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Royal Choral Society Vs. Inland Revenue Commissioners. - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
Decided On
Reported in[1944]12ITR13(Cal)
AppellantRoyal Choral Society
Respondentinland Revenue Commissioners.
Cases ReferredSpecial Purposes Commissioners v. Pemsel.
- lord greene, m. r. :- the royal choral society is an institution which has had a long and honourable history. it has performed services of great value to musical art. it would appear that in general the performances which it has given have been conducted at a loss; but there have been occasions, notably ion the year 1937, when 'hiwatha' was performed, when a performance was produced at a profit. this circumstance attracted the attention of the inland revenue authorities, who sought to tax the income of the society, alleging that it is not a society 'established for charitable purposes only'; and that its income is not exclusively applied for such purposes'. the question which we have to decide is whether or not that contention of the revenue is right.the special commissioners accepted the.....
LORD GREENE, M. R. :- The Royal Choral Society is an institution which has had a long and honourable history. It has performed services of great value to musical art. It would appear that in general the performances which it has given have been conducted at a loss; but there have been occasions, notably ion the year 1937, when 'Hiwatha' was performed, when a performance was produced at a profit. This circumstance attracted the attention of the Inland Revenue Authorities, who sought to tax the income of the society, alleging that it is not a society 'established for charitable purposes only'; and that its income is not exclusively applied for such purposes'. The question which we have to decide is whether or not that contention of the Revenue is right.

The Special Commissioners accepted the view put before them by the Revenue; and their finding is contained in paragraph 13 of the case, where they say this : 'Having considered the arguments and evidence adduced before us, we held that the society was not a body of persons established for charitable purposes only, and we refused the societys claims for exemption from income tax.'

The preliminary argument presented by the Solicitor-General was to the effect that finding was, or involved, a finding of fact which was binding upon this Court. He quoted some observations of Lord Hanworth, when Master of the Rolls, in the case of Inland Revenue Commissioners v. Yorkhire Agricultural Society from which it would appear that in Lord Hanworths opinion the question whether or not a body of persons was 'established for charitable purposes ' would, in certain circumstances, be a question of fact. With all respect, I cannot accept that view. It is the business of the Commissioners to find facts. It is a question of law whether, upon the facts so found, the particular body in question is a body established for charitable purposes. That is a question of law; and in no circumstances, in my opinion, can it be turned into a matter of fact.

But, quite apart from those considerations, the passage which I have read, on its true construction, in my opinion is intended to be conclusion of law and nothing else.

The findings of fact of the Commissioners, so far as they are relevant, are not set out as such in the usual way at the conclusion of the case, but must be collected from the body of the case itself. In the body of the case are to be found several matters which show what the facts were which were established to the satisfaction of the Commissioners.

First of all, in paragraph 3, referring to a petition presented to the House of Lords against a Bill promoted by the Alert Hall Corporation, the Commissioners say : 'The said petition sets out the other facts relating to the origin, management and conduct of the society.' That, therefore, is a finding of fact.

The next matter later to the evidence given before them by Sir George Dyson. In dealing with that evidence, they have adopted a form which I have always thought, and on occasions have said, is not a desirable form to use in these cases. They say : 'Sir George Dyson gave evidence before us and stated (inter alia)'; and then they set out what his evidence was. To may mind it is quite impossible to interpret that as meaning that, although Sir George Dyson said that, they did not believe him. The only significance and interpretation that can be given to that paragraph is that they accepted that evidence as evidence of fact; otherwise the paragraph is meaningless, if not misleading. We therefore find in the evidence of Sir George Dyson the matter of fact which we must take to have been found by the Commissioners.

Further embodied in Sir George Dysonss evidence in certain evidence referred to as taken from the printed report before the Select Committee on the Bill which I have mentioned. That, again, is part of the matters of fact. Sir George Dyson, in dealing with the technical matters relating to the particular art with which he is so familiar, was giving in the ordinary way opinion evidence in many respects; and those opinions must be taken as having been accepted by the Commissioners.

The Commissioners, with that material before them, came to a conclusion of law; and the question is whether, on the fact as appearing in the body of the case, the Commissioners rightly came to that conclusion. Macnaghten, J.,held that they did not and I agree with him.

