New Zealand Court of Appeal: Judgment in Controller and Auditor–General V. Sir Ronald Dawson

1997 ◽  
Vol 36 (3) ◽  
pp. 721-743
Author(s):  
Michael Bvers
Keyword(s):  
New Zealand ◽  
Judicial Review ◽  
House Of Representatives ◽  
Income Tax ◽  
Cook Islands ◽  
Tax Haven ◽  
Inland Revenue ◽  
Auditor General ◽  
Court Of Appeal

On February 16, 1996 the New Zealand Court of Appeal rendered judgment on three applications for judicial review arising out of what had come to be known in New Zealand as the “Winebox Inquiry”. The Inquiry began as the result of certain documents being tabled (in a winebox) before the New Zealand House of Representatives. It was alleged that the documents implicated several New Zealand companies in the evasion of New Zealand income tax by the use of the Cook Islands as a tax haven, and that the New Zealand Inland Revenue Department and Serious Fraud Office had been incompetent at the least in failing to detect and prevent the abuse.

scholarly journals The Illusory Trust Doctrine: Formal or Substantive?

2020 ◽  
Vol 51 (2) ◽  
pp. 193
Author(s):  
Mark Bennett
Keyword(s):  
New Zealand ◽  
Privy Council ◽  
Cook Islands ◽  
Trust Law ◽  
Court Of Appeal

"A document is put before us. Does it or does it not create a trust?" This article considers the illusory trust doctrine (ITD) and claims that although the ITD has been criticised as doctrinally unfounded and therefore based in substantive, non-legal reasons rather than pre-existing law, there are formal reasons of trusts law to support it. It begins by considering Atiyah and Summers' concepts of form and substance, and then examines how they apply in the context of equity (in general), and then trusts law (in particular). It then briefly considers a number of recent decisions on the ITD: the four cases constituting the Clayton v Clayton litigation in New Zealand, Pugachev and the Cook Islands Court of Appeal and Privy Council decisions in Webb v Webb. Finally, it analyses these ITD decisions using the form and substance distinction, concluding that it is arguable that the ITD is grounded in principles of established trust law, as opposed to purely substantive reasoning.

scholarly journals Predication: The Test For Tax Avoidance in New Zealand From Newton to Ben Nevis

2015 ◽  
Vol 46 (3) ◽  
pp. 1011 ◽  
Author(s):  
John Prebble ◽  
Hamish McIntosh
Keyword(s):  
New Zealand ◽  
Income Tax ◽  
Tax Avoidance ◽  
Decision Makers ◽  
Tax Legislation ◽  
First Case ◽  
The Supreme Court ◽  
Inland Revenue ◽  
To Come ◽  
Historical Antecedents

General anti-avoidance rules in income tax legislation are a blunt instrument. They can operate most effectively when decision makers move directly from the rule, such as "Arrangements with the purpose of tax avoidance are void against the Commissioner" to the facts, for example, "Objectively, do these facts demonstrate a purpose of avoidance?", or to paraphrase Lord Denning's test, "Viewing these facts objectively, can one predicate an avoidance purpose?"New Zealand courts adopted Lord Denning's "predication test" in 1966, but later cases confused things by trying to incorporate sub-rules into the exercise of looking for an avoidance purpose.Parliament codified and strengthened the predication test in 1974. Inland Revenue Department archives show that strengthening and codification of the test was what was intended and the language of the amendment confirms this intention. Nevertheless, later judgments misunderstood what the predication test entailed, and mistakenly thought that Parliament intended the 1974 amendment to abolish the test and to replace it with something else.In 2009 the Supreme Court delivered its judgment in Ben Nevis Forestry Ventures Ltd v Commissioner of Inland Revenue, the first case on tax avoidance to come before the Court. The Court said that the 1974 amendment abolished the predication test, but its reasoning in deciding the Ben Nevis case was in effect an exercise in predication.It would be useful to employ a name for the Supreme Court's approach to tax avoidance because a name would enable people to refer to the Supreme Court's test without circumlocution. "Predication" is the appropriate name because of its accuracy as to the meaning required and because of its historical antecedents.

scholarly journals Some preliminary evidence on employee share ownership schemes in New Zealand listed companies

