T UNIVERSITY OF CALIFORNIA LOS ANGELES SCHOOL OF LAW LIBRARY ^OLD ON RATING. PEACTICAL EEMARKS THE PRINCIPLE OF RATING RAILWAY, GAS, AYATER, AXn OTHER COMPANIES ; ^AND, TITHES, BUILDINGS, MANUFACTORIES, AND OTHER PROPERTIES tiatJle to te ^0,00,0000 totoatD0 tfte Eelief of tfje IPoor. SIXTH EDITION, RE-^VRITTEN ^:isrD EXTENDED liY JOHN THOMAS KERSHAW axd WILLIAM MARSHALL, Civil ETijiiiccrs a7id IJafiiij Stirwyors, 37, Norfolk Street, Strand, W.C. LONDON: KNIGHT & CO., 90, FLEET STEEET, E.C., ^ublishcra bji ^^nthoritj; to the JJoor l-'ato ^ourb, iinft to the §)oiuc ©((ice fov the pm-poscs of the Jlocal Cobernmcnt ^ct. T P3n59r 1270 if PEEFAOE TO THE SIXTH EDITION. The last Edition (the 5tli) of "Penfold on Rating" was pub- lished on the 1st February, 1869, and was, before the end of the same year, entirely exhausted. The work of revision and extension of the present Edition was commenced by the late Mr. Kershaw the able Editor of the last, but owing to his violent and imtimely death the labour of its completion has fallen upon me. In the present volume the law as it now stands, both for the Metropolis and the Country, is shown in parallel columns, the various clauses being arranged in the order in which they should be chronologically appKed. I have considered it necessary also to make several alterations and additions in the present instance — first, in consequence of some recent decisions of the Court of Queen's Bench ; and secondly, on accomit of certain obvious omissions in the last Edition. Some independent remarks, having reference to the present unsatisfactory system of valuing railway property, together with some suggestions as to the best method of effecting a remedy, -^ A 2 ' I 75577'.? Tl rHEFACE. v.liicli may bo taken to represent real property in the simplest form ; tlience, progressing by regular stages, to tliose whicli determine tlie same values of general tenements, houses, and land ; and finally, of the property of gas, -water, railway, and other public companies. Mr. Penfold did not use this mode of treat- ment, but dealt with the several subjects as each presented itself to his mind. With regard to the opinions herein stated, it should be remarked that they arc, mth one or two exceptions, those held by Mr. Penfold, some of which were not confirmed as law \mtil after his death. The principal one in which the Editor has taken up a position contrary to that held by Mr. Penfold, refers to the mode of apportionment in the case of gas and water companies, and in this he has always differed from Mr. Penfold, with whom, for many years, he was associated. Technical questions in matters of law have been unnoticed, such matters being entirely without the sphere of a work like the present. Should the Editor prove, through the medium of this edition, to be of any assistance to tliose whose imthankful, and at times per- plexing duty it is to equalise the present unsatisfactory distribu- tion of the jDoor-rates, by transferring their burden from the shoulders of those who now bear it in an unjust proiwrtion, ns he cannot but think, to those of the shareholders of many public companies, the rateable value of M'hose various properties is so imperfectly understood, he will consider himself amply repaid for the time and trouble he has necessarily expended in jnoducing this edition. The diminished bulk of the prosont volume, as compared willi r HE FACE. VU that of its ^predecessor, is due to the omission of the unimportant and cumbersome extracts from Acts of Parliament and Court judgments, which, in the last, tended more to confuse than to elucidate the subject. The Editor cannot conclude this brief introduction -without expressing his thanks to the representatives of the late Mr. Penfold for the confidence they have reposed in him by the transfer of all the valuable manuscripts and data which Mr. Penfold accumulated as the result of many years of professional labour and experience ; and also to his partners, Mr, Ai-mstrong, M.A. (Cantab), C.E., and Mr. Marshall (Lecturer on Surveying, King's College), who have at all times readily given him the benefit of their experience and advice during the progress of the work through the press. 37, Norfolk Street, Strand, W.C. Jcuiuarij 1, 18C'J. CONTENTS Page Act of Elizabeth, IGOl ... ... ... ... ... ... ••• •■• 1 Overseers for the poor, their office, &c. Who shall be taxed A convenient stock shall be provided All rates to be made on net annual value ... Provi.so... THE LAW AS AT PRESENT ENACTED FOR THE COUNTIES. Union Assessment Committee Act, 1862 ... 5 Sec. 1. Interpretation ... ... ... ... ... ... ■ • ... 5 Sec. 2. Appointment of Assessment Committee ... ... ... ... ... 6 Sec. 3. Where union has same bounds as borough ... ... ... 7 Sec. 4. Provision for neglect to appoint ... ... ... ... ... ... 8 Sec. 5. Provision for vacancies ... ... ... ... ... • • ■ ■ 8 Sec. 6. Continuing members may act during vacancies ... ... ... ... 8 Sec. 7. Extent of committee's authority ... ... ... ... ... •.■ 9 Sec. 8. First meeting, when to be holden .. . ... ... ... ... ... Sec. 9. Quorum of meetings ... ... ... ... ... ... ••• 9 Sec. 10. Committee may employ and pay clerk ... ... ... ... ... 10 Sec. 11. Proceedings to be entered in book and signed ... ... ... ... 10 Such entries evidence ... ... ... ... •■. ... ••• H -Sooks to be open to inspection ... ... ... ... ... ... H Sec. 12. Proceedings of committees to be reported ... ... ... ... 12 Sec. 14. Overseers to prepare valuation lists ... ... ... ••• ••■ 12 Sec. 15. Definition of gross estimated rental ... ... .• ■■. • 14 Act of William, 1836 14 Sec. 1. All rates to bo made on net annual value ... ... ... •^. 14 Proviso ... ... ... ... • • •■• ■•• ■•■ ••• 1^ Act of 1864 If* Sec. 7. Expenses of overseers, incurred with consent of vesti-y or allowed by Assessment Committee, mny be charged on poor rates 16 X CONTKNTS. Act of 1862 17 Sec. 16. Committee may enlarge time for making valuation lists, and may giro directions concerning, and appoint persons to make same ... ... 17 Sec. 17. Valuation lists to be deposited and transmitted to committee ... ... 18 Act of ISGi 19 Sec. 5. Notice of assessment to be given to certain companies ... ... 19 Act of 1862 20 Sec. 18. Objections to valuation list ... ... ... ... ... ... 20 Sec. 42. Service of notices, &c., on committee ... ... ... ... ... 21 Sec. 19. Committee to hold meetings to hear objections ... ... ... ... 21 Sec. 13. Committee may require returns from overseers, &c. ... ... ... 24 And may require production of rates, &c.,aud examine persons attend- ing before them ... ... ... ... ... ... ... ... 25 Sec. 41. Authentication and service of orders and notices of the committee ... 25 Sec. 40. Penalty for non-attendance, &c., in obedience to order... ... ... 26 Injuring, &c., rate books a misdemeanour ... ... ... ... 26 Sec. 37. Board may allow compensation for returns, &c., and expenses ... 27 Sec. 38. Eemuncration of clerk, &c., how to bo paid ... ... ... ... 27 Sec. 20. Board may direct further valuation, &c. ... ... ... ... 27 Sec. 21. Valuation list, when altered, to be deposited ... ... ... ... 29 Amendment Act of 1868 ... ... 30 Sec. 30. Columns in the valuation lists to bo cast up by the committee, &c. ... 30 Act of 1862 31 Sec. 31. Copy of valuation lists to be deposited in board room ... ... ... 31 Sec. 30. Contributions to common fund, how to compute ... ... ... 32 Act of 186i 33 Sec. 9. Clerks of Assessment Committees to furnish clerks of the p eace with totals of valuation lists ... ... ... ... ... ... ... 33 Act of 1862 31 Sec. 32. Appeals against valuation list ... ... ... ... ... ... 34 Sec. 33. Ilcaring and determining appeals ... ... ... ... ... ... 36 Sec. 34. Costs of valuation and appeal ... ... ... ... ... ... 38 Act of 1862 39 Sec. 23. Custody, &c., of valuation list after approval ... ... ... ... 39 Sec. 21. What shall bo deemed valuation lists in force ... ... ... ... 39 Amendment Act of 1868 40 Sec. 31. Certified copies of valuation lists rendered available whoso original is lost 40 Act of 1862 41 Sec. 43. Provision as to form of poor rate ... ... ... ... ... ... 41 Sec. 28. After valuation list is approved no rate to be allowed unlcsa made ac- cording to such list ... ... ... ... ... ... ... 42 coxte:sts. XI Page Act of 183G 43 Sec. 2. Kates to be made in a given form ... ... ... ... ... ... 43 Nothing herein to prevent owners compouuding for rates ... ... 44 Act of 1864 46 Sec. 11. Penalty on overseers omitting to make or making false declaration ... 46 Act OF 1862 47 Sec. 29. Provision for places under local acts ... ... ... ... ... 47 Sec. 35. Act not to prevent composition for rates ... ... ... ... ... 47 Sec. 36. Saving of exemption and special rules of rating. . . ... ... ... 47 Sec. 44. Provisions concerning the assessment, &c., of poor rates to be applica- ble to rates made according to this act ... ... ... ... 48 Act of 1836 49 Sec. 5. Power to take copies or extracts of rates gratis .. . ... ... ... 49 Penalty for refusing to permit ... ... ... ... ... 49 Act of 1864 50 Sec. 1. Notice of appeal, to be given to the assessment committee of the union ... ... ... ... ... ... ... ... ... 50 Sec. 2. Committee may, with consent of guardians, be co-respondents... ... 51 Amendmext Act, 1868 ... ... ... ... ... ... ... ... 52 Sec. 29. Power for guardians of unions mutually to bear the costs of several appeals involving same common principle ... ... ... ... 52 Act of 1864 53 Sec. 3. Provision as to costs of committee on appeals ... ... ... ... 53 Act of 1836 54 Sec. 6. Justices acting in petty sessions to hold four special sessions in the year to hear appeals ... ... ... ... ... ... ... ... 54 Seven days' notice to be given of objection ... ... ... ... 56 Proviso ... ... ... ... ... ... ... ... 56 Sec. 7. Justices may act with all the powers of justices at quarter sessions ... 56 Act of 1864 58 Sec. 6. Justices in certain cases not disqualified for hearing appeals ... ... 58 Act of 1862 58 Sec. 22. If on appeal a rate is amended the valuation list to be altered ... 58 Sec. 25. Overseers to prepare supplemental valuation lists ... ... ... 59 Sec. 26. Committee may from time to time direct new valuation, and supi^lc- mental valuation lists ... ... ... ... ... ... ... GO Sec. 39. Expenses of valuation, &c., to be paid out of poor rates ... ... 01 Act of 1864 62 Sec. 8. Power to guardians, with order of Poor Law Board, to borrow money for valuation exjicnscs ... ... ... ... ... ... 02 Sec. 10. Power of Poor Law Board to order map or pUm to be made ... ... 63 Act of 1836 G3 Xll COXTENTS. rage Sec. 3. Power to order new survey and valuation ... ... ... ... 63 Sec. 4. Power of surveyors to enter and examine lands, Ac. ... ... ... 65 Amexdmext Act of 1868 ... ... ... 66 Sec. 32. Guardians may appoint a paid valuer to assist the assessment committee 60 ACTOF186J. 60 Sec. 4. Valuation to be made in writing .. ... ... ... ... ... 66 Act of 1862 67 Sec. 27. This act to apply to new and supplemental valuation lists ... ... 67 Amendment Act OF 1868 ... ... ... 68 Sec. 28. 11 and 12 Vict., cap. 110, sec. 7, extended to a parish ... ... 68 Act of 1862 68 Sec. 45. Power for unions under Gilberts' or local acts to bo included in this act 68 Sec. 46. Extent of act 69 Act of 1864 70 Sec. 12. 25 and 26 Vict., cap. 103, incorporated herewith 70 Sec. 13. Short title 70 THE LAW AS AT PRESENT ENACTED FOR THE METROPOLIS. U-NiON Assessment Committee Act of 1862 ... ... ... ... ... 5 Sec. 1. Interpretation ... ... ... ... ... ... ... ... 5 Valuation- of Property (Metropolis) Act of 1869 ■ ... 6 Sec. 1. Act to be construed as one with 25 and 26 Vict., c. 103 and 27 and 28 Vict. c. 39 6 Sec. 2. Short title 7 Sec. 3. Extent of act ... ... ... ... ... ... ... ... 7 Sec. 4. Definitions ... ... ... ... ... ... ... ... ... 8 Metropolis ... ... ... ... ... ... ... ... 8 Parish 8 Union ... ... ... ... ... ... ... ... . . 8 Ratepayer... ... ... ... ... ... ... ... ... 8 Year ... ... . . . . ... ... ... ... ... 9 Surveyor of Taxes . . ... ... ... . . 9 Overseers ... ... ... ... ... ... ... . . •) Vestry Clerk 10 Hereditament ... ... ... ... ... ... ... ... 10 Gross value ... ... ... ... ... ... ... 10 Rateable value ... ... ... ... ... ... 11 Act OF 1862 11 Sec. 2. Appointment of assessment committee ... ... ... ... ... 11 Metropolis Act of 1869 ... 13 Sec. 5. Election of assessment committee in single paris-li where (here ia a vostrv . . ... ... . ■ • ■ ... 13 CONTENTS. xm Page Sec. 59. Provision for cases whore no guardians and where no overseers ... 16 AcTorl862 19 Sec. 4. Provision for neglect to ajjpoint ... ... ... ... ... ... 19 Sec. 5. Provision for vacancies ... ... ... ... ... ... ... 19 Sec. 6. Continuing members may act during vacancies... ... ... ... 20 Sec. 7. Extent of committee's authority ... ... ... ... ... ... 20 Sec. 8. First meeting when to be holden... ... ... ... ... ... 20 Sec. 9. Quorum of meetings ... ... ... ... ... ... 21 Sec. 10. Committee may employ and pay clerk ... ... ... ... ... 21 Sec. 11. Proceedings to be entered in books and signed... ... ... ... 22 Such entries evidence ... ... ... ... ... ... ... 22 Books to be open to inspection ... ... ... ... ... ... 23 Sec. 12. Proceedings of committees to be I'eported ... ... ... ... 23 Metropolis Act, 1869 ... ... 24 Sec. 6. Making of valuation list ... ... ... ... ... ... ... 2i Sec. 55. Occupier to make returns... ... ... ... ... ... ... 24 Sec. 56. Surveyor of taxes to supply notices and forms to overseers ... ... 25 Sec. 51. Form and contents of valuation list ... ... ... ... ... 26 5 and 6 Vict. c. 35 26 Sec. 5i. Saving of exemptions and exceptional principles of valuation... ... 28 Sec. 75. Saving of powers to value property not included in a valuation list ... 28 Sec. 76. Separate assessment of houses for house duty, &c. ... ... ... 28 Sec. 52. Deductions for rateable value ... ... ... ... ... ... 29 Sec. GO. Provision where vestry are the ovei'seers ... ... ... ... 30 Act or 1861 31 Sec. 7. Expenses of overseers may be charged on poor rate . , . ... ... 31 Act OF 1862 .32 Sec. 16. Committee may enlarge the time of making valuation lists, &c. ... 32 Metropolis Act, 1869 ... ... ... ... 33 Sec. 7. Valuation lists to be dealt with under 25 and 26 Vict. c. 103. ss. 17 to 21 33 Act OF 1862 33 Sec. 17. Valuation list to be deposited for inspection and transmitted to the committee... ... ... ... ... ... ... ... ... 33 Metropolis Act, 1869 ... 35 Sec. 10. Notice to state time and mode of objection ... ... ... ... 35 Sec. 66. Publication of notices by overseers ... ... ... ... ... 35 Sec. 9 (part). Notice to occupier of alteration of value, «tc 35 Sec. 8. Duplicate sent to surveyor of taxes ... ... ... ... ... 36 Sec. 13. If overseers do not transmit list, committee to appoint a person to do so 36 AcT0Fl86i 37 XIV CONTENTS. Pago See. 5. Notice of assessment to bo given to corrain companies ... ... ... 37 AcTOFl862 ... 38 Sec. 18. Objections to valuation list ... ... ... ... ... ... 38 Metropolis Act, 1SG9 39 Sec. 11. Grounds on which persons may object before assessment committee... 40 Sec. 12. Surveyor of taxes, &c., may inspect copy and object to valuation list... 40 Act OF 1863 41 Sec. 19, Committee to hold meetings to hear objections ... ... 41 Metropolis Act, 18G9 ... ... ... ... ... ... 41< Sec. 35. Amount of gross value specified by the Surveyor of taxes to be in- serted unless disproved ... ... ... ... ... ... ... 44 Act OP 1862 ... , 44 Sec. 13. Committee may require returns from overseers, &o. ... ... ... 44 and mayrequire production of rates, &c. and examine persons attending before them ... ... ... ... ... ... ... ... 45 Sec. 37. Board may allow compensation for returns, &c., and expenses... ... 40 Sec. 38. Remuneration to the clerk and certain expenses of committee to bo paid out of common fund ... ... ... ... ... ... 4G Sec. 40. Penalty for non-attendance, &c., in obedience to order of the com- mittee ... ... ... ... ... ... ... ... ... 47 Injuring, &c., rate books a misdemeanor... ... ... ... ... 47 Metropolis Act, 1869 ... ... ... 48 Sec. 57. Assessment committee may require returns from owner and occupier.. 48 Sec. 58. Penalty for making no or false returns ... ... ... ... ... 49 Sec. 65. Service of notices, &c., by post, &c. ... ... ... 49 Sec. 20. Board may direct further valuation and correct and approve valua- tion lists ... ... ... ... ... ... ... ... ... 50 Act of 1864 52 Sec. 8. Power to guardians, with the order of the Poor Law Board, to borrow money for valuation expenses ... ... ... ... ... ... 52 Sec. 10. Power of Poor Law Board to order map or plan to be made ... ... 53 Act of 1836 53 Sec. 3. Power to order new survey and valuation ... ... ... ... 53 Sec. 4. Power for surveyors to enter and examine lands, Ac. ... ... ... 55 Mf.tropolis Act, 1869 ... ... 50 Sec. 61. Guardians may appoint a paid valuer to assist assessment committee - 56 Act of 1864 56 Sec. 4. Valuation to be made in writing ... ... ... ... ... ... 56 Act of 1862 57 Sec. 21. Valuation lists when altered to bo deposited, &c. ... ... ... 57 Metropolis Act, 1869 58 Sec. 14. Valuation list to be revised, certified, and sent to overseers, &c. ... 59 CONTENTS. XV Page See. 15, Deposit of duplicate lists iu each parish 01 Sec. G8. Valuation lists to be equivalent to rate books of parish ... Gl Sec. G7. Inspection, &c., of documents deposited with rate books ... ... G2 Sec. 16. Deposit of list at office of the managers of Metropolitan asylum district .... ... ... ... ... ... ••. ••• ••• G3 Sec. G9. Ratepayers, &c., may inspect documents, &c., in hands of clerk of managers, or assessment committee ... ... ... ... ... 63 Sec. 17. Printing and distribution of totals of gross and rateable value in valua- tion list ... ... ... ... ... ... ... ... ... Gi Metropolis Act, 18G9 ... ... ... ... ... ... 65 Sec.42 65 Sec. 68 66 Act of 1862 67 Sec. 30. In computing the amount of contributions to common fund the annual rateable value to be taken from approved valuation list ... ... 67 Metropolis Act, 1869 68 Sec. 43. Duration of valuation list ... .. ... ... ... ... ... 68 Sec. 44. Rate to be levied notwithstanding appeal ... ... 69 Sec. 45. Valuation list to be conclusive for purposes of certain rates, taxes, and qualifications ... ... ... ... ... ... ... ... 70 Sec. 18. Holding of special sessions to hear appeals ... ... ... ... 72 Sec. 19. Persons entitled to appeal to special sessions ... ... ... ... 72 Sec. 33. Notice of appeal to special or assessment sessions .. ... ... 73 Act of 1864 74 Sec. 2. Committee may, with consent of guardians ... ... ... ... 74 Sec. 3. Provision as to cost of committee on appeals . ... ... ... ... 74 Metropolis Act, 1869 ... ... 74 Sec. 20. Est^nt of jurisdiction of special sessions ... ... ... ... 74 Sec. 21. Powers of special sessions ... ... ... ... ... ... ... 75 Sec. 22. Notice by special sessions of time of sitting ... ... ... ... 75 Act of 1864 75 Sec. 6. Justices in certain cases not disqualified for heai'ing appeals ... ... 75 Metropolis Act, 18G9 ,., ... ■■ ... ... 76 Sec. 63. Use of public room for appeals, &c. ... ... 7G Sec. 34. Sessions to hear and determine appeals, and alter lists accordingly ... 76 Sec. 64. Evidence of valuation list, &c. ... ... ... ... ... ... 76 Sec. 23. Court of general assessment sessions ... ... ... ... ... 77 Sec. 24. Appointment of members of general assessment sessions ... ... 77 Sec. 25. OfScei's of general assessment sessions ... ... ... ... ... 78 Sec. 26. Chairman, quorum, and powers of general assessment sessions ... 7S Sec. 27. Orders as to proceedings and recognizances on appeals ... ... 78 Sec. 28. Fees on appeals under Act... ... ... ... ... ... ... 79 XVI CONTENTS. Pago Sec. 29. Places for hoai'ing appeals... ... ... ... ... ... ... 79 See. 30. Public notice of times of holding courts to bo givcu ... ... ' ... 79 Sec. 32. Persons entitled to appearto assessment ses.sions ... ... ... 80 Sec. 31. Summons of certain officers as witnesses ... ... ... ... 81 Sec. 35. Making of valuation list where none approved ... ... ... ... 81 Sec. 36. Assessment sessions may on application of party to appeal order valuation ... Sec. 62. Assessment committee and overseers may give security for costs of valuation... Sec. 37. Adjournment to receive valuation list or valuation Sec. 38. Valuation to be in writing ; person making it to have power to enter 83 Sec. 39. Costs of appeal ... ... Sec. 48. Costs of appeal, &c. ... ... Sec. 49. Inland revenue may make allowances for expenses of Act Sec. 50. Expenses ... ... Sec. 40. Appeal from decision of assessment sessions on points of law... Sec. 41. Notice of alteration of list to be sent to overseers Sec. 73. Form of rate and declaration Act OF 1836 Sec. 5. Power to take copies or extracts of rates gratis ... Penalty for refusal to permit Metkopolis Act, 1869 Sec. 70. Owner where rated to be in position of occupier Sec. 71. Amendment of error in rate by two justices Sec. 72. Omissions from the rate ... AcTOFl862 Sec. 44. Provisions concerning the assessment, &c., of jioor rate to bo appl cable to rates made according to this Act Sec. 46. Extent of Act Act OF 1864 Sec. 12. 25 and 2G Vict., c. 103, incorporated herewith ... Sec. 13. Short title Metropolis Act, 1869 Sec. 46. Mode of revising valuation list ... Sec. 47. Provision for valuing a houso built between the time at which tl valuation list is made Sec. 77. Rppcal of Acts herein described ... Principle of assessment to the poor rate ... Nature of the various tenures Tenure of the Parochial Assessment Act ... Kent under lease, no( rateable value CONTENTS. XVll Page Weekly tenements ... ... ... • • • • ■ • ■ • • • • ■ "" Decision 9f the court, illustrating the nature of the tenure, Queen v. Wells, 2 law reports, Q.B., 542 98 Statutable deductions Application of the principle of assessment ^02 Land in its simplest form •'-"^ Land enclosed • • • • • • • • • • ■ ■ Land subdivided into farms • • • • ^^^ Land further improved by drainage l^o Accommodation land ... ' ••■ ••■ •• ^^^ Market garden ... Land built upon, houses, shops, &c 1"^ Public houses ^^^ 107 Mansions ... Business premises and manufactories ... ... ...'.•. ••• ••• 108 Machinery in buildings ... ... ... • • • • • • • • • • ■ ■ • • • ■'••'■" Limits within which machinery is rateable... ... ... •. •■• ■•■ HI Decision of the court as to the rateahilitij of machinery, E. v. overseers of Lee 1 LawEeportsQ. B., 241 HI Decision of the court as to the non-rateahility of machinery, E. v. overseers of Halstead, 31 justice of the peace, p. 373 115 Steam hammer rateable ... ... ... •■• ••• ■■• ••• ••• H* Sewing machine not rateable ... ... ■ . ■ ■ • ■ • ■ • • • • • • ■ H * YV^ator mills ^^'^ Windmills ^^^ Tithes " 121 Sand and gravel pits... ... ■•• ■■• 1^" Ballast pits ^^^ ■ije Chalk quarries ... ... Clay pits 1'^^ Brickfields ^^^ Coalmines ^^^ Gas and Water Works. Principle of ascertaining the total rent 163 Judicial decision as to the basis of the estimate, E. v. Sheffield Gas Co., 32 L. J., M.C. 169 165 Deductions to be made from the gross receipts 166 Tenant's profits ... ... ••• ...16/ Judicial dccislou that " plant " is not to be considered a " chattel " of the tenants, but that " meters" are, Phoenix Gas Co. v. Lee, 1 L. E., Q. B. 241 169 a3 XVlll CONTENTS. Page Tenant's risks and casualties . ... ... 180 Certain items charged in the accounts which ought not to be deducted in ascer- taining the rent ... ... ... ... ... ... ... ... 184 Mode of apportionment ... ... ... ... ... ... ... ... 187 E. V. Cambridge Gas Co., 8 A and E., 73 187 R. v. Mile End Old Town, 10 Q. B., 208 191 R. V. West Middlesex Water Co., 28 L. J., M. C. 135 198 Railways and Canals. The various conditions under which railways exist ... .. ... ... 210 Basis of the assessment, whether tolls or gross receipts ... ... ... ... 211 Lord Denman's judgments on that point ... ... ... ... ... ... 212 R. V. South Western Railway, 1 A. and E. N. S. 558, 11 L. J. (X. S.), M. C. 93 212 R. V. Grand Junction Railway, 4 Q. B. 13 L. J. (N. S.), M. C. 97 214 Gross receipts to be the basis of the rate ... ... ... ... ... ... 215 Tenant's working expenses ... ... ... ... ... ... ... ... 218 Tenant's capital, what it consists of . ... ... ... ... ... ... 220 Tenant's profits ... ... ... . . ... ... ... 223 Depreciation of rolling stock ... ... ... ... ... ... ... 224 Reduced value of stock ... ... ... ... 227 Rates and taxes ... ... ... ... ... 2:28 Deductions from the rent ... ... ... ... 229 Improvements not to be deducted from the rent ... ... ... ... ... 231 Other items not to be deducted ... ... ... ... 233 Rent of branch lines 236 Rateable value of stations ... ... ... ... ... . . 236 Special local values ... ... • • . • . • • . • • • ■ ... . • ... 2 12 Apportionment of the entire rateable value ... ... .. ... ... 244 Parochial earnings ... ... ... ... ... ... ... ... ... 246 Deductions for " cartage " . . ... ... 248 Deductions from the "local receipts" ,. .. ... 21.9 Parishes in which there appears to be no rateable value of railway ... 255 Rent paid not sole criterion of value ... ... ... .. .. ... 258 Tolls 272 APPENDIX. Some remarks upon the present unsound system of rating railways, together with a suggestion as to the best modo for the prevention of railway companies escaping the payment of their due share of the parochial rates ... 279 Principle of ascertaining the rateable value of Copper, Tin, and Lead Minos ... 293 On certain inequalities in the rating of railways as between Company and Company . .298 SCHEDULE OF CASES NOTICED. Page 1. R. r. Wells, 2 Law Eeports, Q. B. 542 (1867) 95, 98, 181 2. E.r. Overseersof Wennington, 34L. J., M. C. 17 (1865) 101 3. E. V. Overseers of the Parish of Lee, 1 Law Eeports, Q. B. 241 (1866) ... Ill 4. E. V. Overseers of Halstead, 31 Justice Peace, 373 (1867) Ho 5. E. t'. Joddrell, 403 B. and A 123,128 6. E..r. Capel,12 A. andE., 283 123,130 7. E. f. Skingle 124 8. E. V. Goodchild, 27 L. J., M. C. 233 and 251 125, 130, 219 y. E. r. Lamb, 27 L. J., M. C. 233 and 251 125 10. E. r. Hawkins, 27 L. J., M. C. 248 125 11. E. V. Overseers of Scrjven Tenter Gate, 32 L. J., M. C. 161 (1863) ... 128 12. E. V. Inhabitants of Sherford and Others, 2 Law Eeports, Q. B. 503 (1867) 128 13. E. V. Groves, 29 L. J., M. C. 179 134 14. E. V. E. Westbrook, 10 Q. B. 178 and 16 L. J. ref. (N. S.) M. C. 87 ... 146 15. E. r. Henry Everest, 10 Q. B. 178 and 16 L. J. ref. (N. S.) M. C, 87 ... 148 16. E. v. Foleshill, 2 A. and E. 593 156 17. E. r. John Attwood and Others, 6 B. and C. 277 156 18. E. r. Lord Granville, 9 B. and C. 188 159 19. E. V. The Sheffield Gas Co., 32 L. J., M. C. 169 (1863) 165, 206 ■ 20; Phoenix Gas Co. r. Lee Parish, 1 L. E., Q. B. 241 168 21. E. V. The Cambridge Gas Light Co., 8 A. and E. 73 187 22. E. r. Lower Hutton 189 23. E. V. The East London Water Co., 10 Q. B. 208, 16 L. J. (N. S.) M. C. 135 191,192,234 24. E. V. The West Middlesex Water Co., 28 L. J., M. C. 135 198 25. E. V. South Western Eailway Co., 1 A. and E., (N. S.) 558, 11 L. J. (N. S.) M. C. 93 212,243 26. E. r. Grand Junction Kailway Co., 4Q.B. IS, 13 L. J. (N. S.) M. C. 97 214, 234 27. E. V. Great Western Eaihvay Co., 6 Q. B. 179, 15 L. J. (N. S.) M. C. 80 219,235,237 XX CONTENTS. Page 28. R. i: North Stafforclshiro Railway Co., 30 L. J., M. C. 68 (1861) 112, 221, 227, 238 29. R. V. Southampton Dock Co., 20 L. J., M. C. 155 112 30. R. V. Haughley, 1 L. R., Q. B. 666 (1866) 221, 265 31. R. V. L.B. & S. C. Railway Co., 15 Q. B. 313, 23 L. J., M. C. 124... 229, 244, 246 32. London and North Western Railway Co. r. The Assessment Committee of the King's Norton Union (1870) 232 33. R. V. Overseers, Great Amwell, 32 L. J., M. C. 174 (1863) 238, 217 34. Birmingham Canal Navigation Co. r. Overseers of the Parish of Birming- ham, 19 L. T. R. 311 (1868) 240 35. Staley v. Castloton, 33 L. J., M. C. 178 (1861) 241 36. Great Eastern Railway Co. v. Overseers of Flctton, 30 L. J., M. C. 89 (1861) 243 37. R. V. South Eastern Railway, 15 Q. B. R. 344 245, 250 38. R. V. Midland Railway, 15 Q. B. R. 353 245 39. R. V. Great Western Railway (second Tilehurst case), 21 L. J., M. C. 84 249, 269 40. R. i: Newmarket Railway Co., 23 L. J., M. C. 76 256 41. R. r. South Eastern Railway Co., 13 L. J., M. C. 84 257 42. R. V. Parish Officers of Cannock, L. T. (N. S.) 325 (1863) '...260 43. R. v. Llantrissant (1870) 270 44. North London Railway v. The Churchwardens of St. Pancras, 32 L. J., JI. C. 145 (1863) 274 45. Midland Railway Co. v. Overseers of Badgworth, 34 L. J., M, C. 25 (1865) 276 46. Great Western Co. v. Overseers of Badgworth, 2 Law Reports, Q. B. 251 (1867) 276 THE PRINCIPLE OF RATING PROPERTIES TO THE RELIEF OF THE POOR. CHAPTER I. THE PRINCIPLE OF RATING. The declaration of our Saviour that "the poor ye have alwaj^s with you," has at all times and in all countries been abundantly demonstrated. The presence in our own coimtry of the poor imable to help themselves, has produced a volimiinous code of laws, the object of which is to make provision for their due relief. These laws may be divided into two great parts : the first of which treats of the manner in which the money necessary is to be obtained ; the second, of the manner in which it is to be expended. The foundation of all legislation, of which the poor have been the object, is the following statute : — 43 Elizabeth,^, cap. 2 (a.d. 1601). (An Act for the Relief of the Poor.) " Be it enacted by the authority of this present Parliament, That the churchwardens of every parish, and four, three, or two substantial householders there, as shall be Overseers for the poor, their ottice, thought meet, having respect to the proportion ^g and greatness of the same parish and parishes, to be nominated yearly in Easter "Week, or Avitliin one month after Easter, under the hand and seal of two or more justices of the peace in the same county, whereof one to be of the quormn, inv. I'uixdi'i.K or katixg. dwelling ill or near the sinue parish or division wlierc the same parish doth lie, shall be called overseers of the poor of the same parish ; and they, or the greater part of them, shall take order from time to time, by and Avith the consent of two or more such justices of peace as is aforesaid, for sotting to work the children of all such whose parents shall not, by the said churchwardens and overseers, or the greater part of them, be thought able to keep and maintain their children ; and also for setting to work all such persons, married or unmarried, having no means to maintain them, and use no ordinary and daily trade of life to get their living by ; and also to raise weekly or otherwise (by taxation Who shall be taxed ^f every inhabitant, parson, vicar, and other, and towards the relief . "^ . i , , , of the poor. ^'' ^very occupier ot lands, houses, tithes impro- priate, propriations of tithes, coal mines, or sale- able underwoods in the said parish, in such comjoetent simi and sums of money as they shall think fit), a convenient stock of flax, hemp, wool, thread, iron, and other ware and stuff, A convenient stock to set the poor on work ; and also competent sums shall be provided ^^ ^^ ^^^ ^^^ towards the necessary relief of to set the poor on -^ . ■, ■,- ^ work. the lame, impotent, old, blind, and such other among them being poor, and not able to work ; and also for the putting out of such children to be apprentices, to be gathered out of the same parish, according to the ability of the same parish, and to do and execute all other things, as well for the disposing of the said stock, as otherwise conccniing the pre- mises, as to them shall seem convenient." By this Act not only were the occupiers of the properties, specified therein, to be assessed, but also ever// inhabit a}>f. At the present time the occupiers of property alone are liable to be rated, except such be occupiers of houses let furnished, or of houses let unfurnished at rents under .£'>?0, payable weekly or monthly. Neither does the property mentioned in tlii^ Act of Elizabeth include all real properly, conscquenlly such non-menlicmed ])roperties are not liable to be rated. As the incidence of THE PRINCIPLE OF RATING. O rating is now the subject of legislation, it is unnecessary to dilate upon this. Until last year the rating of all rateable property in England and Wales was effected under the authority of the 6 and 7 William IV. cap. 96, which is commonly called the Parochial As- sessment Act. This Act, which was passed in 1836, enacted that : "Whereas it is desirable to establish one uniform mode of rating for the relief of the poor throughout England and AYales, and to lessen the cost of appeal against an unfair rate : Be it enacted by the King's most excellent Majesty, by and with the advice and consent of the Lords spiritual and temporal, and Commons, in this present Parliament assembled. All rates to be and by the authority of the same, that from and „„„„^i ^-i^g ^t after such period, not being earlier than the the property. twenty-first day of March next after the passing of this Act, as the Poor Law Commissioners shall by any order vmder their seal of office direct, no rate for the relief of the poor in England and Wales shall be allowed by any justices, or be of any force which shall not be made upon an estimate of the net annual value of the several hereditaments rated thereimto ; that is to say, of the rent at which the same might reasonably be expected to let from year to year, free of all usual tenants' rates and taxes, and tithe commutation rent charge, if any, and deduct- ing therefrom the probable average annual cost of the repairs, insurance, and other expenses, if any, necessary to maintain them in a state to command such rent : Provided always, . that nothing herein contained shall be construed to alter or affect the principles or different relative liabilities (if any) according to which different kinds of hereditaments are now by law rateable." In addition to establishing one uniform principle of rating, it provided for a less expensive way of getting relief from an unfair rate. This it did by permitting an appeal to the Justices sitting in Petty Sessions, instead of those sitting in Quarter Sessions, to whom ;in a])peal had up to this time been ob/if/afori/. ij 2 1 THE IMMXCin.K OF UATTXC. But this Act (lid not provide any niacliincry l)y wliitli the adop- tion of one imifbrni mode of rating was secui'ed. AVhen the question of the extension of the Franchise was being mooted, and inquiries were made as to the increase in the number of voters which the adoption of a £G or an £8 qualification woidd effect, it was found that a most extraordinary inequality in the assessment of property prevailed throughout the country. To remedy this inequality, the Union Assessment Committee Act of 1862 and the Union Assessment Connnittce Amendment Act of 18G4 were passed, which, whilst making no alteration in the ])ri)ic/p/e of rating, provided that machinery which was lacking for the purpose of securing imiformity of valuation. Strangely enough, these Acts were so drawn as to be applicable to portions only of the Metropolitan area. When the provisions of the Metropolitan Poor Act, 1867, came to be put in force, it was found that much inequality existed in the assessment of property in vai'ious parts of London, and that, moreover, there was no practical method of remedying this in- equality. To remedy this, the Valuation (Metropolis) Act, 1869, was passed. I3y this Act the operation of many of the sections of the Union Assessment Committee and the Union Assessment Com- mittee Amendment Acts was extended to the Metropolis. Some of the sections of these Acts, as well as of the Parochial Assess- ment Act, were by it repealed ; and by it a special tribunal for hearing appeals against rates was created. The result of all the recent legislation is that the assessment of property in all parts of p]ngland and "Wales, except the Metropoli- tan area, is mider one law, wliilst the assessment of property in the Metropolitan area is under another, ]»ut wlielher in the Metro- politan area or not, the principle of rating is practically the same. The law as it now stands, both for the Metropolitan area and for the rest of England and Wales, is set forth below in the cmct ifortU of the various Acts of ParliamenI, bul in an (uder which it is believed will make the subject clear to tlu' reader. THE PRINCIPLE OF RATING. THE LAW AS ENACTED FOR ENGLAND AND WALES. THE LAW AS ENACTED FOR THE METROPOLIS ONLY. Union Assessment Committee Act, 1862, 25 and 26 Vic- tori.e. Cap. 103. (An Act to Amend the Law relat- ing/ to Parochial Assessments in England.) — 7th August, 1862. Whereas it is expedient tliat more effectual provision sliould be made for securing uniform and correct valuations of pa- rishes in the unions of England : Be it enacted by the Queen's most excellent Majesty, by and with the advice and consent of the Lords spiritual and tem- poral, and Commons, in this present Parliament assembled, and by the authoiity of the same, as follows : — interpretation. 1 . The words used in this Act shall be construed in like man- ner as the words contained in the Act fourth and fifth of King- William the Fourth, chapter seventy-six, and the word "com- mittee" shall signify the assess- ment committee provided for by Union Assessment Committee Act, 1862, 25 and 26 Vic- TORiiE, Cap. 103. (An Act to Amend the Law relat- ing to Parochial Assessments in England.) — 7th August, 1862. "WHiereas it is expedient that more effectual provision should be made for securing uniform and correct valuations oi parishes in the unions of England : Be it enacted by the Queen's most excellent Majesty, by and with the advice and consent of the Lords spiritual and temporal, and Coimnons, in this present Parliament assembled, and by the authority of the same, as follows : — Interpretation. 1. The words used in this Act shall be construed in like man- ner as the words contained in the Act fourth and fifth of King William the Fourth, chapter seventy-six, and the word "com- mittee " shall signify the assess- ment committee provided for by TIIK nilNCirLE OF RATING. The Law as Enacted for Enrjlaml and Wales. The Law as Enacted for the Metropolis only. this Act ; and tliis Act sliall be termed "The Union Assessment Committee Act, 1862." Appointment of the assessment committee by board of guardians. 2. The board of guardians of every union, formed mider the Act fourth and fifth years of King William the Fourth, chap- ter seventy-six, shall, as soon as convenient after the passing of this Act, and in every subse- quent year, at their first meet- ing after the annual election of guardians, appoint from among themselves any number not less than six, nor more than twelve, to be a committee, consisting partly of ex- officio, and partly of elected guardians, to be called the assessment committee of the union, for the investigation and supervision of the valuations to be made, as hereinafter-men- tioned within such union, and for the performance of such said acts and duties as hereinafter- mentioned : Provided always, that one-third at least of sucli committee shall consist of c.r- officio guardians, in case there shall be an adequate number of such cx-officio guardians ; bu< in this Act ; and this Act shall be termed "The Union Assessment Committee Act, 18C2." Valuation of Property (Me- tropolis) Act, 32 am) 33 Victoria., Cap. 67. {An Act to jyroi-ide for Uni- fonnitij in the Assessment of Rateable Propert// in tlie Me- tropolis.)— 0th Aufjust, ISGO. Whereas it is expedient to provide for a common basis of value for the purposes of go- vernment and local taxation, and to promote uniformity in the assessment of rateable pro- perty in the Metropolis : Be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of tlie Lords spiritual and tem- poral, and Commons, in this present Parliament assembled, and by the authority of the same, as follows : Act to be construed as one with 25 & 26 Vict. c. 103, and 27 & 28 Vict. c. 39. 