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TMI Blog1954 (12) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... g regard to the well-known language of rule 1 of Schedule E ......all ......fees, wages, perquisites or profits arising therefrom, that is, from the employment concerned. The Crown have not relied upon any of the special words, for example, particularly perquisites in this rule. This, in the event, is not therefore a case related to any of the peculiar differences between the terms of Schedule D and Schedule E or their respective rules. The question is whether, upon the whole facts of the case as proved and found, these collections were in truth and in substance part of Mr. Dooland's earnings as a professional cricketer and taxable as such: whether they fall fairly within the words which are found in the rule applicable to Case II of Schedule D, all profits and earnings of whatever value arising from the employment, a formula which for present purposes may be taken as synonymous with that quoted from the rule applicable to Schedule E. Since all cases of comparable character must, in my judgment, turn upon their exact facts, I find it desirable to quote at some length from the case stated and the documents annexed thereto. Mr. Dooland's engagement was governed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay in the matches to the best of his ability ; but it may no doubt be assumed from the nature of the engagement and of the game of cricket that he would do so, and that he would be encouraged to such efforts by the provisions for talent money and collections in clause 3. The relevant rules of the league are also set out in the case. At the date of the contract, 1949, rule 33 was, as set out in paragraph 3(2)(b) of the case: Each club must play one professional, but not more than one, in league matches; the whole of a professional's remuneration must be in the form of a weekly wage plus usual talent money and collections, and all other forms of payment such as benefit matches, commission on gate money, agreement signing fee, etc., are strictly forbidden. All professional agreements must be deposited with the league secretary within 14 days of completion thereof, and shall then be examined by him to see that they conform to the league rules. The knowledge of any part of the agreement shall be confined to the President and Honorary Secretary, unless they decide that the interests of the League require that any portion of the agreement should be laid before the league commi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expression by way of gift on the part of members of the public of their grateful pleasure in witnessing Mr. Dooland's skill. This argument was (according to Mr. Bucher) strongly reinforced by the facts: (i) that amateurs could qualify like professionals (albeit by reference to a somewhat less exacting standard) for the making and taking of collections, the true character of which could not differ from those taken for professionals but which, in the case of an amateur, could not constitute professional earnings; (ii) that the sums collected were small in comparison with the regular salary; and (iii) that there was no finding and no evidence that the possibility or expectation of collections had played any part in influencing Mr. Dooland to make the contract which he did. On these grounds, therefore, Mr. Bucher contended, applying the principle which has found similar judicial expression, including the language of that very experienced judge, Rowlatt J., in the cases to which I shall later refer, that these collections were mere personal gifts and not by way of payment for his services. Mr. Bucher further submitted that, in any case, the conclusion of the majority of the Ge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot myself assent to the view advanced by Sir Reginald Hills that it is dangerous to leave matters of this kind-the discrimination between earnings arising from an employment on the one hand and mere personal presents on the other -to the commissioners as questions of fact. No doubt problems of this character commonly involve mixed questions of fact and law. But as Viscount Cave L.C. observed in Seymour v. Reed [1927] A.C. 554, 559; 11 T.C. 625, 646; 43 T.L.R. 584, the Kent County cricketer: The question to be answered is, as Rowlatt J. put it, 'Is it in the end a personal gift or is it 'remuneration?' And in many cases, at least-and more particularly perhaps where the sum involved is small-provided that the Commissioners have been properly instructed upon the principles to be applied, the question will, as Rowlatt J. said, in the end be one to be answered, in my judgment, as a matter of substance, of common sense and therefore of fact. But, in the present case, the commissioners did not, as I understand them, purport so to answer the question. Paragraphs 8 and 10 of the case stated were thus expressed: 8. After due consideration of the facts and the argu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... augmentation of the stipends of the clergy: If, as was contended by the incumbent, it was in fact a gift personal to himself, I do not think it would fall within the provisions of Schedule E; if, on the other hand, it accrued to him by virtue of his office as incumbent, the respondent himself could hardly dispute his liability. In the context of the facts of those cases the contrast thus simply expressed was sufficient. I observe only that the alternatives were intended to be mutually exclusive-if the sum in question was a mere personal gift, then, ex necessitate rei, it was not received by way of earnings of the office or employment; and vice versa. But the attempt to apply the antinomy to the facts of the present case seems to me to have produced the result of an over-simplification or over-statement on each side of their respective cases. Mr. Bucher did not, of course, seek to contest the proposition that a sum received might be taxable earnings though it was given voluntarily; but it was his contention that since the contributions of the spectators were on their part entirely spontaneous donations having no relation to any contract of