HIGH COURT OF AUSTRALIA

Re SILK, deceased; EQUITY TRUSTEES, EXECUTORS & AGENCY CO LTD v COMMISSIONER OF PROBATE DUTIES

GIBBS, Stephen, Mason, Jacobs and MURPHY JJ

16 October 1975 - Melbourne 25 June 1976 - Sydney

Murphy J The case arises under the Probate Duty Act 1962 (Vic) which was a consolidating and amending measure.

The legislative intention was unquestionably to overcome various devices for avoiding or minimizing death duty by reducing the value of the estate at death. The Act includes as notional estate property which would not form part of the actual estate although control of it could be retained up until death.

The case does not come within s 7(1)(f) of the Act. Assuming that the relevant provisions of the deceased husband ' s will constituted (within the meaning of the Act) a general power of appointment to the deceased wife, this was to be exercised in her lifetime. It did not exist at the time of her death.

The case does come within s 7(1)(j) . Immediately before her death, the deceased was competent to dispose of the relevant property. Section 7(1)(j) extends to property not owned by the deceased and comprehends a disposition to or in favour of the deceased. It is not concerned only with a power to dispose other than to the deceased. The Act imposes duties on the actual or notional estate of a deceased, and the inclusion of property which the deceased could dispose of in favour of herself is consistent with the general legislative intention. This is obviously the purpose of s 7(1)(j) , which includes property which was available to the deceased right up to the time of her death upon a mere request in writing. In a sense, it was like " money in the bank " for the deceased during her lifetime, but not upon her death. Contrary to the argument put, it would be difficult to attribute to the legislature an intention to include within the estate property belonging to someone else which the deceased could dispose of only to another during her lifetime. If no advantage could flow to the deceased during her lifetime from such a disposition and it was not disposable by her will, the inclusion of the property in her estate would not fit into the general intention disclosed by the Act.

In my view, the fact that the money could not be paid instantaneously upon her request does not detract from the operation of the provision. This aspect was dealt with well by Lush J in the Supreme Court.

The appeal should be dismissed.