Commissioners of Inland Revenue v The Duchess of Portland
| Jurisdiction | England & Wales |
| Judgment Date | 26 November 1981 |
| Date | 26 November 1981 |
| Court | Chancery Division |
HIGH COURT OF JUSTICE (CHANCERY DIVISION)-
Domicile - Married woman - Domicile of dependence replaced by domicile of choice - Visits to house retained in domicile of origin - Intention to live there in the future - Whether domicile of choice adandoned - Domicile and Matrimonial Proceedings Act 1973, s 1; Income and Corporation Taxes Act 1970, s 122(2)(a).
The taxpayer appealed against the rejection by the Inland Revenue of her claim under s 122(2)(a) of the Income and Corporation Taxes Act 1970, that she was not domiciled in the United Kingdom. She had married her husband who had an English domicile in 1948 and lived in England with him from that time. She was born and had a domicile of origin in Quebec and had always maintained close links with Quebec and kept a house there. She intended to return to Quebec if her husband predeceased her and hoped to persuade him to live there on his retirement. In February 1974 they went to Jamaica for a holiday and in July 1974 went to Quebec for their annual visit. As a result of the provisions of s 1 of the Domicile and Matrimonial Proceedings Act 1973, which came into force on 1 January 1974, she, then having her husband's domicile by dependence, fell "to be treated as retaining that domicile (as a domicile of choice) unless and until it is changed by acquisition…of another domicile…". She was therefore treated as retaining her domicile of dependency "as a domicile of choice". The Special Commissioners allowed her appeal, holding that when she left the United Kingdom, without any intention of returning to reside there indefinitely, on the visit to Quebec in July 1974, she satisfied the requirement as to the cessation of residence in the United Kingdom and so abandoned her domicile of choice. The Crown appealed.
Held, in the Chancery Division, allowing the Crown's appeal, that on the facts it was clear that she had at all times been present in the United Kingdom as an inhabitant of it; that her physical presence in Quebec had been for limited periods; that she was resident in England on 1 January 1974 and that that residence was not displaced when she visited Canada in July 1974 or at any other time during the periods relevant to the appeal; that the Special Commissioners were wrong in holding that any less stringent test fell to be applied to the abandonment of this deemed domicile of choice than that appropriate to a true domicile of choice; that, accordingly, since the intention to reside in Quebec was merely to do so in the future, it could not transmute the visit to Quebec into residence nor cause there to be a cessation of residence in the United Kingdom.
Stated under the Taxes Management Act 1970, s 56, by the Commissioners for the Special Purposes of the Income Tax Acts for the opinion of the High Court of Justice.
1. At a meeting of the Commissioners for the Special Purposes of the Income Tax Acts held on 12 and 13 July 1979 Lady William Cavendish-Bentinck ("Lady William") appealed against the rejection by the Appellants, the Commissioners of Inland Revenue, of her claim under s 122(2)(a), Income and Corporation Taxes Act 1970, that she was not domiciled in the United Kingdom in the years 1973-74, 1974-75, 1975-76, 1976-77 and 1977-78.
2. Lady William and her husband, Lord William Cavendish-Bentinck, gave evidence before us.
3. The following documents were proved or admitted before us:
(2) Copy wills of Lady William's parents (Joseph Arthur Barry and Dame Jessie Skirving Leach).
(3) Copies of several bank statements (Banque de Montreal) dated 17 September 1973 to 30 April 1979.
(4) Copies of local tax statements.
(5) Copy correspondence and receipts concerning Lady William's family grave.
(6) Copy receipts and correspondence concerning the up-keep of Lady William's house and garden at Metis Beach.
Copies of the above are not annexed hereto as exhibits but are available for inspection by the Court if required.
4. Our findings of fact, the question in issue, and the contentions of the parties are set out in our decision which we delivered in writing on 13 August 1979 and which is annexed herto as part of this Case.
5. The following cases and books were cited in argument before us:-
Maxwell v. M'Clure (1860) 8 WR 370;In the Goods of Raffenel decd. ENR(1863) 3 SW & TR 49;Udny v. Udny ELR[1869] LR 1 Sc & Div 441;In re Marrett ELR(1887) 36 Ch D 400;Fleming v. Horniman 44 TLR 315;Bradfield v. Swanton and Crowley IR[1931] IR 446;In re Lloyd Evans, decd. ELR[1947] Ch 695;Zanelli v. Zanelli 64 TLR 556;In re Scullard, decd.ELR[1957] Ch 107;Fielden v. Commissioners of Inland RevenueTAX42 TC 501;In the estate of Fuld, decd. (No. 3) WLR[1966] 2 WLR 717;In re Flynn, decd. WLR[1968] 1 WLR 103;Qureshi v. Qureshi ELR[1972] Fam 173;Commissioners of Inland Revenue v. Bullock TAXUNK51 TC 522; [1976] 3 All ER 353
; Dicey and Morris, Conflict of Laws, 9th edn, pages 95, 96, 111, 114, 115, 116 and 122; Halsbury's Laws of England, vol 8, 4th edn, para 428; Cheshire, Private International Law, 9th edn, pages 187 and 188.
6. The Commissioners of Inland Revenue immediately after the determination of the appeal declared to us their dissatisfaction therewith as being erroneous in point of law and on 6 September 1979 required us to state a Case for the opinion of the High Court pursuant to the Taxes Management Act 1970, s 56, which Case we have stated and do sign accordingly.
7. The question for the opinion of the Court is whether our decision was correct in law.
A.K. Tavaré, E. Wix Commissioners for the Special Purposes of, the Income Tax Acts
Turnstile House
94-99 High Holborn
London, WC1V 6LQ
8 February 1980
Decision
1. Lady William Cavendish-Bentinck appeals against the rejection by the Commissioners of Inland Revenue of her claim under s 122(2)(a), Income and Corporation Taxes Act 1970, that she was not domiciled in the United Kingdom in the years 1973-74, 1974-75, 1975-76, 1976-77 and 1977-78.
2. As a result of the evidence adduced before us we find the following facts proved or admitted:
(a) Lady William was born in the Province of Quebec, Canada, on 26 June 1911. Her father and mother were both resident and domiciled in Quebec and she therefore had a domicile of origin in Quebec. She is and has always been a Canadian citizen.
(b) In 1948 Lady William married in England Lord William Cavendish-Bentinck who was some 14 years her senior; he was domiciled in the United Kingdom. Lady William thereby acquired a domicile of dependency in the United Kingdom. They set up home in London.
(c) Lady William has maintained close links with Quebec throughout her marriage. All her relatives are in Canada. She has always kept her Canadian passport and maintained (with the necessary exchange control permission usually only granted to foreign women) a bank account in Quebec with the Bank of Montreal into which moneys are paid from time to time by the trustees of the...
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