TMI Blog1969 (3) TMI 81X X X X Extracts X X X X X X X X Extracts X X X X ..... t of a telephone call from the hospital he gives instructions to the hospital staff. He usually sets out immediately by car to the hospital. He may advise treatment by telephone and await a further report. Sometimes the telephone call is received when he is out on his medical rounds. It is found in the stated case that his responsibility for a patient begins as soon as he receives a telephone call. Under the terms and conditions of service of hospital staff the management committee pay to the appellant travelling expenses as a part time officer at a fixed rate per mile, said to be 8d., for single journeys between Fishguard and the hospital, limited to a single journey of 10 miles. The appellant pays the cost of the additional five miles travel himself. The appellant in 1962-63 made about 140 journeys to the hospital and received payment of expenses amounting to 100. This sum was included in his income assessable for that year. In 1963-64 he made about 115 journeys receiving 82 which was also included in his assessment for 1963- 64. Before the commissioners he sought to deduct the whole cost of traveling incurred which for 1962-63 amounted to 150 and for 1963-64 to 123 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aterial in the case on the point. The appellant's entitlement to these expenses is contained in section 19 Expenses : (iv) A part-time officer, when called out in an emergency to the hospital where his principal duties lie, shall receive expenses for such journeys. The limitation to ten miles for a single journey is contained in section 19(b)(3)(iii) and under the heading : Travelling Expenses, Mileage Allowances, etc. : (iii) Where a part-time officer travels between his private consulting room or place of residence (whichever is the nearer) and the hospital where his principal duties lie before and/or after an official journey, expenses shall be payable for the whole distance provided that for journeys to and from the hospital where the officer's principal duties lie no expenses shall be paid for any distance exceeding, ten miles each way unless circumstances warrant exceptional treatment. The Court of Appeal, certainly the Master of the Rolls, appear to have treated the payments as allowances payable to the appellant whether he incurred the expenses or not. But Edmund Davies L. J. would have decided the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... office, and it must be something in the nature of a reward for services past, present or future. Lord Radcliffe, who concurred with Viscount Simonds, said at page 391 : . . . while it is not sufficient to render a payment assessable that an employee would not have received it unless he had been an employee, it is assessable if it has been paid to him in return for acting as or being an employee . . . .The money was not paid to him as wages. Later in his judgment Lord Radcliffe appears to treat a claim for indemnity as not assessable. The facts in that case were widely different from the present, but if the proper test is whether the sum is a reward for services, then, in my view, the travelling allowances paid to Dr. Owen are not emoluments. To say that Dr. Owen is to that extent better off is not to the point. The allowances were used to fill a hole in his emoluments by his expenditure on travel. The allowance were made for the convenience of the employee to allow him to do his work at the hospital from a suitable adjacent area. In my view, the travelling allowances were not emoluments. If I am right that the allowances are not emoluments, no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in his consulting room. If he was performing his duties at both places, then it is difficult to see why, on the journey between the two places, he was not equally performing his duties. Indeed Mr. Heyworth Talbot did not contend to the contrary. It follows that he had to get from his consulting room to the hospital by car to treat the emergency. The travelling expenses were, in my view, necessarily incurred in the performance of the duties of his office. I would allow the appeal. LORD PEARCE.-My Lords, the appellant is a doctor carrying on a general practice at Fishguard, which is 15 miles from Haverfordwest. Since the medical needs of the hospital at Haverfordwest exceeded the supply of medical practitioners there, the hospital had to call on the part-time services of a Fishguard practitioner. Accordingly, the appellant was employed or appointed to act as a stand-by for emergencies, one weekend a month as an obstetrician, and one weekend a month (and also Monday and Friday nights) as an anaesthetist. He had to be available on the telephone at Fishguard. As soon as he received a telephone call his responsibility for the patient at Haverfordwest started. If he could deal with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not succeed. There is a corresponding duty to adjust the mechanism where it is found to be creating a clear injustice. On the findings of the commissioners the expenses were incurred in the performance of his duties. In my opinion, that finding was correct and the expenses were allowable under rule 7 of Schedule 9 to the Act of 1952. It was as a doctor practising in Fishguard that the appellant was appointed to his stand-by duties. He was to stand-by in Fishguard. In Fishguard on the telephone he undertook his responsibilities to the patient and the hospital and no doubt he discussed the symptoms and made various arrangements as to what should be done by way of alleviation in the halfhour which must elapse before he could arrive. If he were held up on the road he would be under duty to ring through and make any resulting arrangements. If anyone asked him en route what he was doing, he would probably say truthfully that he was on hospital duty. He would not, I think, be even pedantically accurate if he said : I was on hospital duty on the telephone a quarter of an hour ago and shall be on hospital duty in a quarter of an hour's time but at the moment I am driving on my own ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the appellant in the Court of Appeal. He contends that reimbursements such as that which is here in question do not come within the emoluments of an appointment or employment under Schedule E. They therefore never fall to be charged, and it is unnecessary to consider whether they are allowable under rule 7. In my opinion, that contention is correct. Emoluments are charged. These are defined as including all salaries, fees, wages, perquisites and profits whatsoever. The reimbursements of actual expenses are clearly not intended by salaries , fees , wages or profits. It is contented that they are perquisites. The normal meaning of the word denotes something that benefits a man by going into his own pocket. It would be a wholly misleading description of an office to say that it had very large perquisites merely because the holder had to disburse very large sums out of his own pocket and subsequently received a reimbursement or partial reimbursement of these sums. If a school teacher takes children out for a school treat, paying for them out of his (or her) own pocket, and is later wholly or partially reimbursed by the school, nobody would desc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Haverfordwest, it