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GAZETTE
MARCH 1 9 87
the reversion to a third party, the
third party having previously pur-
chased that reversion, then sells it
to the original intended purchaser,
will not succeed.
Section 96 also provides that a
Declaration by Deed, under section
65 (2) of The Conveyancing and
Law of Property Act, 1881, to the
effect that from and after the
execution of the Deed, a term
subsisting in land shall be enlarged
shall where the term was created
by an Instrument executed
within
6 years of the date of the execution
of the Deed
be charged to Stamp
Duty as a conveyance or transfer
on sale of that land for a
consideration equal to the value
of the land and that value is
to be determined without regard
to the term or any part of the
term.
Wi th regard to residential
properties any lease that would
comply with section 65 (2) of the
1881 Act would appear to be void
under the Landlord and Tenant
(No. 1)Act, 1978 whereby no new
leases of residential property could
be created unless it had been
created before that Act, and, in the
circumstances over 6 years have
elapsed since then.
Section 65 only affects a lease
of property w i th a residue
unexpired of not less than 200
years of a term originally created
for not less than 300 years. If there
is no rent or merely a Peppercorn
rent or other rent having no
monetary value or the rent has
been released or become barred by
lapse of time and there exists no
trust or right of redemption
affecting the term in favour of the
freeholder or other person entitled
in reversion expectant on the term,
the term can be enlarged into a
Fee-Simple by means of a
Declaration by Deed under
subsection (2).
Irish Stenographers
Limited
(Director:
Sheila Kavanagh)
Qualified Experienced Stenographers.
Fast, efficient service.
Overnight Transcripts by arrangement
Contact: Secretary,
"Hillcrest", Dargle Valley,
Bray, Co. Wicklow.
Telephone:
01-862184
The Declaration by Deed cannot I
affect a genuine merger. One must
remember that this provision is
confined to a Declaration under ;
section 65 (2) of The Con-
veyancing and Law of Property
Act, 1881 which enables Lessees
of certain long leases which are
granted Rent free or at a Pepper-
corn Rent or any other Rent which
is valueless, or having value is
released or barred, to execute a
Deed declaring the terms to be
enlarged into the Fee Simple. In
these circumstances and in order :
to avoid the Charge, the "Lessee"
is obliged to let the lease run for a
period of 6 years and then make
the appropriate Declaration under
the section. If over 6 years has
already run, there is no problem.
These provisions cannot effect a
double charge to Stamp Duty but
it has been held in
Speyer Brothers \
-v- I.Ft.C. [1908] A.C.92 that
where an Instrument falls to be
stamped within the heads of two
liabilities to Stamp Duty, the State
is only entitled to one Tax but it
may choose the higher Tax. If,
therefore, a Purchaser mergers
a leasehold and freehold interest
in property by a separate Deed
of Merger or in his Deed of
purchase recites merger, the
Revenue Commissioners may have
the choice of selecting the head of
charge:-
(a) As a conveyance on sale
under the old provisions, or
(b) On the merger ot the two
interests under The Finance
Act, 1986, i.e. as a con-
veyance on sale.
If a leaseholder of long standing
decides to purchase the freehold
(say for £100.00) would Stamp
Duty be payable on the value of the
leasehold interest i.e. the
document evidencing the merger
of the leasehold interest in the
superior interest will be stamped as
a surrender of the leasehold
interest?
Another "Scheme" aimed at, is
the surrender of a leasehold
interest to merge in the superior
interest without any surrender
deed for stamping. Under sec-
tion, 99, the instrument bearing
witness to or acknowledging the
surrender or the merger is to be
charged with Stamp Duty as if it
were a surrender of the leasehold
interest.
DOCUMENT
EXAMINATION
LEGAL AID
CASES
UNDERTAKEN
M . Ansell, M . A . ,
9 8 The Br oadway,
H eme Bay,
Kent CT6 8EY,
England
Tel. (03 02273) 67929 (24 Hours)
An "Instrument" is defined in
the Stamp Act 1 891 section 1 22,
as any document in writing. It
seems, therefore, that the
Statutory Declaration evidencing
the surrender or merger or both will
be stampable with
ad valorem
duty
as if it were the surrender
document.
In any of these cases, it is sub-
mitted that what the legislation has
done is to make the surrender or
merger, a conveyance on sale, and
it will be stamped as such. If the
legislators intended otherwise,
words similar to section 74
Finance (1909-10) Act, 1910
would be used, substituting "value
of the property" for "amount or
value of the consideration" or to
section 96 Finance Act, 1986,
deeming the consideration to be
equal to the value of the property.
"Property" is not defined in the
Stamp Duty Legislation, but in
Potter-v- I.R.C.
(1854) 10 Ex. 147
I at Page 156 it is stated that
property is "that which belonged
to a person exclusive of others and
which could be the subject of
bargain and sale to another".
The surrender (or merger) will be
stamped:-
(a) upon a sale, as a conveyance
on sale
(b) upon a security, as a Mortgage
(c) in every other case, £5.00.
In the case of a conveyance on
sale, Stamp Duty is payable on the
value or the amount of the con-
sideration and in the case of an
arms-length Agreement, the con-
4 9