CITY LEASES

Evening Post, Volume XC, Issue 86, 9 October 1915, Page 9

CITY LEASES

SYSTEM OF VALUATION APPOINTMENT OF ARBITRATORS DEBATE IN THE HOUSE. A spirited protest was made in the House of Representatives last night, when shortly before midnight an amendment to the Municipal Corporations Amendment Act was introduced by Governor's Message. The Hon. G- W. Russell said that in the Act there was provision dealing with the arbitration that takes place between the municipal councils and their lessees. It provided that the senior Stipendiary Magistrate should act as third arbitrator in cases where the lessee and the corporation cannot agree upon the third arbitrator for the purpose of making a valuation of a property leased by the corporation. By Governor's Message it was now proposed that • the section should not come into force until 1917. • A member : Why ? THE DEPUTATION'S REQUEST. The Minister added that that morning a. large deputation of leading business men in Wellington had waited on the Leader of the Legislative Council and himself in connection with this matter. They had represented that an important change was being made in connection with the method of arbitration of which they had no knowledge, and that they had no opportunity of making representations. Hitherto, whep there had been arbitration on these matters the custom had been that the two parties — the Corporation and the lessees — each appointed an arbitrator, and if they were unable to agree a Judge of the Supreme Court selected a name from a list submitted to him. It had been represented to him (the Minister) that local influence ■was so strong that it was desirable that a change should be made in the method of the appointment of the arbitrator, and that v/as the reason of the clause. He thought the people interested had had some right tc intimation that a change was to be made in the law. A member: How many leases are there? The Minister: I understand some eight or nine. Mr. Hindmarsh : Ten. The Minister added that in the event of the House refusing to receive this amendment he understood the probability was that the Bill would pass into law. A PROTEST. Mr. Hindmarsh hoped the amendment would be,disagreed with. In 'the past the City Council had found it impossible to select names from lists. Sometime ago some leases had fallen due and the parties couH not agree. , The council had had some difficulty in submitting names, and Mr. W. Ferguson was appointed. It was said by Mr. J. O'Shea, the City Solicitor, that Mr. Ferguson was not a man likely to view the matter impartially. The Judge had immediately said : "Would you suggest that a man like Mr. Ferguson could not be trusted in this matter?" Mr. Ferguson was appointed, and the effect was disastrous to the Wellington City Council, which had lost thousands of pounds; and in almost every arbitration case the city had been worsted. Notwithstanding the fact that evidence was overwhelming in support of a particular valuation, the evidence was not listened to, and judgment was given 1 which was wholly in favour of the tenant. The tenants of the City Council comprised were 6ome of the wealthiest men in Wellington. They included Messrs. Kirkcaldie and Stains, George and George, the D.1.C., the Club Hotel, and others. They had formed an association which had become so strong that its influence was felt by the arbitrators selected. It would not surely cause complaint if the City Coun cil endeavoured to obtain an independent man, whose judgment would be given, upon the evidence submitted to him. The annual rental" of the leases falling due was about £10,000 a year. ! He asked who could honestly object to the arbitration of a Magistrate? Yet the lessees objected to an independent arbitrator, and the reason was that they could influence an ordinary arbitrator. He was influenced unconsciously; the speaker would not for a moment suggest he was bribed. A Judge or Magistrate decided a case upon evidence. Surely when property waa worth £10,000 a year the citizens were justified in saying our interests should be presided over by an impartial tribunal. The lessees could only be actuated by a desire for favourable terms; otherwise why should they ask that a Magistrate should not preside. One arbitrator in the past, Mr. Fell, of Nelson, had acted in a way satisfactory to the council, but that had meant his exclusion in subsequent cases. SOME QUESTIONS. Mr. T. M. Wilford said that the lessees did not ask for the repeal of the proposition, but its postponement. And why was it? Was it because the ten leases were falling due this year ; and if so, was their desire in favour of the city or themselves ? Mr. Russell said it was not the request of the lessees that the clause should be postponed. He took responsibility for that. Mr. Wilford said that the Minister should add further words, that no leases falling due in the interim, the question of the terms of the renewals should not be decided until the date last hereinbefore mentioned. Dr. A. K. Newman said the question had been a very burning one in Wellington. _ He then went on to explain the position that had arisen. The Corporation of Wellington had some enormously valuable leases, which ran away down to the Supreme Court. These leases were let years ago, and had now expired. It was expected that these leases would bring in rentals of £25,000. They had been coming due from time to time lately, and the question had arisen as to the price of the rentals. The Corporation had an arbitrator, the lessees had an arbitrator, and the Judge was the third arbitrator, and everything depended on him. It was a horrible shock to the Corporation when recently a number of these cases were tried and the rent was fixed at a wonderfully low figure, the Corporation thus losing a great deal of money. There was such a a thing as bias, and he thought the basis of the Court was wrong. He thought that if the third arbitrator could not be- a Judge of the Supreme Court, then the idea of the Resident Magistrate occupying the position was an excellent one. He regretted that the Minister had given way to the deputation that had waited on him. There were ten leases coming in next year, and these leases, instead of being adjudicated on by a Judge or a Magistrate, were to be adjudicated on in this haphazard manner. After further discussion the Prime Minister moved the adjournment, to give the Minister a further opportunity of considering the position.