1. The Union Assessment Committee Act, 1862, is in this Act referred to as "the prin- THE PRINCIPLE OF RATING. The Law as Enacted for Enylandand Wales. Tlie Law as Enacted for the Metropolis only. case an adequate number of such cx-officio guardians shall not exist, then the number so de- ficient shall be made up of elected guardians. Where union has the same bounds as borough, names of assessment commit- tee to be transmitted to town council, who may appoint additional members. 3. Where any imion shall have the same bounds as a municipal borough, the clerk to the guar- dians of such union shall, upon the appointment of the assess- ment committee, if directed by the said guardians to do so, transmit in writing the names of the persons so appointed to the town council of such borough, and such council may thereupon, if they think fit, appoint from themselves a certain number, not exceeding the number appointed by the board of guardians, who shall, until they respectively cease to be members of the town council, or decline to act, forth- with form part of the assessment conunittee for such union, and the said council may from time to time supply any vacancies in the number of persons appointed by them. cipal Act ; " and the principal Act, and the Union Assessment Committee Act, 1864 (amend- ing the same), shall for the purposes of this Act, and so far as is consistent with the tenor thereof, be incorporated with this Act : and the expres- sion "this Act" in the principal Act, and any expression re- ferring to the principal Act which occurs in the said Act amending the same, or in any other Act or document, shall, as regards places to which this Act extends, be construed to mean the principal Act as in- corporated with this Act. Short title. 2. This Act (including the Acts incorporated herewith)may be cited as "The Valuation (Me- tropolis) Act, 1869." Extent of Act. 3. This Act shall extend onlj^ to unions and parishes not in union, Avhich are for the time being either wholly or for the greater part in value thereof respectively situate within the jurisdiction of the Metropolitan TIIK rUINClPLE OF RATING. The Law as Enacted for EwjUtnd and Wales. The Law as Enacted for the Metropolis onli/. Provision for neglect to appoint. 4. If the guardians shall neg- lect or be prevented from mak- ing such appointment at the meeting above specified, the Poor Law Board shall by their order appoint some other day on which the guardians shall make such appointment. Provision for vacancies. 5. If any cx-officio or elected guardian being a member of the committee cease to be guardian, or resign his seat at such com- mittee, or die, or become incap- able of acting as such member, the board of guardians shall with aU convenient sj^eed ap- point an cx-officio or elected guardian, as the case may be, to supply the vacancy. Continuing members may act during vacancies. 6. During any vacancy in any assessment connnittee, the other or continuing members of such committee may act, and shall have the same powers and juris- diction as if no such vacancy had happened. Board of Works appointed un- der the Metropolis Manage- ments Act, 1855. Definitions. 4. In tliis Act, miless the context otherwise requires, — " Metropolis." The term "metropolis" means the imions and Parishes to which this Act extends : " Parish." The term "parish " means any place for which a separate poor rate is or can be made, or for which a separate overseer is or can bo ap- pointed : " Union." The term "miion " means any union of parishes, and any parish for which there is a separate assessment com- mittee under tliis Act and the Acts incorporated here- with : "Ratepayer." The term "ratepayer" means every person who is liable to any rate or tax in res- THE PRINCIPLE OF RATING. 9 27*6 Lawas Enacted for Eiujland and Wales. The Laxo as Enacted for the Metro^'olis onlij. Extent of committee's authority. 7. The autliority of tlie com- mittee appointed for any union under this Act shall extend over every parish comprised in such First meeting, when to be holden. 8. The committee shall hold their first meeting at the board- room of the union on a day to be fixed by the board of guar- dians, and the subsequent meet- ings of the committee shall be holden at such time and at such place and upon such notice and requisition as they shall from time to time appoint ; and any guardian of the union may be present at any meeting of the committee, but shall not be en- titled to take part in the proceed- ings thereof. Quorum of meetings. 9. All acts, orders, matters, and things by this Act author- ised or directed to be made or done by the committee may be made or done by the major part of the members of such com- mittee who shall be present at a pect of property entered in any valuation list : "Year." The term " year " means the twelve months commencing with the sixth of April and ending with the succeeding fifth of April ; and words referring to a year refer to the same period : " Surveyor of taxes." The term "surveyor of taxes" means any surveyor of taxes, inspector of taxes, or other ofiicer appointed or to be appointed by the Commissioners either of Inland Revenue or of Her Majesty's Treasury for the purposes of any tax in res- pect of which a valuation- list is by this Act made conclusive : "Overseers." The term "overseers" in- cludes any person or body of persons performing the duties of overseers so far as regards the assessment, making, and collection of 10 THE rRlN'CirLE OF UATING. The Laic as Enacted for England and Wales. The Law as Enacted for the JTetrojwlis only. meeting, the whole number pre- sent together at such meeting not being less than three, and not less in any case than one- third of the whole number of which such committee consists ; and when upon any question there shall be an equality of votes the presiding chairman shall have a second or casting vote. Committee may employ and pay clerk. 10. The committee shall em- ploy the clerk or assistant clerk of the board of guardians as their clerk, with such remune- ration for his ser\aces as the Poor Law Board shall sanction. Proceedings to be entered in books and signed. 1 1 . The committee shall cause a minute of their proceedings, and of the names of the mem- bers wlio attend each meeting, to be duly made from time to time in books to be provided for that purpose, which shall be kept by their clerk, under tlieir superintendence, and every such entry shall be signed by the pre- siding chairman of the assess- rates fur the relief of the poor : " Vestry Clerk." The term " vestry clerk " means the vestry clerk, if any, elected under the Act of the session of the thir- teenth and fourteenth years of the reign of Iler present Majesty, chapter fifty- seven, or imder a local Act, or, if there is no such clerk, the vestry clerk ap- pointed under the Metropo- lis Management Act, 1855 : " Hereditament." The term " hereditament " means any lands, tenements, hereditaments, and pro- perty which are liable to any rate or tax in respect of wliich the valuation-list is by tliis Act made con- clusive : "Gross value." The term "gross value " means the annual rent wliich a tenant might reasonably be expected, taking one year witli another, to pay for THE PRIXCIl'LE OF RATING. 11 The Law as Enacted for Emjland and Wales. The Laio as Enacted for the Metrojmlis only. mcnt committee present at the meeting at wMcli the proceed- Such entries evidence. ing took place ; and such entry, purporting to be so signed, shall be received as evidence in all courts, and before all judges, justices, and others, without proof of such meeting having been duly convened or held, or of the persons attending such meeting having been or being members of the committee, or of the signatures of the members, all of which facts shall be pre- sumed until the contrary be Books to be open to inspection. proved ; and all such books shall at all seasonable times be open to the inspection of every person rated to the relief of the poor in any parish or place in the union, without any fee being demanded for such inspection ; and all such persons shall be entitled at all seasonable times to take copies or extracts from the said books, without paying any fee for the same ; and if, on request made for that purpose, the clerk of the committee refuse to permit any an hereditament, if the tenant undertook to pay all usual tenant's rates and taxes, and tithe commuta- tion rentcharge, if any, and if the landlord undertook to bear the cost of the repairs and insurance, and the other expenses, if any, necessary to maintain the hereditament in a state to command that rent: "Rateable value." The term " rateable value " means the gross value after deducting therefrom the probable annual average cost of the repairs, insur- ance, and other expenses as aforesaid : The Acts specified in the first schedule to this Act are in this Act referred to by the short title placed opposite to them in that schedule. Section 2 of the Act of 1862. Appointment of the assessment committee by board of guardians. The board of guardians of cci'yij loiion, formed under the 12 THE PRIXCII'LE OF RATING. The Law as Enacted for Emjlaml and Wales. The Lctw as Enacted for the Jfctropolis only . such person to inspect any snch books, or to take copies or ex- tracts therefrom, as aforesaid, such clerk shall for every such offence be liable to a penalty not exceeding five pounds, upon a summary conviction for the same before two justices of the peace. Proceedings of committees to be reported. 12. The board of guardians shall in the month of April in every year report the proceed- ings of their assessment com- mittee to the Poor Law Board. Overseers to prepare valuation-lists. 14. Subject to any order as hereinafter referred to which may be made by the committee, the overseers of each parish in the union shall, within three calen- dar mouths after the appoint- ment of such committee, make a list of all the rateable heredita- ments in sucli parish, w\{\x the annual value thereof respective- ly, in so much of the form shown in the schedule ancxed to the Act sixth and seventh William tlic Fourth, chapter ninety-.six, as is set out in the schedule to this Act ; and imless such over- seers tliiiik tliat the valuation Act fourth find Jifth years of King WilUam. the fourth, chap- ter seventij-six, shall, as soon as convenient after the passing of this Act, and in every sub.sequent year, at their first meeting after the annual election of guardians, appoint from among themselves any number not less than six, nor more than twelve, to be a committee, consisting partly of ex- officio, and partly of elected guardians, to be called the as- sessment committee of the union, for the investigation and super- vision of the valuations to be made, as hereinafter-mentioned within such union, and for the performance of such said acts and duties as hereinafter-men- tioned ; provided always, that one-third at least of such com- mittee shall consist of cx-officio guardians, in case there shall be an adequate number of such ex- offiieio guardians; but in case an adequate number of .sucli ex- officio guardians sliall not exist, tlien tlie number so deficient shall be made up of elected iiuurdians. THE rRIXCIPI,E or HATIXO. 13 The Law as Enacted for Englaiu! and JVales. The Law as Enacted for the Metropolis only. then last acted upon in as.^essing tlie rate for the relief of the poor correctly shows the full annual rateable value of all such here- ditaments, they shall revise such valuation, and such overseers shall sign every list so made by them as aforesaid, and such list shall be styled " The Valuation- List." o 1§ (Lir-H ^ a Ci> P^ *J r-< C5 O . rr += ^^ s m :^ ^ .« f^.s 3 o^^ ;3 H s Ti ^u ^ •^■fi § ■sh V w ^e. ta ^ J Ofl^ .?^ 0.2 S o tM -2 O 02 s- a >> o-e •rH ;h r£i o -s ° O ^ P< ^<4-. H _fl O o i£ 1-1 •rt >'. sS o ^2 P o vJ <1 •_" •% /s after the transmission to the assess- ment committee of any valuation or supplemental valuation-list, the committee shall give notice to every railway, telegraph, canal, gas, and water company named in such list as the occupier of any property included therein, and not having- anv office or parish, and the sums so charged shall be paid by the masters of the bench, treasurer, governor, or other body of persons ; and sections sixty- six, six- ty-seven, and sixty- eight of the Metropo- litan Poor Act, 1867, shall apply to such sums in the same man- ner as if the assess- ment committee and their clerk were the Poor Law Board and the receiver mentioned in those sections. vSection 4 OF Act 1862. Provision for neglect to appoint. If the (juardiana shall neglect or be prevented from making such appointment at the meet- ing above specified, the Poor Law Board shall by their order appoint some other day on which the guardians shall make such appointment. Provision for vacancies. 5. If any ex-offieio or elected o-uardian being a member of c 2 20 TJiE ruixriPi.E of rating. The Laic as Knactcd for Eiujlaud and Jf'alcs. The Law as Enacted for the Metropolis only. place of business in the parish to which such list relates, of the sum or sums sot down as the rateable value of the property purporting to be occupied by such company or companies, and such notice may be served by being transmitted through the post to the principal office of the company, or one of their principal offices when there shall be more than one. Section 18 of the Act of 18G2. Objections to valuation-list. Any overseer or overseers of any parish in an}- union, wlio shall have reason to think that such parish is aggrieved by the valuation-list of any parish with- in such union, or any person who may feel himself aggrieved by any valuation-list on the groimd of unfairness or incorrectness in the valuation of any heredita- ments included therein, or on the ground of the omission of any rateable hereditament from such list, may at any time after the deposit as aforesaid of such list, and before the expiration of the committee cease to be guard- ian, or resign his seat at such committee, or die, or become incapable of acting as such member, the board of guardians shall with all convenient speed appoint an t\r-officio or elected guardian, as the case may be, to supply the vacancy. Continuing members may act during vacancies. 6. During any vacancy in any assessment committee, the other or continuing members of such committee may act, and shall have the same powers and j urisdiction as if no such vacancy had happened. Extent of committee's authority. 7. The authority of the com- mittee apjjointed for any \mion under this Act shall extend over every parish comprised in such union. First meeting, when to be holden. 8. The committee shall hold their first meeting at the l)oard room of the union on a day to be fixed by the board of guard- ians, and the subsequent meet- ings of the committee shall be THE PRINCIPLE OF RATING. 21 The Law as Enacted for Enyland and Wales. The Law as Enacted for the Mctroiiolis only. twenty-eight days after tlie no- tice of the deposit as aforesaid, give to the committee and to the overseers a notice in writing to his objection, specifying the grounds thereof, and where the ground of any objection shall be unfairness or incorrectness in the valuation of any heredita- ment in respect of which any person, other than the person objecting, is liable to be rated, or the omission of such heredita- ment, also give notice in writing of such objection, and of the ground thereof, to such other person. Service of notices, &c., on the committee. 42. Any notice or statement required to be served upon the committee may be served by being left at the office of the clerk to the board of guardians, or sent through the post-office, addressed to the committee at such clerk's office, or by being delivered personally to their clerk, or at his usual place of abode. Committee to hold meetings to hear objections. 19. The committee shall hold holden at such times and at such place and upon such notice and requisition as they shall from time to time appoint ; and any guardian of the imion may be present at any meeting of the committee, but shall not be entitled to take part in the proceedings thereof. Quorum of meetings. 9. All acts, orders, matters, and things by this Act autho- rised or directed to be made or done hij the committee may be made or done by the major part of the members of such com- mittee who shall be present at a meeting, the whole nimiber present together at such meet- ing not being less than three, and not less in any case than one-third of the whole number of which such committe con- sists ; and when upon any question there shall be an equality of votes, the presiding chairman shall have a second or casting vote. Committee may employ and pay clerk. 10. The committee shall em- ploy the clerk or assistant clerk 22 THE PRTNCirLE OF RATING. I'he Law as Enacted for Emjland and H'ales. The Law as Enacted for the Metrojwlis on It/. such meetings as they may think necessary for hearing objections to the vahiation-lists, and shall, tircnf //-eight days at least before holding every meeting for hear- ing objections to valuation-lists, other than meetings by adjourn- ment, cause notice of such meet- ing to be given to the overseers of the several parishes to which such lists relate, and such over- seers shall, on the Sunday next following the receipt of such notice, publish the same in the manner in which notice of a rate allowed by justices is by law re- quired to be given, and the com- mittee may at any such meeting hear and determine such objec- tions, or may from time to time adjourn any such meeting, and adjourn or postpone the hearing or further hearing and determi- nation of any such objections, and may, where they think fit, direct notice of any such objec- tions to be given by the over- seers or by the persons objecting to third parties before the fur- ther hearing thereof; but the committee shall not be required to hold a meeting for hearing objections to the valuation-list of the board of guardians as their clerk, w4th such remune- ration for his services as the Poor Law Board shall sanction. Proceedings to be entered in books and signed. 11. T/ic committee shall cause a minute of their proceedings, and of the names of the mem- bers w^ho attend each meeting, to be duh" made from time to time in books to be provided for that purpose, w^hich shall be kept by their clerk, under their superintendence, and every such entry shall be signed by the presiding chairman of the assess- ment committee present at the meeting at which the proceed- ing took place; and such entry, purporting to be so signed, shall Such entries evidence. be received as e"\adence in all courts, and before all judges, justices, and others, without proof of such meeting having been duly convened or held, or of the persons attending such meeting having been or being members of the committee, or of the signatures of the mem- THE PRINCIPLE OF RATING, 23 The Lcnv as Enacted for England and Wales. The Law as Enacted for the Metropoli'i only. of any parish, unless sucli notice in writing as hereinbefore-men- tioned of some objection or ob- jections thereto have been given to the committee ; and where a meeting is hoklen for hearing objections to the valuation- list of any parish, the committee shall not hear any objection to such valuation-list, unless such notice as aforesaid of such ob- jection have been given to the committee and to the overseers ; and where the ground of such objection is unfairness or incor- rectness in the valuation of any hereditament of any other per- son than the person objecting, or the omission of such heredi- tament, also to such other person by the person objecting, except where the overseers, by them- selves or any other person on their behalf, and in the case aforesaid such other person as aforesaid, by himself or any other person on his behalf, consent to the hearing of such objection, and in such case the committee may, if they see fit, hear the same ; and where the committee see fit to hear the same, they shall act in relation thereto in bers, all of which facts shall be presumed until the contrary be Books to be open to inspection. proved ; and all sixch books shall at all seasonable times be open to the inspection of every person rated to the relief of the poor in any parish or place in the union, without any fee being demanded for such inspection ; and all such persons shall be entitled at all seasonable times to take copies or extracts from the said books, without jiaying any fee for the same ; and if, on request made for that pur- pose, the clerk of the committee refuse to permit any such per- son to inspect any such books, or to take copies or extracts therefrom, as aforesaid, such clerk shall for every such offence be liable to a penalty not exceeding five pounds, upon a summary con^•iction for the same before two justices of the peace. Proceedings of committees to be reported. 12. The hoard of (juanUans shall in the month of April in every year report tlic proceed- 24 THE PRINCIPLE OF RATING. The Laic as Enacted for Emjland and Wales. The Law as Enacted for the Jretropolis only. like manner as it' notice of siicli objection had been duly given. Committee may require returns from overseers, &c. ; 13. T/ie committee by their order may from time to time require the overseers, assistant overseers, constables, assessors, collectors, and any other per- sons having the custody of any books of assessment of any taxes or rates, parliamentary or paro- chial, or of the valuations of any parish, or having the collection or management of any such rates or taxes, to make returns in writing to the committee, at such times and j)laces as they may appoint, of all such particulars as they may direct in relation to such taxes, rates, or valua- tions, or any property included therein, so far as relates to the union for which they act, and may require the persons having the custody of any such books as aforesaid to make and transmit to the committee copies of or extracts from such books, or to permit such copies or extracts to be made by such persons as the committee may in that be- ings of their assessment com- mittee to the Poor Law Board. SeCITON 6 OF THE METROPOLIS Act. Making of valuation-list. The overseers of every parish to which this Act extends, with- in the time in this Act men- tioned shall make (and deposit before 1st June, 1870, Sect. 42, Metropolis Act) a valuation-list of their parish in duplicate, in accordance with this Act. Occupier to maice returns. 55. In the first year after the passing of this Act, and in every subsequent year in which a new valuation-list is made, or in the month of March preceding any such year, every person irho is liable to be charged with any rate or tax in respect of which the vahiation-list is made con- clusive shall, when required, make to the overseers of his parish such statement or return as a person chargeable under the Income Tax Act and the Acts amending the same is bound to make. THE PRINCIPLE OF RATING. 25 The Law as Enacted for Enyland and Wales. Tlie Lavi as Enacted for the Meiro2)olis only. and may require production of rates, &c., and examine persons attending before tliem. half direct ; and may from time to time require any persons having the custody of any such books, or the collection or man- agement of any such taxes or rates as aforesaid, to attend be- fore them at a time and place to be mentioned in the order in this behalf, and to produce all parochial and public books of assessment, rates, rate books, valuations, apportionments, tithe and other maps, plans, surveys, and other public documents in their custody or power, and may examine all persons who shall attend before them: Provided always, that nothing herein con- tained shall authorise the pro- duction of valuations or assess- ments which by any provision of law at present are not suffered to be made public. Authentication and service of orders and notices of the committee. 41. Every order and notice made or given hij the conwiittee under this act maybe in wi'iting or print, or partly in writing Surveyor of taxes to supply notices and forms for returns to overseers, v/ho are to serve them. 56. For the purpose of secur- ing the proper making of such returns, the surret/or of taxes shall in the month of February preceding send to the overseers of each parish in his district a sufficient number of printed forms and notices, and the over- seers, within a month after the receipt thereof, shall serve a notice and form on every person in their parish required by this Act to make a return ; and every person required by this Act to make a return shall make it within twentj^-one days after the service of a notice and form on him. The forms and notices shall be such as are prescribed by the Income Tax Act or the Acts amending the same, or as the Commissioners of Her Majesty's Treasury may from time to time prescribe, and any such form dvdy filled up and signed shall be deemed to be a sufficient re- turn. The return shall be delivered to the overseers of each parish, 2G THE rRINCllM.E OF HATING. 2'he Law as Enacted for Emjhind and fVales. The Law as Enacted for the Jfetrojwlis only. and partly in print, and shall be sufficiently authenticated if sign- ed b}' tlieii- clerk, and may be served by the same or a copy thereof being delivered personal- ly or sent by post to the party on or to Avhom snch order or notice pui-ports to be made or given, or by being delivered at his usual place of abode. Penalty for non-attendance, &c., in obe- dience to order of the committee. 40. Ecerij person ir/io in'/fulli/ refuses to attend in obedincc to any lawful order of any such committee, or to give evidence, or refuses to produce any rate- book, assessment, or valuation which may be lawfully required to be produced before such com- mittee, shall for every such of- fence be liable to a penalty not exceeding twenty pounds upon a summary conviction for the same before two justices of the peace ; and every person who Injuring, &c., rate-books a misdemeanor. wilfully injures, defaces, con- ceals, or destroys such rate- book, or who upon any exami- nation l)cforc anv such commit- and together with the valuation- list shall be sent by them to the survcj'or of taxes, and by the surveyor of taxes to the assess- jnent committee. Form and contents of valuation-list. 51. The valuation-list shall bo made out in the form given in the second schedule to this Act. The overseers shall not include in such valuation-list any here- ditaments (except tithes or pay- ment in lieu of tithes) which are charged according to Rule two 5 & 6 Vict. c. 35. in section sixty of the Income Tax Act, but shall include tithes and pajTnents in lieu of tithes and every hereditament in their parish, and shall enter every hereditament in the valuation- list in accordance with the classes mentioned in the third schedule to this Act, so that the deductions to be made in ascer- taining the rateable value may be calculated in accordance with that schedule. THE PRINCIPLE OF RATING. 27 The Law as Enacted for Enyland and Wales. The Law as Enacted for the Metropolis only. tee wilfully gives false evidence, shall be deemed guilty of a mis- demeanor. Board may allow compensation for returns, &c., and expenses. 37. The committee may allow sucli compensation for any re- turns, copies, or extracts, or any valuation, or valuation-list, or other act, matter, or thing to be made or done in pursuance of their order, and such expenses connected therewith, as to the committee in each case seems just. Remuneration to clerk and certain ex- penses of committee to be paid out of common fund. 38. The remuneration allowed by the committee to their clerk, and all expenses incurred by them for the common use and benefit of the several parishes within the miion for which they are appointed, shall be paid by the guardians of the said union, and be charged upon the common fund thereof. Board may direct further valuation, and correct valuation-lists, and when cor- rected to approve the same. 20. The committee may, whe- ^ Eateable Value as finally de- termined by Assessment Committee. Gross Valixe as finally determined Assessment Committee. wis Gross Value as estimated by Surveyor of Taxes. Gross Value as estimated Overseers. Name or Situation of Property. a .2 >> ft ^ u K 5 6 Q) P-1 28 THE rRINCIPLE OF RATI NO. The Law as Enacted for England and Jl'ales. The Law as Enacted for the Metropolis only. tlier any objection be or be not made to any sucb valuation-list, and either before or after any meeting for bearing objections, make such alterations in tbc valuation of any hereditaments included in any valuation-list, and insert therein any rateable hereditament omitted therefrom, and make such corrections in names, descriptions, and parti- culars in any valuation-list, and upon such information as to them may seem sufficient, and may, with the consent of the guardians as aforesaid, appoint or employ a person to survey and value the rateable heredita- ments comprised in any such valuation-list, or any of them, or omitted therefrom, or may take such other means as they nuiy think necessary for ascertaining the correctness thereof, and when the committee have heard and determined all such objections as aforesaid, and have made such alterations, insertions, and cor- rections in any valuation-list as to them may seen proper, they shall approve the same under the hands of three members of the conmiittee present at the Saving of exemptions and exceptional principles of valuation. 54. Nothing contained in this Act or the Acts incorporated herewith shall affect any ex- emption or deduction from or allowance out of any rate or tax whatever, or any privilege of or provision for being rated or taxed on any exceptional prin- cijilc of valuation. Saving of powers to value property not included in a valuation-list. 75. Nothing in this Act shall in any way alter or affect the mode of valuing or taxing any hereditament which is not in- cluded in any valuation-list, or which is charo-cable accordinfj to the profits and not according to the gross value, or the mode of charging the occupiers of land subject to a tithe rentcharge in respect of such tithe rentcharge. Separate assessment of houses for pur- poses of house duty, income tax, and Licensing Acts. 76. Where for tlic purj)oses of the Acts relating to tlie duty on inhabited houses, or to the duties charged under schedule THE PRINCIPLE OF RATING. 2d The Law as Enacted for Enjland and Wales. The Law as Enacted for the jretro2}olis only. meeting- at which the same is approved, with the date of such approval. Valuation-list when altered to be deposited, &o. 21. Where the committee make any alteration in the valuation of any hereditaments included in, or insert therein any rateable hereditament omitted from, any such valuation-list, they shall cause such valuation-list, with such altei'ation or insertion, to be deposited for inspection in manner hereinbefore provided concerning the valuation-list made by or delivered to the overseers, and shall cause the like notice to be given of such deposit as is required in the case of a valuation-list so made or delivered as aforesaid, and shall appoint a day, not lean than srreii days nor more titan fourteen days from the re-deposit of such valuation-list, for the hearing of any objections to the valuation- list as so altered ; and when the committee have heard and de- termined any such objections, or have made such further altera- tions, insertions, and corrections in such valuation-list, they shall B. of the Income Tax Act, or to the sale of exciseable liquors, it is necessary to make a separate valuation of any hereditament by reason of its not being separately valued in any valu- ation-list, the value of such hereditament shall be ascer- tained in the same manner as if this Act had not passed. Deductions for rateable value. 52. The per-centage or rate of deductions to be made from the gross value in calculating the rateable value for the piu'- poses of this Act shall not ex- ceed the amounts in the third schedule to this Act so far as the same are applicable. THIRD SCHEDULE. Sliowing the several classes into which the hereditaments inserted in a valuation-list imder this Act are to be divided. Class 1. Houses and buildinfrs, or either of them, without land other than gardens where the gross value is under £20 „ 2. Houses and lniildini.'s without hind otlu-r than gardens and plc;!- Bure grounds vahiod therewith for the inir- pose of inhaliitod house duty where the gross value is A;20 and under £-10 Maximum Rate of Deductions. Per cent, or Proportion 25 or 4 th. 20 or \ih. 30 THE PRINCiri.E OF RATIXO. The Law as Enacted for Eni/land and Wales. The Law as Enacted for the .Ifetropolisonly. approve tlie samo in luauner hereinbefore provided. Section 30 of the Poor Law Amendment Act of 1868. Columns in the valuation-lists to be cast up by the committee, and fair copies of the approved valuation-lists to be given to the overseers instead of ori- ginals, AMieu the assessment commit- tee in any union shall have final- ly approved of any valuation- list, whether original, substitu- tional, or supplemental, they shall cause the total of the en- tries in the columns for the gross estimated value and the rateable value to be ascertained and en- tered at the foot of the same, and shall retain such list for the use of the guardians, to be dealt with in the manner provided by the thirty-first section of the Union Assessment Committee Act, 1862, and shall deliver a fair copy of the same to the overseers, signed by the three members of the committee who approved of the same ; and such copy shall be coimtersigned l)y the dork of llic coininitli^o, and Class 3. Houses and buildings witbout laud other than gardens and plea- sure grounds valued therewith for the j)ur- gose of inhabited ouse duty where the gross value is f 40 or upwards 4, Buil 'O lO « ^ lO -d «= o o S-^li sag m ■=> o o 6 <^ S g '-' ■^ ap • Ph' O o |2 «■ =■ ,_, 1 g *^ 5 ^ ^- § o ' w (D ll ■*3 2Ph PW. ci-' ° Ph ^ H- 1 M a r^ , criptio of operty ated. 11 sg is Enact ol for tht .Ifdrnjwlis otifi/. exainiuecl and compared the several particiilai-s in the re- spective columns of the above rate with the Aaluation - list made under the authority of the Union Assessment Commit- tee xict, of 18G2, in force in this parish (or township), and the several hereditaments arc, to the best of our belief, rated ac- cording to the value appearing- in such valuation-list. ) Clinrcliwarilens. Overseers. Section 11, Act 18G4. Penalty on overseers omitting to make declaration or making false declaration. Any over HOC r who wi If idly omits to make the declaration required to be made by the Union Assessment Committee Act, 1862, or makes the same falsely, knowing tlie same to be untrue, shall be liable for every such offence to a penalty not exceeding five pounds, \\\)o\\ a summary conviction for the same before two justices of the peace. at a time and place to be men- tioned in the order in this be- half, and to produce all paro- chiid and public books of assess- ment^, rates, rate-books, valua- tions, apportionments, tithe and otlier maps, plans, sui'veys, and other public documents in their custody or power, and may examine all persons who shall attend before them : Provided always, that nothing herein contained shall authorise the production of valuations or assessments which by any pro- vision of law at present are not suffered to be made public. Board may allow compensation for returns, &.C., and expenses. 37. The coiiinuttce may allow such compensation for any re- turns, copies, or extracts, or any other valuation, or valuation- Hst, or other act, matter, or thing to be made or done in persuance of tlieir oi-der, and such expenses connected there- with, as to tlic committee in each ca.se seems just. Remuneration to clerk, and certain ex- penses of committee, to be paid out of common fund. 38. Tliercnumeratioii allowed THE PRINCIPLE OF RATING. 47 The Law as Enacted for England and Wales. The Law as Enacted for the Metropolis only. Section 29, Act 1862. Provision for places under local acts. The provisions of section twenty-eight shall not apply to any poor rate made by any ves- tiy, trustees, guardians, commis- sioners, overseers, or other per- sons authorised by any local act to make the rate for the relief of the poor in any parish, or the assessment on which such rate is made. Act not to prevent composition for rates. 35. Nothing herein contained shall be construed to prevent the owners of tenements from compounding for the rates to be assessed on the same, in such manner as they were by any statute or statutes enabled to do before the passing of this Act. Saving of exemptions and special rules of rating. 36. Nothing herein contained shall extend or be taken to ren- der liable to be rated any pro- perty, or any person in resi^cct of any occupation not now by law rateable of any property, or to deprive any property, or the by the committee to their clerk, and all expenses incurred by them for the common use and benefit of the several parishes within the union for which they are appointed, .shall be paid by the guardians of the said union, and be charged upon the com- mon fund thereof. Penalty for non-attendance, &c., in obe- dience to order of the committee. 40. Every person who wilful- ly refuses to attend in obedience to any lawful order of any such committee, or to give evidence, or refuses to produce any rate- book, assessment, or valuation which may be lawfully required to be produced before such com- mittee, shall for eveiy such of- fence be liable to a penalty not exceeding twenty pounds upon a summary conviction for the same before two justices of the peace ; and every person who Injuring, &c., rate-books a misdemeanor. wilfully injures, defaces, con- ceals, or destroys such rate-boolc, or who upon any examination before any such committee wil- fully gives false evidence, shall 48 TIIK PRINCirLK OF RATING. The L.iw as Enacted for F.mjlawl ami Wales. The Law as Enacted for the Metropolis oiili/. occupier of any projjerty, of the benefit of any exemption, in Avliole or in part, to -vvliicli sucli property or occupier is now by law entitled, from any poor rate or other rate wbicli by law is required to be based upon tbe poor rate, or to render liable to be rated according to the annual rateable value thereof, any pro- perty which under any local act or otherwise is entitled to be rated upon a fixed amount, or according to any special or ex- ceptional principle of valuation, whether such property shall or shall not be included in any valuation-list in force under this Act, or shall in anpvise aft'ect the provisions of " The Cam- bridge Award Act, 1850," or the Act of the seventeenth and eighteenth Victoria, relating to the relief of the poor in the cit}' of Oxford, Provisions concerning the assessment, &c., of poor rates to be applicable to rates made according to this Act. 44. All the powers, autliori- ties, provisions, clauses, and re- gulations now in force relating to the assessment, collection, and levying of poor-rates (.save so be deemed guilty of a misde- meanor. SliCTION 57 OF THE METROPOLIS Act. Assessment committee may require returns from owner and occupier. An (t'ssessincnt commitfce may, by order, require any person who is the owner or occupier or reputed owner or occupier of any hereditament in their union to send them a return in writing of all or any of the following things — viz., of the rent re- ceivable or payable by him (as the case may be) for such here- ditament, and of the person en- titled to any tithe rentcharge charged on such hereditament, and of the amount of the same, and of the several persons by whom any tithe rentcharge is ])aid to him, and of the amounts paid by each such person, and of any other pail iculars respect- ing such hereditament as are required for the due execution of this Act and the Acts incor- lH>raled herewitli. And every such owner or occupier shall obey such order within fourteen THE PRINCIPLE OF RATIXO. 