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Scottish Court of Session Decisions
You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Galashiels and Selkirk Parish Councils v. Scott Plummer [1923] ScotLR 605 (19 July 1923)
URL: http://www.bailii.org/scot/cases/ScotCS/1923/60SLR0605.html
Cite as: [1923] ScotLR 605, [1923] SLR 605
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SCOTTISH_SLR_Court_of_Session
Page: 605↓
Court of Session Inner House First Division.
v.
Facts:
The Poor Law Amendment (Scotland) Act 1845, sec. 37, provides with regard to the manner in which lands and heritages are to be valued for the purpose of levying the poor rate as follows:—“And be it enacted that in estimating the annual value of lands and heritages the same shall be taken to be the rent at which one year with another such lands and heritages might in their actual state be reasonably expected to let from year to year, under deduction of the probable annual average cost of the repairs, insurance, and other expenses, if any, necessary to maintain such lands and heritages in their actual state, and all rates, taxes, and public charges payable in respect of the same.…” Held (1) that heritors' assessments were included among the rates, taxes, and public charges which fell to be deducted in estimating the annual value of lands and heritages for the purpose of poor-law rating; but (2) that minister's stipend did not fall to be deducted, it not being a charge on the estate of property in the lands themselves but on the estate of teinds.
The Parish Council of the Parish of Galashiels and the Parish Council of the Parish of Selkirk, first parties, and Charles Henry Scott Plummer of Sunderland Hall, second party, brought a Special Case for the opinion of the Court upon questions regarding the deductions to be made by the first parties in estimating the annual value of the lands belonging to the second party in their respective parishes for the purpose of levying the poor rates and other rates levied in the same way, and also as to the method by which such charges if deductible fell to be fixed.
The Case stated—“1. The first parties are the rating authorities charged with the duty of levying within their respective parishes the poor, education, and registration rates, and other rates which are levied in the same way as the poor rate. 2. The second party is the proprietor of lands and others lying partly in the parish of Galashiels and partly in the parish of Selkirk, and is liable to be assessed by the first parties for all rates levied in the same way as the poor rate. 3. The second party is liable to pay land tax, heritors' assessments, and minister's stipend in the parish of Galashiels and the parish of Selkirk. 4. In the parish of Selkirk heritors' assessments have been levied twice in the last ten years, namely, on 21st October 1915 and on 20th April 1922. On each occasion the assessment
Page: 606↓
was levied at the rate of 2d. per £1 after deduction of £50 from the rental. In Galashiels parish during the last ten years heritors' assessments were levied in the following years 1913, 1915, 1916, 1918 (twice), 1919, 1920, and 1922. Small heritors are not assessed in this parish, the assessment being imposed on six heritors. These six are assessed on the old valued rent.… 6. Since the passing of the Poor Law Amendment (Scotland) Act 1845 it has been customary in many parishes in Scotland to estimate the deductions from the gross rental of lands and heritages on the basis of a percentage of the gross rental, which percentage of the gross rental was uniformly deducted from the actual gross rental of each assessable subject in arriving at the annual value of such subject for the purpose of levying the poor rate and kindred rates. In some parishes the scale of deduction is uniform for all classes of property, in others it varies according to the nature of the subject. The rate of deduction thus allowed varies over the whole of Scotland from 2 per cent. to 80 per cent., and in the county of Selkirk alone from 5 per cent. to 47 per cent. In the parish of Galashiels the uniform percentages of the gross rental of each assessable subject allowed for the year 1922–23, as representing the proper deductions under section 37 of the said Act, were— 1 2
Lands
15
per cent.
Houses and shops
25
do.
Railways
55
do.
Mills, factories, and gas works 30
30
do.
Gas and water pipes
20
do.
Telephone and telegraph wires
35
do.
Electric mains and generating station
35
do.
(increased to 40 per cent. after appeal) and in the parish of Selkirk the percentages allowed were—
Lands
5
per cent.
Houses and shops
15
do.
Railways
47
do.
Mills and public works
20
do.
Gas and water pipes
20
do.
Telephone and telegraph wires
35
do.
Electric mains
40
do.