The respondents are a body of ten gentlemen who carry on the work which has been carried on since 1871 by the unincorporated body originally named the 'Royal Albert Hall Choral Society. ' In the petition to which I have referred the history of the society is set out and the method in which it was conducted; and the work which it was doing is given in some detail. That was in the year 1927. In the case it is stated that the objects specified in a later document drawn up in 1939 have been the objects of the society from the date of its foundation. In point of fact in 1939 a constitution and rules were drawn up, and the respondents carry on their work to-day under the constitution and rules. The object as they are there set out are, as the Commissioners find, precisely the same as the objects for which the society has been carried on from the date of its foundation. The objects as stated in the petition were 'for the purpose of providing choral concerts in the said hall' that is to say, in the Albert Hall - 'and generally for the encouragement and advancement of choral singing in London.' The providing of choral concerts quite clearly is regarded in that language as one of the methods of encouraging and advancing choral singing. When the objects were formulated in the existing rules, the language used was this : 'The society is established to form and maintain a choir in order to promote the practice and performance of choral works, whether by way of concerts or choral pageants in the Royal Albert Hall, or as otherwise decided from time to time.' I do not read that language as in any way extending what had all along been the purpose and objects of the society. It seems to me that a very good paraphrase of the language of the existing rules is the phrase found in the petition, namely, 'the encouragement and advancement of choral singing.' That is what appears to me to be the meaning of the words 'to promote the practice and performance of choral works. 'Choral works' must not be regarded as works written for a chorus, or normally sung by what is normally called 'a chorus.' They are words well known to mean works which are written for or are sung by a choir, which is a very different thing to what is commonly called a chorus. The type of music which is written for a choir or which is performed by a choir is a special type of music which requires a choir, and a trained choir, for its adequate performance. Examples of the sort of works meant by 'choral works' may be found from the actual practice of the society. Familiar names which occur to one and which appear in the case are 'The Messiah', Beethovens Mass in D, 'The Elijah' and cantatas and oratorios, and so forth. It does not exclude choir singing of other kinds.

An attempt was made in the argument for the Crown to say that one particular performance, namely 'Hiawatha', was something which had no eductive or useful value; and fell so far below some assumed standard of music that it must be regarded as nothing more nor less than a popular entertainment. I really do not know on what ground that argument was based. 'Hiawatha (which I have never had the pleasure of hearing and about which I know nothing) is, obviously (and indeed, it is so found), a choral work. Of its merits I know nothing nor is there any evidence or finding about that.

The argument for the Crown raised a number of points. First of all its was said, and said truly that the problem is to ascertain the purpose for which this society was established. I think that this proposition is incontrovertible. It was then said that the purpose for which it was established may be regarded from three points of view : first of all, the purpose of the ten gentlemen who constitute the society; secondly, the purpose from the point of view of the choir of the public who goes to hear the performances. It was said that, when those are all looked at, the real purpose must be taken to be not one which is educational or otherwise charitable, but one which is of pure entertainment. The public goes to be entertained; the signers sing in order to have the pleasure of singing; and the ten gentlemen encourage and assist those operations in order to have the pleasure of running a choir and listening to the performances. Those, it was said, were the real purposes for which this body was established. With all respect to the argument, nothing, in my opinion, could be a greater travesty of the facts. Curiously enough some people find pleasure in providing education. Still more curiously, some people find pleasure in being educated; but the element of pleasure in those processes is not the purpose of them, but what may be called a by product which is necessarily there. It seems to me to be turning the facts of this case upside down to suggest that the real object is to provide pleasure and nothing else.

But that, of course, does not conclude the matter, because it has to be shown that the purpose of this body of persons is charitable and only charitable. We are accordingly thrown back upon an examination of the purposes for which it was established and for which it carries on its work. It is the purpose of the members of the society, ten in number, that is relevant. The maintenance of the choir may be regarded in two aspects; First, as an educative process for the members of the choir; and, secondly, as an instrument by which the performance of this type of music is presented to the public. I should have said that there is no flavour of commercial profit, or anything of that kind, about this society. So far as the choir is concerned, the object, as I have said paraphrasing the language of the rule, is the encouragement and advancement of choral singing; or, taking the language of the rule,'the promotion of the practice and performance of choral works.' Bearing in mind the nature of the works in question and the medium through which they are performed, it seems to me that the objects, so far as the public are concerned, are educational; and in so for as possibly they may not be regarded as educational, they would fall within the fourth case referred to in Lord Macnaghtens analysis in the Income-tax Special Purposes Commissioners v. Pemsel.

