Belch's Trustees v. Dalziel and Others [1917] ScotLR 452 (23 May 1917)

Belch's Trustees v. Dalziel and Others [1917] ScotLR 452 (23 May 1917)

Undeveloped land duty is a charge on the capital of the trust estate, not on income, because it is imposed on the site value (capital value) of the land and is recoverable from the fiar (owner) as defined by statute. The liferentrix suffers only to the extent that income is reduced by the application of capital to pay the duty.

Citation
[1917] ScotLR 452
Parties
First Parties (trustees): Mrs Janet Belch or Smyth or Dalziel and others, testamentary trustees of John Belch of Drumoyne; Second Party (liferentrix): Mrs Janet Belch or Smyth or Dalziel (as individual); Third Parties (fiars and Marriage Contract Trustees): John James Belch Smyth and others, children of the second party, and marriage-contract trustees of John James Belch Smyth
Jurisdiction
Scotland
Judgment Date
23 May 1917
Procedural Posture
Special Case (court of Session, Inner House, First Division) / Judgment on Question of Law Regarding Allocation of Undeveloped Land Duty Between Capital and Income of Trust Estate
Outcome
Undeveloped land duty is to be debited to capital of the trust estate.
Legal Topics
Undeveloped Land Duty, Incidence of Taxation Between Capital and Income, Interpretation of Finance Act 1910, Trustee Duties, Liferent and Fee Interests
Trusts and Estates Taxation Property Law Undeveloped Land Duty Incidence of Taxation Between Capital and Income Interpretation of Finance Act 1910 Trustee Duties Liferent and Fee Interests

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 5 Party arguments 2 Amounts and remedies 9
Sign in to unlock

Parties

Mrs Janet Belch or Smyth or Dalziel and others, testamentary trustees of John Belch of Drumoyne

First Parties (trustees)

Mrs Janet Belch or Smyth or Dalziel (as individual)

Second Party (liferentrix)

John James Belch Smyth and others, children of the second party, and marriage-contract trustees of John James Belch Smyth

Third Parties (fiars and Marriage Contract Trustees)

Procedural Posture

Special Case (court of Session, Inner House, First Division) / Judgment on Question of Law Regarding Allocation of Undeveloped Land Duty Between Capital and Income of Trust Estate

Legal Issues

  1. 1 Whether undeveloped land duty under the Finance (1909–10) Act 1910 is to be charged against the capital or the income of a trust estate where property is held for a liferentrix and fiars.

Ratio Decidendi

Undeveloped land duty is a charge on the capital of the trust estate, not on income, because it is imposed on the site value (capital value) of the land and is recoverable from the fiar (owner) as defined by statute. The liferentrix suffers only to the extent that income is reduced by the application of capital to pay the duty.

Court Disposition

Undeveloped land duty is to be debited to capital of the trust estate.

Orders

  • The undeveloped land duty should be debited to capital, the liferentrix suffering the loss of the income on the amount of the capital so applied.