49 Tlie Law as Enacte:! for EiK/land and Wales. Tlie Law as Enacted fo)- the Metropolis only. far as the same are hereby re- pealed or altered) shall be good, A^alid, and effectual for the pur- poses of assessing, levying, col- lecting, and enforcing the pay- ment of such rate and for carry- ing: this Act into execution. Sectio:n 5, Act 1836. Power to take copies or extracts of rates gratis. And be it further enacted. That it shall be lawful for amj 2)orson or penons rated to the relief of the poor of the parish in respect of which any rate shall be made, at all seasonable times, to take copies thereof or extracts therefrom without pay- ing anything for the same, any- thing in any act of parliament to the contrary notwithstanding ; Penalty for refusing to permit. and in case the person or persons having the custody of such rate shall refuse to permit or shall not permit such person or per- sons 80 rated as aforesaid to take copies thereof or extracts theie- fnmi, the person or persons so days after the service thereof on him. Penalty for no or false returns. 58. If any person wilfully refuses or neglects to make any return lawfully required under this Act within the times re- spectively limited by this Act in that behalf, he shall be liable, on siunmary conviction, to a pe- nalty not exceeding five pounds. If any person wilfully makes or causes to be made a false return, he shall be liable, on summary conviction, to a penal- ty not exceeding ten pomids. Service of notices, &.C., by post, &c. 65. All orders and notices under this Act and the Acts in- corporated herewith shall be in writing or print, or partly in writing and partly in print, and if made or given by an assess- ment committee shall be sufficient- ly authenticated if signed by their clerk ; and all orders, no- tices, and documents required by the same Acts to be served on or sent to any person or body of persons corporate or unincor- porate may bo either delivered i: 50 THE rRIXCIPI.E OF RATING. The Iaiw as Enadedfor Emjland ami H'ales. The Law as Knactid for the Metropolis only. refusing or not permitting such copy or extract to be made shall forfeit and pa}' any sum not ex- ceeding five pounds, to be re- covered in a summar}^ way before any justice of the peace having jurisdiction in the parish or place. Section 1, Act 18G4. Notice of appeal against poor rate to be given to the assessment committee of the union. Before any appeal shall be heard by any special or quarter sessions against a poor rate made for any parish contained in any union to which the Union As- sessment Committee Act, 1862, applies, the appclhoit .^hdll f/ivc ticenty-one dayn notice in writing previous to the special or quarter sessions to which such appeal is to be made, of the intention to appeal, and the grounds thereof, to the asses.sment committee of such union : Provided, that after the first day of August next no person shall be empowered In appeal to any .sessions against a poor rate made in conformity with tlic \;iliintioLl-Hst approved to such person or the clerk of such body, or left at the usual place of abode of such person or clerk, or at the office of such clerk or body, or (if such abode or office cannot on reasonable inquiry be discovered) at the premises to which the order, notice, or document relates. They may also be served and sent by post, by a prepaid letter, addressed to such person, or to the office of such body or to their clerk, and, if sent by post, shall be deemed to have been served and received respectively at the time when the letter con- taining the same woidd be de- livered in tlie ordinary course of post, and in proving such service or sending it shall be sufficient to prove that the letter containing the notice Avas pi'o- perly addressed and prepaid and pill into the post. Board may direct further valuation, and correct valuation-lists, and when cor- rected to approve the same. 20. The cominlftcv nuiy, whe- ther any objection be or be not nuide to any .such A'aluation-list, ;ind cither bcCorc oi' after any TIIK ]'RIXfTri,E OF RATTXO. ol The Law as Enacted for Eni/laml and Wales. Tlie Law as Enacted for the Metroi^olis onh/. of by such committee, unless lie shall have given to such coni- luittee notice of objection against the said list, and shall have failed to obtain such relief in the matter as he deems just ; and which objection, after notice given at any time in the manner prescribed by the said Act with respect to objections, the com- mittee shall hear, with full power to call for and amend such list, although the same has been ap- proved of, and no subsequent list has been transmitted to them, and if they amend the same shall give notice of such amendment to the overseers, who shall thereupon alter their then current rate accordingly. Committee may, with consent of guardians, be co-respondents. 2. The assessijicnt counj/iffoc of such union may, witli the con- sent of the guardians of such union, after notice shall have been sent to every guardian, a})pcar as respondents to sucli appeal, but in the name of tlie guardians of such unicm, in like manner, ami with the same in- cidents, and subject to the same meeting for hearing objections, make such alterations in the valuation of any hereditaments included in any valuation-list, and insert therein any rateable hereditament omitted therefrom, and make such corrections in names, descriptions, and par- ticulars in any valuation-list, and upon such information, as to them may seem siifficient, and may, with the consent of the guai'dians as aforesaid, appoint or employ a person to survey and value the rateable heredita- ments comprised in any such valuation-list or any of them, or omitted therefrom, or may take such other means as they may think necessary for ascer- taining the correctness thereof, and when the committee have heard and determined all such objections as aforesaid, and have made such alterations, inser- tions, and corrections in any valuation-list as to them may seem proper, they shall approve the same luider the hands of three members of the committee present at tlie meeting at which the same is ai)pr(»ved, with the date of such approval. 52 TFIK I'HTNCiri-E OF HATING. Tlie Lit w as Enacted for Emjland and Wales. The Law as Enacted for the Metropolis onh/. liabilities, and entitled to the same remedies and rights, as in the case of persons other than the overseer to whom notice of appeal may be given. SEcmoN 29, Pooh Law Amend- ment Act, 18G8. Power for guardians of unions mutually to bear the costs of several appeals in- volving the same common principle. Where an appeal is brought against the poor rate of a parish in a union, and may appear to involve a principle in which some neighbouring parish has a com- mon interest, it shall be lawful for tlio (jnavdianH of the unions comprising such parishes to en- ter into an agreement mutually to bear the costs which may be properly incurrcd in and about the trial of such appeals on the part of the several respondents, as well as the cost of the appell- ants, if any, which may be a- warded against the respondents, in such proportions as shall be fixed and determined with refer- ence to the amount of interest of the several unions in the Section 8, A(;t 186-1. Pov/er to guardians, with the order of the Poor Law Board, to borrow money for valuation expenses. If the a^^sesfiuicnt committee order a valuation, with the con- sent of the board of guardians, to be made of all the rateable hereditaments of any parish, the '(juai'dians of the union ma}'', if they think fit, apply to the Poor Law Board for an order to enable them to borrow the re- quisite amount to pay the cost of such valuation ; and if the said board shall issue their order, the said guardians may borrow the same and charge the poor rates of tlie several pa- rishes in the miion with the re- payment of the same by not more tliau fi\'e ecpial annual in- stalments; and wlicre the parisli for which the valuation is made .'ihall, by reason of any provision in the said miion asses.sment committee Act or this Act, be liable to pay the cost of .such valuation, the .said guardians shall charge the annual instal- ments, and the interest payable therewith, to such pari.sh, and THE PRINCIPLE OF RATING. 53 The Law as Enacted for Etiyland and Wales. Tlie Law as Enacted for the Bletwjwlis only. question, or otherwise, as shall appear just; and the said agree- ment shall continue binding upon the several boards of guardians and their respective successors in succession until the several appeals shall have been finally determined. Section 3, Act 1864. Provision as to costs of committee on appeals. The costs which the committee may incur in consequence of becoming respondents to such appeal, or of having received notice thereof, shall, if not re- covered from the appellants, as Avell as any costs the committee may be ordered to pay to the appellants, be paid by the guar- dians, and charged to the com- mon fimd of the union, unless the court before whom such ap- ])cal is heard shall direct that such costs, or any part thereof, shall be charged to the parish, tlie rate of which is appealed against. may recover the same as and with the usual contributions. Power to Poor Law Board to order map or plan to be made. 10. If there be no map or plan of any parish available for the use or sufficient for the purposes of the assessment committee, tlie committee may, with the con- sent of the guardians, after no- tice as aforesaid, and under the authority of an order of the Poor Law Board, appoint a competent person to make a map or plan of such parish, and the cost thereof shall be charged either to the common fund, or to the parish, as may be directed by the Poor Law Board. Sections 3 and 4, Act 183G. Power to order new survey and valuation. And be it enacted. That when it shall be made to appear to the Poor Law Commissioners by re- presentation in ^\riting from the hoard of guard ians of any union or parish under their common seal, or from the majority of the churchwardens and orerseers or 54 iiii'; rKixciri.K ok kmino. Tin Law as Enacted for KiKjLind and WaU-.f. Hie Law as Enacted for the Metrnpolh oii!i/. Section (I, A(V li^-ML Justices acting in petty sessions to hold four special sessions in the year to hear appeals. And be it enacted, that tlie Jn.sfuTs acting in and for every petty sessions division shall four times at least in every year hold a special sessions for hearing appeals against the rates of the several parishes A\dthin their respective divisions, and shall cause public notice of the time and place when and where such special sessions will be holden to bo affixed to or near to the door of the parish church of the suid parishes twenty-eight days at the least before the holding of the same ; and such special ses- sions shall and may be adjourned IVoni time to time by the justices there present, as they may think fit ; and at such special or ad- journed sessions the justices there present shall hear and de- termine all objections to any such rate on the ground of in- ('(pialify, unfairness, or incori-ect- iiess in the valuation of any hereditaments included therein, which decision shall be binding o of//(')- officers competent as afore- said to the making and le^ying the rate, thai a lair and correct estimate for the aforesaid pur- poses cannot be made without a new valuation, it shall be law- ful for the Poor Ijaw Commis- sionerSy where they shall see fit, to order a sm-vey, with or with- out a map or plan, on such scale as they shall think fit, to be made and taken of the mes- suages, lands, and other here- ditaments liable to poor rates in such parish, or in all or anyone or more parishes of such a imion, and a valuation to be made of the said messuages, lands, and other hereditaments according to their annual value, and to direct such guardians to appoint a fit person or persons to make and take every such survey, map or j)lan, and valuation, and to make provision for pajang the costs of every such survey, ma}) or plan, and A'aluation, eitlier by a separate rate or by a cliai-ge on the poor rates, as they may see fit ; but in case of such charge being made, then provisions shall be made for paying of not less than one-fifth THE PRI^X'IPLE OF RATING. 55 The Laiv as Enacted for Eiujland ami Wales. The Law as Enacted for the Metro2)olis onli/. and conclusive on the parties, unless the person or persons impugning such decision shall within fourteen dai/s after the same shall have been made cause notice to be o^iven in writing of his, her, or their intention of appealing against such decision, and of the matter or cause of such appeal, to the person or persons in whose favour such decision shall have been made, and wdthin fire days after giving such notice shall enter into a re- cognizance before some justice of the peace, with sufficient se- cvirities, conditioned to try such appeal at the then next general sessions or quarter sessions of the peace which shall first hap- pen, and to abide the order of and pay such costs as shall be awarded by the justices at such (piarter sessions, or any adjoiirn- ment thereof; and such justices, upon hearing and finally deter- mining such matter of appeal, shall and may, according to their discretion, awtu'd such costs to the party or parties appealing or appealed against as they shall think proper, and their deter- nn'nation in or concernino- the of the sum charged on the rates, and such interest as may from time to time be payable in respect of such charge or any part thereof, in each succeeding year till the whole is repaid. Power for surveyors to enter and examine lands, &c., for purposes of survey and plans. 4. And be it further enacted, that for the purpose of making every such survey, map or plan, and valuation, it shall be lawful for the person or persons so to be appointed for making the same respectively, together with their and every of their as- sistants and servants, at all rea- sonable times, until the same respectively shall be completed, to enter, view, and examine, survey and admeasure, all and every part of the messuages, lands, and other hereditaments aforesaid, and to do or cause to be done any act or thing neces- sary for making such survey, map or plan, and valuation : Provided always, that any map, survey, plan, or valuation made previously to the appointment of such person or persons which 56 TiiF, rKixc'iri.E of katixo. The Laic as Enacted for Emjlaml and Wales. The Law as Enacted for the Metropolis only. prenii.sos sliall be conclusive and binding on all iiartios, to all intents and purposes wliatsoever: Seven days' notice to be given of objections. Provided ahvaj's, that no such objection shall be inquired into by the said justices in sj^ecial session unless notice of such ob- jection in WTiting imder the hand of the complainant shall have been given, sccon days at least hcfore the day appoinicd for such special session, to the col- h'ctor, overseers, or other persons by whom such rate was made: Proviso. Provided also, that the said jus- tices in special session shall not be authorised to inquire into the liability of any hereditaments to be rated, but only into the true value thereof and into the fair- ness of the amount at Avhich the same shall have been rated. Justices may act with all the powers of justices at quarter sessions. 7. And be it enacted, that the Justices present at any such special or adjourned session shall for the aforesaid purpo.se have .shall be tendered to him or them, and which shall be in his or their judgment and to his or their satisfaction a just and true map or survey, proper for the purposes aforesaid, may be used for such purposes. Section G1 of the Metropolis Act. Guardians may appoiQt a paid valuer to assist the assessment committee.. The guardians may, upon the application of the assessment eonnnittee, after notice sent in the manner required by the principal Act, appoint some competent person to assist the committee in the valuation of the hereditaments in the union for such period as they see fit, at a salary or other settled re- muneration, to be paid out of the coinniun fund. Section 4, Act 1864. Valuation to be made in writing. Where a valuer is appointed by tlie assessment committee he THE PRINCIPLE OF RATING. 57 Tlie Law as Enacted for Em/land and Wales. Tlie Law as Enacted for the Metrop'dis onlt/. all the powers of amending or quashing any such rate so ob- jected to of any parish or other district within their division, and likewise of awarding costs to be paid by or to any of the parties, and of recovering such costs, which any court of quarter ses- sions of the peace has upon appeals from any such rate, ex- cept as herein excepted: Pro- vided always, that no order of the said justices shall be removed by certiorari or otherwise into any of His Majesty's courts of record at Westminster : Provided also, that nothing in this Act contained shall be construed to deprive any person or persons of the right to appeal against any rate to an}^ court of general or quarter sessions: Provided also, that no order of the said justices in special sessions shall be of any force pending any appeal touch- ing the same subject-matter to the court of general or quarter sessions of the peace having ju- risdiction to try such appeal, or in opposition to the order of any such court upon such appeal. shall make his valuation in writ- ing, showing the particulars of the several hereditaments com- prised therein, and the amomits at which he has valued the same respectively, and shall sign such valuation, which shall be open to inspection in like manner and with the same incidents with respect to the taking of copies or extracts as the minute-books of the committee. Section 21, Act 18G2. Valuation-list when altered to be deposited, &.c, Where the committee make any alteration in the valuation of any hereditaments included in, or insert therein any rateable hereditament omitted from, any such valuation-list, they shall cause such valuation-list, with such alteration or insertion, to be deposited for inspection in manner hereinbefore provided concerning the Aaluation-list made by or delivered to the overseers, and shall cause the like notice to be given of such deposit as is I'cquired in the case 58 TIIK PRlXflPl.K OK HATINC. The Late as Enacted for Emjland and n\dis. The Law as Enacted for the Jletroj>ol!s only. Skction G, Act 18G4. Justices in certain cases not disqualified for hearing appeals. 1^0 Justice of the peace shall be disqualified for acting- in the detcnnination of any appeal against a poor rate at any quar- ter or special sessions by reason of such justice being rated, or being liable to be rated, in some other parish in the iniion than that for which the rate appealed against is made. »Sk(Tio,\ 22, Act 18G2. If on appeal a rate is amended, the valuation-list to be altered. In case cdii/ ratcpaijot' shall under the existing law api)eal to the special sessions or quarter sessions against any rate made for the relief of tlie poor in iiiiy parish, and the rosiJt of such api^eal shall be to amend the rate appealed against, the assess- ment committee shall allci' flic valuation-list of the said ])aii>h in confoi'iuity with the decision so made. of a valuation-list so nuide or dcli\'cred as aforesaid, and .shall appoint a day, not less than seven days nor more than four- teen days from the rc-dejjosit of .such valuation-list, for the hear- ing of any objections to the valuation-list as so altered ; and when the committee have heard and determined any such objcc- tionis, or have made such further alterations, insertions, and cor- rections in such valuation-list, they shall apj^rove the same in manner hereinbefore jjrovided. Section 42 (7) ok the Metro- roijs Act. The assessment committee .shall send the valuation-list to be re-deposited within three days after it is a])])roved by thcni, and shall a})point a day not less than fourteen nor more than twenty-eight days after such re-deposit for liearing ob- jections to the alterations of wlilch objections s(>ven days' notice .shall be given by the objector. 9 (I'.MiToi'j. AVhcre the a.s- THE PRINCIPLE OF RATIXG. 59 Tht Lawas Enacted for Eiif/laiiJ and IVdha. The Law as Enacted for the Jletropolis only. Overseers to prepare supplemental valua- tion-lists in case of additions to or alterations in the rateable property of the parish. 25. When and so often as any property not included in the vahiation-list in force in any parish becomes rateable, or Avhere, by reason of any altera- tion in the occupation of any projoerty included in such list, such property becomes liable to be rated in parts not mentioned in such list as rateable heredita- ments and separately valued tlicrcin, and when and so often as it shall appear to the over- seers that aii}^ rateable property included in such list has been increased or reduced in value since the valuation thereof, Avhe- tlier by building, destruction of building, or other alteration in the condition thereof or other- wise, t/if orcrsecrs of the parish in each of the cases aforesaid shall, as soon as conveniently may be, make a supplemental valuation-list showing the an- nual rateable value according to tlie judgment of the overseers of the property so become rate- able, O}- of the parts so become scssment connnittee (otherwise than in determining an objec- tion) alter a valuation-list by in- serting therein some heredita- ment, or by raising the gross or rateable value of some heredita- ment comprised therein, tJic orcr- secrs shall immediateh' after the re-8 (part of). The duplicate of the valuation-list, approved by tlie assessment committee, ()'2 TJII'. I'KIXCll'l.K OK KVriNO. The Law asEiiacieil for Enylanil an.l iV.ihs. The Lmv as K,Mdid forthe .Vctropnlis oiili/. Section 8 of the Act of 1804. Power to guardians, with the order of the Poor Law Board, to borrow money for valuation expenses. If tlie msessnioU commiftoc order a valuation, with the con- sent of the hoard of guardians, to he made of all the rateahle hereditaments of any parish, the guardians of the imion may, if they tliink fit, appl}- to the Poor. Law Board for an order to enable them to borrow the re- quisite amount to pay the cost of such valuation ; and if the said board shall issue their order, the said guardians may borrow the same and charge the poor- rates of the several parishes in the union with the repapnent of the same by not more then five e(pial annual instalments ; and where the parisli for whicli tlie valuation is made sliall, by rea- son of any provision in the said Union Assessment Committee Act or tills act, be liable to pay the cost of such valuation, tlie said guardians shall charge the annual instalments, and tlie in- terest payable therewith, to sucli ])ai'isli, and may recover the and sent to the overseers, as directed by this Act, the notices of alterations made on any appeal under this Act, and any provisional list, shall for all purposes be deemed to be part of the rate books of the parish, and sliall be produced by the overseers before the jus- tices upon any application for allowance of rates, and on any appeal under this or any other Act, and on any other occasion if so required, on which they are bound to produce such rate books, and any overseer who fails to produce such list in accordance with the provisions of this section shall be liable on summary conviction to a penalty not exceeding five pounds. inspection, &c., of documents deposited with rate books. 07. Where any documents ore required by this Act to be de- posited in the same place in a parish in ^\"hic•h i-ate-books are kept, ever}' ratepayer shall be at liberty to insi)cct and take copies of or extracts from such (luciiniciils a1 any reasonable linic, williout fee or cliarge. THE PRINCIPLE OF RATIXG. C3 The Law as Enacted for England cntd Wales. The Law as Enacted for the JTetro^wlis only. same as and witli the usual con- tributions. Power to Poor Law Board to order map or plan to be made. 10. If tliere be no map or plan of any parish available for the use or sufficient for the purposes of the assessment committee, the committee may, with the consent of the guardians, after notice as aforesaid, and under the autho- rity of an order of the Poor Law Board, aj)point a competent per- son to make a map or plan of such parish, and the cost thereof shall be charged either to the common fund, or to the parish, as may be directed by the Poor Ijaw Board. Section 3 of the Act of 1836. Power to order new survey and valuation. And be it enacted. That when it shall be made to appear to the Poor Jjaw Commissioners by representation in writing from the t)0((nt of (/iiardiaiis of any union or parisli under their common seal, or from the ma- jority of the cliurchwardcns and Deposit of list at office of the managers of metropolitan asylum district. 16. The certified valuation- list so sent to the clerk of the managers of the metropolitan asylmn district by the assess- ment committee shall be de- posited at the office of such managers, and within the time in this Act mentioned (see See. 4-3 (11) shall be retiu-ned by such clerk to the same assess- ment committee. Ratepayer, &c., may inspect documents, &c., in hands of clerk of managers or assessment committee. 69. Any ratepayer, overseer, clerk of an assessment conunittee, or surveyor of taxes in the me- tropolis may, at all seasonable times, without paj'ment, inspect and take copies of and extiTicts from all valuation-lists and docu- ments which in pursuance of this Act are under the control of the clei'k of the managers of the metropolitan asylmn district, or of the clerk of the assessment sessions. Any surveyor of taxes and any guardian and any overseer in a union, witlioul payment, Gi TIIF, rUIXCTPI.E OF RATING. I'he Laic as Enact id for EmjLtml and Wales. The Law as Enacted for the Jlctrojwlis onli/. overseers or other officers com- petent as aforesaid to the mak- ing and levying- the rate, that a fair and correct estimate for the aforesaid purposes cannot be made without a new valuation, it shall be lawful for the Poor Law Commissioners, where they shall see fit to order a survey, with or without a map or ^Aixn, on such scale as they shall think fit, to be made and taken of the messuages, lands, and other hereditaments liable to poor- rates in such parish, or in all or any one or more parishes of such a union, and a valuation to bo made of the said messuages, lands, and other hereditaments according to their annual value, and to direct such guardians to appoint a fit person or persons to make and take every such survey, map or plan, and valu- ation, and to make pi'ovision for paying the costs of every such survey, map or plan, and valua- tion, either by a separate rate or by a charge on the poor rates, as they may see fit ; but in case of such charge beinj? made, tlicn provisions shall be made for paying of not less and any ratepayer in a union on pa}Tnent of a fee not exceeding one shilling (to be carried to the common fund), may at any rea- sonable time inspect and take copies of and extracts from any A'aluation-lists, notices of objec- tion, returns, and other docu- ments in the possession or under the control of the assessment committee of that union. Any clerk of an assessment committee in the metropolis may inspect and take extracts from any valuation-lists in the pos- session or under the control of the assessment committee of any other imion in the metropolis. Any person who hinders a ratepayer, overseer, clerk of an assessment committee, or sur- \cyoY of taxes from so insi^ecting or taking copies of or extracts from any valuation-list or docu- inent, or demands where not authorized by this Act a fee for allowing him so to do, shall be liable on summary conviction to a penalty not exceeding five pounds for each offence. Printing and distribution of totals of gross and rateable value in valuation list. 1 7. The clcik of tlie managers THE 1'R1NCTPI,E OF RATING. 65 The Law as Enacted for England and Wales. TJie Law as Enacted for the Metro2JoUs onlj/. than one-fifth of the svun charged on the rates, and such interest as may from time to time be payable in respect of such charge or any part thereof, in each succeeding year, till the whole is repaid. Power for surveyors to enter and examine lands, &.C,, for purposes of survey and plans. 4. And be it further enacted. That for the purpose of making every such survey, map or plan, and valuation, it shall be lawful for the person or persons so to be appointed for making the same respectively, together with their and every of their assistants and servants, at all reasonable times, until the same respec- tively shall be completed, to enter, view, and examine, survey and admeasure, all and every part of the messuages, lands, and other hereditaments afore- said, and to do or cause to be done any act or thing necessary for making such surve}^, map or plan, and valuation : Provided always, that any map, survey, plan, or valuation made pre- viously to the a})p()inlnu>iit of of the metropolitan asylum dis- trict shall, within the time in this Act mentioned, cause the totals of the gross and rateable values of all the valuation-Ksts to be printed, and a printed copy of all such . totals to be sent to every assessment conunittee, and the overseers of every jaarish in the metroj)olis and in every county in which any parish to which any such totals relate is situate, to the clerks of the peace for every such county, to the Commissioner of the Metro- politan Police, the Corporation of the City of London, the Metropolitan Board of Works, every district board in the me- tropolis, and the Poor Law Board. Every assessment com- mittee, overseer, and ratepayer within the metropolis and every such county shall respectively be entitled to have printed copies of such totals on paynient of one penny for each copy of all the said totals. Section 42. (11.) The clerk of the said inanaji-ers shall send 6G TllF. VRTXCTI'I.K OK 1? ATTNG. TJie Lair nit F.iiarteil for Emjland and /('((/(•>■. Tlw Lain as EnacteJ forthe Metropolis only. such person or persons wliich shall be tendered to him or them, and which shall be in his or their judgment and to his or their satisfaction a just and true map or survej^ proper for the purposes aforesaid, may be used for such purposes. Section 32 of the Poor Law Amendment Act, 1868. Guardians may appoint a paid valuer to assist the assessment committee. The guardians may, upon the application of the assessment committee, after notice sent in the manner required by the Union Assessment Committee Act, 18G2, appoint some com- .petent person to assist the com- mittee in tlie valuation of the rateable hereditaments of the imion for such period as they shall see fit, at a salary or other settled remuneration to bo paid out of the common fund. Section 4 ok the Act ok 18G4. Valuation to be made in writing. "Where a ralitcr is appointed l)y the assessmont coininiftee, lie out the printed totals before the first of De- cember in the same year (1870), and shall return the yaluation- list to the assessment committee not sooner than fourteen nor later than twenty-one days after the totals are sent out: 68 (part or). The duplicate of the valuation-list returned to the assessment committee by the clerk of the managers of the metropolitan asylum district, and other documents in the posses- sion of the assessment committee in pursuance of this Act shall be kept at the board room or other convenient place from time to time appointed by the giuirdians of the same union, but shall be deemed to be in the possession of the assessment committee, and shall bo produced by their clei-k to the district auditor whenever required by him. THE PRTXCTPLE OF RATING. 67 Tlie Law as Enacted for Em/land and IValt.t. The La2v as Enacted for the Metro2>olis only. shall make his valuation in writing, showing the particulars of the several hereditaments comprised therein, and the amounts at which he has valued the same respectively, and shall sign such valuation, which shall be open to inspection in like manner, and with the same inci- dents with respect to the taking of copies or extracts, as the minute books of the committee. Section 27 of the Act of 1862. This Act as to valuation-list first directed to be made to apply to new and supple- mental valuation-lists. All the provisions of this Act in relation to signature, deposit, objections, approval, and other- wise concerning the valuation- list first directed and authorised to be made under this Act of the rateable hereditaments in any parish shall be applicable to every new or supplemental valuation-list to be made under this Act. Section 30, Act 1862. In computing amount of contributions to common fund the annual rateable value to be taken from approved valuation- lists. AVTien the assessment com- mittee for any union shall have approved valuation-lists for all the parishes comprised within such union, the guardians of such union, in computing the amount of contribution to the common fund for the several parishes, shall thenceforward take the annual rateable A'alue of the property in such parishes respectively from the valuation- lists for the time being lastly approved of for such parishes respectively, any statute to the contrary notwithstanding: Pro- vided that in case any parish comprised in any imion shall receive any sum of money as a contribution in aid of the poor rate of such parish, for or in respect of government property within such parish and used for pubKc purposes, the annual value of such property, according to the estimate (if any) of such viilu(> on whirh ihe amount of F 4. OS iMiE rinxf'iiM.K or ratixo. The Law as Enacted for Entjlandand Wales. The Law as Enacted for the Jlfetrnjiolis onlt/. Section 28 of the Act of 1868. 11 and 12 Vict., cap. 110, sect. 7, extended to a parish. Tlie provision.s of tlic seventh section of the Poor Law Amend- ment Act, 1848, empowering guardians of unions to cause valuations to be made upon ap- plication as therein set forth, shall apply to the guardians of a parish not comprised in any union. Section 45 of the Act of 1862. Power for unions under Gilbert's or local Acts to be included in this Act. And whereas there are divers unions or incorporations for the relief of the poor formed under local Acts, and under the Act of the twenty-second year of King George the Third, chapter eighty- three, which may desire to adopt the provisions of this Act: Be it enacted, that any such imion or incorporation, on resolution to that effect of a majority, at two successive meetings of the body, the sum of money so received is computed, or, if there be no such estimate, then the annual value of such property, estimated in the mode provided by the Act sixth and seventh William the Fourth, chapter ninety-six, for making an estimate of the annual rateable value of property liable to be rated to rates for the relief of the poor, shall be included by the overseer or overseers in the valuation-list of such parish, and shall be added to the annual rateable value of the property in such parish in computing the amomit of contribution to the common fund for the several parishes in such imion. Section 43, Metropolis A(t. Effect of Yaluation-List. Duration of valuation-list. The valuation-list as approved by the assessment committee, and, if altered on any appeal under this Act to any sessions or a superior court, as so altered, shall come into force at the be- ginning of the year (commencing THE PRINCIPLE OF RATING. 69 Tlie Law as Enacted for England and Wales. The La^v as Enacted for the Metropolis only. having under tlie constitution of such union or incorporation the management of the relief of the poor within the same, may, by writing under the hand of the presiding chairman of the second of such meetings, apply to the Poor Law Board to be included in this Act; and such union or incorporation, upon the consent of the Poor Law Board being given to such application under its seal, shall be so included; and such consent so signified shall be evidence that such application was in all respects duly made according to the pro- visions above mentioned ; and such regulations shall thereafter be made from time to time by the said board, with the consent of such body, as may be neces- sary to render the provisions of this Act conformable with the provisions of the Act under which the said union or incor- poration shall have boon formed. Extent of Act. •IG. This Act shall extend t)uly to England. on the sixth of April) succeed- ing that in which it is made, and shall last for five years, sub- ject to any alterations that may be made by any supplemental or provisional list as hereinafter mentioned. Rate to be levied notwithstanding appeal. 44. Notwithstanding any ap- peal under this Act which may be pending at the commence- ment of the year, the valua- tion-list shall come into force unaltered, and every assessment, contribution, rate, and tax in respect of which the valuation- list is conclusive shall be made, required, levied, and paid in accordance with such valuation- list; and where in consequence of the decision on any appeal imder this Act to assesssment sessions or a superior court an alteration in such valuation-list is made which alters the amount of the assessment, contribution, rate, or tax levied thereunder, the diSerence, if too much has been paid, shall be repaid or allowed, and if too little, shall be deemed to be arrears of the assessment, contribution, rate, or tax (except so far as any 70 THE riuxciri.K of ratixg. The Law (IS Enacted ftir Emiluiul aiul Wales. The Law as Enacted for the Meti-opnlis only. Section 1'2, Act 1864. 25 and 26 Vict., cap. 103, incorporated herewith. The provisions of the Union Assessment Committee Act, 1862, shall, so far as the same are not contrary hereto, be in- corporated herewith, and the terms used herein shall he construed in like manner as in that Act. Short title. 13. Tliis Act may be cited as "The Union Assessment Com- mittee Amendment Act, 1804." [End of the Laic as Enacted for Eni/land and Jfah'S-J penalty is incurred on account of arrears), and shall be paid and recovered accordingly. Valuation-list to be conclusive for pur- poses of certain rates, taxes, and qualifications. 45. The valuation-list for the time bchig in force shall be deemed to have been duly made in accordance with this Act and the Acts incorporated herewith, and shall for all or any of the purposes in this section men- tioned be conclusive evidence of the gross value and of the rateable value of the several licreditaments included therein, and of the fact that all heredi- taments required to be inserted therein have been so inserted; that is to say: — (1.) For the purpose of any of the following rates which arc made dur- ing the year that the list is in force, namely, the county rate, the metropolitan police rate, the church rate, the highway rate, the poor rate, the police, sewers, consoHdatcd and othci' rates in the citv of London, the THE PRINCIPLE OF RATING. 