Commissioner of Stamp Duties of NSW v Permanent Trustee Co of NSW Ltd (Davies' Case)

The case of *Commissioner of Stamp Duties of NSW v Permanent Trustee Co of NSW Ltd* (Davies' Case) concerned a dispute between the Commissioner of Stamp Duties of New South Wales and the Permanent Trustee Co of NSW Ltd, acting as executor and trustee of the will of the late Mr. Davies. The Commissioner sought to assess stamp duty on certain transfers of shares. The matter was heard by the Privy Council on appeal from the Supreme Court of New South Wales.

The central legal issue before the Privy Council was whether the transfers of shares by the executors of Mr. Davies' will to themselves as trustees of a settlement constituted a dutiable transaction under the Stamp Duties Act 1920 (NSW). Specifically, the court had to determine if these transfers were made for "consideration in money or money's worth" and, if so, whether the value of that consideration was sufficient to attract stamp duty.

The Privy Council held that the transfers were not made for consideration in money or money's worth. Their Lordships reasoned that the executors were merely changing their character from executors to trustees, a process that did not involve the creation of a new beneficial interest or the transfer of property for value in the ordinary sense. The beneficiaries under the will remained the same, and the property was simply passing from one fiduciary capacity to another within the same overall administration of the deceased's estate. The court applied the principle that a transfer of property by a trustee to himself in a different fiduciary capacity, where the beneficial ownership remains unchanged, does not constitute a sale or a transaction for consideration attracting stamp duty.

The appeal was allowed, and the assessment of stamp duty by the Commissioner was set aside.