DEATH DUTIES ASSESSMENT

Press, Volume XCIX, Issue 29233, 17 June 1960, Page 14

DEATH DUTIES ASSESSMENT

Commissioner’s Appeal Fails

(New zeaiuna Press Association) WELLINGTON, June 16.

An appeal by the Commissioner of Inland Revenue against a Supreme Court judgment disallowing an assessment for death duties of benefits under a staff superannuation scheme was dismissed by the Court of Appeal in a judgment delivered today. The Court comprised Mr Justice K. M. Gresson, Mr Justice Cleary, and Mr Justice Hutchisdn. Mr D. R. Wood appeared for the commissioner, and Mr C. P. Richmond for the respondents, David Thomas Athol Burt, a company manager, of Wellington, and William Gaitt Clavis, a solicitor, of Whakatane, as administrators of the estate of Ernest Blakely Brown, a company manager, of Whakatane. Brown at the time of his death was general manager of Whakatane Paper Mills, Ltd., which set up a superannuation scheme. The scheme was a non-contributory one, the only contributions being made by the employer at the rate of 10 per cent, of the salary of each employee who became a member of the scheme. The scheme required that the employer’s contributions in respect of each member should be applied in the first place to the payment of premiums to effect a temporary insurance policy. Under this policy the trustees received sums of £lOOO and £21,777 12s, which were paid to Brown’s son and daughter. Court’s Finding

“The question is whether the deceased can be said to have purchased or provided the benefits in consent or by arrangement with his employers,” the Court’s judgment said. “The benefits came wholly from the application of funds contributed solely by the deceased’s employers, and prima facie it is they who would appear to have purchased the policies and provided the benefits. "In this case it cannot be said that in any sense the insurance policies were “purchased or provided” by the deceased, who did no more than acquiesce in a trust towards the creation of which he is not shown to have done anything, which did not result from any contract with him, which imposed no liability upon him. and which at any time might have been terminated by the employer.”