Thurn v Commissioner of Taxation (Cth) [1965] HCA 31

High Court of Australia Kitto, Taylor and Menzies JJ. Thurn v Commissioner of Taxation (Cth) [1965] HCA 31

ORDER Question in the case stated answered: Not any portion. Costs of the case stated reserved for the Justice disposing of the appeal.

Cur. adv. vult.

The following written judgments were delivered:—

June 30 Kitto J.

This is a case stated by Taylor J. under s. 28 of the Estate Duty Assessment Act 1914-1957 Cth for the opinion of the Full Court upon a question of law arising in an appeal against an assessment of estate duty under that Act. The question is whether the estate of one Francis Martin Thurn deceased comprises for the purposes of the Act any and if so what portion of a sum of £11,928 which on the death of the deceased was paid to his widow as the moneys due at the maturity of a policy of assurance on his life.

It is a question depending upon the construction of par. (f) of s. 8 (4) of the Act, containing one of the provisions by which the Act includes in an estate, for duty purposes, property which forms no part of the estate in fact. The paragraph comprises "money payable to, or to any person in trust for, the widow (or relatives of certain classes) 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, or, where part only of the premiums has been paid by or on behalf of the deceased, such portion of any money so payable as bears to the whole of that money the same proportion as the part of the premiums paid by or on behalf of the deceased bears to the total premiums paid".

The policy provided for payment of the sum assured, on the death of the deceased, to his executors, administrators or assigns. During the subsistence of the policy seven annual premiums only were paid upon it. Of these, the deceased paid the first four. Before the fifth fell due he assigned the policy to his wife Olive May Thurn, who on his death became his widow. The assignment was made in consideration of a payment equal to the total of the four premiums, and by means of a memorandum of transfer endorsed upon the policy and duly registered in accordance with s. 87 of the Life Insurance Act 1945-1958 Cth. The result of the assignment was, by force of s. 87 (3) of the latter Act, that thenceforth the assignee had all the powers and was subject to all the liabilities of the deceased under the policy, and was entitled on his death to sue on the policy in her own name. She paid the three premiums which thereafter fell due.