SIR WALTER SCOTT'S INCOME TAX.

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Politeness requires the assumption that the great majority of our readers are familiar with Lockhart's " Life of Scott," but even they may not object to be reminded of what is there disclosed regarding an attempt to exact income tax from the author of Waverley." But, indeed, the incident occurred in 1813 before the first of the novels had appeared, and what the taxing authorities had in view were the poems and the author's miscellaneous and very numerous and lucrative prose works. The matter is first mentioned in a letter dated 10th December 1813 to his friend Miss Joanna Baillie, then in London:

As to the taxing men I must battle them as I can; they are worse than the great Emathian conqueror who

'bade spare

The house of Pindarus, when temple and tower
Went to the ground.

Scott had other troubles at the time, and to add to these in the autumn of 1813 a demand was made upon him by the Commissioners of Income Tax to render a "Return" of the profits of his literary labours during the three preceding years. The language has still a familiar ring. Scott demurred. He consulted high Scottish authorities, by which we take it we are to understand some of his "senior" Parliament House friends in the actual practice of their profession, who had special experience of revenue cases.

David Hume and every lawyer here whom I have spoken to consider the demand as illegal.

From this we may safely infer that the consultations were on a friendly and not a professional basis, and that the opinions were verbal. Evidently it was felt that Scottish

opinion must in such a case be buttressed by that of English lawyers, and so Scott wrote to his friend in London, Mr John Richardson, Westminster, to prepare a

of Fludyer Street, Case fo

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for English counsel. The letter to Richardson contains the following:

I wish you to lay before either the King's Counsel or Sir Samuel Romilly and any other you may approve the point whether, a copyright being sold for the term during which Queen Anne's Act warranted the property to the author, the price is liable in payment of the property-tax. I contend it is not so liable, for the following reasons

1st, It is a patent right, expected to produce an annual, or at least an incidental, profit during the currency of many years; and surely it was never contended that if a man sold a theatrical patent, or a patent for machinery, property-tax should be levied, in the first place, on the full price as paid to the seller, and then on the profits as purchased by the buyer. I am not very expert at figures, but I think it clear that a double taxation takes place.

2d, It should be considered that a book may be the work, not of one year, but of a man's whole life; and as it has been found, in a late case of the Duke of Gordon, that a fall of timber was not subject to property-tax because it comprehended the produce of thirty years, it seems at least equally fair that mental exertions should not be subjected to a harder principle of measurement.

3d, The demand is, so far as I can learn, totally new and unheard of.

4th, Supposing that I died and left my manuscripts to be sold publicly along with the rest of my library, is there any ground for taxing what might be received for the written book, any more than any rare printed book which a speculative bookseller might purchase with a view to re-publication ?

The English counsel consulted were Sir Samuel Romilly and Mr Alexander, afterwards Sir William Alexander, and Chief Baron of the Exchequer. They advised in favour of nonliability. The usual tedious correspondence with the Department followed, but the authorities at last decided to abandon the claim. Lockhart says that they abandoned "their claim upon the produce of literary labour."

He may have had reason to put it in this broad way, or he may have been misled into doing so by thinking exclusively of the numerous cases in which Scott sold the publication rights for a lump sum. Even as to that, however, Sir Walter was usually careful about what he was doing. Thus when in 1816 he was negotiating, through James Ballantyne, with Murray of London and Blackwood of Edinburgh for the production of "Tales of my Landlord," he wrote to John Ballantyne regarding the envoy's "conversations " as they would now be called :

James has made one or two important mistakes in [the pouparlers for] the

Briefly as follows

1stly, Having only authority from me to promise 6000 copies, he proposes they shall have the copyright for ever. I will see their noses cheese first.

Whether the Scottish and English opinions obtained by the bard were wide enough to cover a case like that, we are not told. Turning back to the instructions to Richardson, we see

Indeed, it is difficult to understand a suggestion made by Scott in his letter to Richardson that his case might be placed before "the King's Counsel " to advise him.

Whatever was the extent of the victory won by Scott for himself and for his brethren of letters, let us congratulate him upon it. But it has long since ceased to hold. We are not aware that this severer régime turns on any change in the taxing words of the successive

that he was dealing only with out-and-out sales of the property in the copyright "for ever." He says that he is to be advised on the assumption of the "copyright being sold for the term during which the Act warranted the property to the owner," and the main reasons he gives are applicable only to a deal of that nature, and not to a licence for a limited period or for one edition. We can scarcely believe that the Department intimated, or ever acted on, a decision to treat authorship as being different in kind, from the taxation standpoint, from every other profession and occupation. If no sale at all, then Scott's query had no place. If a letting or licence for an annual fee or for a lump sum, again his query does not hold. In these cases we do not doubt that, back to 1813, income tax, when in force, has been exacted, but it would have been interesting if Lockhart had been in possession of, and had stated, more particulars. What he does say is not satisfactory. His statement of the official abandonment, as we have said, is far wider than was required to meet the one case put by Scott, and that statement is made by Lockhart without any sign that he perceives that he is going far beyond his book. He then adds: "I have thought it worth while to preserve some record of this decision, and of the authorities on which it rested, in case such a demand should ever be renewed hereafter." This is again rather loose and unsatisfactory. It would seem, however, to tell us that Scott never paid any income tax on the profits of any of his literary labours. But as to that it is to be remembered that the tax, which originated in 1803, was dropped after Waterloo, and was not revived till 1842. Further, Lockhart seems to say that the opinions of Sir Samuel Romilly and Mr Alexander had been produced to the Income Tax Department, and that it had been those opinions which had moved the officials. If so, that could only be on the effect of complete sales, for those opinions must have been limited to that, unless the London "Case" went far beyond Scott's instructions for its preparation. It may safely be assumed that, whatever was the decision of the Department,