may fairly be assumed that there was no profit element in the travelling allowances he received in these two years, but that, on the contrary they left him out of pocket. Before your Lordships the case proceeded on that footing without demur from the Revenue, and on that basis I proceed to consider the first question. Tax under Schedule E is charged on the full amount of the emoluments from the office or employment : and emoluments are defined as including all salaries, fees, wages, perquisites, and profits whatsoever. (Income Tax Act, 1952, section 156 as amended by the Finance Act, 1956, section 10 [and Schedule 2, paragraph 1(1)].) This definition certainly gives no impetus towards the view that it covers sums paid to an employee simply in reimbursement of expenses incurred in carrying out his duties. Nor do the dictionary definitions of the word, namely, profit or gain, advantage, due, reward, remuneration, salary (Murray's English Dictionary : the Shorter Oxford Dictionary). Nor does section 1 of the 1952 Act which contemplates that income tax will be imposed on profits or gains. It is also interesting to notice the decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... telephone call, and that on receipt of such a call he gives any necessary preliminary instructions to the hospital staff in relation to the case (which are all emergency cases.) I do not think these facts establish the contention of two places of employment at all. In a very real sense almost every general medical practitioner is on stand-by duty for emergency cases, and is in fact available on the telephone. And almost every such practitioner will, if necessary, give preliminary instructions concerning the patient to anyone who summons him by telephone. There are also thousands of employees in other walks of life who have to be on stand-by duty at their homes and are required to obey a summons to go to their factory or their offices to cope * 1919 S. C. 534. ** [1926] A. C. 1. Page No : 0161 with some emergency. If this is to mean that they all have two places of employment I see no reason why all of them should not be entitled to claim travelling expenses between their homes and their places of work. The simple truth, as I see it, is that Dr. Owen has one place of employment as an obstetrician and anaesthetist ; and that is the hospital at Haverfordwest. When he a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iod he was required to be accessible by telephone. All his work in connection with these appointments was concerned with emergency cases at the hospital. On receipt of a call from the hospital he would give instructions to the hospital staff (e.g., to prepare the patient for an operation). Usually he would then set out immediately to the hospital by car. Sometimes he advised treatment by telephone and then awaited a further report. Not every telephone call resulted in a visit to the hospital. His responsibility for a patient began as soon as he received a telephone call. This description is sufficient to show that both the nature of Dr. Owen's appointment, and the purpose for which he incurred travelling expenses, differ greatly from those found or assumed to exist in the case of Mr. Ricketts. Are they sufficient to establish that he was necessarily obliged to incur and defray out of the emoluments the expenses of travelling in the performance of the duties of his office or employment ? I agree with the Revenue's contention that the mere fact of being on stand-by duty is not enough : if this were all, Dr. Owen would be in the same position as the airline pilot who was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ' If the holder of an office '-the words, be it observed, are not ' If any holder of an office '- ' is obliged to incur expenses in the performance of the duties of the office '-the duties again are not the duties of his office. In other words, the terms employed are strictly, and, I cannot doubt, purposely, not personal but objective : the deductible expenses do not extend to those which the holder has to incur mainly and, it may be, only because of circumstances in relation to his office which are personal to himself or are the result of his own volition. Then it was said that as Dr. Owen chose to live 15 miles from the hospital, his case was indistinguishable from that of the recorder. Now, I would entirely agree that rule 7 is drafted in an objective form so as to distinguish between expenses which arise from the nature of the office and those which arise from the personal choice of the taxpayer. But this does not mean that no expenses can ever be deductible unless precisely those expenses must necessarily be incurred by each and every office holder. The objective character of the deductions allowed relates to their nature, not to their amoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellant works as a doctor treating patients in two ways (i) as a general practitioner in Fishguard, (ii) as an obstetrician and anaesthetist in part-time employment at the hospital in Haverfordwest. These are two aspects of his professional career, two professional activities. Whether he is working at his consulting room at his home in Fishguard, or on his rounds in and from Fishguard, or at the hospital in Haverfordwest, he is working as a doctor, making use of his professional learning, skill and experience for the benefit of his patients and receiving remuneration for doing so. The expense of his journeys between Fishguard and Haverfordwest is a necessary expense of his profession as he carries it on, because he could not engage in both activities without making these journeys. He pays taxes on his income from both activities, and it is unfair not to allow him to deduct expenses which he must inevitably incur so long as he carries on both activities. But the system apparently requires that his earnings from his general practice have to be assessed separately under Schedule D and his earnings from his employment at the hospital have to be assessed separately under Schedule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... none such here. . . . That the appellant travelled from London to hold his court at Portsmouth and returned to London at the close of the sessions was, in my judgment, a course prescribed for him by his own convenience as a practising London barrister and by nothing else. Counsel for the appellant sought to distinguish the present case from Ricketts v. Colquhoun * on the ground that in the present case the hospital employment is at two places-the appellant's home, at which he receives the telephone calls and gives advice on the telephone, and the hosptial-and that he comes on duty when he receives the telephone call and remains on duty while he makes the journey to the hospital and does his work at the hospital. But I do not think it can reasonably be said that there are two places of employment. His only place of employment is at the hospital. Because for his own purposes-purposes other than the hospital employment-he chooses to live away from Haverfordwest he has to be summoned to the hospital and has to come from a distance and so make a car journey. Also because he lives for his own purposes at a distance from Haverfordwest he may have usually to give advice on the tel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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