CITY LEASES

Evening Post, Volume LXXXIX, Issue 66, 19 March 1915, Page 4

CITY LEASES

TO THB SDITOR. Sir, — Mr.' Skerrett's letter in reply to Mr. Morison's statement in connection with the recent arbitrations has been in part published in your paper. The whole of his letter is, in my opinion, practically an evasion of the points at isstie, and is really a bold attempt to justify awards winch have deprived the city of 'at least , £20,000. There have been several sets of arbitrations, lately, one set presided over by Mr. A. Gray, K.C., one by Mr. A. Macintosh, one by Mr. C. Y. Fell (of -Nelson), and one by Mr. Ferguson. Mr. Gray and Mr. Fell, both barristers of standing, acted fairly and judicially. Mr. Ferguson was appointed by Mr. Justice Hosking in ( spite of strenuous objection by the City Solicitor, who stated that if Mr. Ferguson* or any business man were appointed the result would not be satisfactory to the city. At the hearing the lessees were not able to get any valuers to give evidence that suited, except Mr. 0. J. S. Harcourt and Mr. Gerald Fitzgerald. Evidence i'or the Corporation was given, by Messrs, Aines, Wilson, Renner, Shepherd, Longmore, T. Dwan, and W. A. Thomson. Messrs. Hannay and Ferguson, rejected all the Corporation evidence, and adopted in toto the views put forward hy Mr. Harcourt. Mr. Skerrett carps at the terms and conditions of the lease. This argument is ridiculous. The lease was first adopted in Connection with the Te Aro Reclamation about the year 1890, and was in vogue for 14 years before the Wellington City Leasing Act, 1904, was passed. The business men of Wellington had 14 years' experience of this form of lease, and they pressed the council to obtain legislative authority to convert their expiring leases into leases for terms of 14 years, with the right to renewals in perpetuity for successive periods of 14 years. As regards • the Court of Appeal decision. Mr. Skerrett has not made clear the effect of that decision. He says :—: — "The Court of Appeal has said that the Way to arrive at the rental is not to fix the same at a percentage of its fee' simple value as if no buildings existed thereon." What the Court of Appeal did decide was that the arbitrators were not in fixing the rent bound to arrive at the rental by that method only. Mr. Skerrett makes a great point of Mr. J. M'Kenzie Henry's Opinion. Mr. Henry lives in Melbourne. His company pressed the Corporation to accept £3 per foot ground rental for the property at the southern corner of Waring Taylor-street and Lambton-quay for a fourtce^ years' lease with fourteen-year reriewal period*. For a twehty-one years'

lease with twenty-one-year renewal 'periods, Mr. A. L. Wilson paid £5 10s per foot (the rental fixed by the arbitrators) and £1500 for the building, and is, spending £300 on the building. Mr. Wilson's evidence was endorsed by hfs action in taking up the lease, and he. is perfectly satisfied with his bargain. Mr. Skerrett quotes Auckland figures, 432 to £5 per foot. The £2 per foot land is more than a mile from the Post Office, and the £5 per foot land adjdins the new swimming baths in Auckland. He also quotes Dunedin. The land he refers to is in Bond-street, Crawford-street, and Cumberland-street, and is in no way comparable to the land in Lambton Reclamation. Land is much more valuable in Wellington than in Diinedin, yet for a cornet, section in the Octagon, Princes-street, Dunedin, Hallenstein Bros, are paying £10 per foot per annum ground rent-. Mr. Macintosh fixed Mr. Harcourt's rent for a similar corner at £5 per foot. Dal-J gety and Co., Ltd., paid £200 per foot for land in Featherston-street. For similar land Mr. Ferguson fixed Murfay } Roberts and Co.'s rent at £4 per foe* per annum. To show the perversity of the arbitration I will conclude by stating two facts. (1) Mr. Ferguson and Mr. Hannay followed the- awards of Mr. Macintosh. Of these awards his Honour the Chief Justice spoke as follows :—": — " If the Court had to deal with an award as it deals with a verdict of a jury there is a strong case made out for interference by the Court based on misconception, of the position by the arbitrators. The rentals are lower than and' irreconcilable with the decisions of the D.I.C. arbitration, the umpire in that case having been a Judge of the Court. Further, if the awards are proper, then the Government valuation of land in the centre of Wellington is far beyond what it should be and people who have bought land near the centre have been giving absurd prices." (2) The arbitrators themselves called Mr. O. S. Watkins. He stated that he had agreed to pay £5 per foot rental and that he was well satisfied with his bargain* In spite of this fact they fixed the rental of land in the same street and block at £3 and £3 5s per foot. — I am, etc., JOHN O'SHEA, City Solicitor. 16th March.