Inland Revenue v. Gunning's Trustees [1907] ScotLR 514 (09 March 1907)

Inland Revenue v. Gunning's Trustees [1907] ScotLR 514 (09 March 1907)

A revocable donation inter virum et uxorem under Scots law is property of which the donor is 'competent to dispose' at the time of death within the meaning of the Finance Act 1894. The power to revoke and dispose is sufficient to bring such property within the scope of estate duty, regardless of whether revocation was actually exercised before death.

Citation
[1907] ScotLR 514
Parties
Pursuer: Inland Revenue; Defenders: Gunning's Trustees (including Dame Mary Agnes Winwood Hughes)
Jurisdiction
Scotland
Judgment Date
09 March 1907
Procedural Posture
Exchequer Cause (revenue/estate Duty) / Appeal (reclaiming Motion) From Lord Ordinary to Inner House, First Division
Outcome
Appeal allowed; interlocutor of Lord Ordinary recalled; decree pronounced in terms of the restricted conclusion.
Legal Topics
Estate Duty, Property Passing on Death, Donations Inter Virum Et Uxorem, Statutory Interpretation, Competency to Dispose, Application of Imperial Statute to Scotland
Revenue Law Succession Law Trusts and Estates Estate Duty Property Passing on Death Donations Inter Virum Et Uxorem Statutory Interpretation Competency to Dispose +1 more

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Parties

Inland Revenue

Pursuer

Gunning's Trustees (including Dame Mary Agnes Winwood Hughes)

Defenders

Procedural Posture

Exchequer Cause (revenue/estate Duty) / Appeal (reclaiming Motion) From Lord Ordinary to Inner House, First Division

Legal Issues

  1. 1 Whether donations inter virum et uxorem (between husband and wife) unrevoked at death are property of which the deceased was 'competent to dispose' under the Finance Act 1894, and thus liable to estate duty in Scotland.
  2. 2 Whether the statutory phrase 'competent to dispose' should be interpreted to ensure equal incidence of taxation between Scotland and England despite differences in the law of revocability of such donations.

Ratio Decidendi

A revocable donation inter virum et uxorem under Scots law is property of which the donor is 'competent to dispose' at the time of death within the meaning of the Finance Act 1894. The power to revoke and dispose is sufficient to bring such property within the scope of estate duty, regardless of whether revocation was actually exercised before death.

Court Disposition

Appeal allowed; interlocutor of Lord Ordinary recalled; decree pronounced in terms of the restricted conclusion.

Orders

  • Defenders ordained to lodge an account of the specific donation made by Dr Gunning to Dame Mary Agnes Winwood Hughes during marriage, as set forth in her trust settlement dated 19th July 1900 and recorded 21st March 1901.