Ex.C.R.] EXCHEQUER COURT OF CANADA 219 BETWEEN : 1952 WILLIAM F. ANGUS et al. APPELLANTS; Feb. 26 Mar.18 AND THE MINISTER OF NATIONAL ) RESPONDENT. REVENUE Revenue—Succession Duty—The Dominion Succession Duty Act, S. of C. 1940-41, 4 Geo. VI, c. 14, ss. 4(1), 31—Civil Code of the Province of Quebec, articles 607, 891—General power to appoint any property given to a person—Intent of section 81 of the Dominion Succession Duty Act—Provisions of Civil Code not applicable since question one of statutory law related to federal taxation—Appeal dismissed. The appellants are the executors of the estates of Dr. W. W. Chipman and his wife, the latter separated as to property of her husband, who both died domiciled in the province of Quebec, Mrs. Chipman in January, 1946, and Dr. Chipman in April, 1950. It was agreed that the law of the province governs the administration and the devolution of Mrs. Chipman's estate. By her will Mrs. Chipman bequeathed the whole of her property to her husband and two of the appellants as trustees and in trust to be administered and disposed by them as follows:— "(f) to pay to my husband, the said Walter William Chipman, during the remainder of his lifetime, the net interest and revenues from the residues of my estate and in addition thereto to pay to my said husband from time to time and at any time such portion of the capital of my estate as he may wish or require and upon his simple demand, my said husband to be the sole judge as to the amount of capital to be withdrawn by him and the times and manner of withdrawing the same, and neither my said husband nor my executors and trustees shall be obliged to account further for any capital sum so paid to my said husband.
220 EXCHEQUER COURT OF CANADA [ 1952 1952 (g) upon her husband's death to dispose of the estate, 'as it may then exist' as follows: ANGUS et al. v. 6. To divide the capital of the residue of my estate between my MINISTER brothers, sisters, niece and nephews as follows:— . . . ; and I OH' hereby constitute my said brothers, sisters, niece and nephews NATIONAL my universal residuary legatees in the aforesaid proportions." REVENUE * * * Dr. Chipman was assessed for succession duties in respect of the power to demand such portions of the capital as provided in clause (f) of his wife's will on the basis that such power was a succession to him. The appellants appealed to this Court from the assessment. Held: That the intent of section 31 of the Dominion Succession Duty Act, 4-5 Geo. V[, .c. 14, is to include any person who has a general power to appoint any property and to determine the succession duties this person shall pay or when. Cossit v. Minister of National Revenue, (1949) Ex. C.R. 339 followed. 2. That the provisions of section 31 apply to Mrs. Chipman's will. 3. That the articles of the Civil Code of the province of Quebec are not applicable since the question here is one of statutory law related to federal taxation. APPEAL under the Dominion Succession Duty Act. The appeal was heard before Mr. Guillaume Saint Pierre, Q.C., Deputy Judge of the Court, at Montreal. James Mitchel, Q.C. for appellants. Claude Prevost, Q.C. and I. G. Ross for respondent. The facts and questions of law raised are stated in the reasons for judgment. SAINT PIERRE D.J. now (March 18, 1952) delivered the following judgment: Il s'agit de l'appel d'une décision du Ministre du Revenu National qui a, le 17 septembre 1946, fixé à $188,165.20 le montant des droits dus par le Dr Chipman sur la succession de son épouse Maud Mary Angus. Le 9 août 1946, $113,917.30 ont été payés mais le montant réclamé par le Ministre est de $74,247.90 plus les intérêts à la date du compte $1,249.92 soit un total de $75,497.82. La question qui est soumise est celle de savoir si le paragraphe (f) de la clause 3 du testament de Maud Mary Angus Chipman tombe sous les dispositions de l'article 31 de la loi ayant pour objet d'autoriser le prélèvement de droits successoraux.
