Hamra v Commissioner of Taxation (Cth) [1973] HCA 41

High Court of Australia Stephen J. Hamra v Commissioner of Taxation (Cth) [1973] HCA 41

ORDER Appeal dismissed with costs.

Cur. adv. vult.

Stephen J. delivered the following written judgment:—

Oct. 16 Stephen J

This is an appeal against an amended assessment to Estate Duty following the disallowance by the Commissioner of an objection to the inclusion in the dutiable estate of the late George Hamra of the proceeds of two life insurance policies on his life.

In June 1968 the deceased effected two identical policies of insurance on his life, each of which provided for payment of the sum assured, on his death, to "The Assured or his Executors or Administrators or Assigns". He paid the first half yearly premium on each policy late in June 1968 and three months later, on 20th September 1968, effectively assigned one of such policies to each of his two sons in accordance with the provisions of s. 87 of the Life Insurance Act 1945-1965 Cth and these assignments were then duly registered pursuant to that section.

No monetary or other consideration was given by either of the sons, the assignments were voluntary assignments.

The second half-yearly premium on each policy was paid by the deceased in January 1969, notwithstanding his having assigned the policies. On 17th April 1969 he died and the proceeds of the policies were duly paid to the two assignees.

The Commissioner has included these proceeds in the estate of the deceased, relying primarily upon s. 8 (4) (f) of the Estate Duty Assessment Act 1914-1970 Cth; alternatively he relies upon s. 8 (4) (a) of that Act.

Section 8 (4) (f) deems to be part of the estate of a deceased money payable to, or to any person in trust for, the widow, widower, children and other specified classes of relatives of the deceased under a policy of assurance on the life of the deceased where the whole of the premiums has been paid by or on behalf of the deceased; it also provides for a pro rata deeming where some only of the premiums have been so paid.