VALIDITY OF CONTRACT

Press, Volume LXXXIII, Issue 25207, 11 June 1947, Page 5

VALIDITY OF CONTRACT

LEASE OF THEATRE | AT LEVIN TWO APPEALS DISMISSED (P.A.) WELLINGTON, June 10. The Court of Appeal to-day delivered judgments in the cases of the AttorneyGeneral versus tne Levin Borough Council and the Levin Borough Council versus the Attorney-General as to the validity of a contract between the Levin Borough Council, the owneis of the Regent Theatre, Levin, and Levin Amusements, Ltd. All thiee judges, Mr Justice Biair, Mr Justice Kennedy, and Mr Justice Callan, concurred in the decision that the contracts were ultra vires the Levin Borough Council, and that the anneals should be dismissed. • Mr Justice Blair pointed out that any question involving the powers of a statutory corporation was not one of implication, but of construction of the statute which governs the corporation.

The appeal was from a judgment of the Supreme Court, Wellington, in February 1945, in an action brought by the Attorney-General (on the relation of United Theatres. Ltd., and Harry Muschamp Waddington, of Petone, company director) questioning the validity of a contract between the Levin Borough Council, owners of the Regent Theatre. Levin, and Levin Amusements, Ltd., through R. J. Kerridge. its managingdirector.

The relators (in any case where the validity of an act of a local authority is questioned by a person other than a ratepayer it is necessary to sue as relator through the Attorney-General) were lessees of the theatre from 1936 till 1943. when the lease expired, and the council called tenders for a further lease. The relators tendered for a further lease, and their tender was accepted, but because of a defective resolution of the council, such tender was found to be invalid, whereupon the council accepted a tender by Levin Amusements, Ltd., and Kerridge, wherein they offered to spend £3OO on redecoration, to operate the theatre as agents of the council, and to pay the council 20 per cent, of the box office revenue, with a minimum of £1872 per annum.

The relators brought proceedings for a declaration that such a contract was ultra vires the council, and restraining the council and Levin Amusements from operating the theatre under it, and the judgment then appealed from granted this relief.

After hearing the appeal, the Court heard an appeal from a Supreme Court judgment, in July, 1945, in an action by the Attorney-General (on the relation of Levin Amusements, Ltd., and R. J. Kerridge) against the Borough Council for enforcement of the contract between them by declaring the notice of its determination invalid,„or by restraining the council from acting'' on such notice, or alternatively for damages for breach of contract. The Supreme Court in that action granted no relief on the grounds that a previous judgment of the Court had declared the contract ultra vires.