Thompson v Commissioner Of Taxation [1959] HCA 66

High Court of Australia Dixon C.J. McTiernan, Fullagar, Kitto and Menzies JJ. Thompson v Commissioner Of Taxation [1959] HCA 66

ORDER Question (1) in the case stated answered: No. Question (2) in the case stated answered: No. Question (3) does not arise. The appellant taxpayers to pay the Commissioner's costs of the case stated.

Cur. adv. vult.

The following written judgments were delivered:—

Dec. 4 Dixon C.J.

This case stated raises a question whether a claim under s. 8 (5) of the Estate Duty Assessment Act 1914-1947 to exemption from duty is well founded. The claim is for the exemption of a share of residue bequeathed to certain masonic schools by the will of a testatrix who died on 3rd August 1948. By the fifth clause of her will she gave devised and bequeathed the residue of her real and personal property to her trustees upon trust, after discharging (to state it briefly) all liabilities of her estate, to divide the net residue equally among certain named institutions, fourteen of them in all. According to the valuation of the estate for duty that would mean that the share of each institution would amount to about £5,000. Among the institutions named in the list contained in the residuary devise and bequest is The William Thompson Masonic Schools, Baulkham Hills.

Sub-section (5) of s. 8 of the Act provides that estate duty shall not be assessed or payable upon so much of the estate as is devised or bequeathed or passes by gift inter vivos or settlement for religious, scientific, or public educational purposes in Australia or to a public hospital or public benevolent institution in Australia or as or to a fund established and maintained for the purpose of providing money for use for such institutions or for the relief of persons in necessitous circumstances in Australia. Sub-section (8) of s. 8 purports to amplify the application of the expression "public educational purposes" in the Act. At one time the expression occurred in two provisions of the Act, in s. 35 as well as in s. 8 (5), but now it has lost its place in s. 35 and seems only to occur in s. 8 (5). Sub-section (8) provides that in the Act "public educational purposes" includes the establishment or endowment of an educational institution for the benefit of the public or a section of the public. The executors of the will claim that the share of net residue payable to The William Thompson Masonic Schools forms part of the estate devised or bequeathed for "public educational purposes" within the meaning of sub-s. (5) with or without the help of sub-s. (8) of s. 8. The question before us is whether this claim is correct.