7. Questions have arisen between the parties as to whether the first parties in estimating the annual value of the lands belonging to the second party in their respective parishes for the purpose of levying the poor, education, and registration rates, and other rates levied in the same way, are bound to deduct the amount of land tax, of heritors' assessments, and of stipend payable by the second party as owner of his said lands, and also as to the method by which such charges, if deductible, fall to be fixed. 8. The first parties maintain that they are not bound to make such a deduction in respect that neither land tax nor heritors' assessments nor stipend are rates or taxes or public charges payable in respect of lands within the meaning of section 37 of the Poor Law Amendment (Scotland) Act 1845. In particular the first parties maintain that the intermittent and special character of heritors' assessments exclude them from such a category, and that stipend is equally excluded, in respect that it represents part of the estate of teinds, and that it is not ‘a public charge’ payable ‘in respect of the lands and heritages' within the meaning of section 37. Further, the first parties maintain that if they are bound to make these deductions their duty under the statute is sufficiently discharged if they make a uniform deduction of a certain percentage of the gross rental of all lands in a particular parish. 9. The second party maintains that land tax, heritors' assessments, and stipend are public charges which the first parties are bound to deduct from the rent within the meaning of section 37 of the Poor Law Amendment (Scotland) Act 1845, and in particular that the intermittency of the heritors' assessments and the fact that there is an estate of teinds make no difference with regard to the heritors' assessments and the stipend. Further, the second party maintains that the proper method of making those deductions is to take the actual amount of those charges appropriate to the assessable subject, and not to make a uniform deduction of a certain percentage from the gross value of all lands in a particular parish.”
The questions of law were—“1. In estimating the annual value of lands under section 37 of the Poor Law Amendment (Scotland) Act 1845, are the first parties bound to deduct ( a) land tax, and/or ( b) heritors' assessments, and/or ( c) stipend? 2. In the event of the first question being answered in the affirmative in all or any of its branches, is the method of making the deductions or deduction ( a) to deduct the actual amount of the charges or charge applicable to each subject of assessment, or ( b) to make in respect of the charges or charge a uniform deduction of a certain percentage from the gross value of all lands in each parish?”
Argued for first party—Heritors' assessments being intermittent in their incidence and depending for recovery on resort to ordinary action were not a “public charge” within the meaning of the Act. Nor was minister's stipend a public charge in respect of the land. It was a charge on the estate of teinds which was distinct from the estate of property. If the burden of stipend fell upon the second party it was not in respect of his ownership of the lands, but because he had acquired the right to the teinds thereof.
Argued for second party—Heritors' assessments and minister's stipend did not differ in character from other rates and taxes. They were payable for a public purpose in respect of lands and heritages and were enforceable by public law. They therefore fell to be included among “rates, taxes, and public charges” within the meaning of section 37 of the Poor Law Act 1845.
The following authorities were referred to Bell's Prin., section 1122; Rankine's Landownership, pp. 750, 751, 752 (note); Scottish North-Eastern Railway Company v. Gardiner, 2 Macph. 537; Macfarlane v. Monklands Railway Company, 2 Macph. 519; Edinburgh and Glasgow Railway Company v. Hall, 4 Macph. 1006; Traill v. Dangerfield,
Page: 607↓
8 Macph. 579; Stewart v. Parochial Board of Keith, 8 Macph. 26; Downie v. M'Lean, 11 R. 47, Lord Justice-Clerk Moncreiif at p. 51, 21 S.L.R. 33; Galloway v. Earl of Minto, 1920 S.C. 354, 59 S.L.R. 46.
As regards land tax, the Parish Councils conceded the point, and it is unnecessary to consider it further.
As regards heritors' assessments and minister's stipend, it is to be observed that the scheme of section 37 is to ascertain in the first instance what rent an ordinary tenant would be willing to pay for the lands and heritages, and then to deduct from that rent the ordinary burdens of maintenance falling upon the owner as such, and also the public charges payable by him, as such owner, in respect of the same. In short, as was pointed out by Lord Justice-Clerk Inglis in Edinburgh and Glasgow Railway Company v. Hall, 4 Macph. 1006, the conception of net real rent which underlies section 37 is very similar to the conception of the net annual value, familiar as the basis for fixing the price of lands and heritages in the case of sale. What, in other words, is the net rent which the owner of a particular piece of land may ordinarily be expected, as such owner, to draw from it.
In Hall's case it was decided that property and income tax being essentially a tax on personal income and capable of being shifted as regards its incidence from the shoulders of a landlord in receipt of rent to those of his creditors to whom he pays interest under deduction of tax, was not a “public charge in respect of land.” The distinction was emphasised by reference to the consideration that a rate assessed on the net real rent must be paid by the owner even though it can be demonstrated that he is not actually in receipt of a single penny from the land in respect of which he is chargeable to the rate.
