Commissioners for Special Purposes of Income Tax v Pemsel

[1891] A.C. 531

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(Judgment by: Lord Halsbury LC (including background))

Between:Commissioners for Special Purposes of Income Tax - Appellants
And: John Frederick Pemsel - Respondent

Court:

Judges:
Lord Halsbury LCLord Watson
Lord Bramwell
Lord Herschell
Lord MacNaughten
Lord Morris

Subject References:
REVENUE
INCOME TAX
Allowances
'Charitable Purposes'
Certificate
Procedure
Mandamus to Commissioners
5 & 6 Vict. c. 35, Sched. A, s. 61, No. VI., s. 62

Judgment date: 20 July 1891

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Judgment by:
Lord Halsbury LC (including background)

By 5 & 6 Vict. c. 35, s. 61, No. VI., allowances in respect of the income tax imposed by Sched. A are to be granted by the Commissioners for Special Purposes of the Income Tax on (inter alia) the rents and profits of lands, tenements, hereditaments, or heritages, vested in trustees for charitable purposes, so far as the same are applied to charitable purposes.

In a case where an allowance which ought to be granted is refused mandamus lies to the Commissioners commanding them to grant the allowance and to give a certificate of the allowance with an order for the payment thereof.

Lands in England were conveyed by deed in 1813 to trustees upon trust after payment of costs and outgoings to apply two-fourths of the rents and profits for the general purposes of maintaining, supporting and advancing the missionary establishments among heathen nations of the Protestant Episcopal Church, commonly known as the Moravian Church; and to apply the remaining two-fourths for purposes which were admitted in argument in this House on behalf of the Crown to be charitable within the meaning of the Act. On a claim for the allowance in respect of the whole trust:-

Held, Lord Halsbury L.C. and Lord Bramwell dissenting, that the words "charitable purposes" in the Act were not restricted to the meaning of relief from poverty, but must be construed according to the legal and technical meaning given to those words by English Law and by legislation applicable to Scotland and Ireland as well as England, and that the allowance ought to be granted.

Held, by Lord Halsbury L.C. and Lord Bramwell, approving the decision in Baird's Trustees v. Lord Advocate (15 Sc. Sess. Cas. 4th Series, 682), that the technical construction of the words "charitable purposes" imputed to English Law had never been adopted in Scotch Law; that in a taxing Act applicable to the whole of the United Kingdom the words could not receive that construction; and that since the trust for missions among heathen nations contemplated purposes having no relation to the relief of poverty the purposes were not "charitable" within the meaning of the Income Tax Act, and that the allowance ought not to be granted in respect of that portion of the trust.

The decision of the Court of Appeal ( 22 Q.B. D. 296 ) affirmed.

Baird's Trustees v. Lord Advocate (15 Sess. Cas. 4th Series, 682) disapproved.

Appeal from a decision of the Court of Appeal. ^[F1]

By deed in 1813 Mrs. Bates conveyed certain lands in Middlesex to trustees upon trust after payment of costs and outgoings to apply the rents and profits as follows:- 1. As to two-fourths, for the general purposes of maintaining, supporting and advancing the missionary establishments among heathen nations of the Protestant Episcopal Church, known by the name of Unitas Fratrum, or United Brethren; 2. As to another fourth, towards the maintenance, support and education of the children of ministers and missionaries of the said Church educated at the school and academy at Fulner, near Leeds, special regard being had to the children of such ministers as are least able to support the expense of their children's education, or for the benefit and purposes of any similar school, academy or establishment else-where within the United Kingdom; 3. As to the remaining fourth, towards the maintenance and support of certain establishments appertaining to the said Church for single persons, called choir-houses, within the United Kingdom. It appeared that the inmates of the choir-houses were divided into three classes:

1.

Single women who have been engaged in the educational department of the Church and have become incapacitated;

2.

Widows of ministers or missionaries and of poor members;

3.

Single men whose chief employments are to look after the young and to assist in education.

By 5 & 6 Vict. c. 35, s. 61, No. VI., Sched. A, allowances are to be granted by the Income Tax Commissioners on the rents and profits of lands, tenements, hereditaments, or heritages belonging to any hospital, public school, or almshouse, or vested in trustees for charitable purposes, so far as the same are applied to charitable purposes. ^[F2] Under this enactment allowances were until 1886 annually granted by the Commissioners in respect of the rents and profits of the above lands, and a return of the income tax paid by the tenants was made to the trustees, but in 1886 the usual application for a return of the income tax for the year ending the 5th of April 1886 - amounting in this instance to £73 8s. 3d. - was refused by the Commissioners.