employment between Mr. Doland a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mployer to an. employee would or might be taxable. It is not necessary for me in the present case to decide whether such Christmas boxes are or are not taxable. But I am unable to assent to the wide proposition that if it be shown of a voluntary payment to an employee-whether a Christmas box, a wedding present or any other kind of gift-made by the employer or by a third party, that it was only made because the recipient was the employer's servant or that it would not otherwise have been made, therefore the sum is taxable; and accordingly that the collections in this case are taxable, because they owe the fact of their having come into existence to Mr. Dooland's contract with the East Lancashire Club. In my judgment, such a proposition is inconsistent with the decision in Seymour's case [1927] A.C. 554; 11 T.C. 625; for it is clear that the renowned Kent professional indubitably owed his benefit, in one sense at least, to the fact that he had played cricket for many years as a professional for the Kent County Cricket Club and to the fact that the benefit was entirely organized on his behalf by the committee of the club which, in effect, contributed about one half of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y paid at the benefit match which in the ordinary course belonged to the club. The Crown made no claim to-in the words of Rowlatt J. they shied atthat part of the fund which had been subscribed independently by members of the public. It was a point much stressed, and naturally, by Mr. Bucher, who referred to the Lord Chancellor's language [1927] A.C. 554; 560; 11 T.C. 625, 646...... those subscriptions, which are the spontaneous gift of members of the public, are plainly not income or taxable as such. In truth, as was observed passim in the judgments and speeches in Seymour's case [1927] A.C. 554; 11 T.C. 625 there was no valid distinction in principle between the two kinds of contribution for the purpose of taxability; and the Crown, who have displayed no similar shyness in the present case, were disposed, as I understood Mr. Borneman, to admit that their concession in Seymour's case [1927] A.C. 554; 11 T.C. 625 was unnecessary and logically unsound. But, in my Judgment, the facts, on which Seymour's case [1927] A.C. 554; 11 T.C. 625 was determined, are different in vital respects from those in the present case. The terms of Seymour's contract nowhere appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ton v. Cooper, [1909] A.C. 104, 107; 5 T.C. 347, 355 Lord Loreburn L.C. said: In my opinion, where a sum of money is given to an incumbent substantially in respect of his services as incumbent, it accrues to him by reason of his office. Here the sum of money was given in respect of those services. Had it been a gift of an exceptional kind, such as a testimonial, or a contribution for a specific purpose, as to provide for a holiday, or a subscription peculiarly due to the personal qualities of the particular clergyman, it might not have been a voluntary payment for services, but a mere present. I observe that Lord Loreburn L.C. said might not. Applying that language to the present case, although no doubt the collections were testimonials peculiarly due to the great qualities of Mr. Dooland as a cricketer, in my judgment, for the reasons I have given, they were not mere presents so as not to be taxable but were, in Mr. Dooland's hands substantially in respect of his services as the club's professional. Mr. Borneman contended that the facts of the case were so plain that res ipsa loquitur in the Crown's favour. I cannot agree. Although I think the Crow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... holder for the time being are clearly distinguishable. Easter offerings (as ordinarily understood) are contributions made to the holder of the office as such, so that (as has been observed) if a particular incumbent should die before the time arrived for payment of the offerings, they would go to his successor. Such considerations have no place in connexion with an employment such as that of a professional cricketer. In my judgment, the authority of Blakiston v. Cooper [1909] A.C. 104; 5 T.C. 347 is necessarily limited by its own particular facts. The court, however, is not concerned with anomalies--save at least in those cases (of which the present is not one) in which it will tend to favour an interpretation of a doubtful matter of law or an obscure passage in an Act of Parliament or other instrument which will avoid anomalies. Here the court's duty is to relate particular facts to established principles. Since, however, the matter of anomalies was raised, I must observe that our decision in favour of the Crown may well be said to create an anomalous distinction between the large benefits received by professional county cricketers which are not taxable and the relatively s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to which regard should be had in determining whether the circumstances of a particular case are or are not such as to bring it within the line of tax liability. In Herbert v. McQuade, [1902] 2 K.B. 631; 4 T.C. 489 which concerned the liability of the vicar of a certain parish to tax on sums granted to him by the Queen Victoria Clergy Sustentation Fund, Collins M.R. said [1902] 2 K.B. 631, 649; 4 T.C. 489, 500: Now that... is certainly an affirmation of a principle of law, that a payment may be liable to income tax although it is voluntary on the part of the persons who made it, and that the test is whether, from the standpoint of the person who receives it, it accrues to him in virtue of his office; if it does, it does not matter whether it was voluntary or whether it was compulsory on the part of the persons who paid it. That seems to me to be the test; and if we once get to this-that the money has come to, or accrued to a person by virtue of his office-it seems to me that the liability to income tax is not negatived merely by reason of the fact that there was no legal obligation on the part of the persons who contributed the money to pay it. In the same case