TAX COMMISSIONER

Wairarapa Times-Age, 20 November 1942, Page 3

TAX COMMISSIONER

DEFENDED BV MINISTER AGAINST CRITICISM BY JUDGE. “QUESTION OF WHAT STATUTE SAID.” (By Telegraph—Press Association.) WELLINGTON, This Day. “References. to the Stamp Office in newspaper extracts from a recent judgment of Mr Justice Blah’ in the case of Williams and Gardiner against the Commissioner of Stamp Duties and newspaper comments thereon demanding Ministerial explanation have been so condemnatory that it is expedient that I should make some observations in the matter,” said the Attorney-Gen-eral, Mr Mason, in a statement last night. He explained that it was a commonplace that the law as to stamp duties implied nothing of principle, but was entirely a question of what the statute said. FACTS NOT DISCLOSED. “The judgment is based on.the finding (not explicit but to be inferred), of a trust communicated to and accepted by the trustees in the lifetime of the deceased. The suggestion that there was such a trust was never put un by the appellants or their solicitors till after the commissioner’s case for submission to the Court had been handed to the appellants for filing in court. This trust did not in any .way appear on the face of the documents the commissioner had seen. The case stated was handed to the appellants on April 1 to file in Court, and it was only in May that appellants’ solicitors intimated that they proposed to rely on a trust communicated and accepted orally in the lifetime of the deceased. “In his judgment the judge mentions as a matter of reproach that the case as stated by the commissioner contains no reference to the question whether this trust was communicated. The answer is that the commissioner could not have mentioned it because he had never heard of it, though the appellants and their solicitors had had every opportunity of bringing it to. his notice. Evidence on this question of a trust was taken on affidavits. “There does not appear to have been any finding by the judge on the question of the alleged trust before he handed down his judgment. It is true that the commissioner had heard the suggestion of the trust after the proceedings in Court had been initiated as required by appellants. But so far from being obliged to believe it, it was his duty to have it proved in view of the circumstance that it had been first put forward at the eleventh hour. .The judge has assumed that the commissioner had before him facts which in truth he could not accept till they had been established by the judgment of lhe Court.

“MOST UNFAIR.”

“When condemnatory expressions extracted from the judgment and featured in the Press occupy a column of print it would doubtless be inexpedient to discuss each of them, but in the circumstances one must advert to the main points. His Honour states: 'The effect of the attitude the commissioner takes in this matter is that he entirely disregards any moral or ethical considerations.’ This expression will be interpreted by all readers only in a severely condemnatory sense, and that is most unfair to the commissioner. “The commissioner has This in common with the judge—that he is bound by the law. He cannot in disregard of the law make decisions which he believes to accord with what would 1 be right and fair if there were no legal difficulties in the way. Nor can a judge. This fact is vividly brought out in the New Zealand Law Reports, volume 31, page 168, where Mr Justice Edwards, having to give a direction that would result in depriving a woman of compensation due to her by every moral right, said 1 ’Nothing could well be more absurd; nothing could well be more illogical; nothing could well be more unjust,’ and after further pointing out the morally indefensible result, stated: ‘I deplore the absurdity; I protest against the injustice; but I have no alternative but to administer the law as I find it.’ “If testators or other parties enter into transactions or execute documents which require further documents to produce a result consonant with the dictates of morality and justice, and those further documents appear to be liable to duty, then the Commissioner of Stamp Duties is not to be accused of making war on morality and justice because he demands that duty which those further documents appear in law to incur,” said Mr Mason. “Yet that is the basis of the accusation of the disregard of moral, or ethical considerations which is laid against the comI missioner. It is a commonplace that the law as to stamp duties implies nothing of principle but is entirely a question of what the statute says.. If the statute makes a man liable he must pay, and if it does not make him liable then he cannot be made to pay. As considerations of equity and morality will not avail to impose a tax upon a man who escapes by what may appear to be an irrational loophole or anomaly so they will not serve to save him from the obligation if it is clearly imposed; and there is no power in the commissioner to modify or rectify the law in the one case more than in the other.

IMPUTATION CHALLENGED. ■■lt is stated ‘The fact that the Commissioner of Death Duties does not appear to hold with these sound, but unfortunately perhaps, old-fashioned views is to be regretted, if not for his own sake, then at least for the honour of a great State department.' There is no warrant for the imputation, that the Commissioner of Stamp Duties does not appear to hold with sound and honest views. Is the commissioner to assess taxation at the peril of this attack on his views of honesty in every case in which the transaction is one an honest man would feel bound to enter into? , j “I notice the sentence, ‘lt looks to me as if it appears to the Commissioner of Stamp Duties to be of more importance that he becomes enabled to claim taxes upon what is really one transaction in four and possibly five separate and distinct ways than it is to see. an honest trustee being honest to his trust. This is utterly unfair. The commissioner has no authority of any description to remit taxation for the purpose of encouraging honesty. Such a system would clearly be as impossible as one of discretionary power to impose taxation to discourage what in his opinion is dishonesty. TECHNICALITIES & DUTY. “The judgment says, “The commissioner is just seeking to take advantage of a technicality to get more than Miss Keith would have been called upon to pay had she given away the »whole of her estate in' her lifetime, or given it away direct by her will to the person she wished to benefit.’ That is unfairly expressed, for the technicality must not be disregarded by the commissioner. It is undoubtedly the fact that if a person has the technical ingenuity to devise a way of carrying out a transaction without incurring payment of duty incurred by methods commonly used, then there is neither legal nor moral obliquity, to be charged against him for so doing. Equally, if a person choose to employ methods which incur more duty than would be incurred by simpler methods commonly used, then there can be neither moral nor legal obliquity charged to

the Commissioner of Stamp Duties for assessing that higher duty. “I notice references to the Law Courts and State departments being alike in that each must be fair, just, impartial and fearless,” Mr Mason concluded. “The commissioner complied with this standard when he was fearless in that he did not give instructions that the case be dropped when a _ message was sent that condemnatory remarks on his conduct would be made.”