An order of the Queen's Bench Division was made calling on the Commissioners to shew cause why a writ of mandamus should not issue commanding them to grant to Pemsel (the treasurer of the Church of the United Brethren, commonly called the Moravians) the allowance of £73 8s. 3d. in respect of rents and profits of lands on which property or income tax to that amount had been paid in respect of the year ending the 5th of April 1886, and to give a certificate of such allowance together with an order for payment of the same as provided by s. 62 of 5 & 6 Vict. c. 35. That order was after argument discharged, Lord Coleridge C.J. being against the allowance and Grantham J. in favour of it. This decision was reversed by the Court of Appeal (Lord Esher M.R., Fry and Lopes L.JJ.), the Court making an order that a peremptory writ of mandamus do issue for the purpose aforesaid. ^[F3] Against that order the Commissioners brought the present appeal. During the argument the appellants' counsel admitted that an allowance ought to be granted with respect to the third fourth in trust for the maintenance of the children of ministers, & c.; also with respect to the remaining fourth in trust for the maintenance of choir houses.

1890. March 20, 21, 24. Sir E. Clarke S.G., and Dicey Q.C. (Sir R. Webster A.G. with them) for the appellants:-

The two questions now in dispute are first whether the purposes of supporting the missionary establishments among heathen nations of the Moravian church are "charitable purposes" within the meaning of the Income Tax Act of 1842; and secondly whether the proper form of procedure is by mandamus. As to the first the principles laid down in the judgment of Lord Esher M.R. are, it is submitted, correct, though their application is erroneous. Lord Esher admits that charity implies the relief of poverty and that there must be in the mind of the donor an intention to relieve poverty; and that if the purpose in the present case was to convert rich heathen or heathen without regard to their poverty, it could not come within the exemption. On these principles the decision should be in favour of the Crown. There is nothing in the trust deed shewing an intention to relieve poor heathens; on the contrary the manifest intention is to spread the doctrines of the Moravian Church among heathens indiscriminately. Such a purpose may be public spirited, pious, kindly, benevolent; but it is not charitable in the ordinary, natural, and proper use of the word: see the observations of Sir W. Grant M.R. in Morice v. Bishop of Durham. ^[F4] The propagation of moral, political or religious opinions is not "charity." There must be something in the nature of relief of temporal wants to constitute a charity.

The judgment of Fry L.J. goes much further than the other judgments. According to that judgment the term "charitable purposes" is a legal and technical term embracing a great variety of objects which do not involve the idea of the relief of poverty; and the legal meaning of this term has been the subject of a long series of decisions of the English Court of Chancery in cases arising under 43 Eliz. c. 4, the Mortmain Act, and other statutes. As an instance of decisions under the Mortmain Act, 9 Geo. 2, c. 36, which was directed against gifts by dying persons to "charitable uses," see Trustees of British Museum v. White, ^[F5] where it was held in 1826 that a gift for the benefit of the British Museum was a gift to a charitable use within the meaning of that Act. But there is a serious difficulty in the way of importing that meaning into the Income Tax Act. That Act applies to the whole of the United Kingdom; and in construing such an Act words must be understood in their ordinary and popular significance, and in a general sense applicable to the three kingdoms, and not as

"technical legal terms belonging to one system of jurisprudence, which may exist in one part of the United Kingdom and not in another."

This was the view taken of the Income Tax Act by the Court of Session in Baird's Trustees v. Lord Advocate. ^[F6] That case is a strong authority for the Crown that the extended meaning of the word "charitable" does not prevail in Scotch jurisprudence. And see the decision of this House in Lord Saltoun v. Lord Advocate, ^[F7] where it was held that in construing the Succession Duty Act, which applies to the whole of the United Kingdom, legal technicalities must be disregarded and the language of the Legislature must be taken in its popular sense. It would lead to strange confusion if an institution were taxed in Scotland which was exempt in England. Such a result could not have been intended by the Legislature. The Act of Elizabeth was enacted for England only, and has never been extended to Scotland. Nor has it to Ireland; and in Ireland the principle now contended for has been applied: Attorney General v. Hope. ^[F8] The respondent relies on Attorney General v. Bagot, ^[F9] but that case is irreconcileable with Baird's Trustees v. Lord Advocate. Taxing Acts must be construed strictly. If the person sought to be taxed comes within the letter of the law, he must be taxed however great the hardship may appear. An equitable construction is not admissible in a taxing statute, where you can simply adhere to the words of the statute: see the judgment of Lord Cairns in Partington v. Attorney General; ^[F10] and that of Lord Blackburn in Coltness Iron Co. v. Black. ^[F11] Where the Income Tax Act intends to exempt particular institutions which are not charitable in the proper sense of the word, it specially provides for them; e.g. for literary and scientific institutions, public schools, & c.; and for the British Museum, which has a section (149) to itself. Those who inserted sect. 149 in the Act of 1842 must have known of the decision in 1826 with regard to the British Museum, and that section was unnecessary if, as the respondent contends, the Legislature intended the word "charitable" in the Income Tax Act to bear the larger meaning which it had been held to bear in the Mortmain Act. Again, the present trusts are for the benefit of foreign missions; whereas the intention in granting exemptions was to relieve the inhabitants of the United Kingdom.

Secondly, assuming that the allowances ought to be granted, mandamus is not the proper method of procedure. The Commissioners of Income Tax being Crown servants, no mandamus ought to issue: the proper remedy is by petition of right praying that the money in the hands of the Crown might be repaid: see the decision of the Court of Appeal in In re Nathan, ^[F12] overruling R. v. Lords Commissioners of the Treasury. ^[F13] The present case comes within that decision and is not governed by Reg. v. Income Tax Commissioners. ^[F14]

[The respondent's counsel were informed that they need not argue the question whether mandamus was the proper form of procedure.]

