LIVINGSTON v COMMISSIONER OF STAMP DUTIES (QUEENSLAND)

107 CLR 411

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(Judgment by: FULLAGAR J)

Between: LIVINGSTON
And: COMMISSIONER OF STAMP DUTIES (QUEENSLAND)

Court:

Judges: Dixon CJ
Fullagar J
Kitto J
Menzies J
Windeyer J

Subject References:
Conflict of laws
Assessment of succession duty
Wife entitled to share in residue under husband's will
Husband's estate not fully administered
Assets in New South Wales and Queensland

Legislative References:
Succession and Probate Duties Act 1892 (Qld) - the Act

Judgment date: 16 December 1960

SYDNEY

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Judgment by:
FULLAGAR J

We have before us appeals from two orders of the Supreme Court of Queensland (Full Court). Those orders were made on appeals by the present appellant against assessments of (1) succession duty, and (2) administration duty, under The Succession and Probate Duties Acts 1892 to 1952 (Q.). Those appeals were by way of petition, and purported to be brought under s. 50 of the Acts. The actual decision of the Supreme Court in each case was that the appeals were not authorized by s. 50, so that the Court had no jurisdiction to deal with them, but the learned judges who constituted the Court (Philp and Wanstall JJ. and Stable A.J.) expressed the opinion that both appeals should fail. The order made in each case was that the appeal be dismissed.

In my opinion both appeals to the Supreme Court were authorized by s. 50, but I will postpone giving my reasons for this view until after I have dealt with the appeals to this Court on the merits. It should be mentioned that, while the amount involved in the appeal as to succession duty is such as to give an appeal to this Court as of right, the amount of administration duty involved is such that special leave is required, but we were all of opinion that special leave should be given.

The essential facts are simple. Hugh Duncan Livingston the elder (who is so described to distinguish him from the appellant, who bears the same name and is his son) died on 17th November 1948. I will refer to him as the testator. By his last will, dated 9th December 1944, the testator appointed his wife, Jocelyn Hilda Livingston, and two other persons as executors and trustees. He bequeathed to his wife the proceeds of certain life policies, and devised and bequeathed the whole of his real estate and the residue of his personal estate (described as his "trust property") to his trustees upon trust (after payment of debts etc) as to one-third thereof for his wife absolutely, and as to the other two-thirds thereof for the maintenance education and advancement of his two sons until they should respectively attain the age of twenty-three years. As I read the will, any balance up to one-third of income in any year was payable to the wife of the testator. Upon each son attaining the age of twenty-three years the testator directed his trustees to "pay and transfer" one-half of the two-thirds of his "trust property" to him. The will made provision for the contingencies of either or both sons dying under the age of twenty-three with or without leaving children. In fact both sons survived him, the elder being aged nineteen years and the younger seventeen years at his death, and both have since attained the age of twenty-three years. The will contained a power to sell any part of the estate and invest the proceeds in trustee securities or pastoral properties, but provided that the trustees should "not be bound to sell" any part of the estate until the younger son should have attained twenty-three years. I do not think it is necessary to consider whether the estate is now held on trust for sale.

The three named executors proved the testator's will in New South Wales in 1949. On 22nd June 1950 the testator's widow married Bruce Thomas Coulson, and became Jocelyn Hilda Coulson. She died intestate on 8th July 1950, she and her husband being killed in the same motor car accident. The material before us does not make it clear whether her next of kin were her husband and her two sons or her two sons alone, but for present purposes this does not matter. At the date of her death the estate of the testator had not been fully administered, and the residue had not been ascertained and could not be ascertained. In other words, it was not possible to predicate of any asset or assets that it or they formed part of the residue of the estate.

