PAYMENT OF RATES

Dominion, Volume 30, Issue 190, 8 May 1937, Page 8

PAYMENT OF RATES

Position Regarding PreSlump Assessments DECISION OF COURT A claim involving the construction Of section 5 of the Valuation of Land Amendment Act, 1933, which was passed to alleviate the position of landowners who had been assessed for the payment of rates by local authorities on valuations made before the commencement of the period now known as the recent depression, was the subject of a reserved decision given by Mr. J. 11. Luxford, S.M., in the Magistrate’s Court, Wellington, yesterday. Numerous landowners, said the magistrate, took advantage of the provisions of the principal Act to have the valuations of their properties reviewed by the Assessment Court, while others obtained reductions by proceeding under the provisions of sections 4u and 50 of that. Act. The great majority ot landowners, however, had not taken advantage of those provisions, and section 5 of the 1933 Act was enacted to give them relief from the burden of excessive taxation. Power was given by section o to (inter alia) a borough council to resolve that Hie rates leviable by it for anv year should be levied on a proportionate part of the values appearing in the valuation roll as corrected from the district valuation roll up to March 31 next preceding the date of the levy, with a proviso that the proportionate part should not be less than <5 per centum of such values. The Wellington City Council, acting under the powers conferred_ upon it by section 5, passed a resolution "that the rates leviable for the year 19341935 shall be levied on 75 per centum of the values appearing in the valuation roll as corrected from the district valuation roll up to March 31, 1934. The value of the property of defendant, R. Johnston, at that date was shown in the valuation roll at £10,500. A demand was sent to him for the paymetn of rates computed on that sum, but without making any allowance in respect of the reduction brought about by the resolution. The reason for that omission was that the city council considered that the reduction did not apply to defendant’s property on. account of the provisions of subsection (3) of section 5 of the 1933 Amendment Act. It was provided by subsection (3) that: “Notwithstanding anything in the foregoing provisions of this section, if the valuation of any property has been reduced by the Valuer-General pursuant to section 45, or section 50 of the principal Act or the corresponding provisions of this Act, or by the assessment court on objection from a valuation made by the Valuer-General under section 50 of the principal Act, the following provisions shall apply : — “(a) . . . all rates levied pursuant to a resolution passed in accordance with subsection one of this section shall be levied either on the amount of the new valuation or on the prescribed proportionate part of the valuation existing immediately before such new valuation was made . . . whichever is the less.” Valuation Reduced. The district valuation roll ,in 1929 showed the value of defendant's property at £14,755. Special valuations were called for under section 50 in the years 1930, 1931, 1932, and 1933 with the result that the value was reduced to £13,750, £12,750, £11,500, and £10,900 respectively. Later in the year 1933 the value was further reduced by the Assessment Court on an objection from the valuation £10.900 made by the ValuerGeneral under section 50. Defendant claimed that he w.'io liable for assessment on three-fourths of £10.900 which was the valuation appearing in the valuation roll immediately before the new valuation was made, and accordingly paid a sum calculated on that basis. The corporation, however, contended that the only two valuations to be considered were the valuation appearing at the, time the roll was first compiled and that appearing on March 31 of the year preceding the striking of the rate. "Mr. Marshall’s argument (for plaintiff). as I understand it, is this,” said the magistrate. “The original valuation in 1929 was £14,755, but was reduced from time to time until it reached the sum of £10,500; as £10.500 is less than three-fourths of £14,755 the council is entitled to levy rates on the full sum of £10,500. This argument is based on a fallacy. It is incorrect to speak of the 1929 valuation as the original valuation. The principal Act is merely a consolidating enactment, which, although requiring the preparation of valuation rolls for each district, enacts that the rolls in existence at the time the Act conies into operation arc deemed to enure for the purposes of the Act as fully and effectually as if they had originated under its provisions. The Valuer-General, therefore, had no power to prepare a new roll for the City of Wellington, but merely to revise the existing roll from time to lime, which apparently he did in 1929 in accordance with section 8 and 9 of the principal Act. “If Mr. Marshall’s contention is correct it. would he necessary to go back t.o the first valuation roll prepared in respect of land within the city, whenever that may have been, and not to the revision made in 1929, which, of course, is absurd. The difficulty surrounding the question involved in this case arises owing to the use by the legislature of the words ‘shall be levied on tile amount of the new valuation existing immediately before such new valuation was made.’ “It is quite clear that section 5 of the 1933 Amendment Act is retrospective in the sense that it refers to reductions made previously to the passing of the Act, for it speaks of reductions made under sections 45 and 50 of the principal Act which were repealed respectively by sections 4 and 3 of the 1933 Amendment. Act. The valuation existing immediately before the making of the new valuation of £10,500 was the special valuation of £10,900 made by the Valuer-General under section 50. The new valuation was made by the Assessment Court on an objection from the Valuer-General’s assessment of £10.900 under section 50. “Subsection (3) specifically refers to a reduction brought about in this manner and it would seem that on a strict interpretation of paragraph (n) defendant’s contention is unanswerable. If that be so this illogical result follows: a property owner after receiving a substantial reduction from the Valuer-General, as defendant in this case did.'would be entitled to use the Valuer-General’s valuation as well as a valuation made by an appeal tribunal which has set aside such valuation and substituted another for it. Not a New Valuation.

“The Assessment. Court is not a tribunal of first instance for the purpose of fixing valuations, but is an appejlate tribunal charged with reviewing ~the Valuer-General’s valuations. The ValuerGeneral cannot make any valuation which cannot be reviewed by the Assessment Court, and it would seem that an assessment by the court is merely a variation, modification or confirmation of the valuation objected to. The reference therefore in subsection (3) to a reduction made by the Assessment Court is for

the purpose of declaring that a valuation fixed by the court is a substitutionary valuation and not a uew valuation. "In my opinion therefore defendant cannot treat the Valuer-General's valuation of £10,900 as the valuation existing immediately preceding the uew valuation. The effect of the Assessment Court's decision was to expunge the former valuation as from the time it was made, which is the same as saying that the valuation never existed at all. z “In order that plaintiff corporation should succeed in recovering the amount clainu'd, it would be necessary to hold that paragraph (a) subsection (3) means that uo special valuation by the Valuer-General under section 50 can be a ‘valuation existing immediately before the making of the new valuation; that would menu going back to the first valuation that had been made under some section other than sections 45 or 50. That cannot be the intention of the statute, for conceivably the valuations appearing on the roll at the time of striking the rate may have been made by the ValuerGeneral under section 50 years before the depression. “The words 'existing immediately before’ are clear and unambiguous and preclude any artificial meaning being attached to them. If the effect of the Assessment Court’s decision could be treated otherwise than I have indicated, I the valuation existing immediately before | the decision would Jiave been the £10,900 valuation. But as tiiat valuation must be deemed never to have existed, the defendant should have been assessed to pay rates on three-fourths the sum of £ll 500, the amount of the special valuation made by the Valuer-General in 1932. “I will defer entering judgment until counsel have considered whether, in view of my findiiig. a legal demand has been made for the payment of rates. Mr. Spratt (for defendant.) raised that question ductile argument, but this judgment: materially alters the basis on which his argument was founded.”