Fisher v Fisher [1917] HCA 42

OF AUSTRALIA. {HIGH COURT OF AUSTRALIA.] re 2 % 3 : Z 2 5 APPELLANT; DrrEeNnDANT, AND [ER AND OTHERS . f 4 : . RESPONDENTS.

DEFENDANTS AND PLarntiFF,

ON APPEAL FROM THE SUPREME COURT OF NEW SOUTH WALES.

Tenant for life and remainderman—Shares in company held by trustees— Dividend—Distribution of shares in another company—Accumulated profits— - Income or capital.

A company registered in New South Wales, which carried on business within and without the Commonwealth, had accumulated large profits equal in amount tothe value of its assets without the Commonwealth. Being desirous of separat- ing its business without from that within the Commonwealth while keeping ~ both under the same management, the company proposed to form a new com- pany which should acquire the assets without the Commonwealth in exchange for shares of the new company. With that object in view the old company amended its deed of settlement so as to suthorize it to pay any dividend by the distribution among its shareholders of shares of any new company. The new company was then formed with a share capital consisting of a certain ~ number of ordinary shares and of preférence shares equal in number to the subscribed shares of the old company and in nominal value to the value of the assets of the old company without the Commonwealth. 'Those assets were then 'sold and transferred to the new company in consideration of the preference shares, which, pursuant to the amendment of the deed of settlement, were © distributed among the shareholders of the old company. The ordinary shares

VOL. XXII, 23

H.C. or A. 1917. Sypyey,

Aug. 21; Sept. 4.

Barton, tsaacs, Gavan Duffy and Rich JJ.

H. C. or A.

1917.

FisHEr

FisHer.

HIGH COURT

Held, by Barton, Gavan Duffy and Rich JJ. (Isaacs J. dissenting), between life tenants and remaindermen, preference shares of the new received by trustees in respect of shares of the old company held by capital and not income.