The testator was at all material times resident and domiciled in New South Wales. Mrs. Coulson and the other executors of his will were also at all material times resident and domiciled in New South Wales, and the place of administration of his estate was New South Wales. His estate comprised large assets situate in New South Wales, and also large assets situate in Queensland. The assets in Queensland were (1) certain freehold and leasehold land, on which he carried on a grazing business, and the stock and plant thereon, (2) an interest in a partnership with four other persons, which carried on a grazing business with stock and plant on certain leasehold land known as Maranoa Downs, and (3) an undivided one-fourth interest as tenant in common in certain other freehold and leasehold land. It has never been disputed that these assets must, for duty purposes, be regarded as having their local situation in Queensland. The first and third were immovables in fact situate in Queensland, and, with regard to the second, the well-settled general rule is that an interest in a partnership must be treated as locally situate at the place, or the principal place, where the partnership business is carried on: see, e.g., Stamp Duties Commissioner v Salting. ^[F30] What is now in question is not the liability of the testator's estate to Queensland succession or administration duty in respect of these assets in Queensland, but the liability of Mrs. Coulson's estate to those duties in respect of her interest in the testator's residuary estate under his will.

It is, I think, of great importance in this case to state with precision the question or questions on which the liability of Mrs. Coulson's next of kin to each of the two duties depends. For this purpose, it is not necessary to examine in detail the provisions of the relevant Queensland legislation, but it is necessary to state the main provisions of The Succession and Probate Duties Acts and to consider their scope.

The original Queensland Act of 1892, so far as succession duty is concerned, followed, in its essential features, the English Act of 1853. Section 3 provides that the term "property" includes real property and personal property. "Real property" is defined as including "all freehold, leasehold and other hereditaments in Queensland", and all estates in any such hereditaments. "Personal property" includes all property not comprised in the definition of real property. Section 4, so far as material, provides that every disposition of property by reason of which any person shall become beneficially entitled to any property upon the death of any person and every devolution by law of any beneficial interest in property shall be deemed to confer on the person entitled by reason of such disposition or devolution a "succession". The term "successor" denotes the person so entitled, and the person from whom the succession is derived is called the "predecessor". The section which imposes succession duty is s. 12, which provides that "There shall be levied and paid to His Majesty in respect of every such succession as aforesaid, according to the value thereof at the time when the succession takes effect, the following duties." Then follows a graduated scale of rates. Administration duty is imposed by s. 55, which, so far as material, provides that "there shall be paid, in respect of every grant of probate or letters of administration made in respect of the estate of any person dying ... duties at the rates mentioned in the Schedule to this Act." The Schedule provides (subject to certain exemptions) for duty at a flat rate of 1 per cent.

So far as what has been called in this case "administration duty" -the duty imposed by s. 55-is concerned, there is no difficulty in stating the question upon which the liability of Mrs. Coulson's next of kin depends. That duty belongs to a well-known class of death duties. It is a true "probate duty". It is payable, in effect, as the price of a grant of probate or letters of administration. It is well settled that such a duty is, unless a contrary intention appears payable in respect of, and only in respect of, assets which cannot be administered by an executor or administrator without the grant which he seeks. That is to say, it is payable in respect of, and only in respect of, assets locally situate within the territorial jurisdiction: see Blackwood v The Queen ^[F31] and Commissioner of Stamps v Hope. ^[F32] The liability of Mrs. Coulson's next of kin to "administration duty" depends, therefore, on whether her estate comprised assets locally situate in Queensland.

With regard to succession duty, the position is not quite so simple. The original Queensland Act of 1892 made it quite plain that the charge fell on successions to real property which was situate within the territorial jurisdiction, but not on successions to real property which was outside that jurisdiction: see the definition of real property in s. 2. But neither Act contained any express definition or limitation of the successions to personal property which were to be chargeable with duty. In England the question of what successions to personal property were chargeable under the English Act of 1853 came before Lord Cranworth L.C. in Wallace v Attorney-General. ^[F33] His Lordship held that succession duty was not chargeable in respect of the personal property in England of a testator domiciled in France. In holding that the question in every case of personal property, was "not where the property was situate but what was the domicile of the testator", his Lordship followed an earlier decision of the House of Lords in Thomson v Advocate-General, ^[F34] which was a case of legacy duty. He said: "Parliament has, no doubt, the power of taxing the succession of foreigners to their personal property in this country; but I can hardly think we ought to presume such an intention, unless it is clearly stated". ^[F35] Lord Cranworth's decision was applied by the Privy Council to the Queensland Act of 1892 in Harding v Commissioners of Stamps for Queensland. ^[F36] The property there in question included debts secured by mortgages of land in Queensland, freehold and leasehold lands in Queensland, and shares in a company incorporated in Queensland, but the testator was domiciled in Victoria. It was held that the Queensland Act did not extend to personal property given by the will, or devolving on the intestacy, of a person domiciled outside Queensland, whether that property were locally situate in Queensland or not.

