SUPREME COURT.

Evening Post, Volume LXXIX, Issue 78, 4 April 1910, Page 8

SUPREME COURT.

RESERVED JUDGMENTS. SALE OF A PROPERTY. Judgment was given by his Honour the Chief Justice to-day in the case of Thomas Morland, plaintiff, v. Fred Hales, Benjamin Coleinan, .James Brownlie, John OUiver and Thomas iWilson defendants, and Edward Somer■riHe, who was joined as a third party. This was an action for specific performance. The defendants are the owners of an estate in Marlborough, called -'Birch Hill," of an area of about 18,862 acres. In November last it had on if. about 8000 sheep, besides lambs, and other stock, and implements, etc. On 21st September, 19W, the owners appointed Mr. J. P. Mowat, of Blenheim, sole agent for one month, W. Deveraux to act as agent with him for the sale of the property. The property was *iot sold during the month. On Bth ■[November the defendant* placed the estate under offer to the plaintiff, and in negotiating this offer Mr. Deveraux •was acting as agent of *he defendants, Mr. Mowat being also agent, or chief agent The words in the offer were inter alia .—"We hereby place our property .... as a going concern . . " . consideration for option for ten days from date [that is Bth November, It»u9] to be Is, receipt of which is hereby acknowledged. Terms to be five hundred pounds deposit before expiration of the option, eleven thousand five hundred pounds to be- paid one month from the above date . . . 5 per cent, per annum to be paid for alt unpaid purchase money, possession to bo given and taken one month from date, Bth M>v«nber, 1909." Mr. Somerville, the third party, had learned from Deveraux that the- property was for sale, and had gone to Blenheim early in November to inspect the property. He was accompanied by -Mr. Spiers, another land agent, who was acting with Mr. Deveraux. . On 11th November the plaintiff met Mr. Deveraux in Christchurch, aud after the interview ended Mr. Deve« raux despatched two telegrams from Christctrurch, on© to Mr. Mowat, his co-agent, and • oue to Mr. Spiers, who ■was also acting with him. The telegrams were received at tho Christchurch telegraph office at 2.16 p.m.. The one to Mr. Spiers was: "Sell Birch Hill to somerville. Young Morland absolutely refuses to go. Regular row between father and son and tell Somerville wade in." That to Mr. Mowat was as follows: "Son refused go Birch Hill. Sell to Somerville." I Mr. Somerville was shown the telegram to Spiers and on the same date, Bth November, sent the following telegram to Deveraux : "Spiers wishes it clearly understood I will have nothing to do with you in matter Birch Hill or any other property and do not recognise you in any manner as to introducing agent." Two days after the receipt of this telegram Mr. DeTeraux sent a letter to defendants, in which be said, inter alia: — "We are .extremely sorry that because of family troubles Mr. Mhos. Morland has decked wot to purchace your property known as Birch Hill" After reciting these and other facts connected with the case, his Honour said that these, amongst other questions, had been raised :—(1): — (1) Did the plaintiff refuse the offer on 11th November? (2) Tho question of the liability of the defendants for a breach of tbe option. It appeared that two purchases of the property had been made, both in good faith. The question really was, which of the two was entitled to have his bargain completed — either Thomas Moreland or SomerriUe? The equities in the case, in his Hon- ! our's opinion, were equaL and holding that opinion the person who obtainedth* first valid contract, namely Mr. Somerville, was entitled to have the property conveyed to him. Costs-would l»v» to be allowed tiie defendants. A»y other questions arming in the case would bave to stand over. The right to sue for damages on the option to sell (if it was not declined) would also be reserved. Mr. Ge&Ege Harper and Mr. Young appeared for plaintiffs at the hearing, Mr. Skerrett and Mr. O'Leary for the> defendants, and Mr. Stringer and Mr.. Levi for the third party. THE HEATON PARK ESTATE. A QUESTION OF TAXATION. His Honour the Chief Justice also gave judgment in the case of Rhodes «ad others v. the Commissioner of Taxes. The action concerned the Heaton Pack Estate, which was divided and sold in lots. Many of the purchaser* had obtained possession of the land, but bad not paid 15 per cent, of the purchase money. The exact position in which they stood was fully known to the Commissioner of Taxes. The amounts due were returned as unpaid purchase money owing, and the lands were not returned as owned by plaintiffs. No information was withheld from the Commissioner of Taxes, and it ia admitted that the transactions were entered into in good faith and not for the purpose of evading taxation. Acting under the powers he possessed nnder the Land and Income Assessment Act, the commissioner assessed ibe plaintiffs as liable to pay mortgage tax on the unpaid purchase money*, and the taxes assessed were unpaid. This was the course followed in 1907 and 1903. In 1909 the commissioner Amended his previous assessments, and ' he claims he had a. right to do so. No exemption had been applied for under the provisions of the sixteenth section of the Land and Inc*me Assessment Act 1907, but by the rate -of assessment fixed the commissioner in, fact granted the exemption ; for, had he not granted the exemption, his assessment would have been much higher. His Honour pointed out that section 16 of the Act empowered the commissioner to exempt from one class of taxation '•where less than 15 per cent, of the purchase money had been paid. . . In any snch case the decision of the Commissioner ehall be final and conclusive." Subsequently the Commissioner claimed to amend the assessments he had previously nade. Two contentions were put forward by the Commissioner : (1) He did not exerciie his discretion under section 16 ; (2) the purchasers were not in possession as purchasers. That be did in his assessments grant the exemption was undoubted in Bis Honour's opinion, and having done so on two occasions in two different years he could not say he did not do to. It might be that he did not fully realise what he did, but he granted the exemption, and having done «o it is not permitted to him to revise his decision under the section of the Act that allows him to amend, for the amendment ia reversing a decision that if declared ftnal and conclusive. The second contention was the more important one. Had the purchasers possession as purchasers or were they kssees? His. Honour held they were not lessee*. They occupied an entirely different po?ition to that of mere lessees. Tbe pnrcfa**«s were bound to pay the purchase raoaeyi.iit.the doedat^ Their interest