71 The Law as Enacted for the Metropolis only. sewers, the lighting, general, and other rates levied by order of district boards or vestries, the main drainage improvement and other rates, and sums assessed on any part of the metropolis by the Metropolitan Board of Works, assessments for contributions under the Metro- politan Poor Act, 1867, and every other rate, assessment, and contribution levied, made, and required in the me- tropolis on the basis of value : (2.) For the purpose of any of the following taxes which become chargeable during the year that the Kst is in force, namely : — (fl.) The tax on houses levied under the House Tax Act (14 & 15 Vict., c. 36, &c.) and the Acts therein incorporated or referred to: {b.) Any tax assessed in pursuance of the Income Tax Act (5 & 6 Yict., c, 35, &c.) and any Acts continuing or amending the same, on any lands, tenements, and hereditaments, in all cases where the tax is charged on the gross value, and not on profits : (3.) For the purpose of determining, so far as it is applicable, the value of any hereditament included therein for the purposes of the Acts relating to the sale of excisable liquors, to the qualification of a juror, to the qualification of a vestryman, and an auditor of accounts under the Metropolis Management Act, 1855, and to the qualifica- tion of a guardian and of a manager under the "Poor Law Amendment Act, 1834," or of the "Metropolitan Poor Act, 1867," at any time at which such value is required to be ascertained : And in construing the Metropolitan Police Act (10 Geo. 4, c.44) . and the Acts amending the same, the last valuation for the time 72 THE rinxciPLE of katixg. The Law as Enacted for the .ffrtwpolis otily. being acted upon in assessing- the county rate shall be deemed to mean the valuation-list for tlie time being in force : And in construing the County Rate Act (15 & 16 Vict., c. 81, &c.) and Acts referring to the valuation, estimate, basis, or standard shall be deemed to be the rateable value stated in such list: And in construing the House Tax Act (14 & 15 Vict., c. 36, &c.) and the Acts therein incorporated or referred to, the full and just yearly rent shall be deemed to be the gross value stated in such Hst: And in construing the Income Tax Act (5 & 6 Vict., c. 35, &c.) and any Acts continuing or amending that Act, with respect to schedules A. and B. thereof, annual value shall be deemed to mean the gross value stated in such list. Appeals. — Special Sessions. 18. In everj^ petty sessional division in the metropolis the justices of the peace acting in and for such division Holding of special gj^^^ ^^ ^ ^^ ^^^ ^^^^ mentioned in this session to hear . appeals. ^ct, hold a special sessions for hearing apj^eals under this Act against the valuation-lists of the several parishes within such division. 42. (10.) The justices may hold the special sessions at any time after the thirtieth of November in the same year (1870), which will enable them to determine all appeals before the ensuing first of January. 19. Any ratepayer and any overseers of a parish, so far as respects the valuation-list of such parish, and any Persons entitled to su^-veyor of taxes, so far as respects the valuation- appeal to special , \ . . ^ sessions. li'^t of any parish in tlie petty sessional division, may, if he or they feel aggrieved by anj^ decision of the assessment committee on an objection made with respect to THE PRIXCIPJ,E OF RATING. The Law as Enacted for the Metropolis only. the unfairness or incorrectness of the valuation of any hereditament included in such list, but not otherwise, appeal against such decision to the special sessions. The right to appeal to special sessions shall not deprive a person of any other right of appeal conferred on him by this Act. Proceedings on Appeals. 33. Notice in writing of every appeal, whether to special sessions or the assessment sessions {see Sec. 23), specifying the correction which the appell- Notice of appeal to . . special or assess- ant desires to have made m the valuation- p^g^t sessions. list, must be served, within the time in this Act mentioned. 42. (9.) Notices of aj)peal to special sessions shall be given on or before the twenty-first of November in the same year (1S70) on the following persons, namely: — In all cases on the surveyor of taxes of the district to which the appeal relates, and on the clerk of the assessment committee which approved the list wholly or partly questioned by the aj^peal: When the appeal relates to the unfairness or incorrect- ness of the valuation of, or to the omission of an hereditament occupied by any person other than the appellant, or to the incorrectness of any matter stated in the list with respect to any such hereditament, then on such person: If an assessment committee or a surveyor of taxes is the appellant, then also on the overseers of the parish to which the appeal relates : Provided that it shall not be necessary to serve any notice of ai)peal on the surveyor of taxes in any case in which the appeal relates only to the rateable value of any hereditament. The cleik of llie assessment committee, on recei\ ing nolicc of an 74 THE nUXC'IPI.E OF HATING. 'I'hf Imic as Enacted for the Mitrojwlis ouly. appeal, shall forthwith serve notice thereof on the clerk of the special sessions or of the assessment sessions, as the case may require. Section 2, Act 1864. The assessment committee of such union may, with the consent of the guardians of such union, after notice shall Committee may, l^ave been sent to every guardian, appear as re- e-uardians be co- spondents to such appeal, but in the name of the respondents. guardians of such imion, in like manner, and with the same incidents, and subject to the same liabili- ties, and entitled to the same remedies and rights, as in the case of persons other than the overseers to whom notice of appeal may be given. 3. The costs which the committee may incur in consequence of becoming respondents to such appeal, or of having rrovision as to received notice thereof, shall, if not recovered from costs of committee . on appeals. ^^® appellants, as well as any costs the committee may be ordered to pay to the appellants, be paid by the guardians and charged to the common fund of the iniion, unless the Court before whom such appeal is heard shall direct that such costs, or any part thereof, shall be charged to the parish, the rate of which is appealed against. Section 20, Metropoms Act. The justices in special sessions under this Act shall not hear any appeal touching any matter with respect to txtent -) ■ which notice of appeal to the general assessment diction of special _ . sessions. sessions has been served in manner prescribed by this Act, and shall not hear any appeal touching any part or alter any part of the valuation-list except the part THE PllINCIPLE OF RATING. 75 Tha Law as Enacted for the Metropolis only. relating to the value of an hereditament ; and a decision of such justices and an alteration by them of the value of an hereditament in the valuation-list of any parish shall affect only the rights of the ratepayers of such parish among themselves, and shall not of itself in any way alter the totals of the gross or rateable value of such list as settled by the assessment committee, but may form a reason for an appeal against such totals to the assessment sessions and superior court as hereinafter mentioned. 21. The justices in special sessions under this Act may adjourn their court from time to time, as may be necessary _, ... ,. , - n 1 . 1 . 1 1 • » Powers of special for the performance of their duties under this Act. sessions. They shall have, with respect to the attendance and examination of witnesses, the taking of evidence, the keeping order in court, the enforcing their orders, and all matters necessary for the execution of their duties under this Act, the same powers and jurisdiction as if they were assembled in petty sessions. 22. The justices in special sessions shall send a wi'itten notice of the time and place at which they will hold a special sessions for the purpose of hearing appeals '^''^'p^ '^y special ^ • , 1 / sessions of time of with respect to any parish to the overseers of such sitting. parish, who shall publish it as soon as it is received by them. Section 6, Act 1864. No justice of the peace shall be disqualified for acting in the determination of any appeal against a poor rate at any quarter or special sessions by reason of such Justices in cer- • ,. 1 • ,1 1 . T 1 1 - 1 i 1 • tain cases not dis- justice being rated or being liable to be rated m q^^\\^^^^ for hear- some other parish in the union than that for which ing appeals. the rate appealed against is made. 7() THE PRIXCIPLE OF RATINO. The Law as Enacted for the Mitrojwlin oiifi/. Section G3 of the Methopolis Act. Any rooin maintained out of the proceeds of any rate levied wholly or partly in the metropolis may (with the Use of public room coi^g^j^t of the person or body corporate having for appeals, &.c. , , ^ . , ^ o ■, • ^ ^ the control of it) be used for nearmg appeals, and for other purposes of this Act. 34. The justices in special sessions and in assessment sessions respectively shall, in open court, hear and deter- Sessions to hear mine all appeals brought before them in such order I I |P' as they may respectively from time to time appoint, list accordingly. They may adjourn the hearing from time to time, and to any day not later than the day before ■\\hicOi all appeals to them are required by this Act to be heard; and in the case of assessment sessions for the purpose of obtaining the decision of any superior court to any day necessary for that purpose ; and if from accident or mistake due notice of appeal has not been given, or if an additional notice of appeal appears to be required, they may, if they think it just, order notice of appeal to be given. They may confirm or alter the valuation- list, so far as it is questioned by the appeal, in such manner as they think just, but shall not make any alteration in contravention of this Act. The clerk of the assessment committee, or some deputy allowed by the assessment committee, shall attend the court with the valuation-list to which the appeal relates, and any alteration shall be made by the justice acting as chairman of the sessions in that list, and the said justice shall place his initials against such alteration. G4. A valuation-list may be proved by the jj reduction of a duplicate or copy of such list pui-porting to be Evidence of valua- .-n t 4. -u i v * ^ i ^i tion list &.C certified to be a duplicate or a true copy by the clerk of the assessment committee that approved it, and such certificate shall state that the alterations (if any) made TTTE PRTNX'IPLE OF RATING. 77 The Law as Enacted for the Metro2}olis only. in the list in consequence of tlie decision on any appeal under this Act have been correctly made in the duplicate or copy so produced, and the clerk on application shall furnish a copy to any overseers on pajTinent of a sum not exceeding the rate of threg shillings for every hundred entries numbered separately. A provisional list may be proved by the production of a duplicate or copy thereof purporting to be certified to be a true copy by the clerk of the committee who signed it. Appeals. — Assessment Sessions. 23. For the purpose of hearing appeals under this Act against any valuation-list in the metropolis, the justices of the peace appointed as hereinafter mentioned shall ^"'^^ ot general at the time mentioned in this Act assemble and sions. hold a court of general assessment sessions (in this Act referred to as the assessment sessions), 24. The justices who are to form the court of general assessment sessions shall be appointed annually as follows : 1. Three justices of the peace of the county of Appointment of Middlesex (of whom the assistant iudo-e ■ °^" ' ^ , J i^ ral assessment of the court of the sessions of the peace sessions. of the said coimty shall be one) shall be appointed by the court of general quarter sessions or general sessions of the peace for the county of Middlesex . 2. Two justices of the peace of the county of Surrey shall be appointed by the court of general or quarter sessions of the peace for the county of Surrey : 3. Two justices of tlie peace of the county of Kent shall be appointed by the court of general sessions for the county of Kent : 4. Two justices of the peace of the city of London shall bo appointed by the court of tlie mayor and aldermen of the city of London in tlie inner cluniibei'. Tin; ruiNCTiM.K of katixo. Tlie Law as Eiiacietl for the Mitrnpolis oiili/. The said justices shall be appointed in the month of October in every year, or at such other time as may be from time to time fixed by the appointing body. They shall liuld office for twelve months, beginnino^ on the first of November, and any casual vacancy may be filled up by the appointing- body. 25. The justices in assessment sessions may from time to time ap])oint, with the consent of the Poor Law Board, Officers of general .^ ^.j^^^.j ^^^^^ ^^j^^^. ^.g^ns to assist them in the assessment ses- , . . sjons, performance of their duties under this Act, and may assign him or them such remimeration and such duties as the Poor Law Board may approve. 2G. The justices in assessment sessions may from time to time Chairman ouo- appoint one of their own number to act as their rum, and powers chairman, who shall have a second or casting vote, ot general assess- ^^j they may from time to time determine on their ment sessions. quorum so that it be not less than three. The court of general assessment sessions may adjourn from time to time, as may be necessary for the performance of their duties under this Act, and (for the purpose of giving judgment only) from place to place in the metropolis. They shall, with respect to the attendance and examination of witnesses, to the taking of evidence, to the keeping of ord(>r in court, to contempt of court, to the enforcement of their orders, and to all matters necessary for the execution of their duties under this Act, have the same juris- diction and powers, and be in the same position as a court of quarter sessions; and, subject to the express provisions of this Act, shall conduct their proceedings, be convened, and be in the same position, as near as may be, as if they were a court of quarter sessions. 27. The justices in assessment sessions may, with Ihe approval of one of Her Majesty's Principal 8eerclaries of Orders as to pro ^^.^^ ^^^.^^^ oj.j^.j.^ f,.,,,,, pioceeamgs on aj^peals THE PRINCIPLE OF RATING. 79 The Law as Enacted for the Metropolis only. to them under this Act, and for determining the cognizances on recognizances (if any) to be entered into by appell- ^PP^als. ants in the case of appeals either to special sessions or to the assessment sessions. 28. The justices in assessment sessions may make a table of the fees which in their opinion should be laald to the clerks of special sessions and to the clerk of assess- ' ^^.^ *^" . appeals , . . ,, „ 1 J ^1 • "naer this Act. ment sessions m the case ot appeals under this Act, and shall lay such table before one of Her Majesty's Principal Secretaries of State in the same manner as the justices at quarter sessions may make and lay before such Secretary of State a table of fees, and all the provisions of section thirty of the Act of the session of the eleventh and twelfth years of Her Majesty's reign, chapter forty-three (which section relates to a table of fees and to the prohibition of clerks taking other fees), shall apply in the case of a table of fees made, and the business done by the said clerks under this Act. All fees paid in the case of a2:)peals to the assessment sessions shall be paid to the account of the receiver of the Metropolitan Common Poor Fund, and shall be so paid and taken and accounted for in such a manner as the Poor Law Board may from time to time by order prescribe. 29. The justices In assessment sessions shall from time to time appoint a place in the metropolis where the appeals f h • ■,. 1 .•,., -. riaces Tor neanng relating to each parish m the metropolis are to be appeals. heard, and may, if they think fit, divide the metro- polis into districts for the j^urpose of apjDeals, and appoint one or more places for every such district. 30. The justices in assessment sessions shall cause public notice to be given of the several times at which they will sit at the several places appointed for the hearlna- f.""'"' r°l"^f ,. , . . . ^ times of holding oi appeals; such notice may be given under the courts to be given. hand of their clerk, and shall be given by adver- 80 TflE rRIXCIPLE OF RATING, Tlie Law as Enacttd for the Mdropolis vnly. tisemont lii sonic newspaper circulating generally in the metro- polis, and by sending a copy of such notice to every surveyor of taxes in the metropolis, to every assessment committee which would have a right to appeal at such court, and to the overseers of every parish to which any appeal relates, and to all the parties to the appeal. The overseers shall publish the notice as soon as it is received by them. 42. (13.) The justices may hold the assessment sessions at any time after the first of February in the same year, which will enable them to determine all appeals (except where a valuation-list or valuation is ordered) before the en- siling thirty-first of March : (14.) Notice of the times at which the assessment sessions will be held at each place shall be given by the clerk ten days at least before the first court is held. 32. Any ratepayer, and any surveyor of taxes, and any overseer, with the consent of the vestry of his parish, who rersons entitled to ^^^ ^^^-^ ao-grieved by any decision of the asscss- appeal against as- -^ ^p . . sessment sessions, nieiit committee, on an objection made before them to which he was a party, or by any decision of special sessions, whether he was a party or not, may appeal against such decision to the assessment sessions. Any assessment committee in the metropolis, or in the county in which the parish to which the appeal relates is situate, any overseers in the metropolis or such county, with the consent of the vestry of their parish, any ratepayer in the metropolis or such county, and any body of persons authorized by law to levy rates or require contributions payable out of rates in fh(> metropolis or such county, may appeal to the assessment sessions, if they or he feel aggrieved by reason — (1) of the total of the gross value of any paiisli being too high or loo low : THE PRIXCIPLE OF RATXXG. 81 The Laic as Enacted for the MetrojwUs only. (2.) of tlie total of the rateable value of any parish being too high or too low ; or (3.) of there being no approved valuation-list for some parish. 42. (12.) Notices of appeals to assessment sessions shall be given on or before the fourteenth of January in the same year : {See Section 33, Metropolis Act; Sections '2 and 3, Act 18G4-; Section 34-, Metropolis Act; Section 64, Metroptotis Act.) 31. The justices in assessment sessions may order any clerk to the commissioners of taxes, any surveyor of taxes, clerk of assessment committee, overseer, assistant ^"."^"^o^s OT cer- tain officers as overseer, or like officer in the metropolis to produce witnesses. any documents relating to rates or taxes which such justices may consider necessary for determining an appeal, and do not relate to profits of trade or of concerns in the nature of trade. Any person who refuses, after tender of a reasonable sum for his expenses, to obey any order imder this section shall be liable (on smnmary conviction before the justices in assessment sessions or any other two justices) to a penalty not exceeding five pounds. 35. If it appears to the justices in assessment sessions on any appeal that there is no approved valuation-list for some parish, they may appoint some proper per- iy'i''^ing Oi valua- ,. , \ ^ ^ ^} , ^ ^ ^ , tion-list where none son (with such remuneration as they may appoint) aoproved. to make a valuation-list. Such person shall have for that purpose the same powers and duties as overseers. The valuation-list so made shall be deposited and otherwise made known to the persons interested in such manner as the court may direct, but in manner as near as may be as is provided in this Act with respect to the list originally made. The costs of making such valuation-list shall be paid by the assessment committee who failed to approve the list, and shall be deemed part of their expenses under the principal Act. 36. If any of the parties to the appeal apply to the justices in G 82 THK PKTXC'IPLE OF HATINO. The Liiw (IS Enact ed for the Mttrojwlis only. assessment sessions to direct a valuation of any hereditament with respect to which any appeal may be made, and if Assessment ses- , ,. , "^ t . • t sions may on ap- such applicant or applicants give such security as plication of party the court think proper to pay the costs of the to appeal, order yaluation, the court may, in their discretion, ap- valuation. . ' , , . point some proper person to make such valuation. 62. Every assessment committee, with the consent of the p-uardians, and every overseer, with the consent Assessment com- ^ x>i- " --u ^ ^i mittee and over- ^^ ^^^^ vestry ot his parish, may, tor the purposes seers may give of any application for a valuation on any appeal, security for costs -^ security for payino^ the costs of such valua- of valuation. ^. j i j o ^ tion. An assessment committee may give such security, and may appear on any appeal by their clerk, and shall indemnify the said clerk against all monies, losses, and costs paid or incurred by him in consequence of such security or appearance. 37. Where the court appoint a person to make a valuation-list or a valuation, they may fix some subsequent day. Adjournment to re- either before or after the day before which all ceive valuation-list , •itxi-a^^t.t. ^ r or valuation appeals are required by this Act to be heard, tor receiving such valuation-list or valuation, and may adjourn the hearing to that day. 38. The person so appointed to make a valuation shall make his \i I .* „„ +« u„ • valuation in writinf? simied by him, showino; the Valuation to be m _ ? . . writing, person particulars of the hereditaments comprised therein, making it to have ^nd \\^q amounts at which he has valued the same pov^er to enter. ,. , "^ respectively. Such person may at all rea.sonable times, with or without assist- ants, enter upon any of the hereditaments directed to be valued, and may do thereon all acts necessary for completing the valuation. 39. The co.sts of any appeal, including the co.sts of any such valuation as aforesaid, shall be in the discretion of Costs ot Appeal. ^j^^, justices in sju'ciMl or a.ssessment sessions (as the THE PRI>'CIPLE OF RATIXG. 83 The Lam an Enacted for the Metropolis only. case may be), and shall be awarded by tbom to be paid by sucb parties to the appeal, and in sncb proportions, as tbey tbink just. Costs (including tbe costs of making a valuation) so ordered to be paid may be recovered as if tbey bad been awarded by a court of quarter sessions, and wben ordered to be paid by j^arties other than a ratepayer shall be paid as in this Act mentioned. 48. The costs of an aj^peal awarded against or incurred by any assessment committee or overseers shall be deemed to be expenses incurred under this Act and the 5°^*^ °^ m^^\, Acts incorporated herewith, and shall be raised and paid accordingly. Any costs or expenses awarded against or incurred hy any surveyor of taxes shall be defrayed in the same manner as expenses are directed to be defrayed by the Acts relating to the taxes in respect of which the valuation-list is made conclusive. 49. The Commissioners of Inland Revenue may make such allowances as they think fit for remmierating any person employed by them in the execution of this '"''^'^'J Kevenue Act, and lor the discharge oi any costs or expenses ^nces for expenses incurred by him. of Act. 50. The expenses of the assessment sessions and such remunera- tion as the Poor Law Board may from time to time allow to the clerk of the managers of the metro- politan asylum district, the clerk of the assessment sessions, and persons appointed to assist the assessment sessions as provided by this Act, and such costs and expenses incurred by such clerks and persons imdcr this Act as the Poor Law Board may allow, after such audit as the Poor Law Board maj^ direct, shall be paid by the receiver of the Metropolitan Common Poor Fund out of any monies for the time being in his hands, and shall be paid at such times and in such manner and upon such precept of the Poor Law Board as the Poor Law Ikvard mav from time to lime prescribe, and the G 2 84 llIE PRIXCIIM.E 01' nVTINO. Tht Line as Enacted for the Mifropnli.s only. Poor Law Board may require contributions for the purpose of raising sucli remuneration, expenses, and costs. 40. The same proceedings may be had by special case and cer- tiorari or otherwise, for questioning any decision Appeal from deci- of the justices in assessment sessions, as may be „„„•„„ • . had for questioning any decision of the iustices in sessions on points ^ . . of law. general or quarter sessions, provided that every such certiorari shall be sued out within three months after the decision is given. At any time after notice given of appeal under this Act to the assessment sessions, it shall be lawful for the parties, by consent and by order of any judge of one of the superior courts of common law at Westminster, to state the facts of the case in the form of a special case for the opinion of any of those courts and to agree that a judgment in conformity with the decision of that court, and for such costs as that court may adjudge, may be entered on the appli- cation of either party at the meeting of the justices in assessment sessions next or next but one after such decision has been given, and such judgment may be entered accordingly, and shall be of the same effect in all respects as if the same had been given by the assessment sessions upon an appeal duly brought before them and adjourned ; and the justices shall, if necessary, hold a sessions or an adjoui-ned sessions for this purpose. Notice in writing of the decision of any superior court in pur- suance of this section shall be served by the clerk of the assess- ment sessions on the assessment committee which approved the list questioned on the appeal to such court. 41. Notice of every alteration in the valuation-list, which altera- tion is made in consequence of any decision on Notice of altera- jj^j^y appeal to tlie special sessions, assessment ses- tion of list to be . -^ ^^ • . , n -, i sent to overseers sions, or a superior court, shall, as soon as possible, be sent in writing by the clerk of the assessment committee to the overseers and surveyor of taxes of the parish and THE PRIXCIPLE OF RATING. 85 The Law as Enacted for the Meti'ojjolis only. district respectively to which the list which is so altered relates, and such alteration shall be entered by the clerk of the assessment committee and by the overseers on the duplicates respectively de- posited with them. Notice of every alteration in the total of the gross and rateable value of any valuation-list, which alteration is made in consequence of any decision on any appeal to the assessment sessions or a superior court, shall as soon as possible be sent in writing by the clerk of the assessment committee to the clerk of the managers of the Metropolitan Asylum District, and the clerk of such managers shall send in writing such altered total to every person and body of persons who has power to levy or make any rate or assessment or require any contribution based on such total. 73. Every poor rate made in the metropolis after the fifth of April, one thousand eight hundred and seventy- one, shall contain the particulars specified in the , "^[^ . ^^^^ ^"" „,,,, ,:. 1 .1 , declaration, fourth schedule to this Act, together with such other particulars as the Poor Law Board may from time to time by order direct, and the overseers shall sign the form of declaration which is given in that schedule before the rate is allowed by the justices. And the justices shall not allow any rate at the foot of which the said declaration has not been added and signed. Any overseer who wilfully omits to make the said declaration or makes the same falsely, shall be liable on summary conviction to a penalty not exceeding five pounds. 86 THE IMUXCIPLE OF HATING. The Law as Enacted for the Metropolis onfi/. FOUKTU SCHEDULE. Form of Rate. Rate for the Relief of the Poor of the Parish of in the Union, and for other purposes chargeable thereon, according to law made this day of in the year of Our Lord 18 , after the rate of in the pound, which is estimated to meet all the expenses for the above purposes whicli will be incurred before the of next. 9) 1) "s-g P g"^ d >. 8 .2 ►^ Is > .5'^ o O ■g,>. a> !z; O 'C fc u p -^ ■S o g a ■A o o o ft M Declaration to be added to the Rate. We, the undersigned, do hereby declare that one of us, or some person on our behalf, has examined and compared the several particulars in the respective columns of the above rate with the valuation-list made under the authority of the Valuation (Metropolis) Act, 1869, and now in force in this parish (or township), and tlie several hereditaments are, to the best of our belief, rated according to the value appearing in such valuation-list, and do declare that the total of the above rate amounts to pounds shillings and ponce. > Churchwardens. Overseers. Section 5, Act 183G. And he it further enacted, That it shall be lawful for any person or persons rated to the relief of the poor of the parish in respect of which any rate shall be made, at all seasonable times, to take copies thereof or extracts therefrom without paying anything for Power to take copies or extracts of rates gratis. THE PRINCIPLE OF RATING. 87 The Law as Enacted for the Metropolis only. the same, anything in any Act of Parliament to the contrary not- withstanding ; and in case the person or persons having the custody of such rate shall refuse to permit or shall not permit such person or persons so rated as aforesaid ' 6"3i'y jor refusal 1 • 1 / IP ^ to permit, to take copies thereot or extracts thereirom, the person or persons so refusing or not permitting such copy or ex- tract to be made shall forfeit and pay any siun not exceeding five pounds, to be recovered in a summary way before any justice of the peace having jurisdiction in the parish or place. Section 70 Metropolis Act. ^Vhere the owner of any hereditament is liable to be assessed to or to pay any rate or tax in the place of the occu- pier, such owner shall for the purposes of this Act Uwner where rated , , . . -,.-,, , to be in position and the Acts incorporated herewith be deemed to gf occupier. be the occupier. 71. Any j)erson who feels aggrieved by reason of any clerical or arithmetical error in a rate in the metropolis may apply to two iustices of the peace or a maofistrate '*'^6ndment ot ./ •' ^ . ° error in rate by sitting at any police-court iii the metropolitan two iustices. police district, who, after the applicant has given such notice to the overseers who made the rate and such persons as such justices or magistrates think just, may hear the case in Kke manner as in the case of summary proceedings, and amend the rate so far as respects such error. 72. AVlienevcr tlie name of any person liable to be rated at the time the rate is made is omitted from any rate in the metropolis, or if any person is described in O"i'ssions from any such rate by a wrong name, the overseers may, after giving to such j)erson seven clear days' notice of their intention, apply to any two justices or any police magis- trate as aforesaid, who may hear the case in like manner as in the case of suimnaiy proceedings, and insert the name so omitted, or 88 THE ruixcirLE of katixg. The Law as ICnncted for the Jifeti'ojmlis only. correct the name so wrongly entered, and every sucli insertion and correction shall operate as if it Lad been part of tlic original rate : Provided that every person whose name is so inserted or corrected in any such rate may appeal against the same at the general quarter sessions of the peace which is holdcn next after such inser- tion or correction, in like manner as he might have appealed against the rate. Section 44, Act 1862. All the powers, authorities, provisions, clauses, and regulations now in force relating to the assessment, collection, Provisions concern- ^ ^ • p , / r .^ inp- the assess- ''^ levying ot poor-rates (save so lar as the same ment, &c., of are hereby repealed or altered) shall be good, valid, poor-rates to be ^^-^^ eiFectual for the piirposes of assessing, Icvyine:, applicable to rates ,, . -, ^ . , T / made accordine; to collectmg, and enforcing the pajnnent of such rate this Act. and for carrying this Act into execution. Extent of Act. 46. This Act shall extend only to England. Section 12, Act 1864. The provisions of the Union Assessment Com- 25 & 26 Vict., c. mittee Act, 1862, shall, as far as the same are not 103, incorporated cQ^^^trary hereto, be incorporated herewith, and the herewith. , , . -, n , , ■ i .7 terms used herem shall be construed m like manner as in tliat Act. 13. This Act may be cited as " The Union As- Short title. _, . "^ . , . ,or.4 J> scssment Committee Amendment Act, lou4. Section 46 of the Metropolis Act. Revision of Valuation-List. 46. Every valuation-list shall be revised in manner directed by this Act, and such revision in every period of Jive Mode of revising ^ ^^-^^^ ^^.^^ of ^^^^^ periods beginning with the valuation-list. ./ \ ^ 1 00 sixth of April one thousand eight hundred and seventy-one) shall be conducted as follows: — THE PRINCIPLE OF RATING. 89 The Laic as Enacted for the Metropolis only. (1.) In eacli of the first four years of siicli period a supplemental list shall, if necessary, be made out in the same form as the valuation-list, and shall show all the alterations which have taken place during the preceding twelve months in any of the matters stated in the valuation-list, but shall contain only the hereditaments afiected by such altera- tions. If no alteration has taken place which makes a supplemental list necessary, the overseers shall send a certificate to that efiect to the assessment committee in place of such list, which certificate may be in the form contained in the second schedide to this Act : rORir OF CERTIFICVTE ■WHERE NO SUPPLEUEXTAL LIST IS SE\T. We, tbe overseers of the parish of , do hereby certify that no alteration has taken place in the matters stated iu the valuation-list of this parish which renders a supi^lemental list necessary. A.B. ") Overseers of the parish CD. ] of (2.) In the fifth year of every such period the overseers shall make a new valuation-list : (3.) The same regulations shall be observed and the same pro- ceedings shall be had in the case of a supplemental list and a new valuation- list as are directed by this Act and the Acts incorporated herewith in the case of the valuation- list made in the first year after the passing of this Act : (4.) A supplemental list and a new valuation-list shall come into force at the beginning of the year succeeding that in which they are respectively made, in the same manner and subject to the same conditions as the valuation-list made in the first year after the passing of this Act : (5.) In each of the last four years of such period the valuation- list which w^as in force on the day before the commence- ment of each such year, together with and as altered by the supplemental list, if any, which comee into force at the 90 THE PRINCIPLE OF RATING. The Laud as Enacted for the .'ifcti'opolis only. commencement of such year, shall be the valuation-list which is in force during that year : (6.) A new yaluation-list when it comes into force shall super- sede the valuation-list which was in force dui-ing the fifth year of such period, 47. If in the course of any year the value of any hereditament is increased by the addition thereto or erection rrovision Tor thereon of any buildino:, or is from any cause valuing a house . * . . . ■, o ■,■, ■" built between the increased or reduced m value, the followmg pro- time at which the visions shall have effect : I (1.) The overseers of the parish in which such hereditament is situate may, and on the written requisition of the assessment committee or of any ratepayer of the union or of the surveyor of taxes for the district shall, send to the assessment committee a pro- visional list containing the gross and rateable value as so increased or reduced of such hereditament : (2.) A copy of the requisition shall be sent by the person making it to the clerk of the assessment committee, and if within fourteen days after the requisition has been served on the overseers they make default in sending such provisional list he shall forthwith summon the assessment committee, and the assessment committee shall appoint a person to make such provisional list, in the same maimer as is in this Act provided in the case of the overseers failing to transmit a valuation-list : (3.) On the receipt of the list the clerk of the assessment committee shall serve on the surveyor of taxes for the district a copy of the list, and shall serve on the occupier of any hereditament to which the list relates a copy of so much thereof as relates to that hereditament. Every copy shall be accompanied by a notice specifying a day, being not less than fourteen days after the date of the THE PRINCIPLE OF RATING. 91 The Lcnv as Enacted for the Metroj^olis only. service of the notice on or before which any objection to the provisional list may be made, and stating the mode in which an objection is to be made. Such copy and notice shall be served in the same way as notices by an assessment committee are served: (4.) An objection may be made to any such provisional list by the said occupier, and by the surveyor of taxes, or by either of them, by notice thei-eof in writing being served on the clerk of the assessment committee, on the over- seers, on the surveyor of taxes, and on the occupier, or on such of them as the case may require : (5.) The clerk of the assessment committee, on the receipt of the notice of any objection, shall forthwith summon a meeting of the committee, and give notice of the time and place of such meeting to the overseers, to the sur- veyor of taxes, and the occupier : (6.) The committee shall hear and determine on the objection in the same manner as if it were an objection to a valua- tion-list, and may make such order as they think just : (7.) If no objection is made, then on the expiration of the time for making objections, or if an objection is made then as soon as the assessment committee have determined on the objection, the assessment committee shall cause a coj^y to be made of, the provisional list, with any alteration made in it by the committee, and shall return the list and the copy thereof, after being dated and signed by their clerk, to the overseers : (8.) A provisional list, signed as aforesaid, shall have operation from the date of the service by the clerk of the assess- ment committee of a copy of the list and notice on the occupier, and shall continue in force iintil the first list (supplemental or other) which is subsequently made comes into force. 92 THE PRINCIPLE OF HATING. The Law as Enacted for the Metrojwlis only. (9.) Upon a provisional list coming into operation the overseers shall make sueli entries in the rate book for the then current poor-rate as will bring the same into conformity with such list, and shall also enter therein the date at wliicli such list is to come into operation, and shall charge the occupier of such hereditament with a proper propor- tion of such current j)Oor-rate, regard being had to the time which has elapsed between the making of such rate and the said date and to the rateable value stated in such provisional list, and such occupier shall be considered as actually rated for such sum from the said date, and be liable to pay the same, and the same may be enforced accordingly : (10.) A provisional list during the time that it is in force shall be deemed to form part of the valuation-list for the time being in force, and shall (so far as is necessary) be substi- tuted for so much of that valuation-list as relates to the same hereditament, and every rate and tax in respect of which the valuation-list is conclusive, which are respect- ively made or charged after the provisional list comes into force, and the proportion of the current rate charged as before provided in this section, shall be levied accord- ingly ; but if when the next revision of the valuation-list takes place the list as approved and altered on appeal contains a smaller value for the hereditament comprised in a provisional list than the value stated in such pro- visional list, the amount of rate or tax which has been overpaid in consequence of the larger value having been stated shall be repaid or allowed : (11.) Nothing in this section shall affect the value on which any rate is made or sura is assessed or contribution required wliich is made, assessed, or required on the totals of the gross or rateable value of parishes or unions. THE PRINCIPI,E OF RATING. 