If the matter had stopped there, it would seem that on no view of the nature of Mrs. Coulson's "interest" in the residue of the testator's estate could the succession to it have been charged with duty in respect of his interest in the partnership. For, whatever might have been the position in relation to the testator's freehold and leasehold lands, which were real property within the meaning of the Act, his interest in the partnership was personal property, and Mrs. Coulson was not domiciled in Queensland. However, in 1895 the Queensland Parliament passed an amending Act, s. 2 of which provided: "It is hereby declared that succession duty is chargeable in respect of all property within Queensland, although the testator or intestate may not have had his domicile in Queensland." This Act had in fact been passed before Harding's Case ^[F37] came before their Lordships, but the testator had died before its commencement. It was argued for the Crown that it was retrospective in operation, but this argument was rejected. If we disregard the curious fact that it does not appear to refer to successions under settlements, the effect of s. 2 of the Act of 1895, read with s. 4 of the original Act, seems to be, so far as presently material, that the duty falls, irrespective of the domicile of a testator or intestate, on successions to interests in real or personal property which are locally situate in Queensland. It is unnecessary to consider whether it falls also on interests, wherever situate, in the personal property of a testator or intestate who was domiciled in Queensland.

It seems clear, therefore, that, as a result of s. 2 of the Act of 1895, the question upon which the liability of Mrs. Coulson's next of kin to succession duty depends is the same question as that on which their liability to administration duty depends. That question is whether her estate comprised assets locally situate in Queensland. The answer to that question is, in my opinion, determined by clear authority.

It is a commonplace that the law must, for a variety of purposes, attribute a locality to rights which cannot naturally be said to have any local situation. It has very frequently had to do this in relation to death duties, and especially probate duties. Everyday examples are shares in companies, shares in partnerships, mortgage debts. In most cases rules have now been laid down and are well established. It would probably be going too far to say that there is any general principle of law to be discerned in these attributions of local situation. From the very nature of things, such attributions must be in some degree artificial or conventional, and general rules must be modified to meet special cases: it is interesting to compare Attorney-General v Higgins ^[F38] with Brassard v Smith. ^[F39] But, when faced with a question of the locality of a right, the courts have examined the nature of the particular right, and have generally localized it in the place where it must be exercised or enforced, or would normally and naturally be exercised or enforced. Thus a simple contract debt is held to be situate where the debtor resides. Proceeding on this basis, the courts have consistently held in a large number of cases that the right of a residuary legatee or next of kin, before the administration of the estate is complete, is a right against the executors or administrators to have the estate duly administered, and the residue ascertained and disposed of according to the will or according to law. From the nature of the right it follows that it must be treated as situate in the place of administration, or the principal place of administration, of that estate-the place where the executors are, and where they must, or most naturally would, be sued. The locality, natural or artificially ascribed, of the assets comprising the estate is immaterial.

So much is, I think, quite clear. I should have preferred to state the rule in much wider terms, for logically I think that all equitable estates and interests should be held, whenever it is necessary to attribute locality to them, to be locally situate in the place of administration of the trust: see Re Cigala's Settlement Trusts, ^[F40] and Dicey, Conflict of Laws, 7th ed. (1958) p. 508. But, as the authorities stand, I do not think it is possible to state the rule in wider terms. If the view of Lord Summer and Lord Blanesburgh in Baker v Archer-Shee ^[F41] (to which I shall refer later) had prevailed, what I cannot help regarding as anomalies would have been avoided. It may be that applications in later cases of the view of the majority in that case have been based on a misunderstanding of that view, but the fact is that since the decision in that case unsatisfactory distinctions have been drawn between cases where an estate is "fully administered" and cases where it is not, and, in the former class of case, between cases where there is a single beneficiary and cases where two or more beneficiaries are entitled to shares: see, e.g., Stannus v Commissioner of Stamp Duties. ^[F42] There is, however, no occasion now for considering whether these distinctions are sound or unsound. For the rule, as I have narrowly stated it, appears to have been universally accepted, and the present case falls within it. I proceed to consider some of the numerous authorities.

