Todd v Egyptian Delta Land and Investment Company
| Jurisdiction | England & Wales |
| Judge | Lord Atkinson,Lord Buckmaster,Lord Warrington of Clyffe,Viscount Sumner |
| Judgment Date | 23 July 1928 |
| Judgment citation (vLex) | [1928] UKHL J0723-1 |
| Date | 23 July 1928 |
| Court | House of Lords |
[1928] UKHL J0723-1
House of Lords
Viscount Sumner.
Lord Atkinson.
Lord Buckmaster.
Lord Warrington of Clyffe.
Whereas Monday the 23d day of January last was appointed for hearing Counsel upon the Petition and Appeal of Egyptian Delta Land and Investment Company, Limited, whose registered office is situate at Gresham House. Old Broad Street, in the City of London, praying, That the matter of the Order set forth in the Schedule thereto, namely, an Order of His Majesty's Court of Appeal, of the 18th of February, 1927, might be reviewed before His Majesty the King, in His Court of Parliament, and that the said Order might be reversed, varied, or altered, or that the Petitioners might have such other relief in the premises as to His Majesty the King, in His Court of Parliament, might seem meet; as also upon the printed Case of Frank Ernest Todd (His Majesty's Inspector of Taxes), lodged in answer to the said Appeal; Counsel were accordingly called in and were heard, as well on the said Monday the 23d, as on Tuesday the 24th, days of January last: and whereas by an Order of this House of the 18th day of May last, it was Ordered that the said Appeal should be further argued by one Counsel of a side on Tuesday the 12th day of June last; Counsel were accordingly called in and were further and fully heard on the said Tuesday, the 12th day of June last; and due consideration being had this day of what was offered on either side in this Cause:
It is Ordered and Adjudged, by the Lords Spiritual and Temporal in the Court of Parliament of His Majesty the King assembled, That the said Order of His Majesty's Court of Appeal, of the 18th day of February, 1927, complained of in the said Appeal, be, and the same is hereby, Reversed, and that the Decision of the Commissioners for the General Purposes of the Income Tax for the City of London, of the 16th day of November, 1925, thereby Reversed, be, and the same is hereby, Restored: And it is further Ordered, That the Respondent do pay, or cause to be paid, to the said Appellants, the Costs incurred by them in the Courts below, and also the Costs incurred by them in respect of the said Appeal to this House, the amount of such last-mentioned Costs to be certified by the Clerk of the Parliaments: And it is also further Ordered, That the Cause be, and the same is hereby remitted back to the King's Bench Division of the High Court of Justice, to do therein as shall be just and consistent with this Judgment.
My Lords,
The question in this ease is whether or not the Appellant Company was in the years of assessment a person residing in the United Kingdom within the meaning of Schedule D of the Income Tax Act 1918 construed of course with due regard to other relevant provisions of the Act.
The Company was incorporated on the 20th April 1904 under the Companies Acts 1862-1900 as a company limited by shares. By the Memorandum of Association it was stated in accordance with the Statute that the Registered Office of the Company is situate in England.
The actual registered office is at Gresham House Old Broad Street in the City of London. This is in fact the office of Mr. F. J. Horne who carries on there the business of Secretary of Public Companies and performs there on behalf of the Company and certain other companies the functions necessary to be performed by them in order to comply with the requirements of the Companies Acts. The names of the Companies for whom he acts are on the door of the office.
The business of the Company is carried on in Egypt and its affairs are controlled and managed there.
The case thus raises the question whether a company incorporated under the Companies Acts and therefore having a registered office in the United Kingdom, at which under the Statutes certain duties have to be and are in fact performed on its behalf, and notices and other documents affecting the Company are to be served is as a legal consequence of these facts a person residing in the United Kingdom within the meaning of the Income Tax Act, 1918.