Dealing with the education aspect from the point of view of the public who hears music, the learned Solicitor General argued that nothing could be educational which did not involve teaching as I understood him, teaching in the sense of a master teaching a class He said that in the domain of art the only thing that could be educational in a charitable sense would be the education of the executants : the teaching of the painter, the training of the musician, and so forth. I protest against that narrow conception of education when one is dealing with aesthetic education. Very few people can become executants, of at any rate executants who can give pleasure either to themselves or to others; but a very large number of people can become instructed listeners with a trained and cultivated taste. In my opinion, a body of persons established for the purpose of raising the artistic taste of the country and established by an appropriate document which confines them to that purpose, is established for educational purposes, because the education of artistic taste is one of the most important things in the development of a civilized human being.

In the case of artistic taste, one of the best ways of training it is by presenting works of high class, and gradually training people to like them in preference to works of an inferior class. The people who undergo this process go no doubt with the idea of being amused or entertained but it is not the state of mind of the people who go to the performance which matters for the present purposes; it is the purpose of the people who provide it which is important. If the people who are providing the performance are really genuinely confining their objects to the promotion of aesthetic education by presenting works of a particular kind or up to a particular standard, it seems to me that is just as much education (and in fact, having regard to the subject-mater the best available method of education) as lecturing or teaching in class, or anything of that kind.

The Solicitor-General referred to a number of cases in which he said it was established that education in the charitable context is limited to teaching in that narrow sense. In may opinion, those cases do not establish any such proposition. I should be very sorry to think that they did. The matters that were being dealt with a those cases have nothing to do with aesthetic education, or the cultivation and improvement of public taste in music or the other arts. I cannot help thinking that the Board of Education, which has taken the Council for Encouragement of Music and the Arts under its wing, would be very surprised to learned that enterprise, in which public funds are now being used, was not an educative one.

But really, when one analyses this particular case, the fact that the performance are given to the public is not of such great importance; because the circumstance that the choir is being trained, that the training and practice of the choir is one of the principal objects, and in fact may be the primary object, of this society leads to the result that the public performance, as my brother du Parcq.. L.J., pointed out, really may be regarded as something which is a consequential and necessary part of the training; because you cannot train people satisfactorily if they do nothing but rehearse - they must perform. So far as the performance to the public is to be regarded as an object in itself it seems to me that the performance of this type of work by a trained choir is designed to raise the standard of musical taste, and to give to the public an opportunity of hearing, becoming familiar with and appreciating a particular type of music which comprises some of the very finest musical works that have ever been written. So far as the performers are concerned, they are not members of the society; they are not paid for their services; but what they are getting is a very high level of musical education. Sir George Dyson said : 'It was broadly true that the society was the instrument by which everything that there is to be learned about choral music could be learned.' 'He also said : 'The society during its existence has made a large contribution to the higher forms of music which have to do with choral singing. The work of the society is a good means of making the country musical. He thought the vast majority of the performers joint the society because they wanted to exercise their musical faculties and wanted to get to know musical works.' Then he refers to and agrees with the evidence given by Sir High Allen, another member of the society, before the Joint Select Committee.