The case of Re Ewing ^[F43] was not a duty case, but a case of an application for probate in England. The headnote to the report is unsatisfactory. William Ewing was at the date of his death entitled to PD10,000 under the will of his uncle, John Orr Ewing, and was also entitled to one-sixth of the residue of his deceased uncle's estate, which was in course of administration by executors in Scotland. Unless this interest in his uncle's estate was an English asset, William Ewing had only trifling assets in England. Sir James Hannen held that that interest was not an English asset. On this question he said: "It is not disputed that the deceased, J. O. Ewing, was a domiciled Scotchman, and that his will was properly proved in Scotland, and is being administered there in accordance with Scotch law. The claim of the executors of W. Ewing in respect of the interest of their testator under his uncle's will, is a claim on the executors of the uncle duly to administer his estate and to pay the legacy to W. Ewing out of the funds which may be applicable to that purpose. It cannot be disputed that this claim or interest in the estate of the uncle constitutes an asset of the estate of the deceased W. Ewing, because it is recoverable by the executors of W. Ewing virtute officii, but it appears to me that it is an asset in Scotland and not in England.". ^[F44] It may be noted that in Ewing's Case ^[F45] the principal asset of John Orr Ewing's estate was in fact situate in Scotland, but Sir James Hannen did not base his opinion on this fact, or regard it as relevant.

In Lord Sudeley v Attorney-General ^[F46] which must be regarded as the leading case on the subject, a question of liability to English probate duty arose. The duty was imposed by s. 27 of the Customs and Inland Revenue Act 1881 on "the estate and effects for or in respect of which the probate or letters of administration is or are to be granted". This meant, of course, estate and effects situate in England. The essential facts were these. A by his will gave to his wife one-fourth of the residue of his estate. He died on 16th January 1892, domiciled in England. His executors were in England, and proved his will in England. The wife died on 15th April 1893, while the estate was in course of administration. Included in the assets of A's estate were certain large sums owing (presumably) by persons resident in New Zealand, and secured by mortgages of land in New Zealand. The Crown claimed probate duty in respect of these mortgage debts. The whole question in the case was as to the local situation of the interest of the wife at her death in A's estate, but that question was approached by way of an examination of the nature of the wife's interest in A's estate. The mortgage debts were situate in New Zealand, but it was held by a majority of the Court of Appeal and a unanimous House of Lords that the right of the wife's executors was not to any share of the mortgage debts, but a right as against A's executors, who were in England, to have the estate administered and to receive from them in due course a fourth part of the residue. It followed that the asset in question was situate in England, and probate duty was payable.

I will cite only one passage from Sudeley's Case, ^[F47] and that is from the speech of Lord Herschell. His Lordship said "In truth, the right she had was to require the executors of her husband to administer his estate completely, and she had an interest to the extent of one-fourth in what should prove to be the residuary estate of the testator, Algernon Tollemache. Well, where was that situate? It seems to me that it can only be said to have been situate in this country". ^[F48] Sudeley's Case ^[F49] is the converse of the present case, but, in my opinion, it governs the present case. It may be thought that there are passages in it which go beyond the necessities of the case and deny too much. Probably no one would deny that Mrs. Coulson here had an "equitable interest" in the entire mass of the testator's estate, and some may think it follows that she had an equitable interest in every part of that mass. We may call it a proprietary interest, if we wish, or equity may call it "property" (Smith v Layh ^[F50] ), but whether it should have this dignity conferred upon it seems to me to be little more than a matter of "words and names", capable of leading to the kind of strife which moved Gallio to say that he "cared for none of these things". To say that Mrs. Coulson had an equitable interest in the estate is to say something that requires explanation and analysis, and the explanation is given, and the nature of the "interest" analysed, in Sudeley's Case. ^[F51] It is a single interest which is localized at the death of the testator, and cannot change its locality as investments are bought and sold in the course of administration.

