COUNSEL: Macnaghten, Q.C., and Methold, for the Petitioner.

Vaughan Hawkins, for the Crown.

 

SOLICITORS: Solicitors: Johnson & Master; The Solicitor to the Inland Revenue; Clayton, Sons, & Fargus; Frankish & Buchanan.

 

JUDGE: Chitty, J.

 

DATES: 1882 Nov. 21, 25; Dec. 6, 7, 14.

1883 Jan. 23; April 24.

 

Petition – Legacy Duty – Chinese Domicil – Anglo-Indian Domicil.

 

Notwithstanding, the constitution of the Supreme Court of China and Japan, and the jurisdiction conferred on that Court over British subjects having a fixed place of residence in China, a British subject cannot acquire by residence in China a new domicil so as to exempt his personal estate on death from the operation of the Legacy Duty Act.

 

British subjects resident in Chinese territory cannot acquire in China a domicil similar to that existing in India, and commonly know as Anglo-Indian.

 

THE facts and the arguments in this case fully appear from the judgment.

 

Macnaghten, Q.C., and Methold, for the Petitioner.

 

Vaughan Hawkins, for the Crown.

 

B. B. Rogers, Hood, and Bissill, appeared for other parties.

 

The following authorities were cited or referred to:– Arnold v. Arnold (1); In re Ewin (2); Udny v. Udny (3); Thomson v. Advocate-General (4); Attorney-General v. Forbes (5); Re Wallop’s Trust (6); Bell v. Kennedy (7); Advocate-General of Bengal v. Ranee Sanomoye Dossee (8); The Laconia (9); The Indian Chief (10); Doucet v. Geoghegan (11); The Harmony (12); Bruce v. Bruce (13); Collier v. Rivaz (14); Phillimore on Domicil(15); Westlake on Private International Law(16); McLaren on Wills and Succession(17); Jarman on Wills(18); Yeap Cheah Neo v. Ong Cheng Neo (19).

 

(1) 2 My. & Cr. 256.

 

(2) 1 C. & J. 151.

 

(3) Law Rep. 1 H. L., Sc. 441.

 

(4) 12 Cl. & F. 1.

 

(5) 2 Cl. & F. 48.

 

(6) 1 D. F. & J. 656.

 

(7) Law Rep. 1 H. L., Sc. 307.

 

(8) 2 Moo. P. C. (N.S.) 22.

 

(9) Ibid. 161.

 

(10) 3 Rob. Adm. 12.

 

(11) 9 Ch. D. 441.

 

(12) 2 Rob. Adm. 322.

 

(13) 2 B. & P. 229, n.

 

(14) 2 Curt. 855.

 

(15) Page 150.

 

(16) Pages 262, 263, 265.

 

(17) Vol. i. p. 4, par. 8.

 

(18) 4th Ed. vol. i. p. 3.

 

(19) Law Rep. 6 P. C. 381. [*533]

 

The following Acts of Parliament were also referred to: 6 & 7 Vict. c. 80, s. 3; 24 & 25 Vict. c. 114, and 20 & 21 Vict. c. 77, s. 93.

 

April 24.  CHITTY, J. :–

 

The question raised by this petition is whether the personal estate of the testator, J. B. Tootal, is liable to legacy duty. The testator’s will was proved in Her Majesty’s Supreme Court for China and Japan at Shanghai and has not been proved in England.No part of his personal estate was locally situate in England at the time of his death, and it is admitted on the part of the Crown that probate in England is not required. In consequence of the claim made by the Crown for legacy duty the executors, who are also trustees of the will, have paid the funds representing the residuary personal estate into Court under the Trustee Relief Act. And the petition is presented by some of the residuary legatees, or persons claiming under them, asking for a declaration that the testator was domiciled at Shanghai at the time of his death, and consequently that no legacy duty is payable, and for a distribution of the fund on that footing.

