Oppenheimer v Cattermole
| Jurisdiction | England & Wales |
| Judge | THE MASTER OF THE ROLLS,LORD JUSTICE BUCKLEY,LORD JUSTICE ORR |
| Judgment Date | 20 July 1972 |
| Judgment citation (vLex) | [1972] EWCA Civ J0720-3 |
| Court | Court of Appeal (Civil Division) |
| Date | 20 July 1972 |
[1972] EWCA Civ J0720-3
The Master of the Rolls (Lord Denning)
Lord Justice Buckley and
Lord Justice Orr
In The Supreme Court of Judicature
Court of Appeal
Mr. J.E. VINELOTT, Q.C., and Mr. PATRICK MEDD (instructed by the Solicitor of Inland Revenue) appeared en behalf of the Appellant Inspector of Taxes in the first appeal.
Mr. GERALD GODFREY, Q.C., and Mr. MAX ENGLARD (instructed by Messrs. Rayner & Co. of New Barnet, Herts) appeared on behalf of the Respondent in the first appeal.
Mr. J.E. VINELOTT, Q.C, Mr. PATRICK MEDD and Mr. COULSON (instructed by the Solicitor of Inland Revenue) appeared on behalf of the Appellant Inspector of Taxes in the second appeal.\
Miss NOTHMAN, the Respondent in the second appeal, appeared in person.
These two cases arise out of the persecution of the Jews in Nazi Germany. Mr. Meier Oppenheimer and Miss Miriam Nothnan are Jews. They were born in Germany and lived there all their lives until the persecution. In or about 1948 they became naturalised here and became British subjects. in 1953 or thereabouts the new Federal Government of Germany (as compensation for the injustice which had been done to then) awarded then pensions. The question is whether those pensions, when received here, are subject to English income tax.
I will take Mr. Oppenheimer's case first. He was born in Germany in 1896. He qualified there as a teacher and for some 20 years from 1919 to 1939 he taught at a Jewish orphanage in Bavaria. He was detained for a short time at a concentration camp at Dachau, but soon after his release he left Germany in 1939 for England and has resided here ever since. In 1948 heapplied for naturalisation and became a naturalised British subject.
In 1953 the German authorities determined to make compensation to the employees of Jewish religious compounties. They awarded Mr. Oppenheimer a pension from 1st October 1952. In 1961 Mr. Oppenheimer became 65 and they awarded him a second pension. Both pensions were payable out of the public funds of Germany.
The question is whether Mr. Oppenheimer is liable to pay English income tax on the sums he receives from Germany in respect of those pensions. By reason of conventions against double taxation between England and Germany, it appears that, if he is a national or the United Kingdom only but not of Germany (i.e. if he has single nationality) he is liable to pay English income tax. But if he has dual nationality, that is, if he is a national of Germany as well as of the United Kingdom, he is exempt from having to pay English income tax.
The revenue authorities assert that, for the years 1953/4 to 1967/8 he was a national of the United Kingdom only and they have assessed him to tax on the pensions for those years. The Special Commissioners uphold the assessments. The Judge reversed the Commissioners. He held that Mr. Oppenheimer had 2 dual nationality in those years - in that he was a national of Germany as well as of England - and that, accordingly, under the Convention, he was exempt from English income tax.
The conventions about double taxation relief were agreed in 1954 and 1964 and were made law in this country by Statutory Instruments 1955 No. 1203 and 1967 No. 25. The relevant provisions are substantially the same in each instrument. I will read from the 1967 instrument because it is clearer. Article IX(2) provides that:-
Remuneration, including pensions, paid, in respect of present or past services or work, out of public funds of the "Federal Republic…. shall be exempt from United Kingdom tax unless the payment is made to a national of the United Kingdom who is not also a German national.
The term "national" is not defined, but Article 11(3) provides that:
In the application of the provisions of the present Convention by one of the Contracting Parties" (i.e. by the United Kingdom) Many term not otherwise defined in the present Contention shall, unless the context otherwise requires, have the meaning which it has under the laws in force in the territory of that Party "(i.e. in the United Kingdom) relating to the taxes which are the subject of the present Convention."
