United Kingdom House of Lords Decisions

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URL: http://www.bailii.org/uk/cases/UKHL/1913/50SLR0665.html
Cite as: [1913] UKHL 665, 50 ScotLR 665

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SCOTTISH_SLR_House_of_Lords

Page: 665↓

House of lords.

(On Appeal from the Court of Appeal in England.)

Tuesday, February 3, 1913,

(Before the Lord Chancellor (Viscount Haldane), the Earl of Halsbury, Lords Atkinson, and Shaw. Kinnear, and Mersey.)

50 SLR 665

American thread company

v.

Joyce

Subject_Revenue — Income Tax — Residence — Evidence of Residence in United Kingdom — Finding of Fact by the Commissioners.
Facts:

Where a company registered abroad, but controlled by a body of directors who met in England, was found by the Income Tax Commissioners to be resident in the United Kingdom, and therefore liable to be assessed under section 2, Schedule D, of the Income Tax Act 1853, held (1) that the Court, on a Stated Case, can only consider whether there was evidence to justify the finding; (2) that there was evidence that the company resided in the United Kingdom.

Headnote:

This was an appeal from a judgment of the Court of Appeal ( cozens-hardy, M.R., fletcher moulton, and buckley, L. JJ.), who had affirmed a judgment of hamilton, J., affirming a decision of the Commissioners of Income Tax for the division of Manchester.

The facts are given in the opinions.

At the conclusion of the argument for the appellants their Lordships gave judgment as follows:—

Judgment:

Lord Chancellor (Haldane)—If I had any doubt about this case, either upon the law or upon the facts as found, I would have suggested that the House should take time to consider their judgment. But not only does the principle of law applicable seem to me thoroughly established and clear, but the facts of the case do not seem to me to be capable of being regarded in any other light than that in which they

Page: 666↓

were regarded in the admirable judgment of Hamilton, J.

By the by-laws the company was entitled to have various offices, and in point of fact they had an office at Manchester in the office of another company. There, according to the constitution of the company extraordinary meetings of the board of directors could be and were held, meetings at which certain business reserved by the by-laws for those directors was carried on. Much of the management took place from there. It is not for your Lordships to entertain the question how on the materials which came before the Inland Revenue Commissioners you yourselves would have decided the question. In saying that I desire it to be understood that I am far from saying that I dissent in any way from the conclusion at which the Commissioners came to on the question of fact which was raised in this case. What I say is that after the statute of 1880 (Taxes Management Act 1880,43 and 44 Vic, cap. 19) your Lordships are precluded from looking at the finding of fact of the Commissioners except so far as to see if there is any evidence at all on which that finding can be supported. I think the judgment of Hamilton, J., shows conclusively that there is ample evidence on which the finding of the Commissioners can be supported. The Commissioners came to the conclusion that the control of. the management of the affairs of the company was intended to rest and did rest with the directors of the company resident in England in extraordinary session, who constituted the majority of the board, and were also directors of the English Sewing Cotton Company, Limited, which owned the entire stock or ordinary shares of the appellant company, and further that such control was constantly exercised at meetings of the board in extraordinary session held in England. That finding is not ambiguous, and it is unchallengeable if there is any evidence to support it. That disposes of the question of the finding as a question of fact.

The only other question—the question of law—is that of residence. That question was before this House in De Beers Consolidated Mines v. Howe (1906 A.C. 455). That case decided that a person resided for the purposes of the income-tax assessment at the place where his real business was carried on, that is to say, where the control and management of the company abides. I have no doubt that in this case it was with the directors at Manchester. No doubt it is true in a sense that these directors did not ordinarily interfere with the details of the trade. There was an executive committee, the agent of the directors, and there was also a directory which took an active part in the weekly meetings.

It is clear that the directory in Manchester was the directory with paramount authority to deal with referred subjects which came before them in extraordinary session. On these facts the Commissioners found that the directors at Manchester were constantly supervising and guiding the policy of the company, even as regarded manufacture and trade. For these reasons I come to the conclusion that the appeal fails and should be dismissed with costs.

The Earl of Halsbury, Lords Atkinson, kinnear, and Mersey concurred.

Judgment appealed from affirmed and appeal dismissed with costs.

Counsel:

Counsel for the Appellants— Danck werts, K.C.—G. Sutton. Agents— Rawle, Johnstone, Gregory, Rowcliffe, & Rowcliffe, for Addleshaw, Sons, & Company, Manchester, Solicitors.

Counsel for the Respondent— The Attorney-General (Sir R. Isaacs, K.C.)—The Solicitor-sGeneral (Sir J. Simon, K.C.)— W. Finlay. Agent— H. Bertram Cox, Solicitor of Inland Revenue.
1913