9o The Law as Enacted for the Metropolis only. Repeal of Acts. 77. The enactments specified in the fifth schedule to this Act, and so much of any other Acts, whether public or local and personal, as authorizes any valuation of "^P^.^' O' J^cts n6r6in dGScnbcdi hereditaments to be made for the purposes of any rate or tax in respect of which the valuation-list is by this Act made conclusive, are hereby repealed, where they relate only to the metropolis absolutely, and in other cases so far as they relate to the metropolis : Provided — 1. That the provisions of the Acts so repealed shall remain in force until the provision or provisions substituted for them by this Act shall respectively come into operation : 2. That this repeal shall not afiect the validity or invalidity of anything done or sufiered imder any of the said pro- visions while they remain in force, or any right or title acquired or accrued under any of the said provisions while they remain in force, or any remedy or proceeding in respect thereof. [End of the Law as Enacted for the Metropolis only.] 94 THK rUIXCIPLE OF RATING. The foregoing being the princiiDul laws under wliicli the fimds requisite for the relief of the poor are raised, it will be the object of these pages to show how the principle therein laid down is to be applied to the rating of the varioiis desci-iptions of hereditament. The law enacts that the rate shall be founded " upon an estimate of the net annual value of the several hereditaments rrmciple of as- yated thereunto ; that is to sa//, of the rent at which SGssmsnt to the ' poor-rate. ''^'^ same might reasonably/ be crpected to let, from year to year, free of all usual tcnanfs rates and taxes, and tithe coinunifation rent charge, if any, and deducting there- from the probable average annual cost of the repairs, insurance, and other expenses, if any, necessary to maintain them in a state to com- mand such rent." The principle herein enunciated is of the most comprehensive character. It is equally capable of determining the contribution of the smallest ratejjayer or of the largest ; of determining the amount of rate to be paid upon a hereditament of the most trilling annual value, or of a hereditament so great as to require the united contributions of many persons to create it. In the first jjlace, it will be advisable to consider the various tenures under which property is usually held. various tenures.^ ^^^^""^ are-^irst,^ on lease. Under this holding the tenant pays his rent and tlie rates and taxes, insures, and keeps the premises in repair. fBecond ly, On a yearly tenancy. Under this holding the tenant iisiialTy pays his rent, and the rates and taxes, but docs not repair ; and can either quit, or be required to quit, at the end of any year. Thirdly, A weekly holding. Under this holding, the tenant simply pays his rent ; the landlord pays all rates, insures, and repairs. The above are the conditions under wliicli property is usually held bv a tenant. THE PRINCIPLE OF RATING. 95 The Parochial Assessment Act has determined (as will be shown hereafter) that the second of these shall be the tenure under which property on which a rate is to ^^^f^- , , be levied shall be deemed to be held. It therefore ^lent Act becomes necessary to reduce all tenures otherwise held to this condition. In the first place, therefore, we will assume the hereditament to be a house held on a repairing lease, and under this tenure the average annual outgoings of the Rent under Lease, tenant to be as follow: — Rates and taxes £20 Repairs ... £10 ^ lusiu'aiice ... ... ... ... £% Rent £,m ^- The question, then, to be solved is, what will be the gross estimated rental and rateable value of such hereditament ? ( The gross estimated rental will be the rent, jyhis the repairs and insurance, viz. : £80, and the rateable value will be, not £Qd>, the rent paid under the lease, as mani/ . "" i^,'' ^.^^^ suppose, but such rent reduced by an amount, which ought to be set aside annually by the landlord for the idtimate renewal or reconstruction of the hereditament. This amount will entirely depend upon the life of the building, and will vary from 2| to 5 per cent, of the rent, and in some cases more. In some of the metropolitan parishes it is reported that the over- seers have, in making their valuation under the Metropolis Act, assumed the rent paid under lease to be the rateable value. The decision, however, of the Court of Queen's Bench, in the case of Queen v. "Wells (;? Law Beports, Q.B. 5J^2) clearly shows this to be erroneous. In this case two questions were submitted for decision, one of which was: — " Whether any allowance should be made in respect of any contingent or future renewal or re-construction of buildings and macliinery, or either, or which, and if so, to what amount? " 96 THE PRINC'IVI.K OV RATlNf;. And the judgment delivered upon the point, by Lord Chief Justice Cockburn, was as follows : — " The second question submitted to us is, whether nuy allowance should he made iii respect of any contingent or future renewal of buildings or machinery? We (ire of ophiioii thut such allowance ontjht to he niailc. Farm buildings and machinery are. by the effects of the weather, and of wear and tear, reducible to a state which will rentier than unwortltij of rcjiair, and necessitates their reconstruction. " They cannot at length be kept up but at an expense which renders it practically impossible, because not reasonably prudent, to keep them up. ProAision made for a future liability to reconstruct them, involving, as it ought to do, a prudential parsimony as respects all but temporary and indispensable repairs, is an expense which may properly be included among the expenses necessary to maintain a hereditament consisting in part of subjects perish- able, in a state lit to command tlie rent, and which it docs in fact while standing, and in use, command." Under a repairing lease the tenant has merelj'' to do tempor ary and indispensable rcjmirs. He has nothing to do wiia future re- cmihf)' uciwn, ina-t bin then falls upon the landlo rcL.^^^^^^^ 'I'ke rent therefore paid by him is not '* net rental," but "net rental" /;/«<« "renewals;" deduct for " renewals " and then you obtain the "net rental," or "rateable value." In the case of houses let by the week, the rent paid includes not only rent in its restricted sense, but also an amount for rates and all other out-goings which are in this case paid by the landlord, and not by the tenant. To reduce weekly tenements to the conditions of yearly hold- ings, it is necessary to consider in the first instance what the advantages or di.sadvantages of such holdings are, as compared with those from year to year. In the first place when, property is let from week to week, the landlord has to call Jifty-ttco times in a year for his rent, but in the other case he has only to apply four times, i.e., the weekly holdings give him thirteen times as much trouble as the yearly. In order therefore to place the two holdings upon a footing of equality with regard to their respective gross earnings it is necessary to make some deduct ion from the total THE PRINCIPLE OF RATING. 97 yearly receipts for the extra trouble of collection. This may be taken at about 5 per cent, of the total receipts. A further deduction again must be made for rates, and then we arrive at the gross rental which might be expected on the usual terms of a yearly tenure. From this gross rental, in order to arrive at the rateable value, must next be deducted an amount for rej)airs, renewals, and insurance, which amount will vary from 20 to 30 per cent., according to the durability of the hereditament. But since the rateable value of a weekly holding depends upon the amoimt of rates, and these can only be ascertained by knowing what the rateable value is, we therefore at once encounter an alge- braical equation, which must be based upon the following reasoning : That the rod is the rateable value plus the repairs, &c. ; there- fore the rateable value is the rent minus the repairs, &c. That the repairs be taken at 20 per cent., or one-fifth of the rent, in which case, therefore, the rateable value will be four-fifths of the rent. And lastly, that the repairs are one-fourth of the rateable value. Putting s for the sum of the rateable value, the repairs, and the rates (taken by hypothesis at 6s. in the pound), and x for the rate- able value, then we shall have to find r, the rates. bmce the rejDairs — ~r (■'■ + t) And, solving this equation, in which we must substitvite the value of X in terms of r, 10 . 3 or -J- r for r = t— x by hypothesis, 6 we have r — — s. 81 And it will be seen that, whatever the conditions may be, r can ahvaijs be expressed in terms of s. H 98 THE PRTNCIVLK OF 11 ATI NO. These results may appear somewhat difficult to apply, but they are not so actually. Throe or four scales could easily be computed, in each of which the allowance for repairs would diifer, and would depend on the durability of the property to be assessed. Thus, one scale Avould be applicable to well-hmlt brick tenements, a second to «T//-built iroodoi tenements, a third to 5^r////-built brick tenements, and a foui-th to bad/fz-huilt icoodcn tenements. Overseers of parishes, possessing such scales, would simply have to determine the class of tenement to be dealt witli, and the weekly rent paid ; and then, from the scale applicable to such case, ascertain its proper gross and net rental. Upon the question of f enure, the following case, to which refer- ence has ah"eady been made, was recently brought before the Court of Queen's Bench, and the importance of the judgment pronounced in connection with the principle of rating is so great, that it is deemed ad\'isable to quote it here in extensor Queen v. Wells, 2 Law Rcport.% Queen's Bench, 64^. The case found, after setting forth the gross estimated rental, and the rateable value as entered in the rate, that — "1. The sums which appear in the cohimn headed 'gross estimated rental' are the actual rents paid hy tlie occupiers whose names appear against them respectively, and are fair and hondjidc rents, and represent the rents at which the hereditaments might reasonably be expected to let from year to year upon the customary terms between landlord and tenant ; that is to say, in tlie case of the properties the subject of the present appeal, the landlord paying tlie insur- ance, and providing timber, bricks, tiles, and lime, for repairs, and the tenant carting such materials, and providing all other materials for such repairs, in- cluding straw for thatcliing. and paying the cost of the labour for doing such repairs and thatcliing, and also paying all usual tenant's rates and taxes, and the tithe commutation rentcharge." 2. The case then went on to find that — " The probable average annual cost of the repairs, insurance, and other ex- penses necessary to maintain them in a state to command the before-mentioned rents, is — THE PRINCIPLE OF RATING. 99 " 1. For dwelling-houses £W 2. For farms with farm-lioases and buildings ... 1-t 16 7 3. For lands without farmhouses and buildings... 3 10 4. For water corn-mills ... ... ... ... 22 11 6 "3. Of tliis total outlay the proportions borne respectively by the landlord and tenant, under the above terms of tenancy, are as follow : — Landlord, Tenant, per ceut. per cant. " 1. Dwelling-houses ±--20 £0 2. Farms with farm-houses and buildings ... 10 7 4 3. Lands without farm-houses and buildings 1 10 2 4. Water corn-mills 19 11 5 "4. In the cases of the iirst, second, and fourth items, the percentages set forth in the above second paragraph include allowances in respect of any con- tingent or future renewal or reconstruction of buildings and macliinery. " The questions for the opinion of the court were — "1. Whether, under the above terms of tenancy, any portion of the cost of repairs which is borne by tlie tenant ought or ouglit not to be deducted fi-om the rent actually paid in order to arrive at the net annual or rateable value of the premises? " 2. Whether any allowance should be made in respect of any contingent or future renewal or reconstruction of buildings and machineiy, or either, or which, and if so, to what amount ? "The judgment of the court (Cockburn, C. J., and Shee, J.) was delivered by Cockburn, C. J. " Two questions present themselves for our decision in this case, both turning on the construction to be put on that part of the 1st section of the Parochial Assessment Act, & 7 William IV., cap. 9(5, which provides that in estimating the value at which property is to be assessed, a deduction is to be made from tlie rent at which the same might be i-easonably expected to let by the year, and which is to be taken as the criterion of value of the probable annual average cost of the repairs, insurance, and other expenses necessary to maintain it in a state to command suclx rent. " The first question is, whether, where houses or other buildings, either with or witliout land, are let to a tenant, and the tenant agrees to take upon himself, either wliollj' or in part, the repairs and other expenses to which the section refers, and which would ordinarily fall upon the landlord, an allowance is to be made in respect of such repairs and expenses, as though they were defrayed by the landlord. " On the hearing, we were disposed to tliiak that, as the rate when assessed is to be paid by the occupier, tlio tenant, the repnirs and other expenses H 2 100 TllF. I'laXCIPLF. OF KATING. nec3ssary for keeping the property in proper condition, wliich lie has tlnia taken upon himself, might, as against him, he taken as so much rent, and I would not, in his hands, be capable of being deducted. On farther cousidera- tioa, however, we are of opinion that the standard of value adopted by the legislature, is the value of the property to the owner, whether it remains in liis , own occupation, or is let to a tenant. Now, to the o^vner, the measure of tliis value is the rent at which the propertj' is let, or might be let, subject to the deduction which such ouner, as a prudent man, ought to make from the available income which the rent would otlierwise aflbrd, in order to meet the expenses ncccssaiy for keeping the premises in a state to command the rent. "AVherc, by an arrangement between tlie landlord and the tenant, the latter takes upon liimself to defray these expenses, or any part of them, it is obvious that the rent he can afford to pay will be pro tanto less than if such expenses were borne by the landlord. Wc cannot think the statute meant to make the rateable value of the 2>n'mises depend on the terms on which they are actually let, hut upon that rent which miglit reasonabty have been expected if they had let on the statutable terms. In order, therefore, to give effect to the intention of the legislature, it is necessary to consider these expenses as added to the rent, but tlien as to be deducted by the landlord; thus leaving the rent actually paid 1)3' the tenant as the amount on wliich the rate ought to be assessed. We therefore answer the first question bj- saying that the cost of repairs borne by the tenant ought not to be deducted from the rent actually paid, and that the rent so paid is the rateable value of the premises. " The second question submitted to us, whether any allowance should be made in respect of any contingent or future renewal of buildings or machinery? We are of opinion that such allowance ought to be made. Farm buildings and macliinciy arc, bj' the cfTects of the weallier, and of wear and tear, reducible to a state which will render them unworthy of repair, and necessitate their reconstruction. They cannot, at length, be kept up but at an expense which renders it practically impossible, because not reasonably prudent, to keep tliem up. " Provision made for a future liability to reconstruct them, involving, as it ought to do, a prudential parsimony as respects all but temporary and indis- pensable repairs, is an expense which may properly be included among the ex- penses necessary to maintain a hereditament, consisting in part of subjects perishable, in a state fit to command the rent, and which it does, in fact, while standing and in use command. Tliere seems also no distinction in principle between a sum annually laid b}' to make good, wlicn it shall become necessar3% an inevitable loss by the destructive agency of time, and a fund laid by for an indemnity against a loss by fire or storm, or other peril assured against. THE PRINCIPLE OF RATING. 101 " But although a deduction, in respect of the amount wliich ought, as a matter of reasonable prudence, to be set aside by the owner of property for the reconstruction of buildings or macliinery, ought to be made from the rent before the latter is adopted as the test of value, yet, luider the circumstances of the present case, the reasoning on which our answer to the first question is founded is equally applicable to the one now imder consideration, and we are therefore of opinion that no allowance ought to be made in respect of this head of allowance. The tenure of tlie Parocliial Assessment Act is constantly ignored by company's witnesses in giving evidence in support of appeals against a poor rate. Of the many estimates which I have heard given in evidence by company's witnesses, I have never heard one framed in accordance with the statutable tenure, nor one in which the rent proved was the rent under the Act. The amount paid to the landlord imder the statutable tenure is the gross estimated rental ; and the residue thereof, after the specified deductions have been made, is the net annual value. The "gross rent" being determined, the next question is, " What deductions are to be made in IJeouctions rrom tuG 2^1083 6St ■ order to arrive at the ' net annual value ?' " mated rental. These deductions are — repai rs, i nsuranc e, and other expenses (if any) necessary to maintain the premises in a state to command such rent. The first two items require no particular remark here, their nature being self-evident. The third deduction being more com- prehensive, it becomes necessary to set forth the allowances which must be made to comply with its requirements. First come renewa ls of the subject-matter of the rate. It is evident that many classes of property will, however much they may be repaired, ultimately perish, and must therefore be rencAved from time to time. Another deduction, which has recently been claimed and allowed, is the amount of sewers-rate. {R. v. Ovc7'- sccvs of IFcnniiujfon, 84 L. J. (N. S.) M.T, IV. j' This deduction was allowed upon the following grounds : — First, although not a " usual tenant's rate," yet the tenant fre- quently agrees to pay it, in which case the rent he would pay 102 THE VRINCII'LE OF HATING. would be less by the amount so paid. If the tenant did not ag-rce to pay it, then, inasmuch as property properly drained will fetch more rent than if it be not drained, the expense of keeping the drains and sewers in proper order must be met, to enable the "premises to continue to command that rent." The 2)robab/e average annual amount only of each of the above must be deducted. From the allowance of these deductions it follows, that a property is assumed aJtcaijn to continue of equal value, so far as condition is concerned. No age is supposed to affect its rent, for allowances are ordered to be made in order continually to counteract the effects of wear and tear. Of course no Act of Parliament can provide against a change of value when the change is produced by altered circumstances. Thus a man has no right to claim a reduction in the rating of, say, his house, upon the gromid that it is old and very much out of repair. If it is out of repair, it is his own fault. It is his duty, as soon as the house is finished, to lay by annually a sum for its due repair, when it shall need it. Having showni what is the principle upon which all properties are to be rated to the relief of the poor, the next Application OT itie ^j^ -^ ^^ consider the various circumstances principle. \ ^ which would influence a tenant in determining the amount of rent he Avoidd give for each of the several classes of hereditaments. First in order is land, as being the fomidation of all other real property. I^and may be divided into two divi- Uno in 'is sions, viz., m-azinff-land and arable-knd. Of these simplest form. . . two, grazing-land is the condition in which land naturally exists, and shall, therefore, be treated first. The most elementary condition in which grazing-land could exist would be as unenclosed prairie; the state in which large quantities of land may be found in Australia, America, and in all other partially-occupied countries. The rent that land in this con- dition would command would be but small, but nevertheless some- thing would be given for the j)rivilege of being permitted to use THE PRINCIPLE OF RATING. 103 such land for depasturing sheep or cattle upon. The amoiuit of rent so given would depend upon the innate goodness of the land, the water accommodation, and other matters. But however good the land, the rent would not be much, because the tenant from year to year would consider that he would be liable to much anxiety and loss from the liability of his sheep and cattle to stray, being stolen, or injured. And he woidd consider that he would incur expense in obtaining labour to take charge of his stock. The rent paid for such land would be both the gross and the net amount, for there woidd be no deductions to keep the land in a state to command such rent, and the landlord wovdd be at liberty to appropriate to his own use the full amomit paid to him. The first improvement that would be made in the condition of the land would be by its enclosure. For as soon , , , , . -^ Land enclosed. as this was done, it would, m consequence, com- mand a higher rent; because some of the disadvantages above- named would no longer exist, and others woidd be much lessened. AVith the enclosure of land would commence its conversion into arable. For arable purposes land of the best quality woidd be chosen, both in order that the least labour should be required to cultivate it, and that the best crops might be produced. Then, as population increased, and the demand for the articles produced became greater, the profit made by producing and selling the articles would become greater also. But the tenant would not be allowed to appropriate to himself the whole of this increased profit, for the landlord would expect to be paid a larger rent for the use of the land whereby the tenant made his increased profit; for he would contend that it was by no means due to the personal exertions of the tenant, but to the improvement in the general condition of affairs. As population and capital increased, the land, which we have hitherto considered as beinf? o:razino:-land, at first 1 f4 UA' 'A A unenclosed, and subsequently merely enclosed, • 'I'l f ^"^ s'^' ^ would further change its character. The land- lord would find an increased number of applicants for the use of 104 THE TRIXCIPLE OF RATING. liis land ; cacli of whom -u-oiild be willing to pay a larger rent per acre for a smaller holding than the tenant, who used the land for grazing, would pay per acre for a larger holding. In consequence, the land would be gradually converted into a number of farms, consisting of arable and meadow-land, let to tenants paying a higher rent than was previously obtained. This conversion would, however, be attended with more or less expense, which expense must in theory be borne by the landlord. It may be objected that the course of change would be rather by tlic large tracts of land being broken up into smaller tracts, and then sold and not let ; and that the purchaser would himself have to pay the expense of roads subdividing the land, and of other incidentals. The answer to this is, that though in fact such would be the course of things, and that in this, as in a new country, we fre- quently find the occupier of a farm to be the owner also ; yet, for the purpose of this investigation, his tenure, whatever it may be, must be reduced to the condition of a holding /;-ow year to year. From whom the tenant holds his property is perfectly imma- terial. He maj^ hold it from himself, and so fill the two situations of landlord and tenant ; or he may only fill the position of tenant. The Act of Parliament does not sa}- that the premises are to be let from year to year, but only that the rent, at which they would let from year to year, is to be the basis of the assessment. In determining the value to rent of enclosed land, it becomes necessary to examine each enclosure, and to determine the yearly value thereof. In so doing, the tenant Avould be guided by the productive qualit}^ of the land, its aspect and .situation with i-egard to the homestead, the case or difficulty Avith whicli it coidd be cultivated, and by the amount of profit which would remain after expenses were deducted. In detcnnining these things, he woidd be influenced by considerations of the distance he would have to convey his crops to market, the state of the roads leading thereto, the amount of the rates in the pound, and of other minor matters. THE PRIXCIPLE OF RATING. 105 Altliougli land in tlie condition of a farm would command a higher rent than in its elementary condition, it might be so situate as to be capable of further ini- '-^^^ ,,,! ."^' / . . proved by draining, jDrovement, either by means ot drainage, irrigation, ^q_ or other alterations. These improvements must be taken to be done by the landlord. "When made, the farm would command a higher rent than before, either because it would thereby be rendered more f>roductive, or might be worked at a less expense. It is true that, as a matter of fact, these improvements are fre- quently made by the occupier. But in that case he has a long lease of the farm, and usually at a rent so low that he can pru- dently expend his money upon another man's land. But such a tenant would be liable to be rated for the land, not at the rent which he actually does pay, but at the rent which he would pay if he became the tenant of the farm in its imjDroved condition. The most valuable condition in which meadow or pasture land can be placed is that of accommodation land, and when the rent at which it may reasonably be ex- A^ccommodation pected to let is so great that the net produce of the land would not even pay the rent ; but this is of secondary con- sideration to the tenant of this class of land. He does not rent it to obtain a direct profit for himself, but for the sake of other ad- vantages which its holding secures to him. Also with regard to arable land, the most valuable condition in which it exists is when it is devoted to srrowino' ,, , , , . Market garden, market-crops. Here, however, the rent paid must always be such as to allow the tenant a profit for himself. Upon consideration it will bo evident that the portions of land which can be used for this purpose are limited, on account of the numerous conditions that must co-exist ; such as fineness and richness of soil, proximity to large to\vns, and easy access thereto. The next transformation wliieli land undergoes is when it be- comes the site of buildings. Under this condition it has again greatly improved in value, and com- ^ p' ^} ' mands a higher rent than previously. Then, for 106 THE piiixcirLE of katixg. the first time, the element of its productiveness is entirely left out of the calculation of the tenant, when he is detci-mining the amount of rent he is willing to give. In settling this he looks only at the accommodation the house or other premises tuilt upon the land afford, their situation, and the number of houses available for his choice. It matters nothing to him by whom the house has been erected ; whether by the landowner, or by a speculator who has taken a lease of the ground. Neitlier does the tenant inquire into the nature of the tenure upon which the house is held by the person to whom he is willing to pay a yearly rent : whether he owns the house and land, or whether he only owns the house, or whether both the land and the house are mortgaged, such questions matter nothing to the tenant from year to 3'ear. Finding a house suited to his requirements, he is willing to pay a certain rent for the use thereof. Whatever subsequently becomes of the rent is immaterial to him. As to the amomit of rent paid, it so entirely depends upon situation, that nothing can bo said upon that point. The Jand in this case seems to command no rent for itself; but this is only apparently the case, for the rent paid by the tenant is such as to include a payment both for the use of the land and of the house which stands upon the land. It might sometimes happen that the tenant would have to pay rent to two landlords — one to whom the land belongs, the other to whom the house belongs ; but this circumstance would in no way affect the amount ; for whether he paid rent to one or to many landlords, the total rent he coidd pay would be the same. Similar considerations would influence a tenant in determining the amount of rent he could give for a shop, or a house and shop, when the greatest prominence woidd be given to tlie question oi nit tint to it. He could afford to give a higher rent for an inferior shop in a good situation than lie could for a better shop in an inferior situation. l*riti,i( Houses. K prudent tenant before estimating the rent he could afford to give for this class of property, would recpiire to kiKnv what the THE PRINCIPLE OF RATING. 107 " takings " were, and out of these, his experience would doubtless have taught him Avhat per-centage he could judiciously part with as rent to his landlord. The amount of this per-centage would in a great measure depend upon whether the tenant could obtain his Kquor from Avhere he chose, or whether he would be obliged to obtain it from one person — technically speaking — whether it was a " breurr'ti " or a "free house." Mansions. A question which has caused much discussion is in what manner shoidd the rent, which a tenant from year to year woidd give for a nobleman's mansion or house of a special character, be ascer- tained ? This question appears somewhat surrounded witli difficulty, in conseqvience of houses of this class very rarely being let, the tenants being almost invariably the hereditary owners. Therefore, the test of comparison which is applicable to ordinary houses is in- applicable here. These houses differ from the ordinary ones inasmuch as the latter are built on purpose to be let, whilst these are built solely for the o^\Tiers' residence and convenience. In building these houses very little regard is paid to the amount of money expended ; the only consideration is to make them suitable for the owners' requirements. In an ordinary house, whether built for the owner himself to dwell in, or for the express purpose of being let, attention, more or less, is paid to the return which may be expected upon the outlay ; and generally, although a man occu- pying his own house will be satisfied if the rent which it woidd produce, if let, be sufficient to pay him a somewhat less interest for his money than he could obtain if he invested that sum of money in other ways ; yet he always will expect that it will pro- duce nearly as much interest. Where houses are built expressly to be let, it is expected that the investment M'ill produce a greater interest than other securities. But in the case of noblemen's seats, money is expended upon 108 THE PRINCirLE OP^ RATING. tlicm witlioiit tlic sUg-litcst consideration of the return whicli the investment would in-oduce. In settling, therefore, the rent which such places would com- mand, regard must be paid to the following considerations : — In the first place, the number of tenants available for such places is limited, since the tenant mnst be one possessing a large income. Living in such a house would of necessity involve a very great expense, entirely independent of the amount of rent paid. I3ut, on the other hand, it must not be assumed that the rent of such houses should be settled at a very low sum as compared with the convenience and comfort they afford. For, in the present flourishing condition of this coimtry, there are persons possessing large incomes who would be willing to pay great rents for such houses ; but who, if the houses were not available for them, would not be willing to create for themselves similar ones, because the expense of so doing would be more than they might be willing to incur. Again, many very large seats have much altered in their value in consequence of a change in the habits of society ; much of the accommodation that they afford being unsuited or unnecessary for our present customs. The rent of this class of property will, therefore, have to be settled by duly balancing these various considerations. The next class of hereditaments which may be considered, is that in which land is occupied by business premises Business premises, other than shops. manufactories, tj- • ii. j . i} t^ • jj j i. windmills, water- ^^^^^ ^^^^^^ tlie test of "comparison to a great mills, &.C. extent fails; for it will frequently liappen that one hereditament used as business premises occiu's in the midst of house property ; and tliere being no other similar premises near, no comparison can be made by which to measure its value. Hence it must be considered what circumstances may be supposed to determine the rent that a tenant from year to year would give for such premises. It is frequently found that, of premises of this nature, the occu- THE PRINCIPLE OF RATING. 109 pier is at tlie same time tlie owner ; but for tlie purposes of this inquiry the two functions must be entirely separated. It can readily be conceived that tbe occupier wanting premises of a certain description, and finding none to suit bim, may agree witb one who bas capital wbicb be wisbes to invest, to build for bim sucb premises as be requires, wben be would become a tenant tbereof. Tbe one wbo agreed to build would bave to provide tbe land on wbicb to build, and tbe labour and materials necessary to construct tbe premises. He would bave to provide tbe land, eitber by purchase or by securing a building lease. First, assume tbat be purchases it. Having completed tbe premises, the tenant would then pay him such a rent for the use of them as secures to bim not only a fair return upon the capital invested, but also a yearly amount to cover the expense of repairs, insurance, renewals, and other matters, if any, necessary to maintain the premises " in a state to command such rent." In settling this rent, tbe amount actually expended would not of necessity be the basis of the calcu- lation, for the creator of the hereditament might bave spent money unnecessarily and injudiciously ; but if no more bad been expended than was judicious, then the amount paid as rent would be sucb as to secure to the landlord a fair return upon the money expended, after tbe landlord bad himself, out of the rent, provided for such outgoing as he must incur. Again, suppose tbe creator of tbe hereditament bad not purchased the land, but had leased it. He would then have to pay the rent of tbe land. The capital, there- fore, be would have to find would only be that requisite to con- struct tbe buildings upon tbe land. Under this condition of things the rent paid by the tenant would be tbe same as before ; for, whether the creator of the hereditament owned the land or only leased it, tbe entire hereditament would be of the same value to tbe occupier, because it would in consequence be neither more nor less commodious. The creator of the hereditament would, out of tbe rent paid to liim, bave to pay tbe ground rent, and thus leave himself a less sum than be received in tbe previous case. But in- asmuch as be bad expended less in creating the hereditament, be 110 THE I'llINCIlM.E OV RATING. would got the same rate of return for the money he had expended as in the other case. The objection may be taken that no one would be found to erect premises for a tenant from year to year. It is quite true that in fact the tenancy would be under a lease for a term of years ; but it has already been shown that the conditions of a tenancy under a lease may be reduced to the conditions of a tenancy from year to year. Here, where the occupation really would be for a term, the tenant would not only have to pay the rent, but also to do the re- pairs himself ; but the residt would be the same, for having to do repairs, he would pay so mucli less rent to his landlord, and his landlord, having no repairs to do, would, aifter he had paid the ground rent, and laid by his annual quota for idtimate reiicira/, be able to appropriate to his own use the whole amount that remained. Neither would the case be altered if the occupier, instead of agree- ing with some other person to build the premises for him, were to build them for himself. He would in that case simply pay rent to himself. It is to be borne in mind that the condition of a tenancy from year to year does not involve a cJiange of ioxint yearhj, although it does alloAv the yearly readjustment of the rent paid. Instances are continually met with where a holding under a yearly tenancy has continued longer than a holding even inider a lease. MaCIIIXERY TX BriEDIXGS. Again, if the nature of the business carried on by the occupier involves the use of machinery so fixed to the building as to be jiart and parcel thereof, so long as it continues fixed to the build- ing, the rent tliat the occupier must be deemed as paying must be such as would include a sum for tlie use of the macliinery, as well as for the use of the buildings. This result will be arrived at by the same considerations as those by which the rent of the building must be estimated — that is, by consideiiug llial llic machinery has been provided by the lainllfird, and that when provided tlie occu- THE PRINCIPLE OF RATING. Ill jiier pays rent for it. It is perfectly true that the machineiy may really belong to the occupier, but it will usually be found, if that be the case, that he has a lease of the premises, and that, had he not a lease, he would not have put the machinery in, but would rather have rented premises with machiner}' alread}^ attached. It may be asked whether all machinery in business premises must be rated, regardless as to whether it belongs to the occupier or to the o^vner. To settle this question, the fact must be deter- mined whether or not the machinery is of such a nature that it must be let from year to year. A few examples will make this clear. First, let the case of a mill built for a specific business, and fitted \^dth the requisite machinery for carrying on that business, be taken. Such an erection will consist of land, buildings, machinery, and steam-power, whereby the machinery is driven. Such an hereditament as this woidd have to be taken as being let altogether, for it could only be used for the purposes for which it was erected, and no one taking such a place from year to year would be willing to provide the machinery and the steam-power. The rent paid for such a projoerty would of course be subject to a much larger deduc- tion for repairs, insurance, and renewals, than the rent of an ordi- nary dwelling-house. Again, let the case be taken of premises so constructed that they could be adapted to any purpose, and suppose such premises to be fitted with a steam-engine, boilers, and shafting, but with no machinery. They are taken as being supplied with steam-engine, &c., because no tenant from j^ear to year would be at the exjaense of erecting these, but finding them together with the shafting, he would be Avilling to pay a rent for the building, and for their use, much larger than he would be merely for the building. He would himself supply the machinery necessary for business, and this he would connect Avith the shafting. But the machinery thus sup- plied would not be lateablo, because it is not necessarily let AWth the premises from year to year. 112 THE riiixciPLE of rating. The limits within wliieli macliinory is and is not rateable liavc been very clearly defined by the two following decisions 'of the court. Limits within which machinery is rate- First, as to the rateability oi machines. ^ijig. In the case of H. v. Overseers of f/ie Parish of Lee (1 Law Reports, Q.B., 241), the question was raised whether certain plant and trade fixtures requisite for the manufacture of gas were rateable. This plant and trade fixtures were fully described in the case. They consisted of steam-engines and boilers, retorts, condensers, exhausters, purifiers, and meters. AVith I'cgavd to the meters, the court ruled that they were tenant's chattels, and therefore not rateable. But Avilh regard to the steam-engines, the boilers, the retorts, the condensers, the exhausters, and the purifiers, the court ruled that they were rate- able. Lord Chief- Justice Cockbui*n said: — '• Whatever doubt hung over the case at the commencement of the discussion has been removed by the ai-guments. I entirely agree that we must look, not to , the position of the particular tenant, as to whether he has had to i)ay so much money down for the machinerj^ and fixtures which arc necessary for carrying on the works, but we must look to see what, as the whole concern stands, would be the rent that an imaginaiy tenant would give for the thing as a whole, exchid- ing of course from consideration whatever would be mere chattels, and there- fore would not pass under demise from the actual to the imaginarj'- tenant. The way being thus cleared, I think the case presents really no difficulty. First, we think Mr. White has failed altogether to show that the meters are anything more than common chattels. The other tilings, it is plain, fall under one of two classes of articles, which are properly taken into account as enhanc- ing the value of the building. In the first place, witli regard to the retorts. Mr. O'Malley's argument has satisfied mj- mind upon the facts stated in this case, that the retorts are so permanentlj- attached and annexed to the freehold, so fixed to the freehold, as to become part of it. and they must be taken, there- fore, not as removable fixtures at all, but as fixtures so connected with the freehold as to become part and parcel of it. With regard to them there is no difficulty; the moment they are found to be part of the freehold, then, of course, they are rateable as the entire freehold would be. The other items seem to me, one and all, to fall under the principle of the decided cases referred to in the argument of 'The Queen v. The Southampton Dock Company, and The Queen v. 7'he North StalJ'ordnhire Railivuij Company. In the latter case, the THE PRINCIPLE OF RATING. 