Crackanthorpe Q.C. and Russell Roberts for the respondent:-

The construction put by the appellants upon the Act is a very narrow one and is not consistent with the words of the section which express an intention to grant allowances on lands, & c. belonging to "any hospital, public school, or almshouse." If that construction be right trustees of public schools cannot claim the exemption; but it has been held that a public school which was partly maintained by fees charged for instruction was entitled to the allowance: Blake v. Mayor of London. ^[F15] The decision of the Court of Appeal is justified both by the popular use of the word "charitable" and by the technical meaning given to it by English, Scotch and Irish statutes, and by judicial decisions in the three kingdoms. In popular language it is common to speak of gifts for religious or educational purposes as charitable. With regard to the technical meaning, so far as Ireland is concerned, the authorities are conclusive: see Attorney General v. Bagot ^[F16] and the observations of Lord St. Leonards on the statute of Elizabeth and the jurisdiction of Courts of Equity in Ireland in cases of charity: Incorporated Society v. Richards. ^[F17]

Lord St. Leonards there refers to an Irish Act, 10 Car. 1, sess. 3, c. 1, which deals with a great variety of endowments, inter alia for the building of churches, the maintenance of any minister and preacher of the Holy Word of God, the building and maintaining of bridges,

"or for any other like lawful and charitable use and uses, warranted by the laws of this realm."

That answers the alleged difficulty so far as Ireland is concerned; and see Powerscourt v. Powerscourt, ^[F18] citing Lord Gort v. Attorney-General. ^[F19] The only decision against the respondent's construction is Baird's Trustees v. Lord Advocate. ^[F20] That decision is, it is submitted, inconsistent with the language of Scotch Acts and with the administration of charitable trusts in Scotland. The Scotch statute of 1633 c. 6 speaks of "charitable works" as equivalent to pious and recognises gifts to the church for religious purposes as charitable gifts. And charitable trusts seem to have been administered by the Scotch Courts upon the same principles as those recognised by the English Court of Chancery: see the authorities cited by Fry, L.J. ^[F21] Thus in England, Scotland and Ireland both the Legislature and the Courts have given to the word "charitable" a meaning which is not confined to the relief of poverty. The statute of 43 Eliz. c. 4 has been followed by several statutes which have given many instances of an extended use of the word "charitable," classing it with religious worship, education, and public objects: examples of which are found in 7 & 8 Wm. 3 c. 37,

"An Act for the encouragement of charitable gifts and dispositions,"

to promote

"learning and other good and charitable works;"

2 & 3 Wm. 4 c. 115, which has a special application to Roman Catholics in Scotland, and speaks of

"schools and places for religious worship, education and charitable purposes";

and 9 & 10 Vict. c. 59, an Act to relieve Jewish disabilities in respect to their

"schools, places for religious worship, education and charitable purposes."

The Charitable Trusts Act 1853 (16 & 17 Vict. c. 137) in sect. 66 defines "charity" as "every endowed foundation and institution taking or to take effect in England or Wales and coming within the meaning, purview, or interpretation of 43 Eliz. c. 4, or as to which, or the administration of the revenues or property whereof, the Court of Chancery has or may exercise jurisdiction"; and see sect. 62. By the Charitable Trusts Amendment Act 1855 (18 & 19 Vict. c. 124) s. 48 "charity" is to include every institution in England or Wales endowed for charitable purposes. And by sect. 28 stocks certified to be subject only to charitable trusts are to be exempt from income tax. The Legislature has thus recognised the construction put by the Court of Chancery and by the Act of Elizabeth upon the word "charitable."

Still more significant is the Succession Duty Act 1853 (16 & 17 Vict. c. 51) which is a taxing Act and extends to the three kingdoms. Sect. 16 speaks of trusts for "charitable or public purposes," using "charitable" manifestly in the technical sense given to it by the Courts, and with regard to Scotland as well as England without any distinction. With regard to the authorities where "charity" and "charitable" have been judicially interpreted, it is enough to cite Jones v. Williams, where charity was defined as "a gift to a general public use which extends to the poor as well as to the rich," and a bequest of money, by sale of lands, to be applied in waterworks for the use of a town was held to be a public charitable use and void within the Statute of Mortmain, 9 Geo. 2, c. 36; and Attorney General v. Brown, where Lord Eldon held that a parliamentary grant of a duty on coal imported into a town, in aid of the pecuniary inability of the inhabitants to protect the town from the encroachments of the sea, was a gift to a charitable use; see also In re Sinclair's Trust; Wilkinson v. Lindgren; Attorney General v. Vivian; Attorney General v. Webster. As to the argument founded upon the special exemptions in favour of the British Museum and other institutions, those exemptions were no doubt inserted ex abundanti cautelâ. It is therefore submitted that whether the ordinary and popular sense of the word is regarded, or the legal and technical sense as used by the Legislature and defined by judicial decisions for a very long series of years, the narrower meaning should be rejected, and the term "charitable purposes" should be construed in the Income Tax Act as including at all events religious purposes. And for the present case this is all that need be established.