Picking out one or two paragraphs from the report of that evidence, Sir Hugh Allen says this in answer to the question : 'Do you regard these performances as a valuable element in the musical education of the country (A) I do 'Then he says 'I would like, If I may to say to your Lordships that the Royal Choral Society during its fifty five years of existence has made a very large contribution to the higher forms of music which have to do with choral singing.' Then he says : It is my opinion that singing in general is the best means, especially the singing of choral societies, for making this country musical' Then he is asked : 'From that point of view, and you have had some experience of musical education, you do attach considerable importance to the continued existence of such a society as the Royal Choral Society (A) Most certainly.' There are other passages in the evidence to like effect. It seems to me that if the Commissioners had found upon the evidence before them that the purpose and object of this society were not educational, or did not fall within the fourth class in Lord Macanghtens analysis in Pemsels case, they would have been coming to a finding for which there was not only no support in the evidence, but which would have been in the teeth of the evidence before them. It is of course, true that you have to find the purpose of the alleged charitable establishment. It may very well be that a purpose which on the face of it looks to be the real purpose, on close examination is found not to be the real purpose. A body of persons may purport to set themselves up for educational purposes; but, on a full examination of the facts, it may turn out that their purpose is nothing of the kind, and is one merely to provide entertainment or relaxation to others, or profit to themselves. In other words, the presence of the element of entertainment or pleasure may be either an inevitable concomitant of a charitable or educational purpose, or it may be the real fundamental purpose, and education may merely be a by-product. Whether a case falls within one class or the other is, no doubt, a question of fact, save and so far as it may depend upon the construction of written documents. But, again, it would have been quite impossible on that evidence, on the facts that they find and on the evidence that they accept for the Commissioners to say that the real purpose of this society was merely to provide entertainment to give to the choir the pleasure of using their voices and the feeling of satisfaction at appearing in public and to the public mere entertainment and relaxation. I cannot think that that anyone who really appreciates the facts of this case could for one moment possibly come to such a conclusion.

In may opinion, that really disposes of the arguments in the case. They have traversed a wide ground. I have done my best to compress what appeared to me to be the more important points which were brought forward.

A considerable number of cases were mentioned, and I doubt very much whether any useful purpose would be served by going through them. But I ought, perhaps, to mention one paragraph in Tudor on Charities and the two cases there feared to; because it seems to me that the paragraph in Tudor is inadequate and, indeed, if read in a certain sense, misleading. The passage is on page 39 of the 5th edition, and says : 'The fine arts, however, are probably not regarded as objects of charity, and a gift to encourage artistic pursuits was held not charitable sense If it does, I dissent from that most vehemently. There is not a particle of authority in support of such a view. If it means that the only way you can bring the fine arts into the charmed circle of charity is by setting up a class to teach executants, whether to teach executants, whether to teach actors to act, or painters to paint, or musicians to perform, again I dissent most vehemently from any such proposition. Accordingly, in my opinion, that paragraph is inadequate and, indeed, misleading.

When the two authorities on which it is based are looked at, it is found that they rate not authorities for any such proposition. The first is Allsop, In re where Chgitty, J. said that society known as the 'Nottingham Sacred Harmonic Society' could in no sense be called a charity. Macnaghten, J. in his judgment observes : IN this case the body concerned was interested to say that it was not a charity, because if it was a charity it could not benefit from the testators benevolence because of the Mortmain Acts It was therefore, contending and asserting that it was not a charity; but we known nothing about it. We do not know that it constitution was. Chitty, J., finds as a fact, although it had other words in its objects that it was formed with the laudable one of promoting among the public music as an art, yet was at the same time formed and kept up by its members for their own amusement.' That is what he finds on the facts of that case. What those facts were we do not know; but, having come to that conclusion of fact, the result, of course, followed as was recorded in that case. I find no assistance from Allsop. In re; still less do I find any authority in its on which to found the proposition set forth in Tudor.

The other case was the case of Ogden, In re. there the testator desired that his executors, with the assistance of certain gentlemen and an art master, and any persons they might call in to assist them, should expended his residue' in any manner they may think desirable to encourage artistic pursuits or assist needy students in art.' Again, the report of the lease is very meager. Lord Cozens Hardy, M. R.; said that no less than three times last year had it fallen to his lot to express his view on what the law was in this kind of case. Then he said (25 T.L.R. at p. 383) : 'In the present case the vice-Chancellor had thought that the trustees were bound to spend the money to encourage in some way or other education in art. With the greatest respect to the learned Vice-Chancellor, he did not see how it was possible to get that meaning out of the words'. I do not myself derive any assistance from that case : but it is worth pointing out that a gift merely 'to encourage artistic pursuits might be expended in a way that nobody would consider charitable : for instance, in merely providing perhaps for one or two individual saints and paint brushes, or a grand piano with which they could play in their drawing-room. I apprehend nobody would say that that we a charitable object; but the money could have been spent for some such purpose as that.

