Scottish Court of Session Decisions

The Inverness Burgh Act 1847, upon a preamble referring to various statutes (including the Act 48 Geo. III. cap. 41, which then regulated the collection of petty customs in Inverness) and narrating that “the Magistrates and Town Council of Inverness have for time immemorial been in the practice of levying petty customs and other dues upon articles and effects brought into the said burgh, but in consequence of alterations in the system of weights and measures, and other causes, difficulties have occurred in regard to the collection of these dues and customs, and it is expedient that the same should be clearly defined and that greater facility should be accorded for the collection thereof,” enacts as follows—(section 142)—“And whereas the Magistrates and Town Council have for time immemorial been in the practice of levying and collecting certain rates and dues denominated petty customs, and applying the same to the general purposes of the burgh: Be it enacted, That it shall and may be lawful for the Magistrates and Town Council to collect, sue for, and recover the petty customs, imposts, rates, and duties expressed and contained in Schedule A, hereunto annexed, for all goods, cattle, articles, effects, and commodities of every description brought into the ancient and formerly extended royalty of the burgh for sale, storage, manufacture, use, or consumption, as set forth in the said schedule, and to prevent the said goods, cattle, articles, effects, and commodities from entering the burgh until such customs and imposts are so paid, such customs and imposts, except as after-mentioned, to be administered by the Magistrates and Town Council as part of the ordinary revenue of the said burgh; and it shall be lawful to recover the said customs, imposts, and rates by summary process before the sheriff, on the evidence of one witness, or otherwise in a summary manner, in the same way as other rates and assessments are hereby authorised to be recovered and levied; and it shall not be an objection to any such witness that he is an officer of or in the employment and pay of the Magistrates and Town Council, and any person neglecting or refusing to report to the collector of such customs and imposts any effects liable in payment thereof as aforesaid, brought into the burgh by him, shall, on conviction before a magistrate, forfeit and pay a fine of ten shillings besides the amount of customs and all expenses: Provided always that the Magistrates and Town Council may let, as heretofore, the right of collecting and levying the said customs and imposts to tenants and make such rules and regulations for the collection of the same as to them may appear proper: Provided also that for any goods and commodities for which shore dues may have been paid at the port of Inverness, or at those parts of the Caledonian Canal below Muirton Locks, no petty customs shall be exigible; and that goods, commodities, and effects passing through the town and destined for places beyond the said boundaries shall not be liable in the payment of petty customs.”

Schedule A, annexed to the Act, and entituled “Schedule of Petty Customs,” sets forth a list of articles, with the rates leviable in respect of each article, as illustrated in the following excerpts:—

“Ale, beer, and porter, for every 26 imperial gallons—	£0	0	3
Animals—For every horse or bull	0	0	4
All spirits brought into the town—each imperial gallon	0	0	1
Bark—per cwt.	0	0	1
Butter—per stone of 24 lbs.	0	0	1
Under 12 1bs.	0	0	0 1 2
Cheese—per stone of 24 lbs.	0	0	0 1 2
Cabbages—each cart	0	0	2
Cloth——per 12 yards	0	0	1
And less in proportion below 12 yards.
Ditto above 12 yards, per barr el bulk	0	0	3
Linen or tweeling, per 20 yards	0	0	1
And less in proportion below 20 yards.
Ditto—-per barrel bulk	0	0	3
Cloth, harn, sacking, or ticking—-per 20 yards	0	0	1
And less in proportion below 20 yards. Ditto—-per barrel bulk	0	0	3
Boots——per pair	£0	0	3
Boots and shoes in packages, per barrel bulk	£0	0	3
Tallow and grease butter, per barrel bulk	£0	0	3
Yarn of every description, exceeding 12lbs. per barrel bulk	£0	0	3

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Sugar, wine, tea, and all other goods and articles not specially enumerated in the above schedule, to pay at the rate of threepence per barrel bulk (2 1 2 cwt. or 5 cubic feet).”

This was a special case brought by the Provost, Magistrates, and Councillors of the royal burgh of Inverness, the first parties, and D. Cameron & Co., merchants, Inverness, and the partners of that firm, who were general merchants and licensed grocers within the royal burgh of Inverness and ratepayers in the royal and parliamentary burgh of Inverness, the second parties, to determine certain questions which had arisen between the parties as to the rights and powers of the first parties under the Inverness Burgh Act 1847 with respect to the levying of petty customs.