113 Court, after taking time to consider, laid down tliis rule : — That where things which, though capable of being removed, are yet so far attached as that it is intended that they should remain permanently connected with the under- taking, or the premises connected with it, and to remain permanent appendages to it as essential to its worldng. those must be taken to be tilings increasing the rateable value of tlie land, and in respect of which the company were not en- titled to have a deduction made. That principle apphes du-ectly to the pre- sent case. No one can doubt here that the puiifiers and the gasholders are part and parcel of the works, which are absolutely necessary for the manufac- ture of gas, which is the purpose of the undertaking. No one can doubt that it was intended, when those things were erected, that they should remain per- manently connected with those premises, tliat they should remain permanent appendages to it as essential to its workiug. They therefore fall within the rule laid down by the coui't in that ease." Justice Blackburn : — " I am of the same opinion. The rateable value of the premises is to be determined, according to the Parochial Assessment Act, according to the rent that a hypothetical tenant, making the suitable deductions, would give for the rateable property ; and the sessions have quite properly proceeded to tiy to ascertain that. It was disposed of early in the case that the question is, "What would a hypothetical tenant give for the whole of the rateable property ; and although, in point of fact, as stated in the 18th paragi'aph of the case, the person who actually did occupy would not pay rent for portions of the property wliich are fixed to the rateable premises so as to become j)art of it, which would be capable of removal, because instead of paying rent he would purchase tliem, yet we are agreed we must look to what a hypothetical tenant, taking a portion of the premises as they stand, would give for them with those portions .wliich were annexed to the property so as to become part of the rateable property. Upon that, so far as that goes, the sessions were wrong. The rule laid down has been that where the thlnys are attached to the premises so as to be part of the premises, although they are removable afterwards, still they are part of the premises, althowjh there may be a right to remove them. But if things or chattels be merely fixed to the premises, and so far fastened to the premises as to be still chattels, but fixed and steadied for the purposes of use there, they re- main chattels altogether, so that they would not be part of the premises at all — they would never cease, to use the phrase in the case of Hellawell v. East- tvood, to have the character of movable chattels ; although fixed for the pur- pose of the oujoymeut of them, still thej' remain movable chattels. The com- mon illustration is a mirror which, in the ordinary way, would be screwed to the wall ; still it remains a moval)le chattel, and is no part of the premises. I 114 TIIK PRIXC'IPLE OF RATING. On the other hand, a gi-ate which is huilt into a chiiunc}', although it is capable of being removed by a tenant, would still be fixed to the premisea, so that it would be part of the premises, and therefore part of what would be considered to be let to tlic lu'pothetical teuiuit and for which he would pay rent. That was the principle laid down in the case of R. v. North Staffordshire RaVway Com- pany, where the things were similar to those in R. v. Southampton Dock Com- pany. It was not of coui'se in the precise words, but the same idea is con- veyed. The things were cranes, turntables, and a variety of other things, which w^ere attached to the premises of the railway company, in one sense screwed down, some of them firmly attached, and some of them not. The court said that tlie things which were not attached to the freehold were to be deducted, and an allowance made for them ; and the things which were affixed to the freehold clearly enough would not be allowed for. Then the rule laid down to guide the sessions in what they were to do was tliis : ' The articles may bo divided into three classes — first, things movable, such as office and station furniture.' As I have said, all the cases agree in the principle. It is clear these are not to be included. ' Secondly, things so attached to the free- hold as to become part of it.' It is clear on the principle of all the cases that no deduction is to be made for them, and they are to be considered as part of what is left. ' Thii-dly, things which, though capable of being removed, were yet so far attached as that they were intended to remain permanently con- nected witli the railway or the premises connected with it, and to remain j)er- manent appendages to it, as essential to its working.' " Justice Lusli : — " I am of the same opinion. Tlic sum to be arrived at is ' the net annual value of these premises at which they might reasonablj' be expected to let from year to year, free of all usual tenant's rates and taxes, deducting the expenses necessary to maintain them in that state.' The question is, what is the rate- able subject which is comprised within the premises to be rated here? Now I apprehend that the premises to be rated arc to be taken as the}' are, with all their fittings and appliances by which the owner has adapted them to a parti- cular use, and which would pass as a part of the premises by a demise (jf them to a tenant. It strikes me as expressing what in other words has been ex- pressed in the two cases referred to by my learned brethren— ^wherever they have become so far a part of the premises that they would pass by a demise of those premises, they would form a part of the rateable subject of the inheritance in the value for the purpose of rating. "When we have to fipply that test to any particular footing, the question is not what a tenant might remove, not what might be taken in execution under a writ against the owner, but what, as between the landlord and tenant, would pass as a part of the premises which THE PRIXCIPLE OF RATING. 115 he was to let, and what the tenant would take. Now, applying that rule, I cannot entertain a doubt that, with the exception of the meters, all the subjects of discussion here would pass as a necessary part of these premises. Without the retorts, purifiers, the steam-engines, and the gas-holders, the premises would be worthless for the purpose for which these tilings were erected — they would not be a gas manufactory at all. All these things are fixed and so far annexed as to be intended to be permanent, and as really necessary for the use of the premises as gasworks. Therefore, I think, except the meters, that the whole of these items ought not to be allowed in ascertaining the ultimate net annual value. I was struck in the early part of the argument with the finding in the 18th paragraph of the case. It appeared to me to distinguish this from the other cases, and for a time I entertained considerable doubt whether, on account of what was found there, all those items, although forming part of the rateable premises, ought not to be deducted. The finding is that, ' according to the practice and course of business in letting and liiring gasworks, the tenant would have to take to and find capital for all the property comprised under the heads meters, retorts, tenant's fixtui'es, and utensils, and would have to provide ^£150. 000 for that purpose, and that a deduction in respect of such outlay was to be made in estimating, according to the pro\dsions of the Paro- cliial xissessment Act, what rent a tenant from year to j-ear would give.' It struck me at first that, being so, the tenant would be bound to take these pre- mises, making an outlay by purchasing all these articles, and the rent he would pay would be so much less, and that rent would represent the rateable value. Upon consideration, I quite agree with my brethren, and I am satisfied that that is not the right view, on the hypothesis that all these things, except the meters, do form part of the rateable subject, and ought to be taken into considera- tion in estuuating the rateable value ; because if a tenant and a landlord agree, the landlord, before the place is let, agrees that the tenant should pay down a price for part — that is, purchase part of the freehold — to say that the rateable value would be diminished would be absurd. I quite agree with my brethren, therefore, that it makes no difference at all whether the tenant takes the whole, assuming he did, or whether by contract between him and the landlord he pui*- cliases the fixed plant, which, if not so purchased, v ould be a part of the per- manent premises, I quite agree tliat except the meters all the other mattei^s are rateable, and that all of them ought to be disallowed." Next, as to tlio non-ratcability of machinery, wo liave the case of li. V. the Orcrscos of Hahtead (Justice of Peace, vol. xxxi. p. 373). In this case the parish sought to rate the appellants for certain machinery used by the appellants in their business of silk winders and throwers. These machines, though bulky, were very light, IIG THE PRINCiri.K OV RATI NO. and were fixed to the floor or to the walls for the purpose of being steadied. The buildings in which the)'- were, were ordinary factory buildings, supplied with steam and water power, and could be used either for the purposes of a silk factory, or for any other purposes in which steam or water power was required. The case, after fully describing the machinery, found that " The machines are movable at will b}' being taken down, and pnt up either for repairs or re-arrangement, or change of use of the building from tlie silk trade to any other factory purpose, or any other cause, without damage or injuiy either to the machinery or to the buildings, and are coumionly bought, or sold, used, and renewed as chattels." The question for the court was whether this machinery was rateable. Judgment was delivered by Cockburn, C.J. : — "I think there is no difficulty in holding that the chattels and macliineiy used in this mill are not rateable. They arc no doubt fixed to the freehold, but not so as to make them part of the freehold. According to the recent cases, if the chattels are so fixed to the fi-eehold that on a demise they would pass with the premises, then they maj' be taken as part of the rateable value. But here, the sessions find they are not so attached to the freehold, but are merely fixed with a view to steadj- them. Therefore, the finding concludes the case, and the order of sessions must be confirmed." J.J. Blackburn, Mellor, and Shee concurred. In tliis case an attempt was made to stretch tlic principle of rating to an unwarranted extent. Since this decision, attempts have been made to unduh* contract this principle, and to seek, under the authority of the Ilalstcad decision, to exclude from rating, machinery that really is rateable. The question of the rateability or non-rateability of machinery must be determined by the special conditions of each particidar case. If the machinery is such that, before it can be erected, special 2)rcpamfions must be made for it, then such mac-hinery must be rated, fur if the premises in whicli it is erected were let from j/cnr to year, the machinery would of necessity have to be taken with THE PRINCIPLE OF RATING. 117 the premises. Thus, take for example, a five-ton stvani hammer. It would not be sufficient to place such a piece p , . ,11 y p T Steam hammer oi machinery on the basement oi any ordmary rateable factory, and then work it ; since it is absolutely necessary that a special foundation be prepared to receive the hammer, which must be securely bolted down to the foundation. Were this not done, the vibration of the hammer would soon destroy the v,^hole building. Now, it is evident that, were the building in which the hammer is, let from year to year, the hammer must be let with it ; miless, indeed, it were determined to discontinue using the building as a forge, then the hammer would be taken away, and, by so doing, the chai'acter of the heredita- ment woidd be entirely changed. On the other hand, take a seioing-machine, which is fixed to the wall or to the floor for the purpose of steadying it ; , , . , Ti . 1 p " Sewing-machine since such machine can be readily taken irom one „q^ rateable building to another building without any special ^preparation being made for its reception, it would be most unjust to seek to enhance the rent which the one or the other building would command from year to year by any consideration of the value of the sewing-machine contained therein. Having considered the circumstances which should influence a tenant in determining the rent he can give for manu.facturing or business premises, either with or without machinery attached, the next step is to see what conditions would determine the rent that should be given for water-mills and windmills. Water Mills. First, as regards icatcr milts . It has already been shown that the rent which can be given for manufacturer's premises, with machinery attached, depends upon the amoiuit required for the land, either as rent or purchase-money, and upon the amount of capital required to erect the buildings and machineiy upon it. The principal circumstance Avhich would influence the landlord of the ground in determining the amount he woidd require for his 118 THE prvixniM.E of hating. land, cither as rent or piircliase-moncy, would be tlic quantity of land there might be available for the purpose, and the demand that existed for it. If there were various plots which could be used for the required purpose, all equally available to the person who was going to build the premises, then there would be such an amount of competition between the owners of the plots that any one landlord could not demand any sum he pleased ; but if there was but one plot available, the landlord's demand would be limited only by the ability of the tenant to pay the rent demanded; and the tenant's ability would depend, not upon his private resources, but upon the extra advantage which ho could seciu'e by occupying the piece of ground in question. Take as an illustration the case of land in the city of London. There, because almost every available piece of ground is already occupied, the landlord of any piece that may be mioccupied can command a very large rent for such piece. Althoiigh the rent which can be obtained may seem to be any sum the landlord may choose to ask, yet such is not actually the case. The persons who will occupy the premises that may be built upon such a piece of land, are persons whose business necessitates their frequent presence in the city. Such persons can afford to pay a very large rent for premises conveniently situate, rather than occupy at a low rent premises inconveniently placed; because, although the rent itself might be low, the expenses the tenants wovdd be put to, in cab-hire and loss of time, would more than counterbalance the high rent paid by them in the city. This circumstance will in- fluence the oAvner of the ground, when he is determining the rent to be paid to him by the person who is willing to create the premises to be let from year to year ; and this circumstance not only influences but limits the landlord of the ground, and also the landlord of the pi'omises ; for if the rent asked for the land is so high that, rather than pay such rent, increased as it would be by the rent of the buildings erected on the land, it would be cheaper for the tenant to go elsewhere, and to incur the expense of cabs and THE PRIXCIPLE OF RATING. 119 the loss of time, then that rent would be more than " the tenant could pay." Now take a piece of land having a stream of water running through it, which can be profitably employed as a source of power. Then suppose this piece of ground employed as a site for manufac- turing premises, either fitted with shafting merely, which is driven by the water-power, or else so built and fitted with machinery as to be adapted for some special use, and let us con- sider the circumstances which would influence a tenant from year to year in determining the rent he coidd give. It has alreadj'- been shown what kind of considerations would influence a tenant in giving a rent for premises fitted with steam-power. In settling this rent he would make allowance for the fact that he would have to find fuel and labour for the engine and boilers. Having supplied these requisites, he would then be able to carry on his business, and to have everything under perfect control. Then with regard to the premises erected upon that piece of land through which the water rims. The cost of creation may be taken as being the same as that of premises fitted with steam- power ; for though, in the latter case, the creator would have to provide an engine and boiler, and in the former no engine woidd be required, yet an equal expenditure might have taken place in utilising the water-power. The tenant of the premises supplied with water-power would pay at least as much rent as he woidd for precisely similar pre- mises fitted with steam-power, for each of the premises is assumed to be equally commodious and convenient. 13 ut some further con- sideration would now have to bo taken into account by him. lie would, by using the premises supplied with water-power, be free from the expense of providing fuel for the engine, and also free from much of the expense of attending to the boiler. This woidd enable him to pay a greater rent for the premises, although he would not be willing to pay as rent all that he saved in fuel ; for water-power not being so perfectly under control as steam- power, its use would occasion certain inconveniences and draw- 1*20 THE riUXCTl'I.K OF KATING. backs. It will be clour that a very large sliare of the extra rent so paid then must be assigned to the owner of the ground, if the land did not belong to the person who erected the premises ; for the owner, in letting the land, would be fully aware of the advan- tages inherent in it. Again, if the premises built upon the land, having water-power, are fitted up for some special business, the circumstances already considered in the case of ordinary business premises fitted wilh special machinery woidd be eqiially applicable to this case also. But in consequence of water-power being available for driving the machinery, the rent paid in this case would include a sum for the mere use of the land, a sum for the use of buildings, a sum for the use of the machinery in the buildings, and a further sum for the benefit of the water which works the machinery. In deducing the above principles, all consideration of any further rent which the tenant might give in consequence of the premises being so situate as of themselves to command trade, has been omitted. Such a case woidd be Avhere a mill, say a flour- mill, was so situate that persons wishing to have v/heat ground must go to that mill, although the charges of the miller for grind- ing be high. This would ha^jpen when there were no other mills near, and when the expense of carting wheat to the more distant mills would be greater than that of paying the higher charge made by the miller. In such a case, the rent which the occupier would be willing to give would be yet again greater than in the last case. Such a rent, however, might be liable to be much reduced by change of circum- stance, such as the erection of another mill near, when the miller, the occupier of the first mill, would become depcnde^jt for his busi- ness \\\nm the attention wliidi lie paid, and not being able of neccHsiiu to secure a tiade as he ioinierly did, he would no longer pay the large rent which he previously paid, but less, and by as much as was previously paid an rent for the t radc consequent upon the occupation. the principle of ratixg. 121 "Wind Mills. Tlie same principles will influence a tenant in determining tlie rent lie can give for a wind mill; but inasmuch as the capa- bilities of tlie best wind mill are but small, the amount of rent determined would also be small in proportion. Tithes. The next class of hereditament to be considered is the tithe rent- charge. Under the statute of Elizabeth, tithes, amongst other kinds of property, are to be rated to the relief of the poor. Now that tithes have become commuted for a money-payment, the amount so paid, " the tithe rent-charge," being a hereditament for which a tenant from year to year will give a rent, it will be convenient next to investigate the manner in which this rent is to be deduced. First, it may be remarked that the occupier of land which is subject to tithe, practically pays rent in two portions, and to two persons. One person being the owner of the land itself, the other being the owner of the tithe arising therefrom. The Parochial Assessment Act evidently considers that the tenant of land subject to tithe shall pay the tithe commutation rent-charge, which is now paid instead of tithes, for the "rent is to be free from usual tenant's rate and taxes, and tithe commuta- tion rent-charge, if any." When it happens that land is tithe free, then, inasmuch as the tenant has no tithes to pay, he can pay a greater rent. Hence it will follow, that the full value of the land is the rent plus the tithes. And whether the full value of the land be paid by the tenant directl}^ to one landlord, or part of it be paid to one, and the remainder to another, will evidently not affect the real value. Now, if land be tithe free, and the rent paid to the landowner be therefore greater than would be the case if the land Avere not tithe free, then also will the amount payable to the i)arish officers by the tenant for rates be greater. When land is not tithe free, then the rent paid to the landlord being less, the amount paid to 1'22 THE vRiNCiri.E of rating, the parish officers for rates will bo less also. But inasmuch as the pari^h officers rate the owner of the tithes for the amount of rent ho receives, rates are actually paid upon the entire rent which the land yields. The tenant pays to the tithe-owner an amount which not only includes the rent he would otherwise give to his landlord, but also the rates he must otherwise pay to the parish officers. In the act for settling the amount of commutation rent-charge in lieu of tithes, it was specially enacted that such an amount should be arrived at as would include not only the amount of tithes, but also an amount in respect of the rates upon the tithes. Assuming that the aggregate amoimt payable to the tithe-owner has been ascertained, the question then arises, what is the gross estimated rental andtlie rateable value thereof? The first step in the investigation is to ascertain the total amount which is receivable in the year ; for it is on account of the privilege of receiving this amount that the tenant is willing to give a rent. The inquiry as to what are the gross receij^ts has, in no previous case which has been considered been made, because, in all the other hereditaments, the gross receipts have not been the immediate element in ascertaining the rent ; but here, where that which the tenant is supjDOsed to rent is the privilege of receiving a certain amount of money, the question, " what that mount is," must be the first to be settled. The proposed tenant would base an estimate of the rent he could give uj)on this consideration, because he would find that the mere fact of his being the holder of the privilege to receive the tithe rent must of necessity bring in an amount of money, a large portion of which he woidd be willing to pay to the owner in order to receive the remainder himself. This remainder is the tenant's profit, and is analagous to the profit which a farmer expects to make out of the land, for the i)rivilege of occupj'ing which he is willing to pay a rent to the landowner. Having determined tlie total amount the tenant would receive as tithe for any one year, the next question that would arise Avould be, what expenses he would have to incur in respect of that amoimt. THE PRINCIPLE OF RATING. 123 The whole question, both as to what should be the basis of the investigation and what deductions should be made from the gross receipts, having been the subject of judicial decision, it will be most convenient to refer to the cases, and to endeavour to set out the deductions as allowed by them. These cases are : — 1st. R. V. JoddrcU (Barnwell & Adolphus, 403). 2nd. R. V. Capel, 12 A & E. 283. 3rd. R. V. Goodchild, 27 L. J. (JN". S.) M. C. 233. 3rda. Do. do. 27 L. J. (K S.) M. C. 251. 4th. R. V. Lamb, 27 L. J. (N. S.) M. C. 233. 251. 5th. R. V. HaicMns, 27 L. J. (K S.) M. C. 248. 6th. R. V. Groves, 29 L. J. (JS". S.) M. C. 179. R. V. Joddrell was argued before the Parochial Assessment Act was passed. The first question raised was, whether the farmers who paid the tithes ought not to be assessed for them, because, if they had not paid them, they would have paid more rent ; but it was ruled that they ought not. No such question could have arisen after the Parochial Assessment Act came into force, for therein it is enacted that the rent shall be free of tithe commutation rent-charge. The second was, in fact, whether or not tenant's profit ought to be allowed to the rector, which "the court decided in the affirmative. The third was, whether land-tax ecclesiastical dues, and a deduc- tion for the performance of the duties, ought to be allowed. With respect to the deduction of land-tax, it was decided conditionally, and that it should be dependent upon the facts as to whether the other ratepayers paid it themselves, or paid it and deducted it from their rents. With respect to the ecclesiastical dues, including tenths and synodals, it was decided that they shoiild be allowed. Lastly, with respect to the allowance for a performance of the duties, it was decided that these being personal, ought to be per- formed personally by the incumbent. The next case, that of R. v. Ccq)cl, raised the question of the proportion of the tenant's profits, and the wider one also as to 12-i THE TRlNCirLE OF RATING. Avhcthcr titlics were correctly rated upon an estimate of the rent a tenant would give for them, or whether they do not come within tlio operation of the proviso of the first section of the Parochial Assessment Act ? In this case, the Hon. and Rev. W. Capcl, Vicar of Watford, was rated in respect of the small tithes, which amounted, in the year in question, to £660, the average pajTnents for tenant's rates and ecclesiastical dues, being £82. 15s. The tithes were rated at £540, an allowance being made of £37. 5s. for tenant's profits. It was contended that the average profit made by the occupiers of land, being two-thirds of the rent, Mr. Capel was unequally rated, inas- much as the amount at which he was rated bore a larger propor- tion to the full yearly ralne of his tithes than the amounts at which the other occupants were rated bore to their entire receipts. With regard to the question as to the mode of rating, Lord Den- man ridcd that tithes were one of those hereditaments which are demisable at a yearly rent, and also that the "liabilities" of tithes to be rated are not different from the liabiKties of land, nor is the "principle" upon which tithes are rated different, the principle invariably being to endeavoiu' to find the net annual prod ace after nutldnf) jyroportionahle equal deductions (i.e., as between land and tithes), and that consequently tithes do not fall within the scope of the proviso. In dealing with the question of the incqualitj'- of the profits allowed to Mr. Capcl, as compared with those allowed to the farmer or other occupier, Lord Denman quoted from the case of li. V. Shingle a sentence in which annual value is defined as follows : — " Of the whole of the annual profits or value of the land, a part belongs to the landlord in the shape of rent, and a part to the tenant ; and whenever a rate is according to the rack rent (the usual and most convenient mode), it is in effect a rate on jvtrt of the projils only." But Lord Denman denied that this scjitcncc expressed any proposition of law, or any conclusion as to fact from premises stated, and asserted that it was simply an assumption. He said that— THE PRI^X'IPLE OF RATING. 125 " The net annual value might with as much reason be represented by the rack rent, as that consideration wliich it would be worth while to give, beyond the rates, charges, and outgoings, for the right to occupy and take the actual produce." This proposition of Lord Denman's does, it is submitted, tridy define net value ; for the annual value according to the former definition is an amount produced not by property alone, but by property and by labour, whereas . in Lord Denman's proposition a clear distinction is made between the produce of property merely, and the produce of labour. The net annual value as suggested by him is the produce of the property and the remainder of the total produce is the reward of labour expended in producing the whole. If a man possessing pro- perty chooses to expend labour also, he receives the whole produce, part of which is for the labour he himself has expended, and the rest is for the use of the property which belongs to him. If he does not choose to labour himself, but allows another man, who is willing to do so, to use his property, then he receives a retui'n merely for such use. This proposition, given by Lord Denman, of net annual value is that adopted by the Parochial Assessment Act as being the rateable value of any hereditament. In the case of R. v. Capcl, the judgment of the Court was that the assessment was free from objection. The next cases of R. v. Goodehild, R. v. Lamb, R. v. Goodchild, R. V. Hau-kins, were argued upon the same day, and judgment given upon them as a whole. The following were the points raised in the cases : — 1st. Should an allowance be made for estimated losses by non- payment of tithe ? law expenses. estimated expenses of collection, land tax. property tax. rates other than general rate, tithing rate, and sewers rate. 2ndly. Do, do. 3rdly. Do. do. 4thly. Do. do. 5tlily. Do. do. Gthly. Do. do. Stilly. Do. do. Otlily. Do. do. lOtlily. Do. do. lltlily. Do. do. 12tlily. Do. do. 13tlily. Do. do. 12G THE riiixcirLK of uatixg. Tthly. Do. do. genoral rate, lightiiiii-rato, and sewcrs- rate. tenths. ecclesiastical dues, curate's salary. amount paid towards the salary of the minister of tlic district church or chapel, tenant's profits. personal services of the appellant as officiating minister. These •were raised in the case H. v. Goodcliild only. 14thly. Do. do. first-fruits. This additional point in R. v. Lamb. ISthly. Whether the gross estimated rental was correctly fixed (as was done in all the above cases) at the total amount received? ICthly. "Whether an allowance should be made in respect of " certain payments of interest, and repayments of principal to the governors of Queen Anne's bounty," which the appellant had to make out of his tithe income ? These two points were raised in the case II. v. Jlairkiiis. 17thly. Whether the appellant was liable to be assessed to the general rate, the lighting rate, and the sewers rate ? This last point was raised by the second case of i?. v. GoodchlJd. The above is the order in Avhich the points were argued and decided by the court, but it will be convenient to re-arrange them. Judgment was given by Mr. Justice Coleridge on the 23rd of February, 1858. After Mr. Justice Coleridge had determined to what extent the questions raised above had already been decided by the cases of li. V. JoddrcU, and R. v. Capcl, and had sho^^'n that, in rating tithes, the Parochial Assessment Act must be complied with, he said: " But as the language of tlie Act is litcndhj applicable, if X'IPLE OF RATING. 127 liberal as is necessary to effectuate substantial equality in the assessment, and at the same time be compatible with the maintenance of the principle." He then proceeded to show that, whilst certain charges and oiitgoings specified in the Assessment Act could not be allowed, because the}^ did not exist, certain others did exist, and, though not specified, ought to be allowed. Then the net annual value, or rateable value of the tithe rent- charge, being " The rent at which the same might reasonably be expected to let from year to year, free of all usual tenant's rates and taxes, and tithe cemmutation rent, if any, and deducting therefrom the pi'obable average annual cost of repairs, insurance, and other expenses, if any, necessary to maintain it in a condition to command such rent," it will be most convenient to treat of the various allowances claimed above in the order in which they would arise in deducing the rateable valvie. Arranging them in this manner, they may be collected into five groups, viz. : — 1st. The gross income of the tithe rent-charge, or the actual produce, to enjoy which a tenant is willing to pay rent. 2nd. The necessary outgoings, &c. 3rd. Rates and taxes. 4th. Tithe commutation rent-charge. 5th. Repairs, &c. Of these groups, the first requires no further remark. The second group will include the following claims: — (3.) a. Cod of Collection. — The deduction of the amount actually paid for this item was, as a lyrlnclple, allowed and admitted in the course of the argument, though some confusion seems to have arisen respecting the amount claimed for tenant's profits, viz., £92, that being stated to be allowed inclusive of this and the next two items. The amount of the cost of collection per cent, may vary con- siderably, according as the tithe rent-charge has to be collected from two or three landowners or from a lare:e number of tenants. 128 THE riuxnri.K of katin'g. (2.) h. Law J^.rpoisrs. — This claim was also allowed, the neces- sity of the assumed tenant having to considt his lawyer occasionally being admitted. (1.) c. Bad Debts. — These also were allowed. (10.) d. Curate s Salarij. — Here the claim of an allowance for the curate's salary was allowed, although in the case of R. v. Joddrell a claim for providing for the duties of the incumbency was disallowed. Nor are the two cases contradictory, for the cir- cumstances were diflferent. In the latter case the curate acted as a deputy. In the former cases the curate was employed as an as- sistant. And it was pointed out in the judgment that, in the case of Mr. Goodchild, the bishop could compel him, midor the 1 & 2 Vict., cap. 106, to appoint a curate to nsiiiat him in his duties, and, in the other case, that of Mr. Lamb, although the value of the in- cumbency and the number of parishioners was below the standard requisite to give the bishop authority, yet the duties were greater than one man could perform ; and it was held, therefore, in both the former cases, that inasmuch as the curate's salary was really a necessary diminution, it ought to be allowed. In a subsequent case, R. v. the Overseers of Seriren Tenter Gate, 32 L. J. (X. S.), M. C. 161, where the vicar, in addition to the tithe rent-charge, derived an income from certain glebe lands outside of the parish, Lord Chief Justice Ck)ckburn decided that the true princij^le was to set the curate's stipend against aU the sources of income of the rector or vicar. This ruling as to the allowance of a curate's salary has, however, been reversed in the case of II. v. the Inhabitants of Sherford and Others, 2 Law Reports, Q. B. 503. And this on the princijole (laid down in the Mersey Dock cases) stated by Mr. Justice Blackburn during the argument of this case, viz., " The principle of decision in those cases is, that where a person is in tlie occnpation of property capable of yielding u prolit. the occupier is rateable in respect of that jn-ofit, and it is quite immaterial to whom it is paid. If the tithes were rendered in kind, and were rented, the lessee would he rateable in the same amount, whether the whole rent were paid to the incumbent, or part went to a curate." TTIF; r-RIXflPLE OF RATING. 