Sir E. Clarke S.G. replied.

The House took time for consideration.

1891. July 20.

Lord Halsbury L.C.:- My Lords, in this case the Income Tax Commissioners have appealed against an order of the Court of Appeal, whereby a peremptory mandamus was awarded against them, commanding them to make an allowance and to grant a certificate of such allowance. If upon the merits of this case an allowance ought to be made and a certificate granted, I cannot doubt that the order of the Court of Appeal was right. The statute under which the Commissioners are acting is peremptory in its terms to the Commissioners to make the allowance, and to give the certificates in cases where they are commanded to be given. If, therefore, the case is made out that the facts shew a case where the allowance ought to be made, and the certificate, which is merely consequential, should be given, there is a plain duty imposed by the statute on these executive officers, the neglect of which is properly enforceable by mandamus. But the far more difficult question remains, whether the facts proved here establish the proposition that the case for the allowance is made out. That depends upon the true construction of 5 & 6 Vict. c. 35, s. 61, No. VI., Sched. A., which is in these words:-

"No. VI. Allowances to be made in respect of the said duties in Schedule A.

For the duties charged on any college or hall in any of the universities of Great Britain, in respect of the public buildings and offices belonging to such college or hall, and not occupied by any individual member thereof, or by any person paying rent for the same, and for the repairs of the public buildings and offices of such college or hall, and the gardens, walks, and grounds for recreation repaired and maintained by the funds of such college or hall:

Or on any hospital, public school, or almshouse, in respect of the public buildings, offices, and premises belonging to such hospital, public school, or almshouse, and not occupied by any individual officer or the master thereof, whose whole income, however arising, estimated according to the rules and directions of this Act, shall amount to or exceed one hundred and fifty pounds per annum, or by any person paying rent for the same, and for the repairs of such hospital, public school, or almshouse, and offices belonging thereto, and of the gardens, walks, and grounds for the sustenance or recreation of the hospitallers, scholars, and almsmen, repaired and maintained by the funds of such hospital, school, or almshouse, or on any building the property of any literary or scientific institution used solely for the purposes of such institution, and in which no payment is made or demanded for any instruction there afforded, by lectures or otherwise; provided also that the said building be not occupied by any officer of such institution, nor by any person paying rent for the same:

The said allowances to be granted by the Commissioners for General Purposes in their respective districts:

Or on the rents and profits of lands, tenements, hereditaments or heritages belonging to any hospital, public school, or almshouse, or vested in trustees for charitable purposes, so far as the same are applied to charitable purposes:

The said last-mentioned allowances to be granted upon proof before the Commissioners for Special Purposes of the due application of the said rents and profits to charitable purposes only, and in so far as the same shall be applied to charitable purposes only:

The said last-mentioned allowances to be claimed and proved by any steward, agent, or factor, acting for such school, hospital, or almshouse, or other trust for charitable purposes, or by any trustee of the same, by affidavit to be taken before any Commissioner for executing this Act in the district where such person shall reside, stating the amount of the duties chargeable, and the application thereof, and to be carried into effect by the Commissioners for Special Purposes, and according to the powers vested in such Commissioners, without vacating, altering, or impeaching the assessments on or in respect of such properties; which assessments shall be in force and levied notwithstanding such allowances."

The main debate turns upon whether the lands here are vested in trustees for charitable purposes, though the whole enactment is not without its importance in considering what is the extent of its application.

The particular dispositions which give rise to the dispute are sufficiently set forth on page 2 of the appellants' case as follows:

"4.

Under an indenture dated the 11th day of February 1813 certain lands, tenements, and hereditaments (hereinafter referred to as lands) in the county of Middlesex, are conveyed by one Elizabeth Mary Bates, to certain trustees upon trust after payment of costs and outgoings to apply the annuities, rent-charges, yearly issues, and profits (all of which are hereinafter referred to as rents and profits) of the said lands as follows: - that is to say:

(1.)

As to two equal fourth parts thereof, for the general purposes of maintaining, supporting, and advancing the missionary establishments among heathen nations of the Protestant Episcopal Church, known by the name of Unitas Fratrum, or United Brethren (which Protestant Episcopal Church is hereinafter referred to as the said Church).

(2.)

As to another equal fourth part, towards the maintenance, support, and education of the children of ministers and missionaries educated, at the school and academy at Fulner, near Leeds, special regard being had to the children of such ministers as are least able to support the expense of their children's education, or for the benefit and purposes of any similar school, academy, or establishment elsewhere within the United Kingdom.

(3.)

As to the remaining equal fourth part or residue, for the maintenance and support of certain establishments appertaining to the said Church for single persons, called choir-houses, within the United Kingdom.

"5.

Under another indenture dated the 25th day of July 1815 certain freehold estates (also hereinafter referred to as lands) in the county of Middlesex, are conveyed by the said Elizabeth Mary Bates to certain trustees upon trust, after the payment of costs and outgoings, to apply the residue or surplus of the rents and profits of the said lands for the benefit and general purposes of a certain settlement or establishment of the said Church, existing at Gracehill, Ballymena, in the county of Antrim, and the dependencies of the said settlement or establishment as long as the same shall exist as a Congregational settlement of the said Church."

