Trustees of Sir Howell Jones Williams' Trusts v. Inland Revenue Commissioners

[1947] 1 All ER 513

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(Judgment by: Lord Normand)

Between: Trustees of Sir Howell Jones Williams' Trusts
And: Inland Revenue Commissioners

Court:

Judges: Viscount Simon
Lord Wright
Lord Porter
Lord Simonds

Lord Normand

Subject References:
taxation
trusts
Income Tax
Exemption
Charity
Trust to maintain institute in London to give social, educational and other amenities to Welsh people or people connected with Wales
Trust property comprising houses
Direction to trustees to apply rents and profits from settled properties to carrying on institute and maintaining properties
Rents and properties so applied
Whether trust for charitable purposes
Whether moneys applied for charitable purposes only
Charities
Charitable trusts
Charitable purposes
Trust to maintain institute to give social educational etc, amenities to Welsh people

Legislative References:
Income Tax Act, 1918 (c 40) - s 37(1)(a); sched A

Case References:
Income Tax Special Purposes Comrs v Pemsel - [1891] AC 531; 61 LJQB 265; 65 LT 621; 55 JP 805; 3 Tax Cas 53; 8 Digest 241, 1
Re Macduff, Macduff v Macduff - [1896] 2 Ch 451; 65 LJCh 700; 74 LT 706; 8 Digest 296, 731
A-G v National Provincial and Union Bank of England - [1924] AC 262; sub nom Re Tetley, A-G v National Provincial and Union Bank of England; 93 LJCh 231; 131 LT 34; HL, affg, SC, sub nom Re Tetley, National Provincial and Union Bank of England Ltd v Tetley; [1923] 1 Ch 258, CA
Houston v Burns - [1918] AC 337; 87 LJPC 99; 118 LT 462; 8 Digest 297, 739
Dolan v MacDermot - (1867), LR 5 Eq 60; (1868), LR 3 Ch App 676, LC; 8 Digest 298, 751
Dunne v Byrne - [1912] AC 407; 81 LJPC 202; 106 LT 394; 8 Digest 294, 718
Baker v Sutton - (1836), 1 Keen, 224; 5 LJCh 264; 8 Digest 298, 750
Farley v Westminster Bank - [1939] 3 All ER 491; [1939] AC 430; 108 LJPC 307; 161 LT 103
Verge v Somerville - [1924] AC 496; 131 LT 107; sub nom, Verge v Somerville, A-G for Australia v Somerville; 93 LJPC 173; Digest Supp
Keren Kayemeth Le Jisrael Ltd v Inland Revenue Comrs - [1932] AC 650; 101 LJKB 459; 147 LT 161; 17 Tax Cas 27; Digest Supp
Re Grove-Grady, Plowden v Lawrence - [1929] 1 Ch 557; 98 LJCh 261; 140 LT 659, CA; varied on appeal, sub nom A-G v Plowden; [1931] WN 89; 171 LTJo 308, HL; Digest Supp
Re Smith, Public Trustee v Smith - [1932] 1 Ch 153; 100 LJCh 409; 146 LT 145; Digest Supp
Goodman v Saltash Corpn - (1882), 7 App Cas 633; 52 LJQB 193; 48 LT 239; 47 JP 276; HL, revsg, SC, sub nom Saltash Corpn v Goodman; (1881), 7 QBD 106, CA; 8 Digest 327, 1099
Inland Revenue Comrs v Falkirk Temperance Cafe Trust - 1927 SC 261; 11 Tax Cas 353; Digest Supp

Hearing date: 28, 30 January 1947
Judgment date: 21 March 1947

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Judgment by:
Lord Normand

I respectfully agree with my noble and learned friend, Lord Simonds. Discordant decisions have resulted from the occasional failure to keep in mind the two propositions which my Lord has now re-asserted and from the tacit assumption that all trusts beneficial to the public at large or to some section of it are entitled by a benevolent construction to the special privileges of charitable trusts. Yet the line between charitable and non-charitable trusts is sometimes difficult to draw, even when correct principles are applied, particularly where the claim is made that the trust is charitable because its purpose is the furtherance of the moral improvement of the community. The decision in Inland Revenue v Falkirk Temperance Cafe Trust, a case which has some resemblance to the present, must, I think, rest on the ground that the predominant purpose of the trust was the moral improvement by means of temperance of the inhabitants of Falkirk and that the cafes and temperance hotel provided by the trust were so subordinated to the predominant purpose that it was possible to distinguish them from an ordinary commercial venture in catering and hotel-keeping. In the present case the decision of the commissioners was that, while certain features of the institute conformed to the idea of charity, they were not so dominating nor was the general character of the institute such as effectively to distinguish it from an ordinary social club. In my opinion, this conclusion is amply supported by the facts and is well founded in law.