Sudeley's Case ^[F52] has been followed and applied in a large number of reported cases, and has doubtless been acted upon in very many other cases. In In re Smyth ^[F53] a testator, resident and domiciled in England, gave real and personal property in Jamaica to trustees upon trust for certain persons for their lives, and after the death of all of them upon trust to sell and divide the proceeds between certain other persons. The trustees of the will were resident and domiciled in England and one of them proved the testator's will in England. One of the persons entitled in remainder died while persons entitled for life were still living. The question arose whether English probate duty was payable in respect of his interest under the testator's will. It was held by Romer J. that that interest was situate in England, and that probate duty was payable upon it. I will quote at some length from the judgment-partly because it disposes of the relevance of the argument that in some conceivable circumstances a suit might have been brought by Mrs. Coulson in a Queensland forum in respect of the testator's Queensland property. Romer J. said: "The right of the legatee as against the trustee was only to have the trusts of the will administered. Administered where? The testator was domiciled in England, his will was proved in England, his trustee was in England, and the money recoverable would in the ordinary and proper course be brought to England. The trustee could only be properly and in the ordinary course sued in the English Court by the legatee, who was in England. ... It was suggested as against the Crown that possibly under some circumstances an action might have been brought by the legatee to enforce his rights in Jamaica. I am bound to say that at present I do not see what action could have been properly brought there. But even admitting that under some conceivable circumstances or change of circumstances some action might have been brought there, the question is not in what place under extraordinary circumstances an action might be brought, but what place under existing circumstances was the natural and proper one in which the legatee should enforce his rights-in other words, what was the proper forum for deciding upon the legatee's claim; and the answer to this clearly is that the forum was English." ^[F54] .

The same principle was applied in Attorney-General v Johnson: ^[F55] see especially what was said by Bray J., ^[F56] and cf. what was said by Russell J. (as he then was) in Favorke v Steinkopf. ^[F57] These were both cases in which the local situation of an asset was in question. A question as to succession duty in similar circumstances arose in the Canadian case of Minister of National Revenue v Fitzgerald. ^[F58] The facts of this case were somewhat complicated, because there were successive devolutions of interests in estates in course of administration. The relevant physical assets in question were in British Columbia, and the relevant administrations were in California. It was held by the Exchequer Court and the Supreme Court of Canada that the situs of the interests in question was California, and that succession duty was not chargeable under a statute which defined "succession" in the same terms as does the Queensland Act. In New Zealand Sudeley's Case ^[F59] was applied, after an exhaustive examination of the authorities, by Northcroft J. and the Court of Appeal in Stannus v Commissioner of Stamp Duties: ^[F60] see especially the judgment of Callan J.

Apart from cases which are concerned with the local situation of such interests, there are many cases in which the exposition in Sudeley's Case ^[F61] of the nature of such interests has been accepted without question. It was expressly accepted and acted upon by a House consisting of Viscount Finlay, Viscount Cave, Lord Atkinson and Lord Sumner in Barnardo's Homes v Special Income Tax Commissioners. ^[F62] It was treated as clear authority in Glenn v Commissioner of Land Tax ^[F63] per Griffith C.J., ^[F64] per Isaacs J. ^[F65] . In In re Rowe, ^[F66] Dixon A.J. (as he then was) said of a person in the position of Mrs. Coulson's next of kin: ^[F67] "He is entitled to have the assets applied in due course of administration: but he is not entitled to a legal or equitable interest in any specific asset. ... His position is not dissimilar to that of a residuary legatee, of which, in Barnardo's Homes v Special Income Tax Commissioners, ^[F68] Viscount Cave said- ^[F69] `When the personal estate of a testator has been fully administered by his executors and the net residue ascertained, the residuary legatee is entitled to have the residue as so ascertained, with any accrued income, transferred and paid to him; but until that time he has no property in any specific investment forming part of the estate or in the income from any such investment, and both corpus and income are the property of the executors and are applicable by them as a mixed fund for the purposes of administration. This was fully explained in Lord Sudeley v Attorney-General ^[F70] "'. In Watt's Case ^[F71] Knox C.J. and Gavan Duffy J. said in a joint judgment: "The interest of the deceased under the settlement was not an interest in the specific property in which the trust funds were for the time being invested, but a right to call on the trustees of the settlement to account to him as a beneficiary under the settlement. The trustees were resident in New South Wales and not elsewhere, and the interest of the testator was a chose in action enforceable by action against the trustees. The Courts of New South Wales were the proper forum for the enforcement by the deceased or by his representatives of his claim as a beneficiary, and his interest under the settlement was, therefore a New South Wales asset". ^[F72] See also Horton v Jones ^[F73] (where the interest in question was held to be an "interest" in land within the meaning of the Statute of Frauds), Pagels v MacDonald, ^[F74] Robertson v Commissioner of Land Tax, ^[F75] MacKinnon v Campbell ^[F76] (a decision of Roper J.) Young v Commissioner of Stamp Duties, ^[F77] and Re Young. ^[F78]