waa a leasehold interest plus the status of absolute purchaserb. They \\ere in actual or physical possession of the land, and their agreement had to be looked at | as a whole and the clause making them absolute purchasers could not be ignored as if it was not there. He found that they came under section 16 or section 62. and were ia possession as purchasers as 1 well as in possession as lessees. Judgment was given for the plaintiffs with costs. Mr. Skfrrett, K.C., with him Mr. Hadfield. appeared for the plaintiffs, and the Solicitor General for the Commissioner. RIDDIFORD v. FORMAN. In this iase the question raised was whether the defendant, as occupier of sections 220 and 224 and of part of 216 in the Waira*apa North County, bad a way over section* 182, 183, and parU of 216 and 218, which belong to tbe plaintiff. The defendant had used a way for some years over these last-named sections, but it was admitted that unless he could show lie had a way of necessity over plaintiff's land he could not claim the way he had so used. It was contended that if there was no way of necessity siill a way of necessity was created after 1881. After going exhaustively into the facts, which have already been fully reported in The Post some weeks ago, his Honour gave it as his opinion that defendant's contentions as to a way of necessity having been created had failed. There was no implied grant of a way of necessity over sections 182, 183, and 180, as it was not proved that there was not access to the Crown land unsold that bordered on sections 180 to 190 when those sections were granted, and which unsold land included sections 220 aud 224. When the transfer to the Crown of part of section 216 was made it had as one of its boundaries a public road, and was consequently not land-locked. "I may add," his Honour continued, "that the defendant has no doubt been placed in an unenviable position, but tne court cannot help him. The rase shows the need of not disposing of Crown lands until proper access is given to them, and also the need of carefully seeing that no rights to take roads be allowed to lapse unless it is clearly seen that these rights might not be exercised." An injunction restraining defendant from using the way would have to be made perpetual. Plaintiff was awarded costs. Mr. C. F. Skerrett, K.C., with him Mr. H. H. Ostler, appeared for plaintiff, and Mr. Myers for the defendant.