Whether these dispositions, or any of them, are charitable purposes, within the meaning of the exemption I have quoted above, must be determined upon a consideration of what those words "charitable purposes" mean in the exemption in question.

Now, before proceeding to discuss the words themselves, I somewhat protest against the assumption that the alternative is to be between a popular and what is called a technical meaning, unless the word "technical" itself receives a construction different from that which is its ordinary use. There are, doubtless, some words to which the law had attached in the stricter sense a technical meaning; but the word "charitable" is not one of those words, though I do not deny that the old Court of Chancery, in enforcing the performance of charitable trusts, included in that phrase a number of subjects which undoubtedly no one outside the Court of Chancery would have supposed to be comprehended within that term. The alternative, therefore, to my mind may be more accurately stated as lying between the popular and ordinary interpretation of the word "charitable," and the interpretation given by the Court of Chancery to the use of those words in the statute of 43 Elizabeth.

My Lords, to quote from the language of Tindal C.J. when delivering the opinion of the judges in the Sussex Peerage Case:

"The only rule for the construction of Acts of Parliament is, that they should be construed according to the intent of the Parliament which passed the Act. If the words of the statute are in themselves precise and unambiguous, then no more can be necessary than to expound those words in their natural and ordinary sense. The words themselves alone do in such case best declare the intention of the lawgiver. But if any doubt arises from the terms employed by the Legislature, it has always been held a safe means of collecting the intention, to call in aid the ground and cause of making the statute, and to have recourse to the preamble, which, according to Dyer C.J. (Stowel v. Lord Zouch), is a key to open the minds of the makers of the Act, and the mischiefs which they are intended to redress."

Now, I think, it is very material to consider what was the intent of Parliament in passing 43 Elizabeth. That Act itself is intituled,

"An Act to redress the misemployment of lands, goods, and stocks of money heretofore given to charitable uses."

And after reciting the objects with which certain lands and stocks had been limited, appointed, and assigned, it recites that the said lands, tenements, rents, and so forth, nevertheless had not been employed according to the charitable intent of the givers and founders thereof by reason of frauds, breaches of trust, and negligence in those that should pay, deliver, and employ the same. For redress and remedy whereof, Be it enacted, & c. It then proceeds to create the tribunal and machinery for the restoration of the property so misemployed.

My Lords, it is very intelligible to my mind that the Court of Chancery, or any Court, should have given the widest possible interpretation to an Act intended to remedy such abuses. The enumeration of charitable objects in the preamble of the statute was very soon interpreted not to be limited to the exact charities therein referred to. Where a purpose by analogy was deemed by the Court of Chancery to be within its spirit and intendment, it was held to be "charitable" within the meaning of the statute. In Jones v. Williams "charity" is defined to be "a general public use." See also the case of Thomson v. Shakespear, where Lord Campbell, Knight-Bruce L.J., and Turner L.J. (though in the particular case, and for reasons beside the present controversy, they decide against the validity of the gift) shew what width of interpretation in their view may be applied to the words "charitable use." Thus also "paving, lighting, cleansing and improving a town," have been held to be within the equity of the Statute of Elizabeth and "charitable." To build a house of correction or sessions house is a charitable purpose: Duke, 109, 136; Attorney General v. Heelis. Also to found a botanical garden. A fund for the establishment of lectures against cruelty to animals is a "charitable use." A gift "to the Queen's Chancellor of the Exchequer for the time being, and to be by him appropriated to the benefit and advantage of my beloved country, Great Britain" (Nightingale v. Goulbourn ) is a "charitable purpose": see also Thelluson v. Woodford.

In these and many like cases it appears to me that the distinction between what is charitable in any reasonable sense, and that to which trustees for any lawful and public purpose may be compelled to apply funds committed to their care, has been - I will not say confused - but so mixed that where it becomes necessary to define what is in its ordinary and natural sense "charitable" what is merely public or useful is lost sight of. And, indeed, for the purposes for which the Court was then enforcing the performance of the trusts it is intelligible that such distinctions should be disregarded.

If it is never necessary to distinguish between such heads as "religious," "parochial," "educational," but if all public purposes whatsoever which the law would support and the Court of Chancery enforce are in all statutes to be comprehended within the phrase "charitable," then the question is easily solved; but I do not think any statute or any decision has ever countenanced such a proposition.

It is argued that the phrases "charitable trusts" and "charitable purposes" have always received the same construction in Ireland to which the Act 43 Eliz. does not extend, and that therefore apart from the particular statute it has, so to speak, a technical and legal meaning in the law.