The facts of the case were stated in the opinion of the Lord President as follows:—“The ‘ancient and formerly extended royalty’ of the burgh of Inverness does not include the whole burgh as defined for municipal, police, and parliamentary purposes, it being provided by the Act 43 Geo. III., cap. 41, sec. 33, that from the passing of that Act the royalty of the burgh should be extended over and comprehend the lands therein mentioned, and that the Magistrates and Council should thenceforth have and enjoy the same rights, privileges, and jurisdictions over the said lands thereby annexed to and comprehended in the said royalty, as they then enjoyed and exercised over and within the limits of the then present royalty, and they were thereby empowered to levy the same maills, duties, customs, and other taxations within these annexed lands in the same manner and by such ways and means as the Magistrates and Council were entitled to levy and recover such maills, duties, customs, and other taxations within the then present royalty.

“By resolutions adopted by the first parties from time to time, certain modifications of the schedule to the Inverness Burgh Act 1847 have been made, as they maintain, within the powers to that effect conferred by the Act. The competency of the resolutions and the legality of the modifications are, however, not admitted by the second parties. One of these modifications is that all goods and effects of every description manufactured within the Parliamentary boundaries and beyond the ancient and extended royalty are admitted at one-half less than such articles and effects may respectively be charged according to the schedule to the Act, while others relate to the dues on turnips, rubble stones, firewood and other commodities. It is also declared that eggs, fresh fish, and fresh butter, so far as home produce, are admitted free of customs. Further, petty customs are not collected on goods or others entering the royalty by post, or on small parcels brought in by hand, the first parties being unable, owing to the Post Office regulations, to obtain the necessary information to enable them to levy customs on parcels entering the royal burgh by post. It is stated that in the case of small parcels brought into the burgh by hand the customs would not defray the cost of collection.

The revenue derived annually by the first parties from the petty customs is £2000 or thereby. It has been their general practice to treat the consignee of the goods as the person liable in payment, although under arrangement made with the owners of certain distilleries the customs are paid by the consignors at their request and for their convenience.

Since 1876 a rebate of 25 per cent. upon the full scale of customs contained in Schedule A to the Act has been regularly allowed by the first parties to all persons who have made payment of the customs when demanded, but when legal proceedings have been required the full schedule rates have been sued for. Where a private arrangement has been come to the rebate has been allowed, but when it has been necessary to take decree no deduction has been given.

When goods are imported by rail they are brought over the royalty boundary by the Highland Railway Company, whose station is situated within the royalty, and these goods cannot be intercepted at the boundary for the purpose of levying the customs. Further, where goods are imported in close packages or eases (such as casks and bales), so that their nature cannot be ascertained by the collector without opening the packages or cases, the practice has been to charge the customs at the rate of 3d. per barrel bulk. ^* On parcels of smaller dimensions than barrel bulk the customs are charged according to the proportion which the cubic size of the parcels bears to a barrel bulk of 5 cubic feet.

The first parties demand the customs upon each article delivered to the consignees except in certain cases where for the convenience of the consignees they, at the request of the consignees, make the charge by a monthly account.

In the case of goods brought into the burgh by rail inspection is made by two officials at the railway station, and the

_________________ Footnote _________________

* In part 1 of the schedule relating to shore dues of the Inverness Harbour Act 1847 a barrel bulk is defined as follows:—“The barrel bulk of all articles not otherwise rated to be 5 cubic feet except when the said measure shall exceed 2 1 2 cwt., in which case 2 1 2 cwt. is to be rated a barrel bulk. Small packages, not measuring 1 1 4 cubic feet or not weighing 28 lbs., to be reckoned one-fourth of a barrel bulk and to be charged one penny.” In levying petty customs this definition had always been adopted by the first parties.

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accounts of the first parties are made up as accurately as possible from the information obtained by such examination. Another man is stationed at the weigh-house just inside the boundary of the royalty for the purpose of checking all goods coming out of two bonded warehouses which are situated immediately outside that boundary. He makes a note relative to the goods from the Excise permits exhibited to him before the goods are allowed to pass. There is also a man specially engaged to watch all goods coming into the burgh by cart or otherwise for the purpose of collecting the customs due on such goods, and he collects the customs on country produce in the public market.”