 

The liability of the personal estate of a testator or intestate to legacy duty under the statutes in question depends on his domicil at his death; if his domicil is in Great Britain the duty is payable, if his domicil is out of Great Britain no duty is payable. That his personal estate may happen to be locally situate in Great Britain, or that the funds may be transmitted to Great Britain for the purpose of being paid to the legatees, are immaterial circumstances. The broad principle that the liability depends on domicil was established by the House of Lords in Thomson v. Advocate-General (1). The earlier decisions in conflict with that principle were overruled by that case. The previous decision of the House of Lords in Attorney-General v. Forbes (2) does not, when explained, conflict with Thomson v. Advocate-General. As was pointed out by Lord Wensleydale in Attorney-General v. Napier (3) the case of Attorney-General v. Forbes proceeded upon

 

(1) 12 Cl. & F. 1.

 

(2) 2 Cl. & F. 48.

 

(3) 6 Ex. 217. [*534]

 

the assumption (which so far as the facts are stated in the reports was erroneous) that the domicil was in India, and it must be treated as a case of domicil in India. The first and principal question then is where the testator was domiciled at the time of his death.

 

It is admitted that his domicil of origin was in England. The burden of proof that he had acquired a new domicil of choice therefore rests on the Petitioners.

 

The facts are not in dispute. After some previous changes of residence, which it is unnecessary to trace, the testator in 1862 went to reside at Shanghai in the Empire of China, and, with the exception of some visits to England in 1864 and 1873 for health and business, he continued to reside at Shanghai till his death, which occurred in 1878. During his residence there he very extensively engaged in business in connection with newspapers, being the manager and part proprietor of the North China Heraldand the North China Daily News and other publications and periodicals, all of which were published at Shanghai, and he was also a partner in a printing business there.

 

Evidence has been adduced on the part of the Petitioners shewing that for some years before his death he had determined to reside permanently at Shanghai and had relinquished all intention of ever returning to England, and that he had in fact on several occasions expressed his intention of not returning to England. This evidence remains uncontradicted on the part of the Crown. In his will he describes himself as of Shanghai in the Empire of China. In these circumstances it was admitted by the Petitioners’ counsel that they could not contend that the testator’s domicil was Chinese. This admission was rightly made. The difference between the religion, laws, manners, and customs of the Chinese and of Englishmen is so great as to raise every presumption against such a domicil, and brings the case within the principles laid down by Lord Stowell in his celebrated judgment in The Indian Chief (1), and by Dr. Lushington in Maltass v. Maltass (2).

 

But it is contended on the part of the Petitioners that the testator’s domicil was what their counsel termed “Anglo-Chinese,”

 

(1) 3 Rob. Adm. 29.

 

(2) 1 Rob. Ecc. 67, 80, 81. [*535]

 

a term ingeniously invented in analogy to the term “Anglo-Indian.”

 

To make this contention intelligible it is necessary to state some further facts. Under the treaties between Her Majesty and the Emperor of China of 1842, 1843, and 1858, British subjects with their families and their establishments are allowed to reside for the purpose of carrying on their mercantile pursuits without molestation at Shanghai and certain other cities, and to establish warehouses, churches, hospitals, and burial grounds. By the 15th clause of the treaty of 1858 it is stipulated that all questions in regard to rights of property or person arising between British subjects shall be subject to the jurisdiction of the British authorities. By the same treaty provision is made for the settlement of disputes between British subjects and Chinese by the joint action of the British consul and the Chinese authorities, and also for the Chinese authorities themselves affording protection to the persons and properties of British subjects.

 

The treaties do not contain any cession of territory so far as relates to Shanghai, and the effect of them is to confer in favour of British subjects special exemptions from the ordinary territorial jurisdiction of the Emperor of China, and to permit them to enjoy their own laws at the specified places. Similar treaties exist in favour of other European Governments, and the United States.

 

By virtue of these treaties and of the statutes 6 & 7 Vict. c. 80, and c. 94, the Crown has, by the Order in Council of the 9th of March, 1865, constituted a Supreme Court at Shanghai.