129 (11.) c. Claim in roHpcct of a contriimiion toicanh ilte mlary of the minider of the district chapel. — This claim was not positively settled, because the facts stated were not clear enough, but the principles which would determine it were clearly laid down. These were, that' if the contribution was merely rotuntary, and the rector could, if he pleased, Avithhold it, it could not be allowed as a, deduction ; but if it was paid in consequence of some formal grant of tithe rent-charge, which could not be revoked, then, inasmuch as it was a necessary lessening of that which was to be let, the claim must be allowed, although it was intimated that the recipient of this portion of the gross amount might be liable to be rated for it. (13.) f Claim for personal services of the appet/anf as officiating minister. — This claim was disallowed upon the ground that it vras a duty growing out of an institution to a cure of souls ; for the tithe rent-charge was a property the right to which accrued by in^ duction to the temporalities, and no necessary relation exists be- tween the duties of the incumbent and the amount of tithes, (12.) (/. Tenant's profits. — The Court seems to have disallowed this claim, apparently upon the ground that the amount for collec- tion was inclusive of tenant's profit. But the amount for collec- tion, whether it bo a large or a small per-contage, has been assumed above to be the amount aetmdJy paid to a collector for gathering the tithe commutation rent-charge. As the tenant would pay this sum to his collector, there must be some further amomit which he liimself would receive as a benefit oiit of the tithes ; for no man would place himself under liabilities by taking a tithe rent-charge without some profit to himself; and ho certainly would not take the rent-charge merely to secure the collection, for collection would involve labour, and the amount above assumed for collection has merely been such as would pay for labour, and not for labour and liability. All the previous claims (save d, c, f above) must bo satisfied by the tenant before ho himself would receive one farthing. There will therefore be some allowance under tliis head as remu- neration to the tenant himself. K 130 THE rRixnrLE of ratixo. In tho case of ii. v. Capcl an allowance for tenant's profits was made, and sncli allowance sanctioned by the Court. Of course the amount of tenant's profits in anj' case must be determined by the peculiar circumstances of the case. Here, in the argument upon the case of R. v. Goodc/ii/d, certain comparisons were made between tho amount claimed and that in the case of 11. v. Capcl ; but no comparisons can fairly be drawn between any two cases. The sum of the above claims and allowances will complete Group 2. The total amoinit of Group 2 taken from that of Group 1 will leave the sum Avhich a tenant would give if ho had no rates and taxes to pay. liut as he is assumed to pay rates, and taxes, and tithe commutation rent-charge ; this sum, which is made up of rent, rates and taxes, and tithe, must be separated into its component parts. Giioup 3. — Rates and Taxes. (G.) a. Poors rate. — This was as a general principle admitted, yet it was contended that there were certain special features in this particular case which would influence this principle — viz., that the tithe commissioner, in fixing tlio titlu^ connniitation rent, had added thereto an amount in respect of poors rate upon the tithe having previously been paid by the parishioners ; but the Court decided that this had been done in virtue of a special enact- ment, and did in no way bar the tithe owner from claiming it as a deduction. The claim was therefore allowed. (7, 17.) b. General rate, t'Kjhting rate, sewers rate. — Two questions were now raised — 1st, Whether the appellants were liable to these rates at all; 2ndly, "Wliether, being liable to them, they were entitled to deduct them. Tlie latter point must have been admitted had the Court decided the liability. Then with regard to tho general rate and the lighting rate. The Court decided liability to the general rate on account of tho construction of the statute im- l)osing it; and the Court decided liability to the lighting rate because the tithe rent-charge fell witliin tlie d(>scription of ])roi)erty upon which the lighting rate is imposed, and did not fall within the description of property exempted. THE PRINCIPLE OF RATIXO. 131 Lastly, witli regard to sowers rate, the Court found that tlio tithe rent-charge was not liable to this impost, inasmuch as it was exempt from sewers rate previous to the passing of the Act imder M'liich it and the two other rates were levied (18 & 19 Vict., cap 120), and was therefore still exempt therefrom, in virtue of sect. 164. (5.) c. Ti'operty tax. — The claim made imdor this head by ^Iv. Goodchild amoimted to £46. 13s. 4d., the total amount of tithes being £940, and was, therefore, for the property tax upon the entire income. But this income is reallj'' resolvable into three parts — viz., the rent a tenant would give, tenant's profits, and necessary outgoings. The tenant must pay income tax upon his profits, which income tax he would deduct before he determined the rent he could give. This amount, Mr. Goodchild being his own tenant, he, it was decided, was entitled to deduct. But the rest of the in- come tax being payable in respect of the rent, he, as tithe owner, received from his tenant, could not, it was decided, in reason be deducted, but ought to be paid out of the net annual value, when ascertained, and this because the income tax upon the rent was not a usual tenant's tax. (4.) d. Land tax. — This claim the Court disallowed, showing that, although allowed in R. v. Joddrell, it was so because all the other ratepayers in the parish paid it also. And that, since that decision, the Assessment Act had come into force, and that under this Act tlie only rates and taxes from which the rent was to be free were " usual tenant's rates and taxes;" and further, that inasniucli as this tax was specially required and allowed by the landlord to the tenant, who had to pay it in the first instance, it was not a usual tenant's tax, but a landlord's, and was theref\'ed, and -were the sub- ject of these remarks : — First, that first fruits being payable in re- pj)ect of the first year's occupation, ought to be deducted from the^ ftssessmcnt of that year. Secondly, that first fruits and tenths being payable in respect of the whole annit! prorciifii'^, and not of the tithes only, the total amount must not be deducted from the tithes, but only a projDortionate amount. The sura of these two groups — -viz., Group 3. — Poor rate ; Gcueml mfc ; Li(//ifiiif/ rafo ; Tenant's I)) conic fa.v. Group 4. — First fruit k : Tenth!?; FA'clesid^^tieaJ dues — will be the total amount of '' tenant's rates, taxes, and tithe com- mutation rent-charge " to be deducted from that amount which the tenant would pay as rent if he had no rato.^ and taxes to pay. It has already been shown that that whicli remains after Group 2 has been deducted from Group 1, is the amount which the tenant would give as rent if he had neither rates nor taxes to pay. "We have now seen what rates and taxes it would be necessary to pay. And the problem is to determine their amount. The diflference be- tween the amount of Group 2 and Group 1 consists of rates, taxes, and rent. But rent itself includes two things — viz., net annual value, i.e., rateable value, and repairs. It is upon the net annual value that the amount of the rates is computed. Hence, to deduce the amount of rates, we must first deduct from that amount, con- sisting of repairs, rateable value, and rates and taxes, the cost of the repairs. The remainder will then consist of two parts — net annual value, and rates and taxes. Assume tliat the rates and taxes, as set out, amount to 5s. in the pound of rateable value. Then the above remainder will be made up of five parts — viz., four parts rateable value, and one part rates and taxes. Consequently one-fifth part of the remainder represents the amount of rates and taxes to be paid. The amount of rates and taxes Laving been found, and that amount deducted from the difference beiween the amount of Group THE PRINCIPLE OF HATING. - 133 2 and that of Group 1, will give the rent a tenant from year to year would j)ay for the tithe rent-charge, and which rent is the gross ESTiJiATED RENTAL, accoi'ding to the Parochial Assessment Act. Of the questions which were raised by the three cases of Good- child, Lamb, and Hawkins, all have been noticed except two. Of these, one was as to whether " the gross estimated rental had been correctly fixed at the total amount received." But this does not seem to have been noticed by the court. Yet it was evidently wrong to call the total amomit of the tithe commutation rent, the gross estimated rental thereof; for it is neither the gross estimated, rental as defined by the Poor Law Circular, nor is it the gross estimated rental of the Parochial Assessment Act. It certainly is not " Tlie rent wliicli would be paid to a landlord who himself undertakes to pay all the usual tenant's rates and taxes with which the hereditaments or pre- mises rented by the tenant are chargeable, together with the tithe commutation rent-charge and the expense of upholding the buildings in teuantable repair, insurance against loss by fire, and other expenses, if any shall exist, necessary to maintain such hereditaments in a state to command such ijross rental ;" for the total amount of the tithes not only includes all the above items, but others in addition. And it certainl}^ is not the " rent at ivliicli the same mifjJit reasonably he expected to let from year to year free of usual tenant's rates and taxes, and titJte commutation rcnt- charcjc if any'' The rent which has been above deduced may be taken therefore as the real gross estimated rental of the tithe rent-charge. It only now remains to consider what deduction must be made from this gross estimated rental in order to arrive at the rateable value. These deductions must be of the nature of repairs, insur- ance, and other expenses, if any, necessary to " maintain the pre- mises in a state to command such rent." Arguing from analogy, so as to dcteimine these deductions in the case of the tithe rent-charge, the first deduction under this head will be the repairs, insurance, and renewal of the chancel, which the rector must himself maintain. 134 THE ntiNcirLE of hating. Under tliis head may be mentioned tlie last but one of the questions raised by the cases above — viz., "Whether an allowance should be made in respect of certain payments of interest, and repayments of principal, to the governors of Queen Anne's Bounty, which Mr. Hawkins made out of hin income, in respect of monies borrowed by him for the purpose of rebuilding- his parsonage house? The Court rided that he was entitled to an allowance for the pro- bable average '* annual cost of repairs, &c.," but that this claim could not be allowed : " For if a lauclowner rebuilt his mausion, the expeusc ma}' swallow up more tliiui the whole income of the estate for the j'ear, but his estate does not thereby become not rateable, and the estate is not the less productive, nor does he tlic less receive the income because he expends that and more on the building a new house upon it. And so, before the statute passed, if the incumbent rebuilt, as many did, his parsonage -house out of his own means, he must still have been rateable for his tithes. So again, if tlio landowner had borrowed the money on the securitj' of his estate, he could not have claimed to deduct the interest, or vary portion of the principal, which he might rcpaj' under .igree- mcnt, from his poor rate, even if he were temnit for life onl}*. The incumbent who borrows from Queen Anne's Bountj', and mortgages his tithes under the statute, is in exactly the same situation." The gross estimated rental, lessened by the above allowances for repairs, &c., of chancel, and of the parsonage-house, w'hen circum- stances require this allowance, gives the rateable value of the tithe rent-charge. A reference to one other case is desirable — vi/., that of iv. v. GrovcH, 29 L. J. (N. 8.) M. C. 179. In this the appellant was the A'.s.sre of the rectory tithe rent-charge, and other prenn'ses at Ilernc Hill, which he rented from the Archbishop of Canterbury. Tlic archbishop had granted a portion of the tithe rent-charge, to the amount of £40 per aiimini, to the perpetual curates of Thorington for ever. This had been done under statutory jiowers. The appellant, in virtue of tlie decision in 7i*. v. GoodvliUd, claimed that he was entitled tu the deduction of tlie £40 so jjaid in determining the rateable value of his holding, lie, by agie( nunt witli the arch- bishop, paying this portion of the rent of the tithe-rent to the THE PRI^X'I^LE OF RATING. 18o curate. The appellant held hh tithe rent-charge upon a lease for twenty-one years, and everj^ seven years surrendered the lease and received a fresh one for twenty-one years, paying a certain fine ii]ion each renewal. The payment of this £40 had only been made since 1848, and the archbishop, in consideration of the appellant paying this sum, demanded and received a less fine on renewal than he otherwise would have done. In consequence of this condition of things the Court held that the appellant was not entitled to have deducted the £40 in determining his assessment to the relief of the poor ; Lord C. J. Cockburn say- ing, that, in fact, what the appellant had undertaken to pay was so much rent for that portion of the tithe rent-charge paid to the archbishop, and so much for that portion paid to the perpetual curate. He was the occupier of the ichole. ]\Ir. Justice Crompton agreed to this, and added, that he might have paid the Avhole consideration to the archbishop, and that the occupier derived the same benefit from the occupation whether he paid the £40 to the archbishop or to the curate. This case was simply a payment of rent to two landlords instead of one ; for whether he paid rent to one or to two landlords did not in any way lessen the rent he was willing to pay, nor did he pay the rent twice over, for the archbishop took this payment into consideration in determining the amount of fine upon renewal. It may be here remarked, that, though the tenancy was not from year to year, it was one capable of being reduced to a tenancy from year to year ; for the amount of fine paid down, and a certain annual rent, was but the equivalent of a larger annual rent with no fine. In the next class to be considered, the hereditaments, from their very nature, must at some time or other be exhausted. It has already been shown that the On the rateable •' . . value of sand and Parochial Assessment Act provides against the gravel pits, &c. eficcts of wear and tear where possible, but in these properties it is physically impo.ssible to provide for their continued reparation. 136 THE PKINCirLK OF IJATING. These liereditiniicnts are sand and gravel pits, elay, eliallc, and ballast pits ; mines, and similar properties. In this class the pro- duce, for the right to enjoy which the rent is paid, is derived from the 6T//6' of the co)-j)ii.'<, and not merely the use of it. 8axd and Gravel I^its. The considerations which will influence the tenant of the above properties in determining the rent he can give, must be next examined. The tenant would first ascertain tlie extent of ground over which sand and gravel might be found in the neighbourhood, in order to see what likelihood there would be of competition. He would also ascertain what demand existed for sand and gravel. A'ext, what the quality of these was ; whether the sand had an extraordinary value in consequence of peculiar fineness, colour, sharpness, or other peculiarity which would create a special demand for it, or whether it was of an ordinary nature ; also what the quality of the gravel was. These elements, which, amongst others, would determine the rent, are of an innate character, and entirely independent of external circumstances. IIa\ing satisfied himself respecting the probable quantity of the corpus he could dispose of during the year, and the price he could obtain for it, he would then ascertain whether there would be any competition likely to influence either the quantity he sold or the price he could command. If none existed, then he might fairly argue, that inasmuch as a certain demand for sand or gravel existed, he, by the mere occupation of the i)it in question, would be able to sell a certain quantity at a certain price. If competition did exist, then citlier his receijits miglit be less, or else he would have to expend nnuli additional labour in his business in order to secure those receipts. Next, he would consider Avhat Avorking expenses he woidd be put to in " getting " the sand and gravel, and in preparing it for sale, llaving determined these matters, and also the amount of profit which Avould j^atisfy himself, and which Mould be more or less, according as it was necessary to pay THE PRINCIPLE OF RATING. 137 more or less personal attention to the business, he would be in a position to determine the rent he could reasonably afford to give. This rent is usually paid in the form of a roijaltij, the total amount of which, depends upon the quantity of material sold during the year. It must be assimied that the occupier of the sand or gravel pit sells the material to persons who themselves fetch it from the pit, or if the occupier of the pit delivers it in his carts and horses, then the estimate of the rent ho could pay would be entirely exclu- sive of any profits he made by carting the sand or gravel. The following illustration may be given : — Suppose a certain district, in. which there is a fair natural supply of sand or gravel. Suppose also another district some miles off, in which there is a great demand for these materials, and that the occupier of a pit in the sand district does a large business in " getting " and carrying them to the place where there is a great sale for them. Arrived there, he disposes of the materials at a high price per cubic yard. It would not be just to ascertain his total receipts, and then deducting the expenses of " getting," and the expenses of carting, and a tenant's profits, to call the remainder rent and taxes. For although the materials fetched a high price when taken into the district where they were sold, yet a very large proportion of the price paid Avould be a remimeration for the trouble of carting, and the remainder only, which would represent their natural value at the pit, ought to be taken as the basis of an estimate of the rent. But if in the district where the great demand exists, there is also a pit of sand and gravel, of a quality equal in all respects to that brought from a distance, then a tenant would give a ver}- high royalty for the privilege of occupying that pit ; for he would know that the mere occupation would enable him to sell a large quantity' of the material at almost the same price as had hitherto been paid for the material and tlie carting. lie would sell this with but little personal trouble and anxiety to liiinself, and lie would therefore be willing to pay a large proportion of the entire profit as rent for the privilege of appropriating to himself the remainder. Here, of course, as in all other hereditaments, it will frequently 138 THE riuNtii'LE of hating. be found, as a fact, tliat tenants occupy sand and travel pits upon conditions other than tlie payment of a royalty based upon quantity sold, such as a fixed rent for a term of years. But in such cases tlie fixed rent ought not to he tahen as the haais of the assessment. l)ut an inquiry should be made as to Avhat would be the rent paid by a yearly tenant. Or, again, a tenant may hold under a royalty of so much per yard, the total amount yarying with the quantity of material sold during the J'ear ; such royalty, howeyer, having been settled some years back. In this case, again, the royalty must not of necessity be made the basis of the assessment. For the yery condition of a tenancy from year to year inyolyes the yearly re- adjustment of the rent paid, and a royalty agreed upon some years back might be too high or too low, and that in consecpience of an imperfect appreciation of the Aalue of the material sold, or from a change of circumstances, or other cause. Haying, with a due regard to the aboyc circumstance, and to the amount of rates to which the tenant is liable, determined the rent he could pay, the next consideration is as to what deductions must be made from that rent, in order to arrive at the rateable value r* A simple case may be assumed — viz., where a gravel pit is situate in a field having a frontage to a public road. The field will have a fence separating it from the road, and a private road or cart track leading from the road into the pit. This shall be taken as the condition in Avhich the pit was when the tenant took it. Then, as to the deductions for " repairs, insurance, and other cxjjcnses, if any, necessary to maintain the premises in a state to command such rent." First, a deduction must be made for the expenses of maintaining the fencing, the gates, and the private road. As to insurance, none would be re({uired. Having made these deductions, the question arises. What deduction, if any, nmst be made from the rent in consequence of the fact that the gravel must at some time be exhausted? Nom", the words of the Act which would juslii'y any (kduction undrr tliis head are, "to maintain the jjrcini-v-s in a state to connnaud sucli rent." But, from the veiy nature of this class of premises, it is a physical THE PRINCIPLE OF RATING. 139 impossibility to "mainttiin them in a state to command such rent." They must at some time or other be exhausted, and then must go out of the rate. It is quite true that the landlord, by laying aside each year, out of the rent paid, a sum of money to accumulate at compound interest, would, when that which yielded him rent was exhausted, be in possession of such a sum as to enable him to buy another field of gravel, cither in the same parish, if he could get one, or, failing in this, have a sum of money which he could invest in some otlicr way, and so derive for himself a revenue from other sources in lieu of that revenue which ceased, in consequence of that which produced it being exhausted. But the words of the Act are not, to "maintain the premises in a state to command such rent, or else to pro^■ide fresh premises to command some other rent;" but they are simply "to maintain such premises in a state to command such rent." If the premises cannot be so maintained, then it would seem that no deduction ought to be made on account thereof. The parish would be recompensed for a future failure of rate in respect of this particular hereditament by levying a greater present rate. Possibly it would be prudent in the landlord to lay aside each year such a sum as would enable him to derive con- tinually an income from his capital. But that income would not of necessity be derived from the rent of an hereditament. He might choose to invest his capital in the funds. Ballast Pits. A similar course of reasoning to the above will determine the rent a tenant could pay for ballast pits. There are pits so situate, that the occupiers of them can obtain an income by the sale of ballast to ships which have come into port with cargoes, and make the return voyage in ballast. Here there must be a special com- bination of circumstances necessary to the existence of such pits; they must be near navigable water of such depth as to enable ships to come in to obtain the ballast, and there must be land so close to this water, on which land again there must exist such a super- abundance of earth as will permit of its being sold without 140 THE rinxciPLE of hating. detriment to the remainder. The very combination of conditions requisite are siicli that in but few sites can they exist; therefore competition will be almost entirely out of the question. It is not enough that the navigable water exists, or that the land possessing a superabundance of earth exists. These must be so situate that communication can readily be kept up between them, and not only that, but, in addition, there must exist a demand for ballast. As, in the last case, the rent the tenant could give would depend upon the quantity of material he could sell during the year, the expenses he would incur in "getting" the same, and upon the amount of profit he could reasonably expect to realise by the occupation. In determining this profit, he would have to consider that the total receipts were almost entirely dependent upon the natural situation of the pit, and not npon /lis j^ersonal exertions. He would be in receipt of an income as a necessary consequence of the occupation of the premises. Such being the case, he would reasonably expect to give to the owner of the property' a large share of the entire net produce; for the owner would not be willing to let the pits from year to year iinlcss ho did receive such a share; he would feel that he could, if he kept them in his own hands, and bestowed the requisite amount of labour npon them, which woidd be small, himself secure, not merely such large share of the net profits, but the whole of them. In this, as in all other cases, the supposition must be made that the pits, with the entire conveniences for shipping the ballast, are ready to the occupier's hand when he takes the hereditament, and that he has not to expend any money in developing the capabilities of the property. As in all other cases which have been noticed, it frequently happens, as a matter of fact, that the occupier has himself expended money in developing and improving the property leased. In one case that came under my notice the occujiier not only held his premises from two or three persons, but had paid a large premium and spent much money in creating the hereditament. The land whereon the superabundance of earth existed was separated from the river into whicli the ships came for ballast THE rnixciiM.r; of rating. 141 by a public high road, and by land belonging- to another person, whilst the land immediately abutting upon the river belonged to the owner of the ballast land. This being the situation, the occupier had leased the ballast land and the river frontage from one landlord, pajang a heavy rent for the same. lie had also leased the intervening land from a second landlord, and then upon the river frontage had built a wharf, and connected the ballast land with the wharf by a tramroad joassing under the public road. In addition to this, he had incurred expense in obtaining the remis- sions of certain restrictions previously in force. Having done all this, he carried on an extensive business in the sale of ballast. The question then arose, Avhat was the gross estimated rental and rate- able value of this hereditament ? In deducing these, the fact that the occupier had spent so much money on the hereditament was entirely ignored ; no regard was paid to the rents Avhich he paid to the landlords; it was simply considered what rent he might have reasonably expected for the entire holding from a tenant from year to year. This was determined upon the principles already laid down, and a certain gross estimated rental deduced, and then a rateable value. Out of tho rateable value it was necessary to pay the various rents to which the premises were liable. The difference between the rent which the occupier in this case might have expected to receive, had he sublet, and the rents which he had agreed to pay, Vv^ould be the return he would get for the money he had expended to bcnciit other persons' jDroperty. Vnit, inasmuch as he was himself the occuj^ier, he received, in addition to this difference, the amount of tenant's profits, which were his reward for the labour he continued to expend ; the other receij)t being in respect of the capital he had expended. The question with reference to the deductions which ought to be made from the gross estimated rental to arrive at the rateable value in such a case as this Avill be of interest. To determine this, a review of the various circumstances affecting the property is requi- site. The entire hereditament consisted of the ballast-yielding land, the land on which the tramway was built, and tlie land upon -which 142 TTiF, rnTxnri.E oi- katixo. tlio whai-f was built. Tliosc various plots Avoro hold upon various leases by the occupier, as lessee ; each of the leases -would terminate at a different time. Then, is the occupier entitled to any deduc- tion in respect of his leases expiiiing. The only deductions autho- I'iscd by the Parochial Assessment Act arc for " repairs, insurance, and other exijcnscs, if any, necessary to maintain the premises in a state to command such rent." Is, then, a deduction in respect of an ex})irino^ lease a deduction "necessary to maintain the premises in a state to command such rent " ? To determine this, the case of a house built upon leasehold ground may be considered. In that case would the mere expiration of the lease lessen the rent Mliich the house might reasonably be expected to let for ? It would appear not. For the occxipier, instead of pay- i)ig rent to one landlord, as owner of the house, would simply pay rent to another landlord, as owner of the land ; and in consequence of the expiration of the lease, the nowowner of the house ; whether the house were owned by one man or another woidd not aff]nite between the parties at quarter sessions was as to the amount of the annual value in respect of which the rate ought to be laid on cacli of tlio appellanls. " TIlg following facts were agreed upon by the parlies, and foimd by the .sessions, "In all previous rates the appellant liad been rated on an estimated value i»f THE PRINCirLE OF RATING. 147 about ono-eiglitli onlj'^ of the sum wliicli is inserted in tlio rate appealed against, and former rates having been laid with reference to tlie value of tho laud for any purposes of agi'iculturc to which it might be ai^plied; but in laying the rate appealed against, the respondents calculated the number of bricks which, on the laud in question, were capable of being made in the manner hereinbefore mentioned, and the result was the large increase above stated in the amount of the rates. In the business of brick-maldng the following things are necessarily done : — The superficial soil being removed, the clay or brick earth is dug out, various foreign raw materials are pur- chased and brought to the brickfield by the brickmaker — for instance, chalk, breeze, sand, ashes, and straw ; some of these materials are always added to the clay or brick earth — sand and breeze are always so used, and in the parish of Heston are obtained by water and land carriage, the former from Woolwicii, in the county of Kent, and the latter from London, a distance of about fom'teen miles. The quantity of chalk, ashes, and breeze required to be used depends on the quality of the clay — sometimes the clay requii-es to be washed, and for tlie pm'pose of wasliing it a steam engine is erected and used in many cases, but does not happen to be so on the field in question. " The clay has also to be ground or mixed in a mill, called a pug mill, each pug miU is worked by one horse, and one is necessary for each stool — a stool being a frame or table at whicli the bricks are moulded, and a gang, consisting of a moulder, a temperer, an off-bearer, a walk-flatter, two pug boys, and a barrow boy. Each stool is capable of making about 700,000 bricks in a year. " The amount of capital required to enable the brickmaker to work each such stool is about .£1)00. " The appellants severally hold under such leases, and E. Westbrook holds the field above mentioned for a term of seven or fourteen years, or till the earth is dug out, and is liable to pay to liis landlord £'20 per annum as rent certain for the same, being a trifle under the sum of £2 per acre, without any reference to the liind of use which he may make of the land ; and lie is also liable, in adili- tion thereto, to pay his landlord a separate sum, called a royalty or realty, of Is. fid. for every thousand bricks moulded on such land in any one year. The rent, per acre, for the above-mentioned 10a. Ir. 3'2p. which on so taldng a loaso thereof, with liberty to consume the soil and clay or brick earth (and without any liability to pay any royalty in respect of the number of bricks made), any tenant would have been wUling to pay, would have been the sum of ^£10 per acre. " If the Court of Queen's Bench should be of opinion tliat the respondent's mode of rating was correct, the order of sessions was to be affinncd, otherwise that order to be quashed, and the rate to be anicudcd, and any such other order L 2 148 THE rinxoirLE of ratino. to be made in the promises as to tlie Court of Queen's Bench should seem to be just." The Queen v. Jlcnry Everest [l^ Q.B. 178, and 1(1 L.J. Ref. (N.S.), M.C. 87). " Upon an appeal by Henry Everest against a rate for the relief of the poor of the pai-ish of Frindsbujy, in the county of Kent, the sessions confinned the rate, subject to the opinion of the court on the following: — Case. " The appellant is the occupier of a piece of land in the parish of Frindsbury, containing brick earth, on which he makes and burns bricks. He entered on the occupation by virtue of the fi)llo\ving agreement, and has since continued to occupy upon the same terms, without any formal renewal of the contract :^ " Memorandum of an agreement entered into the 3rd July, 1835, between John Batten, of, &c., of the one part, and H. Everest, of, &c., of the other part. First, that the said J. Batten agrees to let to the said H. E. a certain piece of land as a brickfield (which is now, and has been for the last years, in the occupation of the said H. E.), as marked out, &c., containing, &e., together with the cottages thereon, to make and burn bricks for three j'cars certain, from Christmas, 1834, to Christmas, 1837, on the following terms: — " To make or pay for one million of bricks, at least for each year of the above period, at the rate of 2s. 8d. per thousand, and so on for eveiy thousand bej'ond the said milUon, to be considered and estunatcd by and between the parties liereto, to be the same number as the duty to the King is actually paid for. " Such payment to be considered due and payable as a rent, and to be made on the 25th of j\Iarch and the 29th of September in each year, during the said term hereby granted, and in each year of the said II. E.'s occupation," &c. Then followed an agreement to paj' at the rate of i:3 per acre for land not used for brick-making, and for levelling the land broken up, &c. " The appellant appealed against this rate, on the ground that he was over- rated in respect of the annual value of the land in his occupation. The clay dug in tlie land in question is never sold as such by the appellant, and is only one of the materials used in the manufacture of bricks. The other materials used in the manufacture of bricks are cliallc, nxJicn, xaml, and hree:e — all of which have to be brouglit to the brickfield from other jilaccs. Tlie manufacture is attended with great risk and uncertiiinty, and in the process of making, the bricks are exposed to considerable damage from rain and other accidental causes, for which, however, an allowance of one-tenth from the gross number is made by the Excise in charging the duty. "NYlien llie rate appealed against Avas made, the appellant had twenty-two stools for the purpose of brick-making upon his brickfields. The sum of Ji^iOO per annum is necessary for the proper THE PRINCIPLE OF RATING. 149 working of each stool. The sum paid by the appellant to Mr. Hankej', under the memorandum of agreement, at 2s. 3d. per 1,000 bricks made, amounted in the year 1840, to i'1,010. 9s. 6d.; in the year 1841, to £928. Is. 4d. ; in 1842, to i-9C0. 7s. 2d. ; in 1843, to i*953. 13s. 3d. ; and iu 1844, to „ei,324. 4s. 9d. " The question for the opinion of the Court was, what was the net annual value of the land in question ? " If the sums paid by the appellant under liis agreement, were to be con- sidered in the nature of rent, and as such ought to form the basis of the rating, the order of sessions was to be confirmed. If either of the modes con- tended for by the appellant should be considered coiTect, the case was to be sent back to the sessions, that the rate might be adjusted accordingly ." Lord Denman, C.J. : — " These were cases sent from the sessions respectively of Middlesex and Kent, which may properly be considered together, being intended to prociu'e a decision on the same question, the proper mode of rating the occupiers of brick- fields to the relief of the poor. The material facts found in both cases are nearly the same. In both it is stated that much expense, and the introduction of foreign matters, are necessary in order to make the occupation i)roductive and profitable, and the result is liable to much risk. It is understood, there- fore, if not made legally certain, that the tenancy shall be of some years' diu-ation, and the rent is in part only fixed, in part made to depend, in the nature of a royalty, on the number of bricks made. The material, the brick earth, is not in its nature renewable, and in both cases will be consumed, according to reasonable calculation, within no great number of years. In both eases, the basis of the rate has been the supposed total amount paid to the landlord, con- sidering as well the royalty as the fixed sum to be rent, and to be the proper criterion within the Parocliial Assessment Act, of the rent at which the laud may reasonably be expected to let, from year to year, free of such charges, and making such deductions as the statute specifies. " In the case of Westbrook, however, the session found ' the rent per annum, which, on taking a lease, with liberty to consume the soil aiid clay, or brick earth, and without any liabiUty to pay any royalty in respect of the number of bricks made, any tenant would have been willing to pay, would have been the sum of i'lO per annimi only.' "No finding, correspondent to this, appears iu the case of Everest. The question which we have to determine is, whether the principle on wliich the parish officers have proceeded is correct, with reference to the statute before alluded to ? " We must assume the amounts to be correct, both as to the royalty and the deductions mado ; and no question involving any difliculty iu principle was 150 THE rillNCIPLE OF RATING. raised as to the nature or number of these last. It will be convenient, in the first place, to consider the question, -without reference to the special finding in Westbrook's case, and then to see ■whether that finding makes any difi'erence in the decision of that case. " It is objected by the appellants, in the first place, that it is a fallacy to infer fi-om the fact that there are so many stools on the gi'onnd, from which so many thousand bricks may be made in each year, that so many will in fact be made and paid for; or, secondh*, from the fact that no many have been made and paid for in one year, that the same, or an equal number will be made and paid for in the following year and years ; and, without doubt, the conclu- sions do not follow with certaintj' from the premises. But the answer to the first of these questions is, that it is rather a question of amount than of prin- ciple : it does not touch the question, of whether the roj-alty is in substance a rent. Considered as a question of amount onJij, the pa>'(sh officers having to make a 2>ros2oective rate, may well look to see what it is j)rol)ahle the land will ho made to j^roduce in the current year : they may well proceed with a brickfield as they would with laud used for agriculture. " They cannot, in that case, tell for certainty how much will be tilled, nor with what grain, still less how much will be produced, or at what price sold. Yet, supposing the tenant to occupy at a rent, to be ascertained in each year bj' the actual produce and price, as it well might be, they may reasonably beforehand, from such premises as the nature of the land, its usual mode of cultivation, the preparations actually made, if any, and other sucli cu'cum- stances, infer what wiU be the rateable value in the given year. In the present case, w-e cannot say that the nature of the occupation does not afford rather safer premises for drawing the conclusion as to amount. The preparations are somewhat of a more pcnnancnt nature. It is not unreasonable to infer that the stools would not be erected but with the intention of making bricks, and that more would not be erected than the quantity of bricks to be made would require, and that more bricks would not be made than were expected to be sold, especiall}- as the duty to Clovcrnmont, and the royalty to the landlord, are to be paid, not on the sale, but on the making. These premises raised at least a in-iind facie case ; and if they led to an cxayyeratcd conclusion, it was in the power of the appellants to have shown the error by actual proof. As to the second objection, the answer is, that the rate is made but for the year, and any falling-ofl'in succeeding years would, of course, operate in reduction of the rate for tliose years. " But the next objection is a more important one : that it is altoycthcr wrony in principle to consider the royally as rent : and this appears to be founded mainly on this, that it is a sum paid not in respect of the THE PRI^'CIPLP: OF KATIXO. 