Despite that majority of human laws are received with great contention among people, the mutuality principle has stood to be the most contested in the contemporary society. Many scholars and philosophers have offered opposing viewpoints on the efficiency of the mutuality principle. The issue of bias and inefficiencies has been adequately attributed to this principle by many scholars. Despite that many scholars have also embraced the principle; the criticism attributed to it is very explicit. Primarily, mutuality principle is established by case law and is developed on the proposition that organizations can not develop income from itself. Based on the principle, if a group of people contribute a common fund, any surpluses from the common fund can not be counted as income. However it can be observed that the principle does not apply to income derived from other sources outside that of the group. This scenario has attracted hot debate from different scholars who seek to examine the efficiency and authenticity of the principle. Based on the nature of the principle it has been referred to as the only and the best way of avoiding prohibition towards passing of burden for positive freehold covenant. With regards to case law, this statement is correct based on the actual nature of mutuality principle. The elements of mutuality principle are very clear and distinctive thus making it the only way of avoiding prohibition.

Pay to Unlock the Answer!

DeMarco, J. 2004. A Coherence Theory in Ethics. New York: Wiley & Sons Press, 130-157.

Eeckhoudt, L. et al. 2005. Economics and Financial Decisions under Risk. New York: Routldge,


Hakiki, L. 2003. Direct Taxes. New York: Prentice Hall, 87-152.

Ides, A. and May, C. 2008. Civil Procedure: cases and Problems. New York: McGraw Hill, 67-


Jones, C. 2008. Financial Economics. London: Prentice Hall, 100-143.

Lal, B. 2008. Income Tax and Central Sales Tax Law and Practice. London: Wiley & Sons

Press, 24-75.

Lengwiler, Y. 2006. Micro foundations of Financial Economics: An Introduction to General

 Equilibrium Asset Pricing. New York: Routldge, 287: 321.

Nethercott, L. 2010. Master Tax Examples, 2010/11. New York: Prentice Hall, 48-79.

Renton, N. 2005. Clubs and Non-Profits: keeping the Books- A Simple Manual on Accounts and

 Tax. New Jersey: McGraw Hill Press, 61-98.

Seidman, J. 2003. Seidman’s Legislative History of Federal Income and Excess Profits Tax

 Laws. New York: Prentice Hall, 1489-1487.

Trefil, J. 2003. The Nature of Science: An A-Z Guide to the Laws and Principles Governing our

 Universe. London: Prentice Hall, 285-302.