D'Aguiar v Commissioner of Inland Revenue

• Jurisdiction: Guyana
• Judge: Persaud, J.,Stoby, C.,LUCKHOO
• Judgment Date: 06 June 1967
• Neutral Citation: GY 1967 CA 1
• Docket Number: Civil Appeal No. 45 of 1964
• Court: Court of Appeal (Guyana)
• Date: 06 June 1967

Court of Appeal

Stoby, C., Luckhoo, J.A. and Persaud, J.A.

Civil Appeal No. 45 of 1964

D'Aguiar

and

Commissioner of Inland Revenue

Appearances:

G.M. Farnum, Q.C. for the appellant.

M. Shahabuddeen, Q.C. Solicitor General and

S. Rahaman for the respondent.

Revenue Law - Income Tax — Appeals

Persaud, J.

1 the point in this appeal is whether the appellant (tax payer) is entitled in the computation of his taxable income to deduct the sum of $4,200: which he contributed under a Deed of Covenant to an organization described as the Citizens Aid and Advice Service and referred to in this judgment as the organization. The Commissioner held the view that the sum contributed was not deductible, and the members of the Board of Review unfortunately were evenly divided in their opinions. A judge in chambers shared the Commissioner's view, and dismissed an appeal by the appellant.

2 Counsel for the appellant has advanced his arguments along two separate but complementary lines. The first assumes that, as in England, to be classified as charitable, an organization must exist for charitable purposes only, in which case the submission is that the organization here qualifies. The second argument examines s.53(3) of the Income Tax Ordinance (Cap. 299) and propounds the theory that the true construction of the section leads to the conclusion that it is unnecessary for an organization to be charitable only to entitle a tax-payer to deduct from his income donations to such an organization. Counsel further submits that the organization falls under categories (1) and (4) as set out in Pemsel'sCase, 3 Tax Cas. 53, that is to say, “ for the relief of poverty” and “ for other purposes beneficial to the community, not falling under any of the preceding heads”. This latter object was also described in Morice v. Bishop of Durham 10 Ves. 522as the advancement of objects of general public utility, and as being the most difficult category.

3 Before dealing with the submission, it might be of some use to make a few general observations. The overriding test in deciding whether an object is charitable is whether or not it is for the benefit of the public, but an object which is for the public benefit is not necessarily charitable, just as a philanthropic object may not be charitable. (See A.G. v. National Provincial Bank [1924] A.C. 265). A donor's opinion and his motive are both immaterial to the determination of this question, and so are the opinions of officers of the organization. The thing to be examined in this case in order to arrive at a conclusion is the constitution of the organization in which are set out its objects and aims. But those objects and aims are still to be tested to ascertain whether they are within the spirit and intendment of 43 Eliz. 1, c. 4, for s. 8 of the Civil Law of Guyana (cap. 2) provides that the law as to charities shall be the common law of England, provided that by “charities” shall be ordinarily understood charities within the meaning, purview, and interpretation of the preamble to 43 Eliz. 1, c 4, as preserved by the Mortmain and Charitable Uses Act, 1888. Or as it has been put by Lord Simonds in Williams' Trusts v. I.R.C. [1947] 1 All E.R. at p. 518:–

“… there are, I think, two propositions which must ever be borne in mind in any case in which the question is whether a trust is charitable. The first is that it is still the general law that a trust is not charitable and entitled to the privileges which charity confers unless it is within the spirit and intendment of the preamble to 43 Eliz. C. 4, which is expressly preserved by s.13(2) of the Mortmain and Charitable Uses Act 1888”.

4 The other proposition has already been referred to in this judgment, that is, that not all trusts that are beneficial to the community are charitable.

5 Of course, I hasten to add that even though the courts must not ignore the spirit and intendment of the Act, it is the case that the English Courts have from time to time extended by analogy the benefit of the law to various objects. As Lord Eldon said in Morice v. Bishop of Durham 10, ves. 522, the court has taken strong liberties upon the subject of charities, but notwithstanding the strong liberties it has taken, there are certain principles which have always guided the court. It is inevitable that the courts would have extended the classification to include other objects if only because as time goes on the needs of mankind have become wider and more elaborate and an object which could not have been contemplated when the Act of Elizabeth and even Mortmain and Charitable Uses Act were enacted, could very well in the present century fall within the spirit and intendment of the former. It is clear that the enumeration contained in the Statute of Elizabeth was not exhaustive. As Lord Simonds puts the matter in the National Anti-vivisection Society'sCase 28, Tax. Cas. At p. 369:–

