FINAL CASE.

Auckland Star, Volume LXVIII, Issue 234, 2 October 1937, Page 12

FINAL CASE.

NORTH FREIGHT SERVICE. QUESTION OF COMPENSATION. A road freight business, of which the State proposes to take over only a section, was considered yesterday by the special tribunal appointed to fix fair conditions of purchase. This was Northern Transport, Limited, for which Mr. Leary appeared.

Northern Transport, Limited, operates both an Auckland-Whangarei and an Auckland-Dargaville service, but the State intends to take over the former service only.

"The company wishes to carry on the Auckland-Dargaville freight service, and this has been agTeed to in the meantime," said Mr. H. Valentine, second assistant general manager of railways. "For this purpose the company wishes to retain the vehicles and other assets of the combined services, so the question of the valuation of the assets does not arise. The question to be decided is the amount of compensation to which the company is reasonably entitled in respect of the proposed non-renewal of its Auckland-Whangarei license."

Mr. Valentine said the purchase officers were unable to accept the accounts of the company as a sound basis for the valuation of the business, and submitted that a reasonable amount of compensation was 20 per cent on the value of the assets used in the business at March 31, 1936, immediately prior to the purchase of the Auckland-Dargaville license and service.

The compensation asked by the company was a sum equivalent to five years' profit, the annual sum being fixed a's the average of the actual profits realised iu the years 1936 and 1937.