Now it cannot, I think, be disputed that heritors' assessment is one of the burdens payable by the owner of lands and heritages as such. Its imposition is regulated by the Ecclesiastical Buildings and Glebes (Scotland) Act 1868. It owes its origin to the public authority of general statutes, albeit ancient in date; and, except that its incidence is more or less occasional, and that its collection depends on resort to ordinary action for recovery, it does not seem to be distinguishable from any other public charge. It is levied either on the real rent or on the valued rent (section 23). A distinction has been drawn between it and other public rates in connection with clauses of relief from public and parochial burdens in feu-rights. This distinction dates from Carstairs v. Greig (M. 2333), in which the judgment turned on custom as interpretative of the titles. Carstairs v. Greig was affirmed in the House of Lords in 3 Paton's App. 675, and Sir John Rankine (Landownership, 4th ed., p. 871) says that this decision has been regarded in practice as ruling the general point in relation to clauses of relief apart from custom. The cases of Scott v. Edmond ( 12 D. 1077) and Wilson v. Magistrates of Musselburgh ( 6 Macph. 483) support this view; but assuming it to be well founded it is not conclusive of the effect of a statutory direction that all “public charges in respect of the lands” are to form a deduction from the real rent in assessing poor rates and similar public charges. My opinion is that heritors' assessment is as truly a “public charge in respect of the lands” as any local rate.
At first sight minister's stipend might easily be regarded as coming within the same category, for it is obvious that the language of section 37 is intended to be comprehensive. But the language is employed to define a deduction or exception from the assessable rent; and if, on examination, minister's stipend is seen to be not truly a charge on land or the rent of land, the general terms in which the statute defines the deduction of public charges ought not to be stretched so as to include it. Hall's case is a warning against the dangers into which a broad construction (such as the words of section 37 undoubtedly suggest) may lead. Minister's stipend is a charge on the teinds, and the teinds are a share of the produce of the lands (vindicable against the intromitter with such produce) which belongs not to the owner of the lands as such, but to the titular, or Crown grantee, or to the owner of the lands, not as such owner, but in virtue of valuation and sale. The estate of teinds, consisting essentially in the peculiar right to step in and appropriate a share of the fruits legally belonging to the owner of the lands which produce them, is thus distinct from the estate of property in the lands themselves. If the owner of the lands is himself vested in this right, it is either as Crown grantee, or as purchaser under a valuation, or as tacksman. In no case does the burden of minister's stipend fall upon him in respect of his ownership of the lands, or in respect that he is creditor in the rents of the lands. The estate of teinds is an heritable estate, but the peculiar right in which it consists is not an immoveable right—in other words, it is not itself land. My opinion therefore is that minister's stipend is not one of the “public charges in respect of the land” which section 37 of the Poor Law Amendment (Scotland) Act 1845 directs to be deducted from the real rent.
I think therefore we should answer question 1 ( b) affirmatively, and 1 ( c) negatively. Question 1 ( a) is superseded by the concession
Page: 608↓
As regards stipend, I do not think that it forms a deduction from the rental authorised by section 37 of the Poor Law Act. Stipend is not payable by a landowner as such, but because he has intromitted with or has in some way acquired right to the teinds of his lands. Though the fact is not stated in the special case, it was mentioned in the course of the debate that the second party has a tack of the teinds of his lands from a titular. If that is so, the tack duty (in other words the titular) is burdened with the stipend. Any excess of the stipend over the tack duty must be borne by the second party in respect of his interest not as landowner but as tacksman of the teind.
It follows that the questions of law should be answered as suggested by your Lordship.
Page: 609↓
The more important question in this case is whether in fixing the annual value of his estate as assessable for poor-rate the second party is entitled to a deduction from the assessable rental of his estate of the amount payable to the minister as stipend. Is the stipend a “public charge payable in respect of his lands and heritages” within the meaning of section 37 of the Poor Law Act of 1845?
