RATES ON SHOPS

New Zealand Herald, Volume 80, Issue 24535, 18 March 1943, Page 5

RATES ON SHOPS

BASIS OF VALUATION fTEST CASE BEFORE COURT test case was brought before the Assessment Court for tho City of AuckI nd yesterday to decide the basis on hieh rateable values of shop properties r the city should be assessed, in lew of the'fact that the City Council V decided that valuations are to be triennial, instead of annual, Mr. J. H. gttfbrd, S.M., presided v Appearing in support of an objection l,v Leonard Waite, confectioner, tennt of a shop in Pacific Building, Mr. f j. Goldstine said that the decision f the Court would affect about 100 nfher assessments. On the basis of a ? t 0 f £lO a week, plus rates, Waite's chop had been assessed at a rateable Lliifl of £416 a vear and a restaurant attached at £B3, a total of £499. Effects of War Conditions valuer had made his valuation on the basis of the rental paid bv the j-naiit from year to year, said Mr. Goldstine. Under the Rating Act, tho fair annual rental value was what a hypothetical tenant would reasonably be exacted to pay for a tenancy from year *0 year. In normal times, the effects e f valuation 011 this basis were not so serious, because adjustments could bo made every year, but the City Council had adopted triennial valuations, so ratepavers were prevented from objecting for three years. . Owing; to uncertainties or trade, due lo shortages of goods, staff difficulties Btid other 5 conditions due to the war, tenants to-day would not take leases of shops for more than a year, Mr. Goldstine continued. The crux of the position was that a tenant would mot commit himself to a year to year tenjuiev. It was. therefore, difficult to say nrhiit a hypothetical tenant, under these conditions, could reasonably be expected to payCourt Reserves Decision Leonard Waite gave evidence that he §iad had a lease of the shop for eightrears and it bad expired. He would not renew the lea.se at the present rent unless under coercion. Reginald Sydney Newcomb. agent for the 'owners of ~ the building, said the majority of the 138 city shops he managed had been let 011 long lease prior'"to the war. He hfld not let a shop 011 lease for the past two years and no lease that had fallen due in that period had been renewed. Reductions in rent would have to be offered ito induce tenants to take leases for a year or more. The city solicitor, Mr. J. Stanton, fcaid the valuer could not speculate 011 what was to be the state of trade in the next three years. He could only tase his valuations on the present fair ennnal rental value. Conditions might thanee in three vears either to the benefit or the detriment of the ratepayer. The City Council had to take this risk and so should the ratepayer. Decision was reserved.