So far as authorities are of assistance, I find considerable support for the view I have ventured to put forward in the decision of P. O. Lawrence, J., as the then was in the case of Shakeshpeare Memorial Trust, In re. I do not propose to take up time in referring to the facts of that case; but, in many respects particularly from the point of view of public education in matters of art, it falls into line with what I myself have said earlier in this judgment. In that case there happened one of those curious things that frequently happen where the crown is concerned : for there the Crown, appearing by the Attorney-General, was asserting that the Shakespeare Memorial Trust was a charity, as the Attorney-General was appearing there is support of the alleged charitable intention. The learned Solicitor General in the present case, appearing for a different branch of the administration, put before us arguments which could never have been put by the learned Attorney General in the Shakespeare Memorial Trust case and appear to me to be quite inconsistent with those arguments. I make no complaint about that. It is a thing which very frequently happens. One department of State takes one view and appears by the Attorney-General, and another department of State takes a different view, and indeed an inconsistent one, and appears by the Solicitor-General. The result is that the Court gets some instruction as to both points of view. But it is a little bit curious that that should have taken place in the present case, and I must confess that the reasoning of P. O. Lawrence, J., in the case of the Shakeshpeare Memorial Trust appears to me to be most satisfactory, and to agree with the view which I have already expressed. There were elements in that case upon which an argument against the Trust being a charitable institution might very forcefully have been based; nevertheless, P. O. Lawrence, J., pronounced for the charity. So, in the present case, it seems to me that the objects of this society are charitable, and only charitable, and their income is applied, and applied only for the purposes of charity.

In the result I agree with Macnaghten, J., and the appeal must be dismissed with costs.

MACKINNON. L.J. - I agree. The Master of the Rolls has dealt with the facts and the law so fully that I do not think I can usefully add anything

DU PARCQ, L.J - I also agree. I am bound to say that this appears to me to be a plain case. I would like to add to a few words about the from of the case stated. The Master of the Rolls has already said something about it; and it is a matter of some importance. Not very long ago the Court of which I was a member had to send a case back to the Commissioners because they had stated it in a form which made it possible for the Court to deal with it. They had set out the evidence, or some of the evidence,on both sides and then stated their conclusions without making it clear in the least what evidence they accepted and what evidence they rejected. In the present case that difficulty has not arisen, because very early, and no doubt accurately, the Solicitor General said that we were to treat the statement of the evidence which is set out as the evidence of Sir George Dyson as being accepted by the Commissioners. That has made our task a possible one; but if we had been asked to say that we must assume that they only accepted part of it, and rejected part of it, then I for myself should have thought that we might have to remit the case against to them.

It may be (I hope it is not so) that the Commissioners do not always understand what the object of a case stated is. I say that be cause I thought there was a suggestion in the argument of the Solicitor General which,if they heard it (though it was not so intended of course) might mislead the Commissioners. The Solicitor-General said that their conclusion must be supported if there was any evident to support it. He suggested, if we could find any evidence to support it, we must treat their decision as analogous to that of a jury. With respect their decision is quite different from that of a jury. When an appeal comes from a decision of a jury the position is this. The jury have, at any rate as a general rule, been correctly directed as to the law; and one, therefore, assumes that the jury know what the law relating to the particular matter in hand was and correctly applied it. The jury, not being under any obligation to state a case, the only way in which their verdict can be attacked is by saying that there was no evidence to support the finding to fact at which they had arrived. If anyone can show anything on which is could be supported, then the verdict must stand. But in the case of magistrates of Commissioners or arbitrators who have to state a case, it is necessary that they should show to the superior Court precisely what facts they have found. No body has set out the evidence, or some of the evidence,on both sides and been there to direct them as to the law. They may have gone wrong about the law. We can only tell whether they have gone wrong about the law by knowing what the facts are, and it is their province to tell us what the facts are. If they do that and then state their conclusion, it is possible for this Court to see whether they have accurately applied the law, or whether they have erred in point of law. Sometimes it is necessary to set out a great deal of the evidence, as, for instance, when the point of law stated is that there was no evidence to support the finding at which they have arrived. Sometimes it is not necessary to set out the evidence as such at all. In fact, usually it is not necessary to set out the evidence as such at all-neither necessary nor right to do so. Indeed, any tribunal stating a case ought to state the facts in more or less detail, depending on the circumstances, and on the point of law which emerges, which they have found. IO say that because it seems to me to be of great importance that it should be full understood by the Commissioners who have to deal with these important cases.