 

The first of these statutes, intituled “An Act for the better Government of Her Majesty’s subjects resorting to China,” enables Her Majesty by Order in Council to ordain “for the government of her subjects within the dominion of the Emperor of China, or being within any ship or vessel at a distance of not more than 100 miles from the coast of China,” any law or ordinance as effectually as any such law or ordinance could be made by Her Majesty in Council for the government of her subjects within Hong Kong which had been ceded to Her Majesty. The second of the statutes, commonly known as the Foreign Jurisdiction Act,after reciting that by treaty, capitulation, grant, usage, sufferance, [*536] and other lawful means, Her Majesty had power and jurisdiction within divers countries and places out of her dominions, and that doubts had arisen how far the exercise of such powers and jurisdiction was controlled by and dependent on the laws and customs of the realm, enacts that Her Majesty may exercise any pourer or jurisdiction which she then had, or at any time thereafter might have, within any country or place out of her dominions in as ample a manner as if she had acquired such power or jurisdiction by the cession or conquest of territory. The Order in Council by which the Supreme Court was established, provides that all Her Majesty’s jurisdiction exercisable in China for the judicial hearing and determination of matters in difference between British subjects or between foreigners and British subjects, or for the administration or control of the property or persons of British subjects, shall be exercised under or according to the provisions of the order and not otherwise. It further provides that subject to the provisions of the order the civil jurisdiction shall, as far as circumstances admit, be exercised upon the principles of and in conformity with the Common Law, the rules of Equity, the statute law, and other law for the time being in force in and for England. The Supreme Court is a Court of Law and Equity, and a Court for matrimonial causes, but without jurisdiction as to dissolution or nullity or jactitation of marriage. It is a Court of Probate, and as such “as far as circumstances admit” has for and within China, with respect to the property of British subjects having at the time of death “their fixed places of abode in China,” all such jurisdiction as for the time being belongs to the Court of Probate in England. It has jurisdiction for the safe custody of the property of British subjects not having at the time of death their fixed abode in China or Japan.

 

The exceptions from the jurisdiction of the Court as a matrimonial Court in regard to dissolution, nullity, or jactitation of marriage are important, and the effect of them is apparently to leave Englishmen subject to the jurisdiction of the Court for Matrimonial Causes in England in respect of the excepted matters.

 

Upon these facts it is contended for the Petitioners that there exists at the foreign port of Shanghai an organised community of British subjects independent of Chinese law and exempt from [*537] Chinese jurisdiction, and not amenable to the ordinary tribunals of this country, but bound together by law which is English law, no doubt, but English law with this difference, that the English revenue laws do not form part of it, and that by residence and choice the testator became a member of this community, and as such acquired an Anglo-Chinese domicil.

 

The authorities cited in support of this contention for an Anglo-Chinese domicil relate to the Anglo-Indian domicil of persons in the covenanted service of the East India Company. These authorities are generally admitted to be anomalous(1). They are explained by Lord Hatherley in his judgment in Forbes v. Forbes (2) and by Lord Justice Turner in Jopp v. Wood (3). The point that the animus manendi was inferred in law from the obligation to serve in India as stated by Lord Hatherley,has no bearing on the case before me, in which the evidence is sufficient for general purposes to establish the animus manendi.But the observations of Lord Justice Turner that the East India Company was regarded as a foreign Government are material. He says(4), “At the time when those cases [on Anglo-Indian domicil] were decided, the Government of the East Indian Company was in a great degree, if not wholly, a separate and independent Government foreign to the Government of this country, and it may well have been thought that persons who had contracted obligations with such Government for service abroad could not reasonably be considered to have intended to retain their domicil here. They, in fact, became as much estranged from this country as if they had become servants of a foreign Government.”

 

Lord Stowell in his judgment in the Indian Chief shews that in his time the sovereignty of the Great Mogul over the British territories in India was merely nominal, being, as he says, occasionally brought forward for purposes of policy, and that the actual authority of government over these territories was exercised with full effect by this country, and the East India Company, a creature of this country. His observation as to the authority of government being exercised by this country is not really inconsistent

 

(1) Dicey on Domicil, pp. 140, 141, 337.

 

(2) Kay, 341.

 

(3) 4 D. J. & S. 616.

