ANGLIN, C.J.C.:—In our opinion this appeal must be allowed.
The Income War Tax Act provides expressly for the taxation of accumulating income held in trust for the benefit of unascertained persons, or of persons having contingent interests. The income is made
"‘taxable in the hands of the trustees or other like persons acting in a fiduciary capacity, as if such income were the income of an unmarried person.’’
(Subsec. 6 of sec. 3 of the Income War Tax Act, 1917, as enacted by sec. 4 of ec. 49 of the Statutes of 1929; see also sec. 10 of the Act of 1920):
Whether the word ‘‘trust’’ means a person or body holding the property, or distributing the trust estate, or means the property itself, or means the trust upon which such property is held, is quite immaterial in view of what is said above.
Those who are at the present time probable beneficiaries of the trust, or some of them, it is true, reside in the United States. sut that fact does not prevent this case coming within subsec. 6 of sec. 3 above referred to, nor render exempt from taxation in the hands of trustees income accumulated on a trust for unascertained beneficiaries or beneficiaries having contingent interests. On the contrary, in our opinion, such income accumulating in trust is distinctly a subject of taxation under the subsection referred to, regardless of the residence, if ascertainable, of probable beneficiaries, whose interest is contingent during the taxation period.
This view accords with, that which ‘prevailed in the case of McLeod v. Minister of Customs and Excise [1926] S.C.R. 457, C.T.C. (1926). It may be that the decision is not binding upon this Court because there the judgment below was affirmed on 'an even division of opinion amongst the judges who constituted the Supreme Court. (See Stanstead Election ease, Rider v. Snow (1891) 20 S.C.R. 12). It is; nevertheless, entitled to great respect.
We are, accordingly, of the opinion that this appeal should be allowed and that judgment should be entered for the appellant, with costs here and in the Exchequer Court, upholding the income tax assessment in question.
Appeal allowed.