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Scottish Court of Session Decisions |
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You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Brown's Trustees v. Inland Revenue [1897] ScotLR 35_340 (26 October 1897) URL: http://www.bailii.org/scot/cases/ScotCS/1897/35SLR0340.html Cite as: [1897] ScotLR 35_340, [1897] SLR 35_340 |
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Page: 340↓
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In an action of damages against a party for statements alleged to have been made by him to the Inland Revenue-authorities respecting duties due by the pursuer, a diligence to recover documents was obtained by the pursuer. The Solicitor of Inland Revenue refused to produce letters addressed to his office by the defender, on the ground that to do so would be prejudicial to the public service. Held ( per Lord Stormonth Darling, Ordinary), following Arthur v. Lindsay March 8, 1895, 22 R. 417, that the Solicitor was entitled to refuse production.
This was an action at the instance of the trustees of the late Mr William Brown, distiller, Elgin, against Mr Hay, auditor there, concluding, inter alia, for damages for statements made by him to the Inland Revenue authorities regarding the duty which ought to have been paid on the distillery business conducted by the late
Page: 341↓
Mr Brown, which he had been employed to audit. Brown's trustees obtained a diligence for the recovery, inter alia, of all letters and other documents passing between Mr Hay and the Inland Revenue authorities. At the diet the Solicitor of Inland Revenue declined to produce letters received from Mr Hay, on the ground that to do so would be prejudicial to the public service. The question was debated before the Lord Ordinary (
Stormonth Darling ).Argued for the pursuer—This was a case of special circumstances, and it was not sufficient for the Inland Revenue authorities to make a general statement that the production of the documents called for would be prejudicial to the public service. They must go further and say in what respect that prejudice would arise. The pursuers' case was that Hay acted as an informer on his own initiative—a circumstance which distinguished this case from that of Earl v. Vass, July 17, 1822, 1 Sh. App. 229, where the productions refused were documents made officially by a public officer. If the only prejudice the Inland Revenue would suffer by being compelled to produce these documents was the discouragement of private informers in future, that was not a reason entitled to much consideration. Arthur v. Lindsay, March 8, 1891, 22 R. 417, was a case where the administration of the criminal law was in question, and was therefore not an authority in the present case. In Johnston v. Caledonian Railway Company, December 22, 1892, 20 R. 222, the production of income tax returns—quite as confidential as the documents required here—had been ordered.
Argued for the Inland Revenue—The Inland Revenue had a general right to refuse production when they were able to state, through the Lord Advocate, that it would be prejudicial to the public service—Hume ii., p. 134; Earl v. Vass, cit. supra; Donald v. Hart, July 6, 1844, 6 D. 1255; Little v. Smith, February 17, 1847, 4 D. 937; Henderson v. Robertson, January 20, 1853, 15 D. 292; Hughes v. Vargas, May 17,1893, 9 Times L.R. 471; Arthur v. Lindsay, cit. supra; Tierney v. Ballingal & Sons, February 19, 1896, 23 R. 512. The principle usually was not that the particular case would be prejudiced, but that future sources of information would be dried up. Johnston v. Caledonian Railway Company, cit. supra, was a special case, because the object of confidentiality did not apply to income-tax returns, which would always be obtained whether they were disclosed or not.
On 26th October 1897 the Lord Ordinary sustained the appeal of the haver, the Solicitor of Inland Revenue.
Opinion.—“I confess I cannot distinguish this from the case of Arthur, and also, so far as principle goes, from the case of Vass. It may be, and I am sorry if it is, that the non-production of these documents will embarrass the pursuer, although I think it will embarrass him less than his counsel fears at the present moment. But the broad question which I have to decide is whether a public department is to be compelled by a court of law to produce confidential documents in its possession coming from third parties, the reason against it being confessedly that so to compel them would be to discourage similar communication being made in future. In the case of Arthur the Court, if I may say so, paid very proper deference to the view expressed by the Lord Advocate as head of his department. No doubt that was a criminal matter; but that does not seem to me to be a difference in kind, only in degree. It is, no doubt, more important in the public interest that crime should be punished than that money should be recovered for revenue; but they are both things in the public interest, and if the Commissioners of Inland Revenue, speaking through the mouth of the Lord Advocate, represent to me that in their view it will embarrass them in the future collection of revenue to have documents of that kind recovered, I am afraid I must, at whatever hazard to private litigation, give effect to that objection. The proper order, I should think, would be to sustain the haver's appeal and allow the documents to be returned to him.”
The Lord Ordinary pronounced the order indicated.
Counsel for the Pursuer— Salvesen. Agents— J. C. Brodie & Sons, W.S.
Counsel for the Inland Revenue— Lord Advocate Murray, Q.C.— Young. Agent— P. J. Hamilton Grierson, Solicitor of Inland Revenue.