The case further stated that certain of the goods consigned to the second parties by railway, and delivered by the Railway Company's servants to the second parties at their place of business, in respect of which the first parties sought to charge petty customs, were deliverable by the consignors at the second parties' premises within the royalty “carriage free” or “carriage paid” or “delivered.” (Art. 10) The first parties, when they were able to do so, specified in the accounts rendered the nature of the goods consigned to the second parties, but in instances where the goods were so enclosed in cases or wrappings that the exact nature of the goods could not be discovered by external examination, their accounts did not specify the goods, but merely specified a ‘case,’ ‘cask,’ ‘bale,’ ‘keg,’ ‘box,’ or ‘parcel’ without defining its contents, and they charged the customs at the rate of 3d. per barrel bulk according to the practice stated supra. The accounts of the first parties against the second parties for the months of May 1896, July 1897, September 1898, and December 1901 were printed as specimens in Appendix III., and formed part of the special case. The specimen accounts printed in Appendix III. included certain articles, e.g., soap, ‘waters,’ brushes, biscuits, coffee, &c., which were not enumerated in Schedule A. These articles were charged in the accounts at the rate of 3d. per barrel bulk. It was admitted by the second parties that they received by railway or from said bonded stores all the goods specified in said accounts, and all the other goods specified in an account commencing on 1st May 1896 and ending on 27th January 1902, which was produced and held to form part of the case, and that the goods not otherwise described, which were charged in the account at the rate of 3d. per barrel bulk, were so packed that their nature could not be discovered by external examination.

The first parties maintained that the second parties were liable to them for the petty customs charged in the accounts rendered to them, submitting that it could never have been intended that cased goods should escape customs, and that the only practicable mode of exacting the customs was to charge them at the scheduled rate of 3d. per barrel bulk, with a proportional levy on smaller quantities. They further maintained that as the statute specially authorised them to sue for and recover before the Sheriff in a summary manner the customs on the goods brought into the royalty for sale, &c., the consignees of such goods were liable for the customs; and separatim, that they were the persons who brought the goods into the burgh in the statutory sense. They also contended that they were entitled to grant exemptions and rebates provided that they gave equal or similar treatment to all the persons who are in the same or in a similar position.

The second parties maintained that they did not bring the goods into the royalty within the meaning of the Act of 1847, and that consequently they were not liable for the petty customs. They further contended that if they and not the carriers and consignors were liable for the customs, the Act of 1847 fixed the goods and others, and also the actual and not merely the maximum rates to be charged, and that the first parties had no right to make any alterations upon or reductions or rebates of or from the rates fixed by the schedule, and separatim, that if they did this in one case they were bound to do it in all. They also maintained that the first parlies were not entitled to levy duties on any goods without specifying their nature, and that parcels of tea, sugar, and other goods not specified in the schedule were only liable for duty when the quantity brought in at one time amounted to one barrel bulk, as also that the first parties were not entitled, without the consent of the persons liable in payment, to keep a running account of the sums alleged to be due, only rendering that account monthly.

The questions for the opinion of the Court were:—“(1) Are the first parties entitled to demand from the second parties petty customs on the goods contained in the account mentioned in Article 10 of the case, consigned to the second parties, but conveyed into the royalty and delivered to them by the Highland Railway Company, (a) where such goods had been consigned to the second parties without any stipulation as to payment of carriage; (b) where the goods had been consigned ‘carriage paid’? (2) In the event of the first query being answered in the affirmative, are the first parties barred from suing the second parties for customs on the said goods by the practice of rendering accounts stated in the case? (3) Are the first parties entitled to levy petty customs from the second parties on the ‘sugar, wine, tea, and all other goods and articles not specially enumerated in the schedule,’ contained in the said account which were introduced into the royalty in quantities of less than one-barrel bulk at a time? (4) Are they entitled to levy from the second parties petty customs at the rate of 3d. per barrel bulk in the manner stated in the case on the goods contained in the said account which were brought into the royalty in closed packages and cases which concealed the precise class of the goods? (5) In the event of question 4 being answered in the negative, are the first parties entitled to insist on closed packages or cases, here

