SALE OF HOTEL

Grey River Argus, 20 May 1944, Page 6

SALE OF HOTEL

Consent at £22,000 LAND SALES COURT’S JUDGMENT. P.A. DUNEDIN, May 19. The Lands Sales Court (Mr Justice Finlay and Mr William Stewart) has given its reserved judgment in an appeal against the decision of the Otago Land Sales Committee in refusing consent to the sale of the Oriental Hotel by the owners, Thomas Clarke Muir and Mary Frances Muir, to Ellen Niall and George Philip Miller, at a price of £2750 for the land and buildings and £19,250 for the license, stock and furniture, being at valuation. In its decision the Court stated that the £22,000 agreed to be paid for the Oriental Hotel represented its market value, not only at the date of the sale but also at December, 1942. The point at issue was the value of the goodwill, and after dealing at length with the question of the license and goodwill, the judgment says:— “In the view of the Court a material part of the sum expressed to be payable for - the license may well represent in part a sum payable for the goodwill which attaches to, and enhances the value of, the premises, and in part the sum by which the existence of the license issued in respect of them enhances the value of the premises. That the whole sum payable for the license is referable to these two features alone is implicit in the testimony of the witnesses for the appellants, each of whom in turn justified, the magnitude of the price agreed to be paid for the license by reference to the favourable situation of the premises in a locality that is partly commercial and party residential, the volume of the trade which is being done and has for some years been done in the hotel, and by reference to some physical feature of the premises.

“All this indicated that the £22,000 agreed to be paid for the Oriental Hotel represented its market value, not only at the date of sale but also at December, 1942. To hold that it did not do so would be to deny the truth of a considerable body of unquestioned evidence. This the Court is in duty bound not to do. It is constrained to determine fairly on the evidence what the value of the premises was on December 15, 1942, and none of the evidence suggests that the value as at that date was any less than £22,000. This being so the Court can only grant consent to the sale and it does so accordingly.”