Sale under S. E. Act, 1877, and S. L. Acts.

Where a purchaser contracts for the purchase of an estate in fee simple in possession, notwithstanding that the purchase is in part from owners in remainder, e.g., when the remainderman in fee concurs with the tenant for life in selling the fee simple, the purchaser can insist on the duty being borne of the vendors (m); and even if the purchaser contracts with notice of the property being in settlement, the contract being one entire contract for the purchase of the fee simple in possession - as distinguished from separate contracts for the purchase of the separate interests which in the aggregate make up the fee simple - will not assist the vendor to avoid the liability. In such cases the purchaser should require the vendors to have the duty commuted (n) before completion, or insist upon a sufficient indemnity from the remaindermen or reversioners. But a purchaser of an independent reversionary interest, or of an estate subject to a periodical charge, the duration of which depends upon a life or lives, purchases, primd facie, subject to the duty (o), and cannot, in the absence of an express stipulation to the contrary in the contract, require the vendor to discharge it (p); and it is conceived that he may be called upon to covenant to pay it when due and so indemnify the vendor against it. Where, however, land is sold in possession subject to a leasehold interest, the purchaser is entitled to have the lease conveyed free from the duty payable on the determination of the lease (q).

Liability to duty on purchase of reversionary interests.

(e) S. 42.

(f) Dugdale v. Meadows, (1870) 6 Ch. 501.

(g) See Davidson Conv. Prec. 4th ed. Vol. 2, Pt. 1, p. 313.

(h) S. 5; Bee Harding v. .H, (1861) 2 Gif. 597 ; Wilcox v. Smith, (1857) 4 Dr. at p. 55 ; notes to s. 5 in Hanson, 4 th ed.

(i) S. E. Act, 1877, s. 22.

(k) Succession Duty Act, 1853, s. 2 ; see and distinguish s. 42.

(I) S. L. Act, 1882, s. 20.

(m) See s. 42 ; Customs and Inl. Rev. Act, 1889, s. 12 ; Re Kidd and Gibbons, 1893, 1 Ch. 695 ; 62 L. J. Ch. 436.

Sect. 15 of the Act provides that where any succession shall, before the successor shall have become entitled thereto or to the income thereof in possession, have become vested by alienation or by any title not conferring a new succession in any other person, then the duty is to be paid at the same rate and time as if no such alienation had been made or derivative title created. The words in italics must not be read so as to qualify the word " alienation " by the words " not conferring a new succession": they must be read grammatically as placed, as if the section had read " by any title not conferring a new succession or by alienation." Thus when a tenant for life and remainderman in fee contract to sell the fee simple and in pursuance thereof convey their respective interests without obtaining the duty to he commuted, the estate remains liable in the hands of the purchaser or his alienees for the duty which becomes payable on the death of the tenant for life; and the same applies where the tenant for life and remainderman convey under a joint power of appointment created by a disentailing deed under which the property was limited to such uses as they should jointly appoint (r) : and the fact that the property has subsequently become liable to duty in the hands of an alienee under a disposition of the purchasers will not exonerate it from liability to duty on the death of the original tenant for life (a).

(n) Sees. 41.

(o) Cooper v. Trewby, (1860) 28 Beav. 194.

(p) See and consider Barraud v. Archer, (1828) 2 Si. 433 ; 9 L. J. N. S. Ch. 173 ; 2 R. & M. 751 ; Bliss v.

Put man, (1843) 7 Beav. 40; Hales v. Freeman, (1819) 1 Br. & B. 391; Farwett v. Scale, (1849) 18 L. J. Ch. 189.

(q) Re Kidd and Gibbon, 1893, 1 Ch. 695 ; 62 L. J. Ch. 430.

If a tenant in tail in remainder bars the entail, and resettles the property in his own favour, he must, on the death of the tenant for life, pay the same duty as if he had taken his estate in possession under the original settlement; but if on disentailing the property he absolutely alienates it, the liability is shifted to his alienee (t).

In purchasing an estate comprised in a past succession, and which has timber upon it, the future liability to succession duty, under s. 23 of the Act in respect of money to be received from subsequent sales of timber, should be borne in mind: it is conceived that in such a case the vendor is bound to procure an assessment of the future liability and pay it off (u). He should also produce a proper discharge for the duty, if any, which has become due in respect of the sale of timber cut by him, or though uncut contracted to be sold prior to the contract, though it is not clear that the duty is a charge on the land where it formerly grew (x).

As to timber.

(r) A.-G. v. Duke of Northumberland, 1904, 1 K. B. 762 ; 73 L. J. K. B. 418.

(s) S. C.

(t) Braybrooke v. A.-G., (1860) 9 H. L. C. 150; 31 L. J. Ex. 177; see s. 12. As to the reservation of an annuity to a tenant in tail on a re-settlement during the life of the tenant for life and the succession duty payable on the death of the latter, see Inl. Rev. Commrs. v.

Harrison, (1874) L. R. 7 H. L. 1 ; 43 L. J. Ex. 138 ; Le Marchant v. Commrs. of Inl. Rev., (1876) 1 Ex. D. 185 ; 45 L. J. Ex. 247.

(u) It is not, however, the practice to demand duty where timber is cut for sale by a purchaser of the estate after completion, see Hanson, 4th ed. p. 669 ; but quaere if the estate were a timber estate as in Dashwood v. Magniae, 1891, 3 Ch. 306 ; 60 L. J. Ch. 809.

By the Inland Revenue Act, 1888, s. 21, in addition to the duties chargeable under s. 10 of the Succession Duty Act, 18o3, the following duties in respect of every succession therein referred to were made chargeable in the case of any person dying on or after the 1st July, 1888, that is to say:- A duty of half per cent, upon the value of the successor's interest where the successor is the lineal issue or ancestor of the predecessor, and in all other cases a duty of one-and-a-half per cent, thereon : the interest of the successor, however, on leaseholds passing to him by will or devolution by law are exempted from the additional duty; so also is property on which account duty is payable under the Customs and Inland Revenue Act, 1881.

Additional succession duties.

By the Customs and Inland Revenue Act, 1889, where the value of any succession (y), upon the death of any person dying on or after the 1st June, 1889, and before the 1st June, 1896, chargeable with duty under the Succession Duty Act, 1853, and the Customs and Inland Revenue Act, 1888, exceeds 10,000, and also where the value of any succession to real property, under the will or intestacy of any person so dying, chargeable with duty under the said Act, does not exceed 10,000, but such value together with the value of any other benefit taken by the successor under such will or intestacy exceeds 10,000, a further duty of one per cent, is chargeable: this duty is not, however, payable upon the value of leaseholds passing by will or devolution by law, or of property included in an account under s. 38 of the Customs and Inland Revenue Act, 1881, as amended by this Act, in respect of which value duty has been paid under s. 5 of this Act. The duty is made a first charge on real property or on the interest of the successor therein according as it is or is not chargeable on the principal value of the property : it seems that a purchaser, when the duty is payable on the principal value, is not exempted from the necessity of seeing that the duty is paid (z).

Temporary estate duty.

(x) Succession Duty Act, 1853, b. 42 ; see slip. p. 1228.

(y) I.e., the whole succession and not only the interest of the successor therein, see A.-G. v. Lord Abcrdare, (1892) 61 L. J. Q. B. 615.

Where estate duty is payable under the Finance Act, 1894, neither the additional succession duties or the temporary estate duty is payable (a).