“The task of the court was in some degree simplified by the Statute of Elizabeth, which made it clear that at least the purposes enumerated in the preamble were charitable, but from the beginning it appears to have been assumed that the enumeration was not exhaustive and that these purposes also were charitable which could be fairly regarded as within its spirit and intendment. This view enabled the court to extend its protection to a vast number of objects which appeared both to the charitable donor and to it to be for the benefit of the community. Nowhere perhaps did the favour shown by the law to charities exhibit itself more clearly then in the development of the doctrine of general charitable intention, under which the court finding in a bequest (often, as I humbly think, on a flimsy pretext) a general charitable intention, disregarded the fact that the named object was against the policy of the law and applied the bequest to some other charitable purpose.”

6 Counsel for the appellant relies upon the dictum of Fitzgibbon, L.J., In Re Cranston (1898) 1 Ir. R. at p. 466, particularly so as it was adopted by Lord Cozens-Hardy, M.R. in Re Wedgwood, Allen v. Wedgwood (1915) 84 L.J.R. at p. 108. That dictum is to this effect:–

“…any gift which proceeds from a philanthropic of benevolent motive, and which is intended to benefit an appreciably important class of our fellow-creatures (including, under decided cases, animals), and which will confer the supposed benefit without contravening law or morals, will be ‘charitable’.”

7 And Lord Cozens-Hardy continued his judgment with these words (ibid at p. 108):–

“It may be, and indeed I think it is true that there has been a tendency to enlarge the meaning of the word ‘charity’ and that gifts within the last fifty years have been supported as good charitable gifts which a hundred and fifty years ago would not have been supported.”

8 I have already attempted to give a reason for the latter dictum. There can be no exception to the statement of Fitzgibbon, L.J., as it stands if the purpose of the gift was not illegal, and not contrary to public policy. I would refer to the dictum of Holmes, L.J., in the same case and also referred to by cozens-Hardy, M.R. in Wedgwood to the effect that gifts, the object of which is to prevent cruelty to animals and to ameliorate the, position of the brute creation, are charitable.

9 Lord Justice Holmes said:–

“If it is beneficial to the community to promote virtue and to discourage vice, it must be beneficial to teach the duty of justice and fair treatment to the brute creation, and to repress one of the most revolting kinds of cruelty.”

10 The Wedgwood case concerned a trust for the protection and benefit of animals, by the movement for the humane slaughtering of animals, and to provide municipal abattoirs.

11 I wish to observe in passing that In Re Foveaux (1895) 2 Ch. 501 which was also cited with approval in the WedgwoodCase has since been overruled in C.I.R. v. National Anti-Vivisection Society 28 Tax. Cas. 312.

12 In the last mentioned case – decided in 1947 – it was held that a society which existed “to awaken the conscience of mankind to the iniquity of torturing animals for any purpose whatever” and to suppress the practice of vivisection was not established for charitable purposes only, this being contrary to the decision in Re Wedgwood.

13 So much for the cases dealing with the amelioration of the suffering of animals. I have had reason to refer to them because two of them were relied upon by the appellant, and to show that they are not completely acceptable. It is still the law – as was observed by Lord Simonds in the National Anti-Vivisection Society's Case (ibid at p. 375) that the court must still in every case determine by reference to its special circumstances whether or not a gift is charitable.

14 It now becomes necessary to set out in detail the objects of the society in the instant case, in order to deal with the first submission, that is, assuming that to qualify for relief the organization must exist for charitable purposes only, then it so qualifies having regard to its objects.

15 The objects are as follows:–

• (a) to provide advice, aid and services on or relating to medical, dental, optical, health, legal matrimonial, domestic or other social matters;

• (b) to establish and operate a fund for the assistance of those in need on such terms and conditions as the Central Committee may determine;

• (c) to encourage thrift and provide saving facilities;

• (d) to make available to the individual in confidence accurate information and skilled advice on personal problems of daily life;

• (e) to establish, organize, sponsor or otherwise promote Adult Education and technical, training of every kind including the explanation of legislation and Government notices and publications;

• (f) to help the citizen to benefit from and to use, wisely the services provided for him by the State;

• (g) in general to...