The purpose of this research is to supply a putative decision by the judges in the House of Lords in the case Ensign Tankers (Leasing) v. Stokes, originally decided in 1992 but for purposes of this essay decided as if it were current. The plan of the research will be to set forth the facts of the case and then identify relevant issue fronts with a view toward determining how the House of Lords would decide the case.
In the background of Ensign is a growing body of case law aimed at ascertaining whether and to what extent corporate financial transactions undertaken with a view toward tax advantage ought to be permitted as a matter of equity in the shared burden of "supplies" required by the government to conduct its ordinary course of business. Blackstone locates the authority to levy taxes with the commons and, as a matter of equity, specifically rejects the idea that tax levies on the people should originate with the House of Lords because they are socially privileged, "supposed more liable to be influenced by the crown" (164). Even so, in the evolving British discourse of high-ticket tax-advantaged claims by corporate business entities, the issue of equity as fairness is implied rather than explicitly stated. The less explicit the statement, the more likely claims for privilege are to resonate in a culture.
Those who might deem equity a self-evident point of tax law would find instructive a pattern of tax-policy implementation in England until 1981 that tended to privilege the ability of creative taxpayers to mitigate tax liability through any of a number of schemes designed for the purpose. For example, in 1936 Inland Revenue Commissioners v. Duke of Westminster more or less affirmed that taxpayers and Inland Revenue were in a state of permanent contention and that the more able and articulate strategist in any contest of interpretation of acceptable tax liability would be supported as a matter of law.
Every man is entitled...