Keir & Cawder, Ltd. v. C.I.R. (1958), 38 TC 23 (C.S. (1st Div.))

The taxpayer, which sold materials for use in construction projects, made a foray into the field of construction contracting which was terminated on the death of a consulting engineer whose services it had retained. In finding that the death did not result in the loss of the taxpayer's business, the Lord President (Clyde) stated (p. 30):

"The civil engineering activities of the Appellants were not being conducted by a separate entity, but formed an inchoate part of a single business which still continues."

The taxpayer, whose main activity was carrying on the trade of quarrymasters, sought to extend its business to civil engineering contracting by retaining a firm of consulting engineers to provide the services and reputation of one of their engineers. Insurance proceeds which the taxpayer received on the death of this individual represented compensation for loss of profits which it expected to make through utilizing his services and, accordingly, were taxable receipts.