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GAZETTE
JULY/AUGUST1985
acquisition when that motive was in
keeping with the statutory policy.
Brian Hussey and Others
-v-
Irish Land
Commission - Supreme Court (per Henchy
J. (with Hederman J. concurring) and
McCarthy J., 13 December 1984 -
unreported.
Eamonn G. Hall
TAXATION
Corporation Tax — IDA Training Grant
— Capital or Revenue?
J a c o b I n t e r n a t i o n al
L i m i t ed
Incorporated is a multinational company
incorporated in Panama which has
carried on the business of providing
engineering services in Ireland from May
1974. On 1 October 1975, the Company
entered into an agreement with the
Industrial Development Authority under
which the IDA was prepared to give the
Company a training grant not exceeding
£245,000.00 towards actual elegible
training costs, subject to certain terms
and conditions. The relevant conditions
considered by the Court were:—
1. A condition binding the company
during the period of ten years from
the date of the agreement, not to
undertake without IDA consent any
work or commission which in the
opinion of the IDA could be
undertaken by existing Irish Firms.
2. There was an upper limit of £1,633.00
per permanent full-time job created
by the Company.
3. That if by the end of 1978 the total
number of permanent full-time jobs
created within the Company was less
than 150, the company would repay
to the IDA, all grant monies received
in excess of the sum of £1,633.00
multiplied by the number of such
jobs actually created.
4. The monies were to be refunded in
the event of the appointment of a
Receiver over the property of the
Company.
The IDA by Section 39 of the
Industrial Development Act, 1969 was
given power to enter such an agreement
with the Company and no evidence was
given to state that the Company had not
complied with all the conditions laid
down by the IDA and the Court assumed
that the IDA was satisfied that the
Company had complied. The grants paid
from 1976 to 1978 came to a total of
£244,996.00.
The case stated to the Supreme Court
was whether the sum of £244,996.00 was
assessable to Corporation Tax and the
issue to be decided by the Court was
whether the training grant was to be
treated as Revenue or Capital and for this
purpose the Court stated that the
question must be answered by investi-
gating the true nature and purpose of the
payment and not how they were dealt
with by the Recipient or how the Grantor
considered they should be applied. It was
the opinion of the Court that the main
object of the IDA in paying the training
grant was to secure permanent employ-
ment in Ireland and a company carrying
out work which would not be undertaken
by existing Irish Firms. The object of the
Company in qualifying for the Grant
was to aid its new industrial venture in
Ireland by getting relief of its wages and
salaries and training in new employees.
It was HELD by the Court that the
grant should be treated as Revenue rather
than Capital in assessing the Company's
position as the sole object of paying the
grant was to relieve the company's
outgoings in relation to the employment
of new employees.
The Revenue Commissioners Appeal
was therefore allowed and the training
grant was treated as Revenue of the
Company for the purposes of Corpora-
tion Tax.
Jacob International Ltd. Inc.
-v-
L.
O'Cleirigh (Inspector of Taxes) - Supreme
Court (per Hederman J.). (nem diss). 22
March 1984 - unreported.
John Barry Fox
ADOPTION
The welfare of the child is to be found
within the family unit unless there are
compelling reasons why this cannot be
achieved.
At the time of the birth of the infant girl
in September 1982 her father and mother
were unmarried. The mother arranged
for her to be placed in foster care and she
visited her infant while in such care from
time to time. In November 1982, the
mother signed a consent for the
placement of the infant for adoption and
one month later the infant was placed
with the adopting parents with a view to
being adopted by them. In December
1983, the mother withdrew her consent
and in March 1984, the mother and father
of the infant were married.
The a d o p t i ng p a r e n ts
i s s u ed
proceedings in February 1984 seeking
inter alia
an order pursuant to Section 3
of the Adoption Act, 1974 authorising An
Bord Uchtala to dispense with the
consent of the natural mother to the
making of an adoption order and an
order granting them custody of the
infant. In the course of the High Court
hearing, the Court added the father as a
party to the proceedings. He also added
An tArd Cláraitheóir as a party and
restrained him, pending the determina-
tion of these proceedings, from re-regis-
tering the birth of the infant under the
Legitimacy Act, 1931.
On August 10, 1984, the Court refused
the claim of the adopting parents for
relief pursuant to the Adoption Act, 1974
and continued the order restraining An
tArd Cláraitheóir from re-registering the
birth until after the expiration of 21 days
from the date of the perfection of the
order. On May 22, 1984, the parents had
i s s u e d a s u mm o n s u n d er t he
Guardianship of Infants Act, 1964
claiming custody of the infant and
naming the adopting parents as the
defendants. The adopting parents issued
a summons on June 21, 1984 under the
same Act claiming custody of the infant.
On October 15, 1984, judgment was
delivered by the Court and custody of the
infant was awarded to the adopting
parents with rights of access to the
parents.
By a further order, dated October 17,
1984, the Court continued the order
restraining an tArd Cláraitheóir from re-
registering the birth of the infant pending
the appeal against the decision of the
High Court in the summons under the
Adoption Acts.
The issue raised on appeal by the
parents against the order granting
custody of the infant to the adopting
parents was as to whether the High Court
had applied the right test having regard to
the fact that they were now married; that
the infant was now their legitimate
daughter and had that status even before
re-registration of its birth.
The Supreme Court HELD that the
principles of law applicable to the case
were as follows:
(1) The infant being the child of married
parents, now legitimised, has in
addition to the rights of every child,
which are provided for in the
Con s t i t u t i on and which are
identified by O'Higgins CJ in
G.
-v-
An Bord Uchtala
[1980] I.R., at p.56,
rights under the Constitution as a
member of a family which are:
(a) to belong to a unit group
po s s e s s i ng inalienable and
imprescriptible rights antecedent
and superior to all positive law
(Article 41.1);
(b) to protection by the State of the
family to which it belongs
(Article 42.1);
(c) to be educated by the family and
to be provided by its parents with
religious, moral, intellectual,
physical and social education
(Article 42.1).
(2) The State can not supplant the role
of the parents in providing for the
infant the rights to be educated
conferred on it by Article 42.1 except
"in exceptional cases" arising from a
failure for moral or physical reasons
on the part of the parents to provide
that education (Article 42.5).
(3) The Act of 1964 must, if possible, be
given an interpretation consistent
with the Constitution.
The Court HELD, also, that it did not
seem that Section 3 of the Act of 1964
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