Law:

Section:

- Schedule D, Case - Income-tax Act, 1952. CASES REFERRED TO Inland Revenue Commissioners v. Livingston [1927] SC 251, Jenkinson v. Freedland [1961] 39 TC 636, Jones v. Leeming [1930] AC 415; (HL), Edwards v. Bairstow and Harrison [1956] AC 14 (HL) and Inland Revenue Commissioners v. Fraser [1942] 24 TC 498. Sir Arthur Irvine and J. Raymond Phillips for the Crown. H. Major Allen and Barry Pinson for the Taxpayer. APPENDIX March 8, 11, 1968 Goff, J.-This is a case in which Mr. Halpern, acting for the taxpayer, Mr. Norman Wisdom, was concerned, in the middle of 1961, with the possibility of a devaluation of the pound and the effect which that might have on his client's assets, which were found by the commissioners to be of a value between £150,000 and £200,000. The taxpayer had a very substantial professional income in addition to anything which might be yielded by way of income on his investments. Mr. Halpern, therefore, decided, as is found by the commissioners, that, in looking after the taxpayer's affairs, he ought to take steps to find a hedge against devaluation ; that is to say, to find an investment which, upon devaluation, would retain its value in the United States and could easily be sold. 2. Having considered the matter and taken advice, he lit upon the idea of a purchase of, or investment in, silver bullion. The commissioners found as a fact that he had checked that, over the five years prior to the autumn of 1961, the price of silver had not varied by more than three per cent., and that there was then no substantial likelihood of a sudden fall or rise. In those circumstances, in November, 1961, having been introduced to Mocatta & Goldsmid Ltd., who were bullion brokers, Mr. Halpern made an appointment to see them on the afternoon of November 29, 1961. 3. Despite the fact that silver bullion had remained virtually unchanged in price over some five or six years, there was just at that moment, and before he could keep the appointment, a sharp rise in the price ; but the commissioners have found that that was an unexpected rise resulting from certain action taken by the United States Treasury. Mr. Halpern wished to purchase £200,000 worth of silver,…

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