In the present case, the really crucial question probably is what is the true construction of the rules, and particularly rule 2, which I may perhaps call a construction of the rules, and particularly rule 2, which I may perhaps call a codifying rule, because it really puts in written form what has for some time been the guiding principle of this society. It is plain, therefore, that up that point at any rate, the question is entirely one of law. But if the Commissioners had heard no evidence and had merely set out the rule and had said : 'Upon this rule we came to the conclusion that this was not a trust established for charitable purposes', then it would be apparent that it was a question of law. As it is they heard evidence, and I think they were fully entitled to hear evidence, The evidence was properly called. It might be called to rebut any suggestion that in fact the moneys in question were not applied to a charitable purpose only. It might properly be called to show that the apparent charitable intention of the rule had not been used as a clock for the carrying on of entertainments, or pursuits of one sort or another which were not charitable at all.

If one looks only at the rule, I am bound to say that it seems to me to be clear on the face of it that the trust was established for charitable purposes. I have tried to thick what would be said by any lawyer to a person disposed to assist with his money the cause of one department of music. Supposing that a wealthy man had said to a lawyer versed in such matters : 'I attach enormous importance to choral singing, and I want to establish a trust which will encourage that : will that be a charitable trust ' I can hardly imagine any lawyer would have said : 'No certainly not.' I should have thought that the answer would be clearly 'Yes.' Then supposing he had gone on to say : 'When large numbers of people have been trained and in this case we are dealing with a choir of over 800 people - 'my idea is that they should sing in public and that the public should be admitted, which will serve another purpose, because not only shall I be teaching or causing to be taught music so far as one department is concerned to a very large number of people, but I shall also, I trust, be educating public taste,' can it be imagined that the right answer to give him would have been to say : 'No, if you do that, the moment you allow your trained singers to sing to listeners who come to listen with appreciation and enjoyment, the purpose of your trust ceases to be charitable It seems to me impossible to suppose that could have been a proper answer. I agree it probably is enough to say here that the mere fact that the 800 people at any one time are to be taught the are of choral singing is enough to show that this is a charitable trust : apart from the further question whether, far from making it less like a charitable trust, it is not making it more clearly a charitable trust that you are trying at the same time not merely to give pleasure to a large number of people, but educating a large number of the public and teaching them, if one may so put it to understand and appreciate these choral works.

I find it difficult to know, looking through this case, on what grounds the Commissioners came to the conclusion that they did. When that question was put to the Solicitor-General, he suggested that they might have been influenced partly by the finding that most of the performers 'jointed the society because they wanted to exercise their musical faculties' and partly from the fact that it is recorded that Sir George Dyson agreed 'that audiences derived an educational benefit from first class musical and dramatic performances, whether these were produced by the society or by a producer working for commercial profit.' But I find it very difficult to suppose that the Commissioners based their conclusion on those findings. If they did, it is quite clear that they were thoroughly bad reasons for their conclusion. To exercise your musical faculties is to have your musical faculties trained. Nobody can learn to sing without exercising his musical faculties. If they take pleasure in exercising their musical faculties, as the Master of the Rolls has pointed out, that does not mean that they are not being taught and trained. It would be an unfortunate thing if preceptors and teachers in any department were told that they must realise that the moment their teaching was found to be giving any kind of pleasure and enjoyment to those who were under their instruction, they must know that they were failing in their duty.

The other matter seems to me nothing to the point at all. That is the suggestion, as Sir George Dyson said, that audiences derived educational benefit from first class musical performances, because it is the object of this trust to provide first class musical performances. To say that it is also possible to derive educational benefit, as it is called, from entertainments produced by a producer working for commercial profit, seems to me to have nothing in the sense of education given at the universities, is undoubtedly swatting up a charitable trust. It is quite true to say that there are people employed as a result of that who are not doing anything charitable at all, but who are working for their private profit and gain who teach, and I dare say impart education which is possibly in some cases not less valuable than that imparted by the universities. All that is quite irrelevant to the question whether the object of the trust is a charitable object.

For these reasons, I agree that the learned Judge came to the right conclusion; and that it is impossible to support the decision at which the Commissioners arrived.

Appeal dismissed.

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