The Gazette 1961 - 64

case stated to the High Court where it was held that the former document attracted ad valorem stamp duty but that the latter document was liable to the io/- fixed duty as a genuine exchange. The Crown appealed against the decision and Messrs. Little- woods, the tax payers, cross appealed. The Court of Appeal dismissed both appeals and the Crown appealed to the House of Lords. Messrs. Littlewoods put in a cross appeal. It was held by the House of Lords that (i) the assignment of December 9th was liable to ad valorem stamp duty as a voluntary dis position under section 74 of the Finance (1909-10) Act 1910 and was not exempted from such duty by section 42 (i) of the Finance Act, 1930 because the beneficial interest in the property thereby conveyed was previously conveyed by the freeholders by the grant of a new lease, (ii) The deed of exchange was not liable to ad valorem stamp duty as a conveyance or transfer on sale, because, although it was not an exchange within the meaning of the Stamp Act, 1891 it was also not a conveyance or transfer on sale since a sale connoted among other things a price in money paid or promised. (Inland Revenue Commissioners v. Littlewoods Mail Order Stores Ltd., Littlewoods Mail Order Stores Ltd. v. Inland Revenue Com missioners, 1962 A. E. R. 279). The summer courses of the International Faculty of Comparative Law, open primarily to practitioners and law graduates, will be held in the Institute of the International Faculty in Luxembourg from the 23rd July to the I5th September, 1962. The course will be divided as follows :— (1) Preliminary Course on the law of the European Community—from the 23rd July to the 4th August, 1962. (2) General Introductory Course on Comparative law—from the 6th August to the I5th September, 1962. (3) Special comparative course on the essential features of a contract. (4) Special comparative course on the jurisdiction of Courts in constitutional cases. Courses Nos. (3) and (4) will be held from the 6th August to the I5th September, 1962. Full particulars may be obtained on application to the Secretariat of the Institute of Comparative Law, at 13 rue du Rost, Luxembourg. . ao INTERNATIONAL FACULTY OF COMPARATIVE LAW

assigned their lessee's interest in this new lease to a wholly owned subsidiary Company, Fork Manufac turing Co., Ltd. This was by way of voluntary assignment. On December loth Fork granted an underlease of the same premises to Littlewoods for 22 years at an annual rent of £42,450. On December nth Oddfellows and Fork executed the deed of exchange which recited the lease, assignment and underlease already mentioned and a mutual agree ment of the parties to exchange their respective estates and which witnessed that in consideration of an assignment thereinafter made by Fork to Oddfellows, Oddfellows transferred to Fork their freehold interest in the premises in question in return for which Fork assigned to Oddfellows for all the residue of the term thereby created the lease of December 8th. In other words Fork and Oddfellows simply changed places. On December nth Fork by deed guaranteed the payment to Oddfellows of the rent reserved by the underlease and charged the freehold reversion with such payment to Oddfellows. Finally on December I3th Littlewoods by deed indemnified Oddfellows against the payment of stamp duty and any penalties in connection with the entire transaction. The effect of all this was that Oddfellows were no longer owners of the fee simple subject to a long lease but instead were holders of a lease for twenty-two years which by virtue of the underlease procured them a rent nearly double that to which they had previously been entitled while Fork (and therefore indirectly Littlewoods) became the owners of the fee simple subject to the obliga tions of the underlease. As Lord Reid put it, the practical result was the same as if Oddfellows had simply sold the freehold to Littlewoods for twenty two annual instalments of £42,450 secured on the property. The six deeds were presented to the Commissioners of Inland Revenue for adjudication for stamp duty and the appellants objected to the assessment made in respect of two of the deeds. Objection was taken to the assessment on the voluntary assignment of December 9th by which Littlewoods assigned the new lease for £6 a year to their subsidiary company. Stamp duty had been assessed at £8,000 on an estimated value of £400,000, the value of the interest assigned. Objection was also taken to the assessment on the deed which was described as the deed of exchange and dated December nth. It was treated as a conveyance on sale of the fee simple by reference to the head of charge " conveyance or transfer on sale " and to section 56 (2) of the Stamp Act, 1891. Ad valorem duty was assessed at the rate of£i per £50 on £42,444 multiplied by 20, £16,978. It was contended that this deed was liable to the fixed rate ot io/- only as it was a deed of exchange. They appealed by way of