SUPREME COURT.

Star (Christchurch), Issue 5503, 2 March 1896, Page 3

SUPREME COURT.

IN BANCO. Monday. March 2. (Before his Honor Mr Justice Denniston.) IN BE JOHN MACFARLANE, DECEASED.: This was a case brought on petition by the Commissioner of Stamps against John Macfarlane, Catherine Macfarlane, Malcolm Macfarlane, John Donald Macfarlane, James Macfarlane, "Walter Macfarlane, David Duncan Macfarlane, Alexander Macfarlane and James Guild. ; Mr Stringer appeared for the Crown, and Mr Beswick for the respondents. Mr Stringer, in opening, said the case was brought under Section 35 of the Deceased Persons Estate Duties Act, 1881, and the Commissioner of Stamps prayed the Court to declare that a deed of covenant made between the late John Macfarlane and others- with respect to the former's property had been made for the purpose of evading the Act, ana to order a payment, of duty. The facts, niost of , which we're' adinitt^d,.weje. to, tb.es'.' effect that on August 9, 1884;, "J0hn Macfariane, formerly a sheepfarmer,' of Coldstream, made 'a, covenant with his wife and family by which the whole ot.his lind, stock and other property, valued at .£3oo>ooQi was to be divided amongst his sons and daughters in certain proportions in consideration that he should receive an annuity during his lifetime of ,£IOOO, and if his wife survived him that she should receive an annuity of <£500. John Macfarlane had died on Oct. 23, 1884, intestate and without being possessed of any property, having alienated and disposed of the whole of his real and personal estate by means of the deeds and dispositions referred to. The statement declared that the deed of covenant had been made and executed for the purpose of evading' the duty which would have been payable under the Deceased Persons Estates Duties Act, 1881, had the property passed to the various persons benefiting by virtue of the last will and testament of Johii Macfarlane, and asked the Court to order each of 1 the persons benefited to file a statement of the property and to pay duty on it under the Act. The statement was signed by William Pember Eeeves, as Commissioner of Stamps, the signature bearing the date of March 20,1895. Mr Stringer said that most of the properties dealt with in the deed of covenant had previously been subject to conveyances in 1883, and. he considered it had all been part of the same scheme. If the case were to rest wholly on the deed of covenant, he contended that in itself it was a disposition, and therefore came within the meaning of the Act. With respect to whether or not that disposition was intended as an evasion, he contended that where the reasonable effect of such a covenant would be the non-payment of duty which would be otherwise payable, it must have been made with that object. He quoted from a case under a statute of Elizabeth, by which case it had been established that, where a debtor had by a certain action evaded payment of his creditors, he had taken that action with the object of defeating his creditors. He quoted other cases to establish his contention that where the necessary or the natural consequences would be the non-payment of duty it would be unnecessary to' supply extrinsic evidence as to the motive in the mind of the person making the disposition at the time it was made. Taking all the circumstances into consideration — the method in which Macfarlane had got his property valued and divided into certain distinct proportions with the additional fact that he was an old man of sixty-seven — there could be no doubt that an attempt had been made to evade the Act. In answer to his Honor, Mr Stringer said that when the case had been heard in the lower court it had apparently been the opinion of the Crown solicitor that extrinsic evidence as to motive would have to be shown. Subsequently in 1886 an Act had been passed to enable the obtaining of such information. He and his learned friend, Mr Beswick, had agreed to the production of the evidence heard in the lower court. Mr Beswick said that the evidence heard in the lower court went to show that Macfarlane had in his mind in making the deed of covenant, not the making of a will but the idea of endeavouring to benefit his family during his lifetime, and that he was desirous of seeing his children settled in the various properties in his lifetime. Evidence would show that this had been Mr Macf arlane's fixed idea for many years previous to the making of the deed. (Left sitting.) [Pee Press Association.] WELLINGTON, March 2. The criminal sitting of the Supreme Court opened this morning before the Chief Justice, whose address to the Grand Jury was unusually brief and colourless. There are twenty-one cases on the calendar. DUNEDIN, March 2. The criminal sittings commenced this morning. The Judge passed- the following sentences: — P. Horne^ embezzlement, four years ; John Spehce, horse-stealing, eighteen months; William Scbbie, horse-stealing, eighteen months ; Charles Holsen alias Morgan, false pretences, one year; William Storey, forgery, two years j Bernard M'Cann, larceny, six months.