The two Archer-Shee Cases-Baker v Archer-Shee ^[F79] (to which I have already referred) and Archer-Shee v Garland ^[F80] - require special mention. They were income tax cases, and it is unnecessary to refer to the facts or the complex statutory provisions involved. In the earlier case the majority of their Lordships fully accepted Sudeley's Case, ^[F81] but considered that it was not applicable because in the case before them the estate had been "fully administered" and a "definite and specific trust fund" constituted, to the income of which Lady Archer-Shee was entitled. Lord Sumner and Lord Blanesburgh dissented. In their opinion it could make no difference whether the estate was or was not, at the material time, "fully administered". In their judgments is to be found a very clear exposition of what was really decided by Sudeley's Case, ^[F82] and I will quote Lord Sumner. His Lordship said: "Again the case of Lord Sudeley v Attorney-General ^[F83] is said by Sargant L.J. to be in its general reasoning precisely applicable. The points referred to there were, first, the local situation, for the purposes of English taxation, of an equitable right to have an estate administered, in which the testatrix was interested as a residuary legatee at the time of her death, and, second, the question, whether for such taxation her interest was to be deemed to be confined to a specified fraction of the residuary estate, corresponding to her share under her husband's will, or extended to the whole of that residuary estate. In applying this to the present case the learned Lord Justice says, that Lady Archer-Shee has not any specific right to any particular item of income, but, following Lord Herschell's reasoning, only an equitable right to have handed over to her the net income of the estate, subject to all proper deductions, which right of hers is a form of property situate in New York, in whose Courts it would have to be asserted. I think the reasoning of this judgment is correct. It is immaterial that in Lord Sudeley's Case ^[F84] the estate of the husband of the testatrix had not yet been administered, whereas here, no doubt, this has been long ago accomplished." ^[F85] . Cf. what was said by Lord Blanesburgh. ^[F86] In an article in the Law Quarterly Review entitled A Menace to Equitable Principles ((1928) 44 L.Q.R. 468) Hanbury commended strongly the dissenting judgments as upholding "Maitland's position", which "could not be too strongly established": see in this connection Maitland's refutation of Austin in his ninth lecture.

Baker v Archer-Shee ^[F87] was decided by the majority on the assumption that the law of New York was, in the absence of evidence to the contrary, the same as the law of England. In Archer-Shee v Garland, ^[F88] where an assessment of a later year was in question, evidence was called which was regarded as establishing that the law of New York was in accordance with what Lord Sumner and Lord Blanesburgh had thought to be the law of England; and the income in question was held not to be taxable. (It is rather surprising that the law of New York should differ from the law of England on such a subject.) The actual decision in the earlier case does not, of course, affect the present case, where the testator's estate was at Mrs. Coulson's death still in course of administration.