of literature, in the widest application of that abused term, have been taxable, even including lump prices for the complete sale of the copyright "for ever." As regards those sales we are merely stating what is, without expressing any opinion on what ought to be. As to that we think Royal Commissions, whether aware or not of Sir Walter's first argument in his letter to Richardson, have conceded that it admits of no logical answer. But the fact is that, while royalties from both patents and copyrights are assessed to income tax, lump prices for sales of patents are treated as capital, while lump prices for sales of copyright are treated as assessable income. The present writer once tried to explain this apparent anomaly to an enquirer on the view of the official doctrine that literature is or may be made a steady occupation, the author turning out so much bulk per day after the manner of Goldsmith, and indeed, of Sir Walter himself, while invention comes by inspiration, to which the reception recorded was-Nonsense! If there is a better explanation we concur with Royal Commissions in saying that we do not know it. So, argumentatively, Sir Walter is unanswered and apparently unanswerable. Logic counts for little in this country, and it is significant that even the latest Royal Commission that which reported in 1920-abstained from recommending that the law-or it may be only the practice should be changed.

It may be added that copyright royalties score over patent royalties in respect that the former are treated as earned income when payable to the author, while the latter, even when payable to the inventor, are taken as investment income.

J

As we go to press we note that the King has been pleased, on the recommendation of the Secretary for Scotland, to whom the name was submitted by the Lord Justice-General, to approve of the rank and dignity of King's Counsel to His Majesty in Scotland being conferred on Mr Robert Macgregor Mitchell, advocate.

Note. With regard to the transmission of causes for trial at these sittings, agents are referred to the Codifying Act of Sederunt, Book F, chapter i., section 5. A copy of the Lord Ordinary's interlocutor allowing the trial to proceed at the sittings, along with a print of the closed record and of the adjusted issue or issues, must be handed to the Keeper of the Rolls of the Division in which the cause is to be tried, and that not later than twelve o'clock noon on Wednesday, 5th March, other wise the cause will not be taken at the sittings.

BOX-DAYS-SPRING VACATION, 1924. - Edinburgh, 27th February 1924. - The Lords of Council and Session appoint Thursday, 10th April, and Thursday, 1st May, to be the Boxdays in the ensuing vacation.

J. A. CLYDE, I.P.D.

THE Lord Ordinary officiating on the Bills will sit in Court on Wednesday, 16th April, and Wednesday, 7th May, each day at eleven o'clock forenoon, for the. disposal of motions and other business falling under the 93rd section of the Court of Session Act, 1868, and the 3rd section of chapter i., Book A, Codifying Act of Sederunt; and Rolls will be taken up on Monday, 14th April, and Monday, 5th May, between the hours of eleven and twelve o'clock.

EDINBURGH, 27th February 1924.

A SPECIAL meeting of the Faculty of Procurators in Glasgow was held last week in the Faculty Hall, St George's Place, for the purpose of appointing an auditor of accounts in succession to the late Mr John Fraser Orr. On a ballot, Mr William Stirling, writer, 184 West Regent Street, Glasgow, was elected auditor. The following law agents were admitted members of Faculty: John Rankin, B.L., 138 West

and was for some time in Largs, where he held several public appointments, including that of Procurator-Fiscal. He returned to Aberdeen about twelve years ago, and for a few years was in partnership with Mr John Middleton under the firm name of Stuart M'Kay & Middleton.

MR A. B. NICOLSON, W.S., a partner of the firm of Davidson & Garden, advocates, Aberdeen, and the proprietor of Glenbervie, Kincardineshire, died at Glenbervie, on 25th February, aged fifty-eight years. Mr Nicolson succeeded to the estate in 1899 on the death of his father. He took a prominent part in the public work of Kincardineshire, was Deputy Lieutenant, member of the County Council, chairman of the Glenbervie Parish Council, and represented Kincardineshire on the Board of Governors of the North of Scotland College of Agriculture: Mr Nicolson was a B.A. of University College, Oxford, and qualified as a Writer to the Signet in 1891. He is survived by his widow, a daughter of the late Mr A. J. Napier, W.S., Heriot Row, Edinburgh, and by a son and two daughters.

DECISIONS IN THE ENGLISH COURTS.

Sutton v. New Tabernacle (Old Street Congregational) Approved Society.

INSURANCE-NATIONAL HEALTH-APPROVED

SOCIETY-RIGHT TO EXPEL-PREGNANCY OF UNMARRIED WOMAN-NATIONAL INSURANCE ACT, 1911 (1 & 2 GEO. V. CAP. 55), SECTION 30NATIONAL HEALTH INSURANCE ACT, 1918 (7 & 8 GEO. V. CAP. 62), SECTION 12 (3).-Edith Sutton was a member of a society approved under the National Insurance Act, 1911. She had duly paid her subscriptions thereto. She

was an unmarried woman. A visitor of the

society, hearing that she was ill, visited her and found that she was pregnant. The visitor reported this fact to the society, which after consideration of the case exercised its rights under its 18th Rule, and expelled Edith Sutton on the ground of immoral con

Glasgow.

MR R. STUART M'KAY, solicitor, has died suddenly at his residence, 24 Orchard Place, Aberdeen. He had not been in good health for some time. He was fifty-one years of age,

expelled was not deprived of any benefits within the meaning of the National Health Insurance Act, 1918, section 12 (3), inasmuch as she got the full transfer value of her rights handed over either to another society or to the Post Office, although she ceased to