I think the argument is not sound; the statement of fact on which it rests is literally accurate, but misleading, inasmuch as between 43 Eliz. (1601) and 10 Charles 1 (1634) there is very little authority obtainable as to what the views of the Irish Courts were during that interval; and from that date the Irish Act, 10 Charles 1, certainly established what I will call the statutable meaning of those words as applicable to the subject-matter with which it dealt just as much as 43 Eliz. To shew that I am not overstating the identity of the statutes in question in their scope and object, it may be worth while to quote the language of Lord St. Leonards, in the case of the Incorporated Society v. Richards. In delivering judgment as Lord Chancellor of Ireland, he observed:

"I minutely compared the two Acts, placing the charitable uses enumerated in one in juxtaposition with those to be found in the other; and I find very little difference between them. Thus the Statute of Elizabeth speaks of relief to aged, impotent, and poor people; the maintenance of sick and married soldiers and mariners; it enumerates a list of such cases, whilst that of Charles has those comprehensive words 'or for the relief or maintenance of any manner of poor, succourless, distressed, or impotent persons.' It would be difficult to shew that any one of the particular charities set forth in the Act of Elizabeth is not included within those general words. Again the Statute of Elizabeth speaks of 'schools of learning, free schools and scholars of universities;' whilst that of Charles is thus expressed; 'for the erection, maintenance, or support of any college, school, lecture in divinity, or in any of the liberal arts or sciences.' The Act of Charles in this respect goes beyond that of Elizabeth, for the latter does not comprise in words 'the liberal arts and sciences.' Then the Act of Elizabeth recites those gifts which had been or might be made for the repair of bridges, & c.; 'some for repairs of bridges, ports, havens, causeways, churches, seabanks, and highways'; and I find in the Statute of Charles mention made of similar gifts, not as in the other, collected all together, but in different parts; thus:

'for the building, re-edifying, or maintaining in repair of any church, college, school, or hospital';

and in another place,

'for the erection, building, maintenance, or repair of any bridges, causeyes, cashes, paces, and highways, within this realm.'

The Act of Charles also provides 'for the maintenance of any minister and preacher of the Holy Word of God,' which was purposely omitted in the Statute of Elizabeth (Duke, 125). After this the general words of the Act of Charles are, 'or for any other like lawful and charitable use and uses, warranted by the laws of this realm.' The Statute of Charles seems, therefore, an almost exact pattern of the Statute of Elizabeth, and I have but little doubt, that its framers had the latter Act before them at the time they were preparing it."

Then it is said that these exemptions have been allowed for a long period; that is true, but I am not able to assent to the view that the course pursued by the executive officers of the Crown is one which, under the circumstances of this case, could afford any clue to the true construction of the statute.

I do not deny that, in the language of Cockburn C.J.: Feather v. The Queen "where there has been an exposition of the law by judicial decision, or a settled course of practice or understanding of the law among legal practitioners, the language of an instrument" (or of a statute) "may in certain cases be interpreted according to such a standard." Take the case there referred to. I quote from the statement of facts by the Chief Justice (p. 289):

"It certainly appears that at the time this patent was granted a general understanding prevailed, founded on the practice of a long series of years, that if patented inventions were used in any of the departments of the public service the patentee would be remunerated by the ministers or officers of the Crown administering such departments, as though the use had been by private individuals.

There can be no doubt that in numerous instances payments had been made to patentees for the use of patented inventions in the public service without objection or difficulty; and not only does no question appear to have been raised as to the right of the patentees by the ministers of the Crown, but the legal advisers of the Crown appear also to have considered the right, whether arising from the terms of the patent or from the existing practice, as so well settled that we find Sir John Jervis the then Attorney General, on an application for the renewal of the patent of Pettit Smith, before the Judicial Committee of the Privy Council in the year 1852, two years only before the date of this patent, endeavouring to obtain the insertion of a condition that the Crown should have the use of the invention without payment; a course which obviously would have been unnecessary if the Crown had been considered entitled to use the invention without such a provision.

That the same view of the matter has prevailed until the present question was raised in this case and that of Clare v. The Queen which immediately preceded it, is plain, as we find a similar application to that made by the Attorney General in the case of Smith's Patent repeated in the subsequent cases of Carpenter's and Lancaster's Patents, the application for the renewal of the latter having occurred as late as in the last year. There can be little doubt that on the faith of the understanding and practice referred to many inventors have, at a great expense of time and money, perfected and matured inventions and taken out patents in the expectation of deriving a portion of their reward from the adoption of their inventions in the public service."

And yet notwithstanding this they held that the patent would not be construed in pursuance of such a practice. Or to put the limitation a little higher, as it is put by Lord Ellenborough in Isherwood v. Oldknow, "where the general understanding of the law has not been speculative and theoretical, but where it has been made the groundwork and substratum of practice" (such as in the case with which he was dealing) "upon which powers of the character then in debate had been erected and acted upon from the time of Henry VIII. down to 1815."

I think it would be impossible to say that anything in the history of the administration of the Income Tax Act comes up to the standard required, even apart from the history of how the practice of allowing the exemption in debate had grown up.

As a matter of fact we know that the practice is directly in conflict with the opinion given by the law officers of the Crown,

Sir Alexander Cockburn and Lord Westbury, when respectively Attorney and Solicitor General, in the year 1856, who advised that "charitable purposes" were plainly distinguishable from "parochial purposes" in the Income Tax Acts, and accordingly advised against exemptions which certainly in the Court of Chancery would have been considered "charitable." We know also that the origin of the allowance was founded on the opinion of Mr. Fuller, to whom was assigned the duty of superintending the business relating to the claims of charities for exemption in the year 1843.