Stirli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. A benefit is not usually given early in a cricketer's career, but rather towards its close, and in order to provide an endowment for him on retirement; and, except in a very special case, it is not granted more than once. Its purpose is not to encourage the cricketer to further exertions, but to express the gratitude of his employers and of the cricket-loving public for what he has already done and their appreciation of his personal qualities. It is usually associated, as in this case, with a public subscription; and, just as those subscriptions, which are the spontaneous gift of members of the public, are plainly not income or taxable as such, so the gate moneys taken at the benefit match, which may be regarded as the contribution of the club to the subscription list, are (I think) in the same category. If the benefit had taken place after Seymour's retirement, no one would have sought to tax the proceeds as income; and the circumstance that it was given before, but in contemplation of, retirement does not alter its quality. In the same case Lord Phillimore (after referring to Blakiston v. Cooper [1909] A.C. 104; 5 T.C. 347 and Herbert v. McQuade [1902] 2 K.B. 631; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or other of the stipulated performances, and enjoyed a collection accordingly, recurred with considerable frequency, there having been no less than eleven such occasions during the 1951 season. According to the principles above stated, these facts afford cogent grounds for holding that the present case falls within the line of tax liability. On the other hand it is to be observed:-(i) that m order to earn the right to a collection Mr. Dooland had not only to play in a given match, but also to achieve in the course of play one or other of the stipulated performances, and (ii) that according to the rules of the Lancashire Cricket League amateurs were entitled to make, or have made on their behalf, similar collections whenever they achieved like performances in batting or performances in bowline of a slightly less exacting standard. Mr. Bucher, for Mr. Dooland, contends that these features of the present case show that spectators contributing to his collections were were not contributing, albeit voluntarily, to the remuneration of Mr. Dooland as professional to the East Lancashire Club but were merely expressing, in terms of cash, their spontaneous appreciation of a display of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of his employment. The term of his contract, giving him the right to collect, cannot be regarded as nugatory. It gave him a contractual right to do something which he could hardly have done without the permission of the club-that is to say, to solicit contributions from spectators on the ground. If the club had prevented him from collecting on attaining one or other of the stipulated performances, he could, I take it, have sued them in damages. Even in the case of an away match, where it was necessary for the club oil whose ground the match was played to permit the making of a collection, Mr. Dooland's own club were, I take it, under a contractual obligation to him to apply for, or at all events to support his application for, such Permission. I do not think that the rights given by the league rules to amateurs in the matter of collections really assist Mr. Dooland's case. If the proceeds of collections made by or for amateurs are not taxable, that is merely because they are amateurs playing cricket for their own amusement and not as a source of income. I do not think that Mr. Bucher's submission to the effect that sums paid voluntarily by third parties to the hol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmissioners, came to the view that these were personal testimonials to the skill of the respondent as a cricketer, and were not paid to him because he was the professional employed by the East Lancashire Club. They did not, in other words, arise out of his office or employment but were personal tributes to him. The judge then went on to treat the findings of the commissioners as findings of fact which they were entitled to make, and with which he would not interfere. But as I read paragraphs 8 and 10 of the case stated, the commissioners did not purport to make the findings of fact, but expressed an opinion, and stated the question of law for this court whether they were entitled to hold that opinion on the evidence before them. In my judgment the opinion expressed by a majority of the commissioners and supported by Harman J. that the collections in question were not a profit arising from the respondent's employment within the meaning of the statutes but were given as testimonials to his abilities was clearly wrong. Mr. Dooland is a very distinguished cricketer and on August 27, 1949, he entered into the contract with the East Lancashire Cricket Club the terms of wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llector. Seymour v. Reed [1927] A.C. 554; 11 T.C. 625 was naturally much relied on by counsel for the respondent, and the Master of the Rolls has dealt fully with the decision in that case so far as it relates to the present appeal. It does appear to be a great anomaly that a famous cricketer may receive a benefit running into many thousands of pounds tax free, whilst a professional cricketer in Lancashire playing for a few brief seasons, and receiving small sums by way of collections, should be liable to tax. But the facts in Seymour's case [1927] A.C. 554; 11 T.C. 625 were quite different from the facts in the present case and it is quite clear that the present appeal cannot be determined by applying the decision in Seymour's case [1927] A.C. 554; 11 T.C. 625 to it. I should have been glad to find, if I could, that the collections made to Mr. Dooland were essentially of the same character as the benefit given to Mr. Seymour, and to say that the collections were voluntary payments made by the cricketing public on grounds which were purely personal to Air. Dooland because lie was well liked and because of his cricketing skill, and were not a profit accruing to him ..... 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