Court Of Appeal Gives Judgment In Land Valuation Test Case

Press, Volume XCIV, Issue 28150, 13 December 1956, Page 6

Court Of Appeal Gives Judgment In Land Valuation Test Case

(New Zealand Press Association)

WELLINGTON, December 12. The Court of Appeal today delivered its judgment in an appeal by way of a case stated from the .Land Valuation Court relating to an application by James Gordon Fowlie, of Auckland, returned serviceman, for an order fixing the 1942 basic value of his farm at North Auckland. The appeal was in the nature of a test case, and it was stated in argument before the Court, when the appeal was heard last March, that a total sum of between £1 million and £2 million was involved. The Court which heard the appeal comprised the Chief Justice (Sir Harold Barrowclough), Mr Justice Gresson, Mr Justice Stanton. Mr Justice McGregor and Mr Justice Shorland. The Crown was represented by the Solicitor-General. Mr H. E. Evans, Q.C., with him Mr C. N. Irvine. Mr H. R. Biss, with him Mr W. S. Shires, appeared for Fowlie. The matter arose from an application made to the Land Valuation Court by Fowlie for an order fixing the 1942 basic value of farm land at North Auckland leased by him from the Crown. The case stated, showed that certain necessary buildings and improvements on Fowlie’s land were erected and effected by the Crown in 1948 and 1949 at a cost which was £1460 in excess of the sum which would have been the cost in December, 1942. of erecting such buildings and effecting such improvements. The question before the Court was whether, in fixing the basic value of Fowlie’s land, the Land Valuation Court was permitted “to take into account the fact that necessary buildings and improvements on the land have in fact been erected or effected after December, 1942, at a cost in excess of what would have been the reasonable cost of erecting such buildings in December, 1942?” The Crown contended that the Court could take these further costs into account but council for Fowlie submitted to the Court of Appeal that that was not so.

All the Judges at the Court of Appeal concurred in the answer which was given to this question by the Chief Justice, who said in his judgment:—

“In determining the 1942 basic value of farm land, the said basic value is to be determined as at the date of the disposal of the land. As regards improvements then existing on the land which were effected subsequently to the year 1942 there should be taken into account in determining the said basic value any increase in the value of such improvements, having regard to the date of construction, over and above that which would have been their value as at December 15, 1942, had they then been in existence.

“Though such increase in value may be attributable to increases in construction costs since the year 1942. the question of cost at any particular date is relevant only in so far as it assists in ascertaining value. “Though the land sale committee has a discretion as to what proportion of

any such increase in value should be added to the productive value in order to make it a fair value for the purposes of the act. that discretion is a judicial discretion and in the absence of any circumstances leading to a contrary conclusion, the whole of any such increase should be so added.” The Chief Justice said in conclusion: ‘‘We were informed that this was a test case of great public interest and of particular importance to the Crown as, according to the answers given, the State Advances Corporation would retain or lose amounts aggregating a very large sum of money?’ Costs amounting to £157 10s and disbursements were therefore ordered to be paid by the Crown to Fowlie. /