Debt on a security: House of Lords decision: marketability
In Ramsay the House of Lords considered the underlying purpose of the distinction between debts and debts on a security in TCGA92/S251 (1). Both Lord Fraser and Lord Wilberforce suggested the essential feature of the debt on a security is that it should be marketable.
At page 194 Lord Fraser says `the distinction in [Section 251(1)] is, I think, between a simple unsecured debt and a debt of the nature of an investment, which can be dealt in and purchased with a view to being held as an investment.’ Later having analysed the essential features of the loan he says `it possessed the characteristic of marketability.’
At page 189 Lord Wilberforce says `it can be seen, however, in my opinion, that the Legislature is endeavouring to distinguish between mere debts, which normally (though there are exceptions), do not increase but may decrease in value, and debts with added characteristics such as may enable them to be realised, or dealt with at a profit.’