The Oxford Group v Commissioners of Inland Revenue
| Jurisdiction | England & Wales |
| Judgment Date | 28 July 1949 |
| Date | 28 July 1949 |
| Court | King's Bench Division |
No. 1431-HIGH COURT OF JUSTICE (KING'S BENCH DIVISION)-
COURT OF APPEAL-
Income Tax - Exemption - Charitable purposes - Income Tax Act, 1918 (8 & 9 Geo. V, c. 40), Section 37; Finance Act, 1921 (11 & 12 Geo. V, c. 32), Section 30 (1) (a).
The Appellant Company was incorporated in August, 1939, as a company limited by guarantee. Its objects, as set out in its memorandum of association, included: "(A) The advancement of the Christian religion, "and in particular by the means and in accordance with the principles of "the Oxford Group Movement, founded in or about the year 1921 .... "(B) The maintenance, support, development and assistance of the Oxford "Group Movement in every way…(C) The exercise of all or any of the "following powers… (9) To establish and support or aid in the establishment "and support of any charitable or benevolent associations or "institutions, and to subscribe or guarantee money for charitable or benevolent "purposes in any way connected with the purposes of the Association "or calculated to further its objects. (10) To do all such other things as "are incidental or the Association may think conducive to the attainment "of the above objects or any of them".
The Company claimed exemption from Income Tax under Section 37, Income Tax Act, 1918, in respect of rents, interest and annual payments, and under Section 30 (1) (a), Finance Act, 1921, in respect of property owned and occupied by it, on the grounds that its objects were solely for the advancement of religion and that it was therefore established for charitable purposes only. The claim was refused by the Commissioners of Inland Revenue and, on appeal, by the Special Commissioners, who held that they were bound by the decision in the case of Re Thackrah, Thackrah Wilson, [1939] 2 All E.R. 4.
Held, that the Company was not established for charitable purposes only.
Stated under the Finance Act, 1925, Section 19 (3) and the Income Tax Act, 1918, Section 149, by the Commissioners for the Special Purposes of the Income Tax Acts for the opinion of the King's Bench Division of the High Court of Justice.
1. At meetings of the Commissioners for the Special Purposes of the
Income Tax Acts held on 5th and 6th May, 1947, the Oxford Group (hereinafter called "the Association") appealed against the refusal of the Commissioners of Inland Revenue to grant exemption from Income Tax under Section 37 of the Income Tax Act, 1918, in respect of rents, interest and annual payments made under covenant, and under Section 30 (1) (a) of the Finance Act, 1921, in respect of property owned and occupied by the Association, the Commissioners being of opinion that the Association was not a body of persons established for charitable purposes only. The claim of the Association related to the years 1939-40 to 1944-45.2. The Association was incorporated on 15th August, 1939 as a company limited by guarantee, not having a share capital. As coming under Section 18 of the Companies Act, 1929, it was licensed by the Board of Trade to be registered without the addition of the word "Limited" to its name. A copy of the memorandum and articles of association is annexed, marked "A", and forms part of this Case(1).
3. The objects of the Company, which is referred to in the memorandum as "the Association", are set out in clause 3. (A) and (B) of clause 3 are as follows:-
(A) The advancement of the Christian religion, and in particular by "the means and in accordance with the principles of the Oxford "Group Movement, founded in or about the year 1921 by "Frank Nathan Daniel Buchman.
"(B) The maintenance, support, development and assistance of the "Oxford Group Movement in every way, and in particular "(subject to the provisions of Section 14 of the Companies Act "1929) by holding, administering and dealing with property, "including all or any of the property which at the date of the "incorporation of the Association was held by trustees or "nominees for the Oxford Group Movement.
(C) of Clause 3 is: "The exercise of all or any of the following powers", which powers are set out severally under heads (1) to (10). Heads (3), (9) and (10) are as follows:-
(3) To print and publish any newspapers, periodicals, books or "leaflets which the Association may think desirable for the promotion "of its objects.
"(9) To establish and support or aid in the establishment and support "of any charitable or benevolent associations or institutions, and to "subscribe or guarantee money for charitable or benevolent purposes "in any way connected with the purposes of the Association or calculated "to further its objects.
"(10) To do all such other things as are incidental or the Association "may think conducive to the attainment of the above objects or "any of them.