Assessments to Income Tax for the years 1919-20 to 1924-25 under Schedule D cases iv and v having been made upon the Company by the Commissioners of Inland Revenue the Company appealed to the General Commissioners for Income Tax for the City of London. The Commissioners found that the Company was not resident in this country. At the request of the present Respondents they stated a case for the opinion of the Court. The case came before Rowlatt J. in the King's Bench Division on the 23rd November 1926 who allowed the Respondents appeal from the decision of the Commissioners. His judgment was on the 18th February 1927 affirmed by the Court of Appeal. Hence the present appeal to this House.
The statutory provisions relating to this and all other Companies incorporated under the Companies Acts are now contained in the Companies (Consolidation) Act 1908.
Under that Act every company is to have a registered office to which all communications and notices may be addressed. Every company is to keep a register of its members containing certain particulars enumerated in the Statute (section 25). An annual list of members with a summary specifying a large number of particulars relating to its capital and its liabilities and assets is to be prepared and is to be contained in a separate part of the register of members (section 26 (3) ). A copy of every instrument creating any mortgage or charge requiring registration under the Act is to be kept at the registered office and such copies are to be open to inspection by any creditor or member of the Company. The register of members, and therefore of course the annual list and summary which are a part of it, are to be kept at the registered office, and under certain conditions are to be open to inspection by members and other persons, and any member or other person may require a copy of the register, or of the list or summary or of any part thereof respectively, on payment of the prescribed sum. Every Company is to keep at its registered office a register containing the names addresses and occupations of its directors or managers. A document may be served on a company by leaving it at or sending it by post to the registered office. This provision extends to service of a writ and of a petition for winding up and such service is equivalent to personal service. Service may be thus effected at any time of the day or night.
By No. 1 of the General Rules applicable to all Schedules to the Income Tax Act 1918 it is provided that every body of persons is to be chargeable to tax in like manner as any person is chargeable under the provisions of the Act.
Inasmuch therefore as tax is imposed upon a person residing in the United Kingdom it is clear that the artificial person a Company under the Companies Act amongst other bodies of persons is regarded as capable of residing in the United Kingdom, although of course, inasmuch as it neither eats nor sleeps nor performs any of the physical or social functions of a natural person, the fact of residence depends upon other considerations than those which determine the residence of an individual.
Independently of authority, and in the absence of any relevant provisions of the Income Tax Act 1918 throwing light on the meaning attributed by the Legislature to the words "residing" and "resident" as used in the Act, I should probably have been of opinion that the provisions of the Companies Act to which I have referred lead to the conclusion that, whatever other residence the Company may have, the Legislature has provided that the registered office shall be a residence.
Certain corporate functions imposed upon it by the Act are to be performed at that place. Service of the most important documents, which in the case of individual persons must be served personally, may be effected by this being left at or sent by post to the registered office without restriction as to time.
The cumulative effect of these provisions apparently creates for the Company a statutory home where it is to perform the corporate functions above mentioned, and where it is regarded as at all times present and ready to receive such documents and communications as are left or sent there.
This state of things would go some way to establish that in the case of a registered Company there are present those conditions which, in the case of an artificial person may constitute a residence in that part of the United Kingdom in which by the terms of its Memorandum of Association the Registered Office is situate.
But I have to consider the authorities and such relevant provisions as may be found in the Act of 1918 and to determine whether the opinion I have above expressed can be maintained in view particularly of the provisions of the Act.
At the date of the passing of the Act of 1918 the authorities were in this position:—
In The Cesena Company Ld. v. Nicholson and The Calcutta Jute Company Ld. v. Nicholson L.R. 1 Ex D. 418 Huddleston B. expressed himself as follows (p. 453):
"In the present argument the Attorney-General advanced a proposition to which I cannot assent. He suggested that the registration of a Company is conclusive of its residence, that if a Company was registered in England it must be held to reside in England. I think the answer given during the argument is a good one. It is this: Registration like the birth of an individual is a fact which must be taken into consideration in determining the question of residence. It may be a strong circumstance but it is only a circumstance. It would be idle to say that in the case of an individual the birth was conclusive of the residence. So, drawing an analogy between an actual and an artificial person, you may say that in the case of a corporation the place of...
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