 

(4) Ibid. 623. [*538]

 

with the passage above cited from Lord Justice Turner’s judgment. Lord Stowell was not addressing himself to the particular point for which I have quoted Lord Justice Turner’s judgment. Although the Government of British India was English, being carried on principally by the agency of the chartered company, it was for all practical purposes a distinct Government from that of Great Britain, and in that sense it was, as Lord Justice Turner says, regarded as a foreign Government. At Shanghaithere is a British consul, residing there by virtue of the treaties, but there is no government by British authority existing there, and there is nothing which can be regarded as a separate or independent Government, and the analogy which the Petitioners seek to establish with an Anglo-Indian domicil is not made out.

 

On principle, then, can an Anglo-Chinese Domicil be established? The British community at Shanghai, such as it is, resides on foreign territory, it is not a British colony, nor even a Crown colony, although by the statutes above referred to the Crown has as between itself and its own subjects there a jurisdiction similar to that exercised in conquered or ceded territory.

 

Residence in a territory or country is an essential part of the legal idea of domicil. Domicil of choice, says Lord Westbury in Udny v. Udny (1), is a conclusion or inference which the law derives from the fact of a man fixing voluntarily his sole or chief residence in a particular place with the intention of continuing to reside there for an unlimited time. He speaks of residence in a particular place, and not of a man attaching himself to a particular community resident in the place. In Bell v. Kennedy (2) he uses similar expressions. Domicil is an idea of the law, “it is the relation which the law creates between an individual and a particular locality or country.” He refers to locality or country and not to a particular society subsisting in the locality or country. The difference of law, religion, habits, and customs of the governing community may, as I have already pointed out, be such as to raise a strong presumption against the individual becoming domiciled in a particular country; but there is no authority that I am aware of in English law that an individual can become domiciled as a member of a community which is not the

 

(1) Law Rep. 1 H. L., Sc. 458.

 

(2) Law Rep. 1 H. L., Sc. 320. [*539]

 

community possessing the supreme or sovereign territorial power. There may be, and indeed are, numerous examples of particular sects or communities residing within a territory governed by particular laws applicable to them specially. British Indiaaffords a familiar illustration of this proposition. But the special laws applicable to sects or communities are not laws of their own enactment, they are merely parts of the law of the governing community or supreme power.

 

It may well be that a Hindoo or Mussulman settling in British India, and attaching himself to his own religious sect there, would acquire an Anglo-Indian domicil, and by virtue of such domicil would enjoy the civil status as to marriage, inheritance, and the like accorded by the laws of British India to Hindoos or Mussulmans, and such civil status would differ materially from that of a European settling there and attaching himself to the British community. But the civil status of the Hindoo, the Mussulman, and the European would in each case be regulated by the law of the supreme territorial power.

 

In the case before me the contention is for a domicil which may not improperly be termed extra-territorial. The sovereignty over the soil at Shanghai remains vested in the Emperor of Chinawith this exception, that he has by treaty bound himself to permit British subjects to reside at the place for the purposes of commerce only, without interference on his part, and to permit the British Crown to exercise jurisdiction there over its own subjects, but over no other persons.

 

According to the Petitioner’s argument the subjects or citizens of all the foreign states who enjoy similar treaty privileges would (subject to any particular exceptions arising from the law of their own country in relation to domicil), acquire under circumstances similar to those in the present case a new domicil of choice. If for instance a citizen of the United States were to reside at Shanghai with the intention of remaining there permanently, but not under such circumstances as would be sufficient to rebut the strong presumption against a Chinese domicil, and were to attach himself so far as he could to one of the European communities there, say, for an instance, the British community, he would, according to the Petitioner’s contention, have lost his [*540] domicil of origin, and would have acquired an Anglo-Chinese domicil, which for most practical purposes would be equivalent to an English domicil. In my opinion he would not acquire such a domicil.

 

It appears to me that there is no substantial difference as to the question I am considering between the residence of a British subject at Shanghai, or at any factory in Turkey or elsewhere, or the East, whether by virtue of special treaties, capitulations, sufferance, or the like. But such factories are not regarded as colonies or foreign countries for the purpose of domicil. There may be commercial domicil there in times of war with reference to the law of capture, but that is altogether a different matter.

