RATING CLAUSES

Press, Volume LXXI, Issue 21424, 16 March 1935, Page 14

RATING CLAUSES

. o OPINION OF WELLINGTON CITY SOLICITOR (PRESS ASSOCIATION T K I.EG It AM .) WELLINGTON. March 15. The opinion of the Wellington city solicitor has been obtained by the City Council on the Rural Mortgagors Final Adjustment Bill. He points out what he says is also an omission in the Mortgage Corporation Bill, that no attempt has been made to deal with the questions that must arise on _ the death of mortgagors in a moratorium. This might be got over by extending the definition of a mortgagor to include the executor, administrator, or trustee of a mortgagor, or any near relative or person, approved by the court, purchasing from the executor, administrator or trustee of the mortgagor. „ , . , The main matter, however, to wmcn he directs attention is the rating clauses. These, he says, are a frontal attack on local authorities, effectively postponing their rights to those of the first mortgagee for whom provision can be made under the amount of the difference between the mortgagor s equity, as fixed under the statute, and the basic value, as also fixed under the statute. . The position is really serious, he says. The legislation affects directly what is indirectly effected by the Mortgage Corporation Bill and goes a long wav further. In his opinion the effect of the bill will be to deprive local bodies of rates in cases where the value of a property, estimated on its producing capacity, is not sufficient to meet the mortgages and to provide a nest-egg for each farmer-mortgagee who is in financial difficulties. This opinion, as summed up by the Mayor (Mr T. C. A. Hislop), means that rates, now a first charge on a property, would become a last charge, and this' was an indication of what might happen to corporation rates if the scope of the proposed act was extended to cities.