Ex.C.R.] EXCHEQUER COURT OF CANADA 221 La clause 3 du testament se lit comme suit: 1952 Tout d'abord la testatrice nomme comme fiduciaires son ANaus et al. v. mari, le DrChipman, son frère D. Forbes Angus et le The MINISTEE Royal Trust Company pour administrer et disposer de la N A IONAL f açon suivante de la fiducie: REVENUE a)to payall debts,funeral expe p n ses and succession Saint Pierre D T. duties, — b) to deliver a special bequest of jewellery to her niece Mrs. Vanklynn, e) to give her husband the use of her home so long as he may desire, d) to give her husband the use of her furniture and effects during his lifetime, e) to divide the sum of $5,000 amongst her employees, f) to pay to my husband, the said Walter William Chipman, during the remainder of his lifetime, the net interest and revenues from the residues of my estate and in addition thereto to pay to my said husband from time to time and at any time such portion of the capital of my estate as he may wish or require and upon his simple demand, my said husband to be the sole judge as to the amount of capital to be withdrawn by him and the times and manner of withdrawing the same, and neither my said husband nor my executors and trustees shall be obliged to account further for any capital sums so paid to my said husband. g) upon her husband's death to dispose of the estate, "as it may then exist" as follows: 1. My jewellery, pictures, household furniture and household effects shall be disposed of in accordance with any memorandum I may leave with respect to the same and failing any such memorandum then the same shall be divided among my residuary legatees hereinafter named in the same manner as the residue of my estate. 2. To pay to The Royal Institution for the Advancement of Learning (McGill University), of Montreal, the sum of fifty thousand dollars as a special legacy. 3. To pay to the Royal Victoria Hospital, Montreal, the sum of fifty thousand dollars as a special legacy. 4. To pay to The Art Gallery, presently situate at the corner of Ontario Avenue and Sherbrooke Street West, Montreal, the sum of fifty thousand dollars as a special legacy.
222 EXCHEQUER COURT OF CANADA [1952 1952 5. To pay to The Church of St. Andrew and St. Paul, presently on Axous et Sherbrooke Street West, Montreal, the sum of twenty-five thousand V. al. dollars. The receipt of the treasurer for the time being of each of the MINISTER foregoing institutions shall be a good and valid discharge to my executors OF and trustees. NATIONAL REVENUE 6. To divide the capital of the residue of my estate between my brothers, sisters, niece and nephews as follows: One-sixth thereto to my Sain D t . P J. i erre brother, D. Forbes Angus, of the city of Montreal; one-sixth thereof to mybrother William Forrest An n g g u u s s of the city of Montreal; one-sixth thereof to my brother, David James Angus, presently of Victoria, British Columbia; one-sixth thereof to my sister, Margaret Angus wife of Dr. Charles Ferdinand Martin, of the city of Montreal; one-sixth thereof to my sister, Dame Bertha Angus widow of Robert MacDougall Paterson, of the city of Montreal; one-eighteenth thereof to my niece, Gyneth Wanklyn widow of Durk McLennan, of the city of Montreal; one-eighteenth thereof to my nephew, David A. Wanklyn, of the city of Montreal; and one-eighteenth thereof to my nephew, Frederick A. Wanklyn, presently of Nassau, Bahamas; and I hereby constitute my said brothers, sisters, niece and nephews my universal residuary legatees in the aforesaid proportions. The share of any of my brothers or sisters who may have predeceased leaving lawful issue shall accrue in favour of such issue equally by roots and failing issue such share shall be divided among my remaining brothers and sisters or their lawful issue by roots. The share of either of my said nephews or niece who may have predeceased leaving lawful issue shall accrue to such issue equally by roots and failing issue such share shall be divided between my remaining nephews or niece and the issue of any predeceased nephew or niece by roots. Should any beneficiary become entitled to a share of my estate under any of the foregoing provisions while a minor the net revenues therefrom shall be expended for his or her maintenance, education and support by my executors and trustees through such channels as they may think advisable, but it shall not be necessary to spend the whole of such net revenue unless my executors and trustees so decide and such net revenues may be allowed to accumulate in whole or in part and spent later as may be decided, the whole in the discretion of my executors and trustees, and after such beneficiary attains the age of majority the capital of his or her share or so much thereof as then remains shall be made over to him or her in absolute ownership. Il résulte donc de la clause 3(f) que le Dr Chipman avait le pouvoir de s'adresser aux fiduciaires et de se faire payer sur simple demande le capital qu'il désirait avoir et ni le Dr Chipman ni les fiduciaires étaient tenus de rendre compte des montants ainsi payés au Dr Chipman. En face de cette clause le Dr Chipman avait deux alternatives, l'accepter et se faire payer les montants qu'il désirait ou la refuser. Il ne fait pas doute que s'il refusait la clause les dispositions de l'article 31 ne pouvaient