4. Article 2 of the articles of association provides that "The number "of the members with which the Association proposes to be registered is "100, but the Council" (i.e., the council of management for the time being of the Association) "may from time to time register an increase of "members." Articles 32 to 35 relate generally to the said council and its members, articles 36 to 40 to its powers, article 41 to disqualification of council members, articles 42 to 48 to rotation of council members, and articles 49 to 56 to proceedings of the council.
Under article 33 the first members of the council were the eleven signatories of the memorandum, the first name being Frank N.D. Buchman. The council as at present constituted consists of the said first members, together with five additional members appointed by the council under article 34. Article 57 provides that accounts shall be kept, and article 61 that they shall be audited at least once a year.
5. A pamphlet entitled The Oxford Group-A Brief Account of its Principles and Growth, written by J.P. Thornton-Duesbery, and first published in 1947, was put in on behalf of the Association as an authoritative statement, and read to us in full. A copy of the said pamphlet is annexed, marked "B", and forms part of this Case(1). Pages 3 and 4 contain a foreword with fourteen signatories, from two of whom-The Rev. Dr. Sidney M. Berry and Sir Lynden Macassey, K.B.E., K.C.-as well as from the author of the pamphlet, we heard evidence as hereinafter appears. Pages 6 to 16 contain a consecutive account of the aims of the Group, its principles-particularly under the headings "A Change of Heart", "The "Guidance of God" and "The Building of a Christian Force"-and its basis of association. Pages 17 to 26 contain a historical outline of the Group from its foundation by Dr. Buchman in Oxford in 1921 up to the present day. A bibliography is appended, consisting of a short list of books and pamphlets on the Group.
We accepted the statements in The Oxford Group, so far as relating to matters of fact. So far as relating to matters of opinion, we accepted them as expressing the considered views or convictions of the writer, formed from his experience and study.
6. Two books, What is the Oxford Group?, by "The Layman with a "Notebook", with a foreword by Professor L. W. Grensted, (Oxford University Press, 1933) and Innocent Men, by Peter Howard (Heinemann, 1941)-the latter being one of the books in the bibliography above mentioned-were also put in by the representative of the Crown and were referred to in the course of evidence given before us (see paragraphs 10 and 14 of this Case). Copies of the two books, marked "C" and "D" respectively, are annexed and form part of this Case(1).
7. The question of the status and purposes of the Group before the Association was incorporated came before the Courts in the case reThackrah, Thackrah v. Wilson. [1939] 2 All E.R.4, which was heard before Bennett, J., in March, 1939.
Copies are annexed of documents which were before the Court, and form part of this Case(1); they are marked "E" and numbered consecutively as follows:-
E.1. Joint affidavit of R. W. Wilson, one of the defendants, and L. W. Grensted, sworn on 12 July, 1938. (There were two exhibits to this affidavit, the first being a copy of What is the Oxford Group?already attached as annexe "C" to this Case(1) ).
E.2. The second exhibit to the said joint affidavit, being extracts from a letter from Dr. B. H. Streeter, Provost of Queen's College, Oxford, to Dr. Frank Buchman, dated 30th June, 1937.
E.3. Affidavit of R. W. Wilson, sworn on 1st March, 1939.
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E.4. The first exhibit to the said affidavit (headed "R.W.W.1"), being a memorandum as to origin of the name "The Oxford Group".
E.5. The second such exhibit (headed "R.W.W.2"), being a list of the members of-in the words of paragraph 3 of the affidavit-"a sort of "governing body who since the year 1931 have under the presidency of "Dr. Buchman directed and controlled the policy and work of the Oxford "Group".
E.6. The third such exhibit (headed "R.W.W.3"), being a statement and report by the auditor of the general fund accounts for 18 months to 30th June, 1938.
E.6. (The fourth exhibit to the affidavit of R. W. Wilson was not considered to be relevant to this Case, and was not before us. The fifth and last exhibit was a print of the proposed memorandum and articles of association of the company intended to be formed. The said print corresponds, word for word, with the memorandum and articles finally registered, which forms annexe A to this Case(1) ).
E.7. Affidavit of R. W. Wilson, sworn on 8th March, 1939, and referring to an exhibit.
E.8. A memorandum (headed "R.W.W.6") describing instances of the manner in which the governing body or council of the Oxford Group referred to in paragraph 3 of the said affidavit of 1st March, 1939 (annexe E.3 hereto), had from time to time taken decisions and authorised expenditure in the furtherance of those decisions.
8. Bennett, J., held, on the evidence that had been adduced, (a) that there was not in existence any Association known as "the Oxford...
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