 

No authority except those relating to Anglo-Indian domicil has been cited in support of the Petitioner’s contention as to domicil. In Maltass v. Maltass (1), already cited, Dr. Lushington admitted to probate the will, valid according to the law of England,of an English merchant resident at a British factory at Smyrna.He held that if the treaty between England and the Porte was applicable to British merchants resident or domiciled in the ordinary acceptation of the term in Smyrna, the provisions of the treaty decided what was to be done in the case of succession to personal estate, namely, that it was to follow the law of England.But he considered that the deceased was domiciled not in a colony, but in England.

 

In the argument for the Petitioners great reliance was placed on the nature and extent of the jurisdiction of the Court at Shanghai, and the fact that the will has not been proved in England. The law administered by the Court at Shanghai, being for most practical purposes the same as that administered in England, the question of domicil is likely to arise only in exceptional cases like the present. The jurisdiction conferred on the Supreme Court at Shanghai is merely the jurisdiction of Her Majesty exercisable in China, and confined to British subjects. It is not exclusive and does not oust the jurisdiction of Her Majesty’s Courts in England. No solid reason exists that I can discover for holding that the will of an Englishman “whose fixed place of abode” was at his death in China, could not be

 

(1) 1 Rob. Ecc. 80. [*541]

 

admitted to probate by the Court of Probate in England. I may observe that the term “fixed place of abode” is not equivalent to domicil. The technical term “domicil” was, it appears to me, purposely avoided. The only distinction between this case and Maltass v. Maltass (1) is the existence at Shanghai of an English Court of Probate. Similar Courts now exist in the Ottoman dominions and in Eyypt. In fact all these Courts are Consular Courts, or constituted on the same model with more or less jurisdiction.

 

In the case of Attorney-General v. Napier (2) letters of administration had been granted by the Courts established in India,where nearly the whole of the intestate’s personal estate was locally situate at his death. In order to recover a comparatively small debt in England, administration was taken out in this country also. The intestate’s domicil was in England. But in deciding that legacy duty was payable, the Court of Exchequer proceeded solely on the domicil, and did not even advert in the judgment to the grant of administration in England. Evidently that fact, as well as the fact that the Indian Court had jurisdiction to grant and had granted administration, were considered immaterial.

 

If an Englishman domiciled in England dies resident abroad, and no part of his assets are in England, and no probate or letters of administration are taken out in England, there may be great difficulty in asserting the Crown’s right to duty, and inasmuch as foreign Courts will not enforce the revenue laws of this country the difficulty may in some cases be insuperable. But the Crown’s right cannot depend on the greater or less difficulty in pursuing the remedy. In the case before me there is no difficulty in giving the remedy, since the fund is in Court, and under the Legacy Duty Acts this Court or its officers are bound to see that the legacy duty, if payable, is paid before the fund is parted with.

 

The circumstance that the will has not been proved here is also immaterial. It has been proved in a duly constituted British Court of competent jurisdiction, and, it being admitted that further probate here is not required, it follows that the

 

(1) 1 Rob. Ecc. 67.

 

(2) 6 Ex. 217. [*542]

 

Court must look at the Shanghai probate before distributing the fund. This disposes of the argument that the Court cannot take notice of an alleged will of personal estate, unless it has been proved in this country. The argument which was addressed to me, founded on a close examination of the various provisions of the Legacy Duty Acts, for the purpose of shewing that they do not apply in the circumstances of this case, was substantially the same as that urged in the House of Lords in Attorney-General v. Forbes (1), and is disposed of by the decisions in Thomson v. Advocate General (2), and in Attorney-General v. Forbes, as explained by the Court of Exchequer in Attorney-General v. Napier (3).

 

For these reasons I hold that there is no such thing known to the law as an Anglo-Chinese domicil, that the testator’s domicil remained English, and that the circumstances are not sufficient to create any exception from the broad principle that legacy duty is payable when the domicil is British. Consequently I think that the duty is payable.

 

(1) 2 Cl. & F. 48.

 

(2) 12 Cl. & F. 1.

 

(3) 6 Ex. 217.