal representatives in accordance with law. But during the period of administration the legatee has no legal or equitable interest in the assets comprised in the estate.’
. . And ‘it is crucial to appreciate that the property settled by [the legatee] comprised, not the assets in the deceased’s estate . . but a separate chose in action, the right to due administration of his estate.’
Statutes: Finance Act 1981 80, Finance Act 1965 24(11), Taxation of Chargeable Gains Act 1992 62(6)
This case cites:
- Appeal from – Marshall (Inspector of Taxes) v Kerr CA (Gazette 07-Apr-93, Ind Summary 26-Apr-93, [1993] STC 360, (1993) 67 TC 56)
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 . . - Cited – Sudeley v Attorney-General HL ([1897] AC 11)
The husband had died leaving part of his residuary estate to his widow. She then died before the estate was fully administered. Both died domiciled in England. The husband’s estate included mortgages of land in New Zealand and the House was asked . . - Cited – Commissioner of Stamp Duties (Queensland) v Livingston PC ([1965] AC 694, Bailii, [1964] UKPC 2, Bailii, [1964] UKPC 45)
A testator had died domiciled in New South Wales and with real and personal property both in New South Wales and in Queensland. He left one-third of his real and personal estate to his widow absolutely. She then died intestate, also domiciled in New . .
(This list may be incomplete)
This case is cited by:
- Cited – Jerome v Kelly (Her Majesty’s Inspector of Taxes) HL (House of Lords, [2004] UKHL 25, Bailii, Times 20-May-04, [2004] 21 EGCS 151, [2004] STI 1201, [2004] 2 All ER 835, [2004] 1 WLR 1409, [2004] NPC 75, [2004] WTLR 681, [2004] STC 887, 76 TC 147, [2004] BTC 176)
In 1987, trustees holding land for various beneficiaries in undivided shares entered into a contract to sell it to a purchaser. In 1989 Mr and Mrs Jerome, who were absolutely entitled to interests in the land, assigned part of their beneficial . . - Cited – Jenks v Dickinson (Inspector of Taxes) ChD (Times 16-Jun-97, [1997] STC 853)
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 . . - Cited – Revenue and Customs v DCC Holdings (UK) Ltd SC (Bailii, [2010] UKSC 58, [2010] WLR (D) 333, WLRD, SC Summ, SC, [2011] 1 WLR 44, [2011] BTC 13, UKSC 2009/0223, [2011] STI 133, [2011] STC 326, [2011] 1 All ER 537, Bailii Summary)
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. . . - Cited – Raymond Saul and Co (A Firm) v Holden and Another; In re Hemming (deceased) ChD (Bailii, [2008] EWHC 2731 (Ch), Times, [2008] WTLR 1833, [2008] NPC 122, [2009] 2 WLR 1257, [2009] Ch 313)
The claimant was sole residuary legatee of his mother’s estate. He became bankrupt, but was released by automatic discharge from the bankruptcy before the administration of the estate was completed. He challenged the solicitors who wished to pay the . .
(This list may be incomplete)
Last Update: 07 March 2019
Ref: 83428