Ex.C.R.] EXCHEQUER COURT OF CANADA 223 s'appliquer à lui. D'un autre côté ayant accepté la clause 1952 3(f) du testament, la clause 31 de la loi des droits succes- ANa s t al. soraux s'applique-t-elle? v. MINIBTES Cette clause 31 se lit comme suit: NATIO NAL 31. Lorsqu'il est donné à une personne un pouvoir général de trans- REVENUE mettre un bien soit par acte entre vifs, soit par testament, ou par les Saint Pierre deux à la fois, les droits prélevés au sujet de sa succession sont exigibles DJ. de la même manière et dans le même délai que si le bien lui-même avait été donné ou légué à la personne qui a reçu ledit pouvoir. Cet article 31 est complété par l'article 4, paragraphe 1 qui se lit comme 3 suit: Une personne est répartie habile à disposer de biens si elle possède un avoir ou un intérêt dans cet avoir ou tel pouvoir général, si elle était sui juris, lui permettrait de les aliéner et l'expression "pouvoir général" com-prend toute faculté ou autorisation permettant au donataire ou autre détenteur de transmettre ou d'aliéner des biens selon qu'il le juge opportun, qu'elle puisse s'exercer par un acte entre vifs ou par testament, ou les deux, mais à l'exclusion de tout pouvoir susceptible d'être exercé à titre judiciaire en vertu d'une disposition qu'il n'a pas faite lut-même, ou susceptible d'être exercé en qualité de créancier hypothécaire. Il résulte donc de ces deux articles que le pouvoir général de transmettre un bien comprend la faculté ou l'autorisation permettant au donataire ou autre détenteur de transmettre ou d'aliéner des biens. Or dans le cas de l'article 3 parag. (f) du testament de Mme Chipman elle donne à son mari le pouvoir général de se faire payer le capital qu'il désirera et comme consé-quence de ce paiement du capital il s'en suit qu'il obtient par le fait même le pouvoir général de transmettre les capitaux qu'il aura retirés soit par donation soit par testament. L'article 31 contient deux parties, la première pour constater le fait d'un état existant dans un testament et la deuxième pour déterminer comment dans ce cas seront prélevés les droits de succession. Si un état de chose existe comme celui fixé par la première partie à savoir qu'une personne par son testament a donné à une autre personne un pouvoir général de trans-mettre un bien soit par acte entre vifs ou par testament, ou par les deux à la fois, alors la deuxième partie s'applique et dans ce cas les droits prélevés au sujet de la succession d'une personne qui a- donné tel pouvoir général, sont
224 EXCHEQUER COURT OF CANADA [1952 1952 exigibles de la même manière et dans le même délai que ANa s t al. si le bien lui-même avait été donné ou légué à la personne V. MINI$TES qui a reçu ce pouvoir. OF NATIONAL Dans le présent testament de Madame Chipman, vu REVENUE qu'elle a donné à son mari un pouvoir général sur les Saint Pierre capitaux de sa succession, alors le Dr Chipman qui a D.J. obtenu ce pouvoir doit payer les droits au sujet de la succession de Mme Chipman de la même manière et dans le même délai que si le bien lui-même lui avait été donné ou légué. L'article 31 a pour objet d'atteindre celui qui a un pouvoir général de transmettre et de déterminer quels droits il devra payer ou dans quel délai. Je suis donc d'opinion que les dispositions de l'article 31 s'appliquent au testament de Mme Chipman. Le procureur de la Couronne s'appuie spécialement sur la cause de Cossitt v. Ministre du Revenu National (1). Il s'agit d'une clause de testament analogue à la présente cause et l'Honorable Juge O'Connor a jugé que l'article 31 s'appliquait dans ce cas. La clause dans le cas de Cossitt se lisait comme suit: 3(f). To invest and keep invested the residue of my estate and to pay the net income derived therefrom to my said son Edwin Comstock Cossitt during his lifetime, with power to him at any time ta use for his benefit such amount or amounts out of the capital of the said residue as he may wish. (g). Upon the death of my said son, the residue of my estate or the amount thereof remaining shall be held in trust for the issue of my said son or some one or more of them in such proportion and subject to such terms and conditions as my said son may by his last will direct, provided. L'Honorable Juge O'Connor déclare ce qui suit à la page 343: The effect of section 31, in my opinion, is that where a general power to appoint any property is given to any person, such person shall be deemed to have derived a succession of such property from the decease. In my opinion, there was not a succession within section 2(m) but there was a succession within section 31. And under section 31, the duty levied in respect of such succession is payable in the same manner and at the same time as if the property itself had been given to the appellant. Je partage les vues exprimées par l'Honorable Juge O'Connor dans cette cause de Cossitt v. Ministre du Revenu National. (1) (1949) Ex. C.R. p. 339.
Ex.C.R.] EXCHEQUER COURT OF CANADA En conséquence pour les raisons ci-dessus mentionnées je renvoie l'appel avec dépens. J'ai examiné les autorités citées par les procureurs des deux parties et je ne partage pas les vues du procureur de l'appelant d'appliquer les articles du code civil dans cette cause où il s'agit du droit statutaire relativement à l'im- position de taxes fédérales. Judgment accordingly. 225 1952 Axaus et al. MINV IS. TER NT A ZNAL REVENUE saint Pierre D.J.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.