The opinion given in 1856 does not appear however to have been acted on, since by a letter from the Treasury to the Commissioners of Inland Revenue, dated October 1, 1863, it was laid down that, notwithstanding the opinion of the law officers, the administration of the tax ought not to be altered by a purely administrative authority. All this appears from a Return made to an order of the House of Lords, dated August 3, 1888. But I confess I should regard with very great hesitation any inference derivable from the parliamentary paper in question, except the inference which negatives a universal and adopted practice as expounding the law.

I cannot therefore agree that the statute receives any exposition from the fact that the practice has been such as has been described. I also think the true view of the construction of an Act which is to apply to England, Ireland, and Scotland alike, is, that it ought to be construed according to the canon of construction laid down by the Court of Session in the case of Baird's Trustees v. Lord Advocate. It is a rule which has been acted on, not only in respect of Taxing Acts, but of other enactments. Indeed, it is only part of a general principle of common sense which Mr. Justice Grose laid down in a rating case: R. v. Hogg, "a universal law cannot receive different constructions in different towns." And if (to quote the language of Lord Justice Fry), words construed in their technical sense would produce inequality, and construed in their popular sense would produce equality, you are to choose the latter. I should hesitate very much to qualify this rule of construction by pointing to instances in which inappropriate words had been used in a statute. That, in fact, the language of an Act of Parliament may be founded on some mistake, and that words may be clumsily used, I do not deny. But I do not think it is competent to any Court to proceed upon the assumption that the legislature has made a mistake. Whatever the real fact may be, I think a Court of Law is bound to proceed upon the assumption that the legislature is an ideal person that does not make mistakes. It must be assumed that it has intended what it has said, and I think any other view of the mode in which one must approach the interpretation of a statute, would give authority for an interpretation of the language of an Act of Parliament, which would be attended with the most serious consequences.

I am not satisfied, after fully considering the statutes and decisions which the care of my noble and learned friend, Lord Watson, has collected for our guidance, that the principle of the decision of the Court in the case of Baird's trustees is not quite reconcilable with all of them. That "godly" and "pious" are convertible terms, and may be so treated, is true. And, with reference to the subject-matter of the decisions to which my noble friend has referred, it is to be observed that the supply of education, or the relief of poverty, largely entered into the purpose referred to, and that the question then in debate did not raise the question now before your lordships. In no one of them do I find such a latitude of interpretation of "charitable purposes" as those which I have quoted, as being within the contemplation of the English Court of Chancery "charitable purposes," and they are also open to an observation of a more general character, which I shall have to make presently when dealing with the particular donation now before your lordships for consideration.

In common with the Court of Appeal, I think that the principle laid down by the Court of Session in construing an Act which is to apply to the three kingdoms, is a sound one, though perhaps verbal criticisms may be applied to the language in which it is conveyed. Lord Campbell's observation in the case of Lord Saltoun v. Lord Advocate, I think is the true rule; though even there, perhaps, criticism might be applied to the exact language in which it is expressed.

I cannot concur with the view which has found favour with one of your lordships, that the technicalities which Lord Campbell thought were to be disregarded were not technical expressions in the Act. The word which was in debate was "predecessor," and whether that word was to receive its meaning according to technical application in Scotch law, or its more popular meaning, was the turning point of the case; and it was with reference to the use of that word "predecessor" that Lord Campbell's observations were made. Neither do I think one gets much light from the case of Gordon of Park, where, by the Act of Union itself it was ordained "that the law of treason should be administered as much as possible alike in the two countries." That Act, therefore, recognised that differences did exist, and enacted in somewhat loose phraseology that they were to be administered "as much as possible alike."

I do not find that in any Scottish Act, or in any Scottish decision, "institutions for general public purposes," "protection of animals," "extension of knowledge," "museums," "libraries," or the like, "diffusion of geographical knowledge," "homes for lost dogs," or "anti-vivisection" societies, would be treated in Scotland as the objects of charitable donation, and the argument involves the necessity of establishing, not that there are points in which the English and Scottish use of that word may be similar, or even identical, but that generally, and in the Scotch and English law, they must have practically the same meaning. I should hesitate very much to differ from the Court of Session on that subject, and certainly there is nothing which has been brought before your lordships during the argument which to my mind justified the proposition that the use of the words "charitable purposes" in the Court of Chancery, which, as I have pointed out, comprehends all the above objects, has ever been adopted in the law of Scotland.