This Act provided alternative modes of assessment, two of which take account of what was called “means and substance,” the third is based exclusively upon the annual value of land and heritages owned or occupied. As had happened in the case of other imposts both in England and in Scotland, the last was found the preferable system and was generally adopted. For the purposes of collection it was much the more convenient, and it was supposed to supply a rough test of ability to pay, though doubtless that test is much ruder in modern than in old times, when land was in Scotland almost the only form of wealth. The present case is not concerned with occupiers' rates, and these may therefore be left out of account. One-half of the total poor-rate for the parish is leviable upon owners, with whom alone we are here concerned. As regards the individual owner, the standard of apportionment is the annual value of his lands, under certain deductions specified in the Act. According to legal theory the annual produce or rent of the estate is ultimately divisible between two persons—the owner of the lands and the titular or owner of the teinds. The Act lays no burden in respect of poor-rates upon the titular. The exemption of the latter from any share of parochial burdens may be an anomaly, but it is a very old one, and was not created by the Act of 1845—Connell on Tithes (vol. ii), p. 81; Roxburghv. Dice, (1750) M. 15, 665. Accordingly it was not suggested in the argument in the present case that the titular is liable in assessment in respect of the teinds. Nor was it suggested that the amount of the teinds payable to a titular falls to be deducted from the assessable rental in levying the poor-rates. As regards the great majority of the estates in Scotland under present-day conditions, there is no practical separation between the interest in the teinds and the interest in the lands and heritages. But in the eye of the law, though the interests may be in the same person, there are two estates. It is convenient therefore, and it avoids confusion, to figure the case which still occasionally obtains of two different persons as well as two estates. It is also convenient to ignore the possibility, or rather the probability, of the teinds having been valued, and to figure them as one-fifth of the rent. Now the Poor Law has adopted as the standard of assessment for the heritor an annual sum which includes both the four-fifths which the heritor enjoys and the one-fifth for which he has to account to the titular. Apart from the question of stipend the matter is simple enough. But the one-fifth which the heritor has to account for to the titular is generally burdened with payment of stipend to the minister. Obviously (still adhering to theory) this can make no difference to the heritor. He may deem it a hardship that he has to pay the rates in respect of the one-fifth that forms the teind which does not fall to him, but the matter is not affected by the consideration that a burden has been imposed upon the titular's share. The stipend is payable, not out of the four-fifths falling to the heritor, but out of the one-fifth falling to the titular. To avoid circuity of collection it is paid by the heritor, who takes credit for it in accounting for the teind to the titular, and who is liable for it, not in respect of his own four-fifths, but in respect of his intromission with the one-fifth effeiring to the titular. Even under present-day conditions there may be cases where the matter is illustrated free from any complexity. The teinds may be bishop's teinds, payable to the Crown or to the Crown donee, which have not yet been affected by stipend. The heritor pays the amount of this teind to the titular, and he cannot claim the amount as a deduction from his rent assessable for poor-rate. It might happen that an augmentation of stipend was granted which impinged upon these teinds. The heritor would not be affected thereby. He would pay the same amount as before. According to the theory of the second party to this case, however, he would now be entitled to a deduction of the amount of the stipend payable out of the titular's teind as being a public charge upon his lands and heritages.
My view of the matter may be summarised as follows:—(1) The standard of the heritor's assessment for the poor-rate is the rent of the land, from which rent the teind payable to the titular does not form a deduction. (2) Stipend is payable out of the teind payable to the titular and is a charge thereon. (3) Stipend is not therefore a “public charge” upon the heritor's lands and heritages within the meaning of section 37 of the Act of 1845.
Two general observations occur to me. Under the conditions which now obtain the position is artificial. In probably the great majority of cases the stipend is a direct burden upon a person who combines in himself the position of heritor and of titular. The legal principle is, however, too firmly established to yield to anything but direct statutory enactment.
If it could have been shown that in practice since the Act of 1845 stipend had been treated as a deduction, that might have been a factor well worthy of consideration. No suggestion, however, has been made of the recognition of any such practice. My own very distinct impression is that the second party's contention upon this branch of the case is a new idea. It might be none the worse for that if it commended itself as in accordance with legal principle. But for reasons which I have stated it does not appear to me to do so.
I accordingly agree with your Lordship
Page: 610↓
The Court answered question 1 ( b) in the affirmative and question 1 ( c) in the negative.
Counsel for First Parties—Lord Advocate ( Hon. Watson, K.C.)— Murray. Agents— Skene, Edwards, & Garson, W.S.
Counsel for Second Parties— Brown, K.C. Marshall. Agents— Mylne & Campbell, W.S.