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after brought into the royalty by or consigned to the second parties, which conceal the precise class of the goods therein, being opened in the first parties' collector's presence or on exhibition being made to the collector of the invoice or advice note of the goods, in order that the class of goods may be ascertained? (6) Are the second parties exempted from payment of the customs claimed from them on the goods contained in the said account, whether the claim be for the full or for the abated rates, by the fact that exemptions and reductions have hitherto been granted to them and others by the first parties as stated in the. case? (7) Can the first parties exact from the second parties the full schedule rates on the goods contained in the said account, or must they ( a) grant them exemption as regards any class of goods on which exemption from customs has been granted to others; and (b) allow them the same rebates from the full schedule rates of customs as have been allowed to other parties?”

Argued for the first parties—The rights and powers of the magistrates to levy petty customs were regulated wholly by the provisions in the Inverness Burgh Act 1847, and Schedule A, which superseded the old right to levy such customs founded on usage. The purpose of the Act, as stated in the preamble, was that “greater facility should be accorded for the collection thereof.” 1. On the question as to exemptions and abatements—Sec. 142 of the Act enacted that it “shall and may be lawful” for the magistrates to collect, sue for, and recover” the petty customs, rates, &c., set forth in Schedule A. These words gave a large discretion to the magistrates to levy customs on the included articles, or to refrain from levying them in cases where they considered it inexpedient in the interest of the community that they should be levied. The words “shall and may” conferred a bare faculty or power, and were permissive not obligatory— Julius v. The Bishop of Oxford (1880), 5 App. Cas. 214. Accordingly the magistrates were entitled to refuse to make levies in certain cases, or to grant abatements. In the cases where this had been done the magistrates had good reasons for their decision—such reasons, for example, as that the cost of collection would exceed the revenue, or that the collection was unworkable in practice. It was absurd to say that the fact that such exemptions and abatements had been granted could deprive the magistrates of all the rights and remedies conferred on them by the Act. It was nowhere alleged that with regard to any particular thing on which the second parties were rated, anybody else was getting different treatment. Thus with regard to the 25 per cent. abatement upon prompt payment, the second parties might have the abatement if they chose to make prompt payment. The magistrates had express power to make regulations as to the collection of the dues, and the practice of monthly accounts, as well as the various exemptions and abatements complained of, were in reality merely methods of, or rules regulating, the collection. Petty customs were in a different position from taxes in this respect, that in the case of taxes an unequal assessment meant that if one man paid less another had to pay more, whereas, in the case of dues it made no difference, except to the receivers, that one man paid less. Hence the present case differed from Stewart v. Isat, 1775, M. 1993. The enactments as to equality of treatment in the case of railways and canals had no application here. 2. As to the persons from whom the customs were to be demanded—These persons were clearly the consignees of the goods. It was the consignees who brought the goods within the burgh. In whatever way the dues were collected it must be the consignees who ultimately paid. This was true even in the case of goods consigned “carriage paid,” for this was merely the result of an arrangement between consignor and consignee— Milne v. Leys, May 26, 1852, 14 D. 798; Magistrates of Perth v. Macdonald, November 24, 1852, 15 D. 85; per Lord Selborne in Great Eastern Railway Company v. Mayor of Harwich, 1880, 41 L.T. (N.S.) 533. The case of Magistrates of Kilmarnock v. Donald & Morton. February 14, 1900, 2 F. 590, 37 S.L.R. 417, dealing with rights of collecting customs based solely on usage, had no application in constnuing the statute by which the rights of parties in this case were settled. The statute gave rights to sue for and recover the dues quite independent of the right of stopping at the ports. It was only the consignees who could say whether goods brought in were for sale, storage, consumption, or manufacture. The railway company could not be the person chargeable— Magistrates of Linlithgow v. Edinburgh and Glasgow Railway Company, July 12, 1859, 21 D. 1215. If the consignors were held to be the persons liable, the effect would be to bring persons who might be in England or anywhere abroad within the jurisdiction of the Sheriff of Inverness, and endless confusion would result. Further, at common law delivery to a carrier operated delivery to the consignee—Bell's Prin., sec. 117. When the consignor paid the carriage he did so as agent for the consignee— Dunlop and Company v. Lambert, 1839, M'L. and Rob. 663, per Lord Cottenham, at p. 681. 3. As to quantities less than one barrel bulk, the magistrates, being empowered to levy customs at a rate per barrel bulk, were enabled to charge proportionally on goods introduced in smaller quantities. “Barrelbulk” was not a unit below which the customs could not be levied; it was mentioned as fixing the “rate” of payment— per Lord Fullerton in Magistrates of Linlithgow ( supra). The power to open closed packages was necessarily involved in the right to levy petty customs, and the general clause at the end of the schedule was sufficiently wide to cover the various articles charged in the accounts.