The Commissioner relied on the case of Skinner v Attorney-General. ^[F89] But that case does not appear to me to help him. The facts were simple. A died in 1923, domiciled in Northern Ireland, having by his will bequeathed to his wife an annuity charged on all his residuary estate. His wife died in 1936. At his death his estate consisted almost entirely of assets in Northern Ireland and the United States. Between the date of his death and the date of his wife's death his executors purchased a number of English securities, but the estate was not at the date of the wife's death fully administered. The Commissioner claimed estate duty from the wife's executors in respect of the English securities. The claim was made under ss. 1 and 2 (1) (b) of the Finance Act 1894. Section 1 provided that the duty should be payable on the value of "all property, real or personal, which passes on the death of" a person. If s. 1 had stood alone, one would have thought that it did not touch the case, but s. 2 (1) (b) provided that "Property passing on the death of the deceased shall be deemed to include property in which the deceased ... had an interest ceasing on the death of the deceased". It was held that the wife had, within the meaning of s. 2 (1) (b), an interest in the English assets of her husband's estate, and that interest ceased, of course, on her death, when the annuity ceased to be payable. That is all that Skinner's Case ^[F90] decided. Referring to Sudeley's Case, ^[F91] Lord Russell of Killowen said: "The whole point of the decision was that the widow did not own any part of the mortgages." (In the present case the widow did not own anything in Queensland.) "As Lord Herschell pointed out in his speech the whole fallacy of the argument of the widow's executors rested on the assumption that she or they were entitled to any part of the mortgages as an asset-she in her own right or they as executors. `I do not think', he said, `that they have any estate, right, or interest, legal or equitable, in these New Zealand mortgages, so as to make them an asset of her estate.' My Lords, I emphasize the last ten words of that sentence, which show clearly that the interest which was being repudiated was a proprietary interest". ^[F92]

In Skinner's Case ^[F93] the question was simply: was there an "interest" in property within the meaning of s. 2 (1) (b) of the Finance Act? If there was, that was an end of the matter. The question whether that interest was an asset in the wife's estate was wholly irrelevant. Indeed, since it ceased with her death, it could not be an asset in her estate, and no question could arise as to its character or local situation. In Sudeley's Case, ^[F94] on the other hand, the wife's estate could only escape liability to duty by establishing not merely an interest in a general fluctuating mass of assets but a proprietary interest in specific asset in New Zealand. The idea that she had such a proprietary interest in any specific asset was the idea which was "repudiated". In the present case it is on that repudiated idea that the Commissioner in Queensland must rely. He must establish not merely an interest in the general mass, but a proprietary interest in specific assets in Queensland as distinct from a proprietary interest in specific assets in New South Wales. This case is like Sudeley's Case ^[F95] and unlike Skinner's Case ^[F96] in that we are here concerned with the question whether Mrs. Coulson had such an interest in specific property in Queensland as to constitute an asset of her estate.

In Minister of National Revenue v Fitzgerald ^[F97] Kerwin J., after quoting from Lord Russell's speech in Skinner's Case, ^[F98] said: "These extracts from Lord Russell's speech indicate the difference between the Skinner case, on the one hand, and the Sudeley case and the present one, on the other. Here, we are not dealing with a statute imposing a tax on the passing of property in which a deceased had an interest, ceasing on his death, but with one which imposes a tax upon a succession to property situate in Canada. ... All that devolved ... was a right to have the estate of Bonnie Steed administered; and that right was a chose in action properly enforceable and therefore situate in California and not in Canada." In the same case Kellock J. quoted the following passage from the judgment of Lopes L.J. in Sudeley's Case: ^[F99] "`The right of the executors of Frances [the widow and residuary legatee of the testator] as against the executors of her husband is a right to have his estate administered. Administered where? The husband was domiciled in England, his will was proved in England, his executors are in England, and his estate is being administered in England, and the money recoverable will be brought to England. The executors of the husband can only be sued in the English Courts by the executors of Frances. It is an English chose in action, recoverable in England, and is, in my opinion, an English and not a foreign asset."' The judgment of Lopes L.J. was approved in the House of Lords.