I admit the justice of the criticism which suggests that words are sometimes put into an Act ex abundanti cautelâ, and would not therefore rely upon mere redundancy of expression, which I agree may be inserted for securing some particular institution which it is thought might otherwise be deprived of such statutable exemption; but I do not think that the same observation applies to a series of statutes in which "charitable" is distinguished from "public" purpose, or religious, or educational, as indeed is the case in the statute upon which most reliance is placed (16 & 17 Vict. c. 51), where the words are "charitable or public purposes." I do not deny the validity as an argument of the drafting of that clause, which having described the property as subject to a trust for "charitable" or "public" purposes, and having all through the clause spoken of "such" property, finally speaks of it as "the charity" property, a phrase in itself not quite accurate; but I agree that if a question were to arise whether there was the power of securing the amount of duty upon the property, the subject of a trust for "public" or for "charitable" purposes, any Court would construe the words "charity property" as being comprehended within the intended power to charge; but it would be rather upon the construction of the whole section, than that the words themselves import an identity between the words "charitable" and "public."

The fact however remains, that in various statutes the word "charitable" is distinguished by the legislature from "public," "educational," "religious;" and, in no one instance that I have been able to find, do the words run "or other charitable purpose," which one would think would be the natural mode of expressing the meaning now insisted on. One can understand the good sense of the effort to give the widest interpretation to such a phrase as "charitable uses," as in the English and Irish statutes, or the words "pious donations" of the Scottish Statute of 1633. The evil was the same in all three countries, viz.: the misapplication of donations made for the benefit of people who could not be represented by any particular litigant, and whose interests were neglected by the dishonest appropriation of gifts intended for useful, public, or charitable purposes. But such considerations have no application to a Taxing Act. There is no purpose in a Taxing Act but to raise money, and an exemption is just as much within this criticism as any other part of the Act, since every exemption throws an additional burden on the rest of the community.

It is suggested, indeed, that the reason for an exemption may be that the public nature of the interest is that which may justify the exemption. I cannot find any trace of such a principle in the statute, and I do not think it is borne out by decisions where the incidence of rates has been in question. It was undoubtedly thought that property held for public purposes was not rateable; but this is now clearly not the law. It is settled that no such exemption applies: see Mersey Docks v. Cameron; Clyde Navigation Trustees v. Adamson; Commissioners of Leith Harbour and Docks v. Inspector of the Poor.

The construction of a Taxing Act appears to me to present no analogy to the class of Acts, English, Irish, or Scotch, to which I have above referred, and I cannot apply to this Act the principle of construction which those Acts may very justly have received.

To come now to the particular bequests before us, and to the use of the word "charitable" in the particular Act we are construing, I would say, without attempting an exhaustive definition or even description of what may be comprehended within the term "charitable purpose," I conceive that the real ordinary use of the word "charitable" as distinguished from any technicalities whatsoever, always does involve the relief of poverty. No one would doubt what was the meaning of a charity sermon, a charity school, or of a person giving service gratuitously because it was for a charity. And it seems to me that the Court of Appeal did not so much differ with the Lord Chief Justice as to the true exposition of the word involving the relief of poverty, as in the application of the proposition, What would be a relief of poverty? And as to that, I think it would be impossible to give an adequate exposition of what would presumably be in the mind of the Legislature, without regarding the circumstances of the time, and the state of public feeling when the legislation in question was under debate. At a time, for instance, when religious instruction was regarded as being as important as the maintenance of life, then if people were without the means of obtaining religious instruction, one can well understand the principle that to give them the necessary religious instruction, which the argument assumes they would not otherwise be able to obtain, would be in the sense which I have indicated "charitable."

But the difficulty I have in reconciling the decision of the majority of the Court of Appeal with the principle they have laid down is that in the particular gift under debate, purposes appear to be contemplated, having no relation to poverty at all. Take the first case of foreign missions: I suppose the conversion of the wealthiest chieftain to the views of the Moravian Mission would be just as much within the object of the trust as any other purpose.

The Master of the Rolls whilst enlarging the purposes which may be described as charitable, beyond the mere relief of physical necessities, as to which I do not disagree, adds these words:-

"You may desire to convert the richest people, and very often do. If you desire to convert them to your religious opinions, whatever they may be, not on account of their poverty, but because you think it is desirable that their religious views should be like yours that does not come within this canon. A religious object is not necessarily a charitable object within the sense that I have put it."

With that view I entirely concur, and, as I have said, the difficulty I have is in applying such a rule to justify the exemption here claimed. I do not understand how it can be said that this trust is only for a mission to convert simply poor heathens. It seems to me (to use the language of the Master of the Rolls himself) "a mission to convert heathens without regard to their poverty at all." And it is to be remembered that, so far as the property is entitled to exemption, it must not only be applicable to but applied to the charitable purposes in favour of which the exemption is claimed. I think it would be a surprise to the Moravian body itself to find that their missions were either exclusively or substantially applied only to impoverished heathens, and that heathens well off in their own country were beyond the scheme of their missions. To my mind it is obvious that the object of the mission is the propagation of the Moravian tenets among persons whom the Moravian Brethren conceive to be in darkness, and whom they wish to enlighten by the views which they themselves profess, and that the element of poverty, as applicable necessarily to the objects of their efforts, is as much beside the Moravian view as the colour of the converts or the situation of the territory.

That there are some objects which would be charitable objects under these trusts, I do not deny; but the question here argued is whether the funds are all applicable and applied to charitable purposes.

For these reasons I am of opinion that the judgment appealed from ought to be reversed.