Argued for the second parties—The Act of 1847 must be read as declaratory of previous usage, and further, as a taxing statute it must be construed strictly. (1) The

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words “shall and may be lawful,” though conferring merely a power, might be obligatory where the power was coupled with a duty. In the case of powers given to a public body to levy dues, these powers, if put in force, must be exercised strictly in accordance with the statute and schedule which fixed the particular goods to be charged and the actual rates to be charged on those goods. There was no ground for treating the specific rates set forth in the schedule as maximum rates. The duty of the Magistrates also was to exact the dues with an even hand. Instead of this the Magistrates, without warrant under the statute, had made all sorts of exemptions and abatements on particular goods and in favour of particular classes of persons. These abatements and exemptions were not in any sense mere rules of collection. As a result of this unequal treatment the second parties were prejudiced. The grounds of public policy on which railway companies and similar bodies were compelled to give equal treatment was fully applicable here. The principle of equality of treatment by public bodies had long been recognised at common law— Isat v. Stewart, M. 1993, and provision was made for uniformity of ates in the general Act regulating such imports—the Burgh Customs Act 1870, 33 and 34 Vict. c. 42, section 2. (2) In determining the persons from whom the customs were to be demanded, the usage prior to the Act, as well as the words of the Act itself, must be looked at. The theory and practice of such dues were that the burgh officials sat at the ports and took the money from the persons bringing in the goods. By the nature of the impost the person liable to pay was the person who tendered the goods— Magistrates of Kilmarnock v. Donald & Morton ( supra), vide historical account of such imposts, per Lord Medwyn in Magistrates of Linlithgow v. Edinburgh and Glasgow Railway Company ( supra). The only compulsitor of payment was a refusal to admit the goods till payment. The provisions of the Act did not alter that state of things. The imposts were on the goods “brought into” the royalty, and the remedy was to “prevent” the goods, &c. “from entering the burgh until such customs and imposts are paid.” The first parties founded on the new power given by the Act to “sue and recover.” But the effect of these words was merely to facilitate collection, not to make a change in the persons who paid and to transfer the whole burden to consignees. As before, it was the carrier (in this case chiefly the Railway Company) who remained the person who had to pay. The words of the Act “brought into the burgh by him” occurring in the provision dealing with the recovery of the imposts, went strongly to show that the Act made no alteration on the class of persons from whom the collection was to be made. The Act preserved the former mode of collection and the former remedy by stoppage of the goods, and merely gave additional power to recover the dues by granting a right to sue persons who in bringing in goods had evaded the vigilance of the burgh officials In Great Eastern Railway (supra) the Railway Company was found liable. The circumstances of Magistrates of Linlithgow ( supra) were special. It was a “toll thorough,” and the decision proceeded on the ground that the Railway Company under its Act had acquired the property of its land and therefore could not be charged this toll. (3) The Magistrates had no power to charge dues on goods included in the general clause at the end of the schedule when the quantity was less than one barrel-bulk. One barrel-bulk was the unit beyond which the dues did not go, as one lb. was the unit, e.g., of tobacco under the Customs Acts. The contention of the first parties involved that “rate” was to be read “ratio.” The incorrectness of this contention was made very clear by the addition of the words in the schedule, e.g., as regards cloth, where the standard taken was 12 yards, “and less in proportion below 12 yards.” Instances of the addition of such words occurred again and again in the schedule, and the clear inference was that where such words were not added the magistrates could not charge dues on any quantity less than the unit. There was no warrant in the Act for the magistrates opening closed packages nor for exacting customs on some of the articles charged in the accounts, e.g., soap, brushes, candles, and mineral waters. The general words at the end of Schedule A could include only articles ejusdem generis with sugar, wine, and tea, and the articles in question were distinct in use and kind.

At advising—