I must refer briefly in conclusion to the case of McCaughey v Commissioner of Stamp Duties. ^[F100] In this case Jordan C.J., delivering the judgment of himself and Halse Rogers and Roper JJ., expressed strong disapproval of Sudeley's Case, ^[F101] regarding it as inconsistent with the decision of the House of Lords in Cooper v Cooper. ^[F102] His Honour said: "Had not both cases been decisions of the House of Lords, one or other would have long been overruled, and that, I venture to think, would have been Lord Sudeley v Attorney-General. ^[F103] The idea that beneficiaries in an unadministered or partially administered estate have no beneficial interest in the items which go to make up the estate is repugnant to elementary and fundamental principles of equity." ^[F104] The Court nevertheless, the estate having been "fully administered", applied Sudeley's Case ^[F105] as it understood that case to have been qualified by Baker v Archer-Shee, ^[F106] and, with the greatest respect, I am unable to see a sound reason for this assault upon a case which is, to my mind, especially after reading the opinions of Lord Sumner and Lord Blanesburgh in Baker v Archer-Shee, ^[F107] sinned against rather than sinning. One may say with respect, as I have said, that there may be passages in Sudeley's Case ^[F108] which deny too much, but I would not regard that case as deciding that "beneficiaries in an unadministered or partially administered estate have no beneficial interest in the items which go to make up the estate". What it does is simply to explain the nature of the interest of such beneficiaries, and to attribute a local situation to it accordingly. Younger J. (as he then was) in Vanneck v Benham, ^[F109] has reconciled Cooper v Cooper ^[F110] with Sudeley's Case, ^[F111] if they needed reconciling.

It remains only to explain why I think that an appeal lay to the Supreme Court of Queensland under s. 50 of the Queensland Act.

Section 43 makes the succession duty "a debt due to the Crown from the successor" and "a first charge on the interest of the successor". Section 46 provides that certain other persons, in addition to the successor, "shall be personally accountable" for the succession duty. Section 47 authorizes the Commissioner to assess the succession duty, and he did in fact make an assessment of that duty in this case. Section 50 provides that "any accountable party dissatisfied with the assessment of the Commissioner" may appeal to the Supreme Court. Jurisdiction is then given to the Court to hear and determine the appeal, and the section proceeds: "The costs of any such appeal shall be in the discretion of such court or judge, having regard to the extent to which the Commissioner's assessment exceeds the amount admitted by the appellant before the appeal commenced and the extent to which the Commissioner's assessment is upheld or varied."

It was argued that s. 50 does not authorize an appeal based (as the appeal to the Supreme Court in this case was) on the contention that the appellant is not an accountable party at all because no succession duty is exigible. The right is given, it is said, only where liability is admitted and the only issue is as to amount. The argument is, of course, supported by reference to the last paragraph of s. 50, which I have quoted above. But I am not able to accept the argument. Its acceptance would create an absurd position, and in the construction of a statute an absurd result is to be avoided if possible. I can see no real difficulty in reading "any accountable party" as meaning "any party made accountable by the assessment". A person assessed to duty is an "accountable party" unless and until he upsets the assessment on appeal: see s. 56A (2) (i) (a) and (b). And the last paragraph is not literally incapable of application to a case where the Commissioner's assessment exceeds, to the extent of the whole amount of the assessment, the "amount admitted by the appellant". Even if it were incapable of such an application, the meaning of the section cannot be controlled by making an assumption that the last paragraph was intended to be applicable to every possible case.

With regard to administration duty, the difficulty up to 1935 was that the appeal which s. 50 gives is an appeal against an assessment, and, although s. 47A (which was not introduced until 1918) refers to "any assessment of succession or probate duty", no express power to make an assessment of the latter duty was given to the Commissioner. This position, however, was remedied in 1935 - presumably in consequence of the decision of the Full Court in Re Guest. ^[F112] Section 2 of the Act of 1935 (which was retrospective) gave to the Commissioner express power to make an assessment of administration duty whether or not a grant of probate or letters of administration be sought or made. An assessment was in fact made in the present case. In the light of that provision, I can see no sufficient reason for reading s. 50 as giving the right of appeal only in respect of succession duty.

Both appeals should, in my opinion, be allowed.