1970 ◽  
Vol 12 (1) ◽  
Author(s):  
Michael Firth ◽  
Stephen Keef ◽  
Ross Mear
Keyword(s):  
New Zealand ◽  
Income Tax ◽  
Listed Companies ◽  
Preliminary Evidence ◽  
Participation Rates ◽  
Share Ownership ◽  
Inland Revenue

This note examines employee share ownership schemes as approved by the Commissioner of the Inland Revenue Departnzenr under the provistons of section 166 of the 1976 Income Tax Act. The note provides preliminary evidence on the characteristics of these section 166 schemes, including an analysis of the participation rates and the benefits conferred.

FIXED AND FLOATING CHARGES

2001 ◽  
Vol 60 (3) ◽  
pp. 441-492
Author(s):  
Philip R. Wood
Keyword(s):  
New Zealand ◽  
Fixed Charge ◽  
Privy Council ◽  
Council Decision ◽  
Inland Revenue ◽  
A Charge ◽  
A Company ◽  
Court Of Appeal ◽  
At Will

The Privy Council decision in Agnew v. Inland Revenue Commissioner [2001] B.C.C. 252 (on appeal from the New Zealand Court of Appeal in Re Brumark Investments Ltd.) decides that where a charge over the uncollected book debts of a company leaves the company free to collect and then to use the proceeds for its own benefit in the ordinary course of business, the charge is inevitably a floating charge and not a fixed charge, whatever the debenture might say. The court’s reason for this, in short, was that it makes no commercial sense to separate a book debt from its proceeds and so, if the company can use the proceeds at will, then the charge on the debt itself must be a floating charge.

scholarly journals Controller and Auditor-General v Davison: Three Comments

1996 ◽  
Vol 26 (2) ◽  
pp. 459
Author(s):  
W K Hastings
Keyword(s):  
International Law ◽  
Judicial Review ◽  
Case Note ◽  
Private International Law ◽  
Sovereign Immunity ◽  
Cook Islands ◽  
French Version ◽  
Auditor General

This article is a case note of Controller and Auditor-General v Davison CA 226/95, 16 February 1996. The case involved an application for judicial review of an order by the "Winebox" Commission of Inquiry to the Audit Office and KPMG Peat Marwick to produce documents relating to their functions as Government Auditor of the Cook Islands. The three authors make comments about the case and its impact on private international law, noting in particular the doctrine of sovereign immunity. *NOTE: a French version summary is provided at 476.

PROFESSIONAL PRIVILEGE AND THE TAX MAN

2002 ◽  
Vol 61 (3) ◽  
pp. 499-544
Author(s):  
John Tiley
Keyword(s):  
Judicial Review ◽  
Income Tax ◽  
Statutory Interpretation ◽  
House Of Lords ◽  
Legal Professional ◽  
Court Of Appeal

R. (on the application of Morgan Grenfell & Co. Ltd.) v. Special Commissioner of Income Tax [2002] UKHL 21, [2002] 3 All E.R. 1 is an exercise in statutory interpretation in which different courts came to diametrically opposite views. The Revenue were trying to decide how MG, the taxpayer, should be assessed in relation to certain transactions and so asked MG to supply certain documents. MG declined, in part because these documents consisted of advice which MG had obtained from leading counsel and solicitors about whether the scheme behind the transactions would work; so the issue was the scope and nature of legal professional privilege (“LPP”). The Revenue asked for—and obtained—the consent of the Presiding Special Commissioner (His Honour Stephen Oliver Q.C.) for the issue of a notice by them to MG under Taxes Management Act 1970, s. 20(1), which allows an inspector by notice in writing “to require a person to deliver to him such documents as are in the person’s possession or power and which … contains information relevant to any tax liability of that person”. MG applied for judicial review to quash the notice, failing before the Divisional Court ([2000] S.T.C. 965, Buxton L.J. and Penry-Davey J.) and the Court of Appeal ([2001] EWCA 329, [2001] S.T.C. 497, Schiemann, Sedley L.JJ. and Blackburne J.), so that all six judges were for the Revenue; MG must therefore have been both delighted and perhaps surprised when a unanimous House of Lords, led by Lord Hoffmann, decided in its favour.

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