As a result of that Article, it was agreed before the Special Commissioners, that the meaning of the word "national" in the Conventions fell to be determined by English law. It is plain that under English law Mr. Oppenheimer is a "national of the United. Kingdom within Article IX(2). The question is whether under English law he is "also a German national" within Article IX(2). If he is also a German national, i.e., if he has, by English law, dual nationality, he is exempt from United Kingdom tax: but if he has only single nationality (of the United Kingdom), then he is not exempt.
In order to see whether Mr. Oppenheimer is "also a German national" by English law, I turn to see 'nether he is aGerman national by German law, though I realise that this is not the ultimate question to be decided.
The nationality of Mr. Oppenheimer by German law.
The German municipal law was proved before the Commissioners by Dr. Conn, a well-known Professor of German law residing in this country.
The first relevant German decree was passed on 22nd July 1913. It contained this provision:
"A German who has neither his habitual residence nor his permanent abode in Germany shall lose hit nationality when he acquires a foreign nationality if such acquisition is made upon application by him…. unless he had the written permission of his native country to retain his nationality."
If that decree was applicable to Mr. Oppenheimer in 1948, he would have by German law lost his German nationality when he became a naturalised British subject.
The next relevant decree was made on 25th November, 1941. It said.
"A Jew whose usual place of abode is abroad may not be a German citizen… A Jew loses German citizenship if, at the date of entry into force of this regulation, ho has his usual place of abode abroad."
Seeing that Mr. Oppenheimer was a Jew who has his usual place of abode abroad, by German law ho lost his German nationality at that time in 1941. It was an abominable law, but still it was the German law at that time.
According to Dr. Cohn that decree of 25th November 1941 remained the law of Germany until a decision or the Federal German Constitutional Court given in 1968 by which the decree of 25th November 1941 was absolutely void ab initio, but that decision of the Constitutional Court had no retrospective effect. So the 1968 decision did not, of itself, restore to Mr. Oppenheimer the German nationality which he had lost in 1941. Jut we ere told that, in consequence of the 1968 decision, Mr. Opperheimer is entitled to apply now for re-instatement as a German national and has done so: and it will be granted automatically.
Dr. Cohn expressed the opinion "under German law that, if Mr. Oppenheimer had not lost German Nationality under the decree of 25th November 1941, be lost the said nationality under the German nationality law of 22nd July 1913 on being nationalised as a British subject in 1948.
Dr. Cohn's evidence was accepted by the Special Commissioners. They said "We find from that evidence that under German law the Appellant ceased to be a German national not later than 4th June, 1948, when he became a national of the united Kingdom." I do not think that finding can be challenged. It means that, by German law. Mr. Oppenheimer, during the years of assessment, did not have dual nationality. He was not a German national. He was only a native of the United Kingdom. If the question fell to be determined by German law, he would not be exempt from United Kingdom tax.
The nationality of Nr. Oppenheimer by English law.
But the question does not fall to be determined by German law. It falls to be determined by English law. It was urged before us that English law must itself apply the German law. At first I thought this was correct; for I thought on theauthorities that a country was in charge and solely in charge of the nationality of its citizens; and that when Germany passed the decree of 25th November 1941 it was effective in English law to deprive Mr. Oppenheimer of his German nationality: and that however abominable or atrocious that decree might be, we had to some extent to recognise it as between that country and the individuals concerned. That view was supported by the law as stated by Mr. Justice Russell in Stoeck v. Public Trustee 1921 2 Ch. at page 32: "Whether a person is a national of a country must be determiner by the municipal law of that country. Upon this I think all text writers are agreed. It was supported also by a decision of the Unites States Court of Appeals for the Second Circuit relating to this very German decree of 25th November 1941. It is United States of America ex relatione Schwarzkoof v. Uh1 (1943) 137 Federal Reporter at page 898, where it was said: "There is no public policy of this country to preclude an American Court from recognising the power of Germany to disclaim Schwarskoof as a German citizen."
I think those observations have no application to this case. We are here concerned with dual nationality. If a man is a British national, owing allegiance here, it is for the English law to say whether he can, consistently with that allegiance, be also a national of "another country, owing allegiance to that other country also. I turn therefore to see whether English law does recognise Mr. Oppenheimer as having, by English law, dual nationality.
When Mr. Oppenheimer came to England in 1939, he was a German national, and English law would regard his as such notwithstanding that...
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