151 reuewiug protTuce of the land, but of a portion of the land itself and that not consumed by slow degi-ees, and to be exhausted at the end of a long period, as is the case Avith a coal mine, under wliich circum- stances it was admitted that it might be treated as produce, but in such large proportions that the whole in a few years would be exhausted. It does not appear to us that the circumstance of a more or less nqnd consumption can make any difference in the principle. The rate is always imposed with refer- ence to the existing value, whether temporary or enduring is immaterial. A case was supposed of a brickfield worked out in less than a year, to meet the demand of some enormous contract for a public work, the consequence would be, that the land would have a very much increased rate for that year; in the following year its value might sink almost to notliing, and the rate ought to fall proportionately, even to notliing, if the brick earth being exhausted, the land, like an exhausted coal mine, should become entirely unjjroductive. If this were not so an obvious injustice would be done to the ratepayers. Suppose two brick fields of the same size, uhich, if worked, so as to be consumed in ten years, and by equid working in each year would 2^roduce .£1,000 each, on which the rate should be ten pounds in ten years, each will contribute one hundred ]70unds to the pcirochial authorities ; let one be exhausted in the first year, the produce tvill have been .£10,000; but the rate only ten jwunds for that year, according to the appel- lant's argument, and it may be nothing afterwards, but, whatever it be after- tvards, it is clear that there will have been a valuable occupation in one year, escaping as to nine-tenths the rate entirely. But no injustice would be done if in every year the occupier could be assessed according to the actual value in that yc'ir, and it is the duty of the overseers to arrive as nearly at this as they can. Tlie case of King v. ]\Jirfield was mentioned in the course of the argument, the facts of the case are wholly unhke the present, the saleable underwoods there produced no profit, except in the twenty-first year, here there is notliing to show that equal profits may not arise in every j-ear of that tenancy ; long or short, the term of tenancj' is fixed on that assumption : the principle of that decision, however, is in accordance with what will be our conclusion. " We come then to the bare objection, that the royalty is paid, not for the renewing produce of the land, but for several portions of the land itself, mixed up with foreign matter. I'he expoise, however, must of course have been castoj)^' before the roytdly itself was fixed. Tliat was a sum, which, after all such ex- penses were i)aid, the occupier could afibrd to render to the landlord. "When the case is thus laid bare, there is no distinction between it and that of the lessee of coed mines, of clay pits, of slate quarries ; in all these the occuj)atiou is only valuable by removal of portions of the soil, and whether the occupation is paid for in money or in kind, is fixed beforehand, b}' contract, or measured after- wards by the actual produce ; it is equally in substance a rent ; it is the com- 152 THE PKINCIPLE OF HATING. pensation ^vliich the occupier paj-s the landlord for tliat species of occupation which the contract hetwecu them allows. This would not admit of an argument in an agi-icultural lease, where the tenant was to pay a certain portion of the produce, that would he admitted to be in all respects a rent sen-ice, with every incident to such a rent, and in Danid v. Grade we held the same with regard to a marl pit and hrick mine, as the parties termed it, where the render was of so much jjcr cubic yard of the marl dug, and so much per thousand of the bricks made. " We are brought, then, to the conclusion that the jxiyish officers have done right in considering the royalty as a portion of the rent, and tee see no objection to the mode by which they arrive 2^ri>fid facie at the conclusion, that the amount of royalty rechoncd in the rate vAllbe j^idd in the year for which the rate was made. " Still, it must always be remembered, that the ultimate question is that propounded by the statute, and therefore the amount which has been paid, or what is reasonable to infer will be paid, is only evidence, not the fact itself to be ascertained. When, therefore, the case came to the sessions, it was open to the appellants to j)rove such imcertainty in the market, or such circum- stances affecting the process of maldng, as showed that the parish officers had done wrong in concluding from such a quantity made or expected to be made^ that the land might reasonably be expected to let, at a rent measm*ed by that quantity ; such evidence would have raised a question of fact for the sessions, and they would have had upon the whole to sustain or reduce the amount of the assessment. It ma}- well be, that although at the end of the year the lessee has made so many bricks, that he can afford to pay one lumdred and fifty poimds in royalty to liis landlord, he could not prudently at the beginning of the year contract to pa}- more than one hundred pounds, and if so, the latter, rather than tlie former, will be the simi at which the land may reasonably be expected to let fi-om year to year. And this is what we understand the sessions mean in Westbroolc's case, by the special findmg. The parish officers estimate the rent at a supposed amount of bricks actually made, and the royalty then payable on such amount ; from this they make such deductions as reduce the rateable value to one hundred and fifty-nine pounds ten shillings, but the sessions say, that, placing the tenant exactly on the same footing as to the incidents of his occupation, but calling on him to say beforehand, what rent he would pay per acre for it, he could not be expected to give more than ten pounds Per acre, which, on the whole, would amount to a little more than one hundi-cd pounds. This latter appears to us to be the true criterion rather than the foi-mer, and the rate must be amended accordingly. " It is not so easy to deal with Everest's case. The sessions ask us, what is the net annual rateable value of the land ? and add, if the suuis paid arc to be THE PRINCIPLE OF RATING-. 153 considered in the nature of rent, and as sucli, ouglit to form tlie basis of rating, their order is to be confirmed ; if either of the modes contended for by the appellant be correct, the case is to be sent back, that the rate may be adjusted accordingly, '^ow, neither of the appellant'' s modes are correct, nor icere con- tended so to he ; they were in effect to rate land occupied in one mode, as if it were occupied in another, the modes producing different rates of profit, and commanding different amounts of rent, than wliich nothing can be more im- reasonable. But, on the other hand, although the sums paid are in the nature of rent, it does not follow that they must form the basis of the rate in the sense of fixing its amount. The true question is that which the sessions ask, but wliich they must answer for themselves, by finding, upon evidence according to the principles laid down, what, in the words of the statute, is ' the rent at wliich the land may reasonably be expected to let fi-om year to year,' remembering the purposes to wliich it is to be applied, and the privileges which the tenant will enjoy under liis contract and by reason of his occupation, and after making all the deductions specified in the statute. It by no means follows that this mode of examination will produce so gi-eat a change in Everest's case, as it has in Westbrook's. The circumstances may be such as to risk, or market, or competition, as to make the difference little more than nominal. The market may be so sure, the competition so little, as to make the risk almost notlung. Still this is the question to be tried, and for the purpose of trying it, this case must go back to the sessions. Both orders should go back to the respective sessions, that the rates may be amended according to the principles laid do\\'u." The orders were sent back to the sessions accordingly. AltliougiL the above decision was pronoiincecl by the Court more than thirty years ago, yet, even at this present time, very few chalk pif.'i, hriclxfiehh, gmrcl jnts, and other occupations of a like character are properly assessed. It is only a short time ago that many properties of this class, situate in various parts of the country, came imder the notice of our firm. Some were chalk pits, having lime kilns or cement factories attached, others were chalk pits used solely for ballasting purposes, and others were pits from which was being extracted cither sand, gravel, or clay. The following comparative amounts having reference to the old and new rating of some of those hereditaments, will illustrate how very little could have been known about applying practically, the principles laid down in the above judgment : — 15-1 THE rRlNC'ir]>E OF RATING, Oia Rateable Ixateablo Value finally Value. settled by A. K. &.M. 1 . . . £250 . £470 2 . 50 . 110 a . . . 300 . 1130 4 . . . 413 . 1108 5 . . . 212 . 906 6 . . . 120 . 500 7 . SO . 330 8 . 135 . 500 9 . 3G . G8 10 . 70 . 300 11 . 280 . 1397 12 . 1685 . 3980 13 . 331 , 742 14 . 200 . 588 15 . . 110 16 . 120 . 354 17 . 480 . 900 18 . 21 . 470 Other instances miglit be given, but it is simply intended here to show what parishes lose annually by their officers not properly seeing after this exhaustible class of property. Case No. 18 was a sand and gravel pit, in the occupation of a railway company, from which they were extracting large quantities of ballast for their permanent way, and had been for several years. Tlic parish officers knowing nothing oi ihc j)n')icip/c of rati it rj — nor can tliey be expected to — had assessed it as ordinary agricultural land. "NYc were called in to value the whole of the company's pro- perty in the parish, and rated the pit at the above amoimt, which was never crcii appealed arjainnf. It would be well for ratepayers if tlioir roprosentaiives would bear in mind the words pronounced by Mr. Gladstone in his great THE PRINCIPLE OF RATING. 155 Budget Speecii of 1853 — viz., that "The exemption of one man means the taxation of another." Mines. The rent which a mine would let for from year to year maj' be ascertained upon the principle ah-eady considered in reference to ballast pits. The total annual produce Avould have to be ascer- tained in the first instance, and also the total working expenses in respect of "getting" the produce. An amount for tenant's profit must be determined, and this amount, in the case of mines, should be made upon a liberal scale, because, from the very nature of the work, there will always be a certain liabiKty to accidents which, with the utmost possible care, cannot be avoided. The difierencc between the gross receipts, and the working expenses and tenant's profits, will give a certain rent in respect of the total annual pro- duction, if the tenant had not rates and taxes to pay. Making allowance for these, the residue is the amount of rent a tenant could pay, and which may be reduced to a fair royaUi) per yard, j^cr ton, or 2^<^>' chaldron. With regard to the deductions to be made from the rent in order to arrive at the rateable value, the principles upon which they must be made have already been noticed when considering the question of ballast pits. For a mine, like the ballast pit, will, as a whole hereditament, consist of parts which of necessity must some time become exhausted, and of other parts which will cease to yield rent in consequence of the exhaustion of those parts. With regard to the tenure of mines, they in very many cases are occupied by persons who have spent much money in converting them from land with a certain quantity of minerals contained beneath, into collieries from which the minerals are in process of being extracted. The rent or royalty paid by the occu- piers in such cases is by no means a necessary criterion of the rent the mine, in its present condition, would let for from year to year ; for, in addition to paying a certain rent or royalty per annum, they may have expended large sums in sinking shafts, erecting engines and various kinds of machinery to work the mine. By doing this 15 THE PRIXCIPLE OF RATING. they have created a hereditainciit which will let from year to year at a certain ascertainable rent. It very often happens that the icorkinga of a mine extend into several parishes ; in such a case a careful survey would require to be made and the parish boimdaries accurately laid down, the sur- veyor could then, after ascertaining the total yieht, approximate sufficiently close by an inspection of the workings, to enable him to apportion to each parish its respective share of the rateable value of the whole. It does not follow that because the shaft of a coUiery happens to be situate in one parish that the rateable value of the whole mine is to go to that particular parish. If the workings extend into other parishes, then the value of each of the portions in those parishes must be ascertained distinctly. Such was the decision of the Court of Queen's Bench, in the case of the Queen v. Foleshill, 2 A. & E., 593. In the following case, many of the principles which have been ah'eady discussed, are so clearly stated, and authoritatively con- firmed, that it is desirable to quote, not only the judgment, but also the case and the arguments : — The Kimj v. John At (wood, Esq., and others (0 B. and C. 277). " On the 2i)tli of March, 18-25, the churchwardens and overseers of the parish of Rowley Regis, in the county of Stafford, made a rate for the reUef of the poor, in which the above John Attwood was assessed as owner and occupier, and Thomas Davey "NVightwick, John Jones, Joseph Fereda)-, and Josiah Parkcs, were assessed as lessees and occupiers of certain coal mines then at work. " fpon an appeal to the Midsummer General Quarter Sessions for the county of Stafford, the rate was confirmed, subject to the opinion of tliis Coxu-t upon the following case : — " The appellant, Jolui Attwood, was the proprietor and occupier of the coal toine upon which the above rate upon liim was made (which mine is situate in the parish of Rowley Regis, in the county of Stafford), and had expended lipwards of i'10,000 in planting the niinc and scttuig it to work. The mine had been at work one year and a quarter. The value of tlie whole of the coals which had been raised froto the mihc did not exceed X'y,000. Tlie full value of THE PRINCIPLE OF RATING. lo7 tlie annual produce of the mine in question, after deducting the current expenses of working the same, amounted to the sum of ^428. 9s. Upon that amount the appellant was rated. " The appellant, T. D. Wightwick, had been for five months prior to the said 29th day of March, 1825, lessee of the coal mine upon wliich the rate upon him was made, and wliich is situate in the said parish of Rowley Regis ; and during the five months he had been lessee he had paid ^785. 14s. in royalties for coals raised ; he had also expended in the purchase of the lease and setting the mines to Avork, £'5,020. During the five months that he had occupied the mine he had raised coals to the amount of i'3,825. 2s. 8d. The appellant, T. D. Wightwick, was rated upon the sum paid for royalties, the sum of i;785. 14s. being considered by the respondents as the annual value of the royalties paid by him. " The appellants, John Jones and Joseph Fereday, were the lessees of the coal mines upon M'hich the rate upon them was made, and wliich are situate in the said parish of Rowley Regis. Sir Horace St. Paul, the owner and lessor of the mines, sunk the pits, and made preparations requisite for working the nunes, and then let them to the appellants, Messrs. Jones and Fereday, at a certain fixed royalty, not a specific proportion of the amount of sales : ^492. 12s. 8Jd. was the amount of royalties paid to the lessor during the last year. The lessees had expended ^600 in permanent erections on these mines. The appellants, IMessrs. Jones and Fereday, were rated upon the supposed amount of the annual sums paid for roj'alties. " The appellant, Josiali Parkes, had been eight years lessee of the miuo upon which the rale upon him was made, and which is situate in the said parish of Rowley Regis, and had expended .£2,500 in planting the mine and setting it to work. During the last year he had raised coals to the value of £2,500, and, during that period, had paid X"585 in royalties, and was rated upon the supposed amount of the annual sums paid for royalties. " The questions for the consideration of the Court are — first, wlicther under all the circumstances of this case, Mr. Attwood was properly rated at the sum of £438. 9s. in respect of the said coal mine, such .sum being the full value of the annual produce of tlie mine, after deducting the current expenses of work- ing the same ; and, secondl}^ whether the said T. D. Wightwick, John Jones, Joseph Fereday, and Jo.siah Parkes, were rateable in respect of their occupa- tion of the said coal mines to the full amount of tlio .'^ums paid for royalties upon the coals raised from such mines ? " Campbell, Shutt, and Ilolroyd, in support of the order of llie sessions. Two objections arc made to the rate in litis case : iirst. lliat the rate should liavc been not upon the annual value of the produce, but upon the interest of LjS the rRixciri.E of rattxo. tlmt value ; secondly, that in maldng the rate, allowance shoxihl have been made for the expense of planting the coal mines. The words of the statute -13 Eliz. c. -^ are decisive ou the first point ; the occupiers of coal mines are thereby made rateable in respect of the mine ; that is, tho capital, when occupied by the owner ; the coal raised is the annual value, and for that the occupier is rateable, whether the adyeuture be profitable or not. And nheii the mine is in the hands of a Je^see, he is Utihie to he rated upon the full amount of the royalty or rent uhirh he pays, so long as he continues to irork the mine. R. v. Farrott (5 T. 11. 593). B. v. Jledimrth (H East, 387). Then as to tlie second question, the argument on tho other side must go to the length of saying, that no rent can be made upon the mines until tho expense of i)lanting thom has been repaid, for no proportion of those expenses can ever be fixed as proper to be deducted before the rate is made. But li. v. M((st (0 T. Pi. 154) shows that the property is rateable for the improved value, without taking into consideration the expense of making tho improvements. If a canal is cut, the whole of the produce of the toll is immediately rateable ; so, if a house is built, it is rateable as soon as occupied. " The same principle applies whether the premises be in the hands of tho owner or occupier. The rent is the value after deducting the outgoings, li. V. Hull Docli Comjmny (,3 B. & C. 51()). Here the tenants agi-ee to pay a certain proportion of the produce as royalty or rent, for that sum they are rateable. Attwood, who occupies his own mine, is said to have made a certain clear profit, after deducting e.rpenses ; that, therefore, leould he the amount of royalty if the mine was in the hands of a tenant, and he is, therefore, rateable for that sum. " The Solicitor- General, Oldnal Russell, and 'Whately, contra. The import- ant question for consideration is, whether the mode of rating coal mines which generally prevails, has been well considered. All the other thuigs mentioned in the 43 Kliz. c. 2, as the subject-matter of rating, are of a permanent nature ; but tho coal in the mine is the capital, it is the soil and freehold, and tho sum produced by tlie sale of it must be considered as the purchase-money of a part of the estate. " The rate, therefore, shoidd not be upon the whole sum produced l)y tho sale of the coals, but upon the interest of that sum. Ji. v. Farrott and Jf. v. JJediiorth are the only cases upon the rating of coal mines, and in neither of them was the attention of the Court called to the circum.stance that the subject- matter of the rate was part of the really, and, not being renewable, would, in a few years, become exhausted. But, on ihv oilier ground, Attwood was not rateable at all ; the moneys expended by hiin liad never been repaid, and therefore the mine bad never become productive. Now, it is difTicult to find THE miXClPLE OF RATING. 109 any clifferenco between the case of a mine wliicli lias never become productive, and one that has ceased to be so; and, in the latter case, it is not rateable, li. V. Bcdworth, and iq. U. v, Durdey (0 T. H. 53], it was held that stock in trade was not rateable, because not proved to be productive. At all events, Attwood is rated too hiyli in proportion to the other appellants ; the rate upon him is in respect of the full value of the amiual produce of the mine ; now, that includes both the landlord's and the tenant's profit ; the rate certainly cannot be good if imposed upon more than the estimated value to let. As to the other parties, 'the rate upon the royalties cannot be suj^ported. If the owner is to be con- sidered as the seller of part of the realt3% the lessee is the purchaser, and the royalty is the purchase money ; the rate, therefore, should be, not on the royalty, but on the sum at which the mine could be let subject to the royalty. Abbott, C.J. :— " We are all of opinion that the owner and occupier of a coal mhie should be rated at such a sum as it Would be let for, and no more. As to the other points, the first was, that the rate should not be imposed upon the coals produced, because that was part of the realtj'. It is the first time that such a proposition has ever been submitted, although many coal mines, in various piarts of the countiy, have constantly been rated ; and the argument in support of it is wholly untenable. The legislature has expressly made coal mines rateable, and they must he rated for what they j^i'oduce — viz., the coah. Sh(te quarrica and brick earth are also exhausted in a few years, but, nevertheless, the rate is always imjjosed ujwn that which is 2^1'oduced. The other argument was, that the rate could not be imposed until the expense of planting the mine had been recouped. But I cannot discover anj' distinction between expenses incurred in bringing a mine to a productive state, and building a house. The attempt to distinguish them is perfectly novel ; and if a house is to be rated as soon as built and occupied, it must follow that a coal mine is rateable as soon as it is set at work aud produces coals, although it may happen that the expense of sinking it may never be recovered. If the tenant of a mine expends money in mctkiny it mure productive, that is the same as expending money in iniproviny a farm or house, in which cases the tenant is rateahle for the improved value. " Order of sessions amended as to the rate upon Attwood, aud confirmed as to the residue of the rate." The next case brought before the Court of Queen's Bench, having reference to the principle of assessing mines, was that of The Kiny v. Lord Granville i!) 13. & C, 188). The defendant appealed against a rate made the -.'xiudday ofFcbruaiy, 18-i8, for the relief of the poor of the parish of Stoke-upou-Trent, whereby lie was 160 THE PRixcirLE of rating. rateil for a oolliorv, including engines and raihvaj', at .£'(>1. 17s. od., being a rate made upon the snm of i:'.)^'.). IMs. Tlic court of quarter sessions confirmed the rate, subject to the opinion of this Court, on the following case : — " The defendant is the lessee and occuijier of a colliery in the parish of Stokc- npon- Trent. In the year ending on the ;31st of December last (1827), he paid to his landlord, for royalty, a mine-rent upon the coals raised from the said collier}', viz., the sum of £802. Is., which sum is a fair mine-rent for a tenant to pay upon the quantity of coal raised in that year. The sum of ,fS02. Hs. forms part of the sum of £"989. 18s., upon which the defendant is charged. The defendant, some time since, erected several steam and other engines in the colliery, which are used solely in draining the mines, and in raising the coal to the surfoce ; and he also laid down a railway, which is solely employed in facilitating the carriage of the coals. These form the machinery with which the mines are worked, and without which they could not be worked ; and there would be no mine-rent at all unless such macliineiy were used. The sum of ^187. 10s., •wliich is the remainder of ^989. 18s. on wliicli the defendant is charged, is a charge over and above the amount of the mine-rent introduced into the assessment in respect of the engines and railway. And it is calculated that if ihe colliery were now to be let by the defendant to a sub-tenant, along with the engines and railways, the total sum of i)!)89. 18s. would not be more than a fau' rent for such sub-tenant to pay. If the Court should be of opinion that the defendant ought to be rated for liis engines and railways, in addition to what he ought to pay as mine-rent to his landlord, then the rate was to stand ; but if not, then the rate was to be reduced to ^50, 3s." Baylcy, J. :— " / have no douht that ihe defendant ought to he rated for his engines and railways. Whether the sessions have made proper deductions we are not to decide. The only point for our consideration is, ' Whether the defendant ought to be rated for his engines and railwaj'S.' Jf the owner had occupied the mine he would have liccn liahle to he rated accordimj to the improved value of the propertijy and uhere the owner of a mine fixes an engine, or other- uise, h)j expenditure of his cajiittd, raises the value of his jirojiertg, he uill he rateable for the value of that properly so improved by his e.rpenditure. If it be leased to a tenant, who is to incur the same expenditure of erecting an engine, the owner will receive a less (rent or) royalty, but as a greater quantity of coal will be raised the tenant will be thereby remunerated for his expenditure, and, I think, the tenant being the occupier, is liable to be rated for such improved value. The order of sessions must therefore be confinncd." Ijittledalc, J.: — " The question is, 'Whctlicr tlio dcfendnnt be lialdc to be rated ut the THE ^lu^•CT^LE or hating. 161 increased amount mentioiieLl in the case, by reason of the engines and railway lio has erected ? Generally speaking, the rate is to he in proportion to the rent. Here the tenant has erected an engine, wliich renders the mine more produc- tive. It is immaterial, Viith reference to rateability, whether the landlord or tenant erect an engine, or lay down a railway. The bargain between the landlord and tenant maybe varied on that account, hut the occiijjier of tJiepro- 2Jerty is rateable in resi^ect to its improved annual value. I think, therefore, that the lessee of this mine, being the occupier, was properly rated for the improved value." Mr, Justice Parke says — " The question left to us is, ' Whether the defendant be liable to be rated for improvements ? ' I think he clearly is." Concluding as follows : — " The only question for us, however, is, ' whether it be right in principle to rate the lessee in respect.ofan annual value, increased h)/ reason of improvements made Inj himself.' I think he was properly rated for the improved value." Order of sessions confirmed. The above decisions clearly establish, the principle upon which the net rental or rateable value of coal mines shall be arrived at. In reference to other mines, which at present are not rateable, it is reported that a Bill has been prepared, and will probably be introduced and passed next Session of Parliament, which will place them in the same category as coal mines. See Appendix. M 1G2 THE TRIXCrrLE OF KATIXG. GAS AND WATER WORKS. The organisation of sucli properties as rjas and irafcr irorls is much, more complicated than that of any of the properties hitherto considered ; instead of the hereditaments having been created by one person and being occupied by another, it is generally foimd that the entire hereditament has been created by the joint contributions of many persons acting as a corporate bodj", and ■s\ho themselves (by their officers) almost invariably occupy the hereditament, and fill at once the two positions of landlord and tenant. But it "will be evident from what has already been said, that the interest of the tenant may easily be separated from the interest of the landlord by an application of the principle of "W/icU rent man f/ie hcyeditament rcasonahb/ he expeefed to hi for from year to year .-" The hereditament itself is frequently situate in many parishes, there being in some parishes works, reservoirs, conduits, mains, &c., and in other parishes mains and pipes only. "When property is so distributed, it may seem to be a difficult question to determine the rent which a tenant woidd give for each of the various parts ; but when, instead of inquiring what rent a tenant would give for the portion situate in any given parish, the question proposed is, *' What rent a tenant would give for the whole hereditament ? " and then, " ^^'^lat share of that rent is duo in respect of the part situate in that parish ? " the problem assumes a phase Avhich can readily bo discussed. Those who have been affected by the preceding questions, having at various times joined issue upon the point of how the rent is to be determined, the necessity for frequent appeals to the Court of Queen's Bench has arisen. THE PUrXflPLE OF RATING. 163 The leading decisions affecting these properties are : — 1st. a. V. The Cambridge Gas Light Co., 8 A. and E. 73. 2nd. R. V. The Bad London Water Co., 10 Q. B. 208. ■3rd. R. V. The West Middlesex Water Co., 28 L. J. (N. S.), M.C. 135. . 4th. R. V. The Sheffield Gas Co., 32 L. J. (N. S.), M. C. 169. 5th. R. V. The Overseers of the Parish of Lee {The Phoenijo Gas Case), 1 Law Rej)orts, Q. B. 241. Although the cases were argued in the order in which they are enumerated, yet, inasmuch as the points raised by them may be more conveniently noticed in the order in which they would actually arise in deducing the rent a tenant woidd give, it is not proposed to consider them chronologically. The questions to be considered are divisible into two principal classes — viz., first, questions affecting the rateable value of the whole hereditament ; and, second, those affecting its apportion- ment. The first question raised as to " the cu'cumstauces wliich ought to be taken into account in PrJncJDle of ascer- detcrmining the rent a tenant would give for the whole," taining the total is the most important. rent. On the one side, it was contended that a tenant about to take either gas works or water works would base his estimate of tho rent he could afford to give upon the receipts and expenses connected with the whole undertaking. Ul^on the other side, it was contended that the tenant would simply take into consideration the amount of capital invested in the works and mains, and pay as rent an amount sufficient to afford good interest upon that capital. The argument in favour of basing the estimate of the rent upon the receipts was that, inasmuch as that for which the tenant is willing to pa}' rent, is the right to occujiy and take the actual produce, and inasmuch as the actual produce of gas or water works is ultimately measured by the gross annual receipts, the gross receipts alone should be the basis of the calculation of the rent M 2 J64 THE PIIIN'CIPLE OV RATING. wliicli the tenant ■would give. It was furtlicr contenclod that gas and water works are of that class of lieroditamcnts in whicli a trade, more or less profitable, is a necessary consequence of the occupation ; that, from the verj'' nature of the properties, there exists, more or less, a monopoly of trade in either of those articles. It was also contended that any persons requiring either gas or water must, in the case of gas, either make gas for themselves, or, in the case of water, possess a well of water of their o\n\, or, in each case, must purchase that which they require from the gas or water company which happens to supply the district. Upon the other hand, it Avas argued that the rent deduced from the gross receipts as a basis, is not the rent at which the premises might reasouahlij be expected to let from year to year ; that any inquiry into the gross receipts earned is an attempt to rate profits in trade ; that no inquiry is made into the gross receipts of the ordinary trader; and that the rent deduced from the gross receipts is not the rent the hereditament would command from year to year, but that which the hereditament and the (joodicill of the business together woidd command. That, inasmuch as if the owners of the premises had neither works nor mains, they could have works erected and mains laid by paying as rent a certain per-centage upon the capital required ; the amount that Avould be so paid is the true measure of the rent Avhich might be expected from year to year for the occupation of this class of hereditament. In reply it was contended, that no goodwill need be rented by the assumed tenant, because the mere occuj^ation of the premises, without the sliglitest consideration of the goodwill, would of necessity command a trade ; that the case is not similar to that of a shop which may be let, and then afterwards the lessor of the shop open a similar one immediately opposite, and so, although he lets his shop, still retains his trade ; for in siich a case it must be clear, that unless the lessor not only lets his shop, but also agrees not to trade within a certain distance, llio occupier of the shop would not of necessity have any of his landlord's trade. Further, it was contended, tliat tlie rent which a gas or water company THE ^llI^•CIPLE OF RATING. 165 miglit pay for the use of premises erected for tliein, would not be tlie same as they themselves could obtain for the use of the premises by a tenant from year to year. This question was raised and finally decided in the case of JR. v. T/io SJipffield Gaa Comjianij ; for although cases had been before the Court in which secondary questions were raised, yet, inasmuch as in those cases the total amount of rent was agreed upon, the Court were not called upon to decide whether the total amomit of rent had been ascertained iq^on correct princij)les. The Sheffield case, which was most carefully drawn, set out at length the method adopted by the respondents, the parish officers of the to-^Tiship of Sheffield, in determining the rent of the whole hereditament. This they did by taking the gross receipts and deducting therefrom the working expenses. They then deducted a sum for tenant's profits, a sum on accoimt of rates and taxes which are payable by the tenant, and also sums on account of repairs, renewals, and insurance of buildings and mains. The residue, after all these deductions had been made, amounted to £21,072, which, according to the case, was taken to be the rent at which the works might reasonably be expected to let from year to year, and to be the true estimate of the net annual value thereof. To this mode of ascertaining the rent the appellants objected, and contended, that " The respondents slioukl have first ascertained the quantity of land, and the size and class of the buildings and fixed macliinery, if any, at each of the different stations of the company in the respondent township, and the class of station of each in the to^vn of Sheffield ; and then as to each station used for manufacturing, they should have considered it as land and buUdings, with machinery affixed, employed in a first-class and lucrative manufacture in the prosperous manufacturing town of Sheffield; that they should then have ascer- tained whether there were any, and if any, what other locaUties than the one in question, available for such a station for this company as the one in ques- tion ; that they should then have ascertained the actual rental of other stations • consisting of laud and building, and machinery employed in the large manufac- tories in Sheffield; that then, havmg regard to the quantity of space occupied by the station in question, and to the size and class of tho buildings and 16G THE PRIXCIPLE OF RATING. machinery, and to the possibilit}', if thought expedient, of obtaining a com- peting locality, and to the fact of such station being fit for and used as the manufacturincj station of a first-class manufactory in such a manufacturing town as Shcllield, tlie respondents sliould have fixed the rental of the station in question by comparing it with the other manufacturing stations above men- mentioned, and the actual rental paid for them ; and tlic respondents should then have made from such rental the deductions pointed out by the statute, and should so have obtained the rateable annual value of each such station." Upon this statement, the first question put to the Court was — " If the Court of Queen's Bench should be of opinion that the method above applied by the respondents of fixing the net annual value of the appellant's rateable property in the respondent township is not according to the Parocliial Assessment Act, and is contrary to law, then the Court is praj'ed respectfully 60 to declare." To this Mr. Justice Blackburn, who delivered the judgment, replied : — " As to the first — viz., the mode in which the respondents have arrived at the value of the entire subject — it seems to us that if the proper allowance for expenses, and for tenant's profits and interest on capital, lias been made, and the proper value is put upon the stations, and works, and buildings, &c., a proper mode has been adopted for obtaining the rateable value of the remaining property." Here the correctness of the principle upon which the rent of the whole had been ascertained by taking the gross receipts as the basis, is, for the first time in the case of gas or water works, distinctly affirmed ; for although in the West Middlesex case such a definition of " rent " — viz., " Profit remaining after all deductions have been taken from the receipts" — had already been given so as to imply that the rent of the whole must be based upon the rcceii^ts, yet, inabmuch as this question was not then before the Court, the extent to which the definition could apply was open to argument. The ^^I'^iicip^c, that the rent of the whole is to be ascertained by taking the gross receijits and making certain Deductions from deductions from tliem, being thus autliorifatively the gross receipts. ... . . . . , stated, the next question which arises is with reference to THE 1>RIXCIPLE OF RATING. 167 " The propor allowances for expenses and for tenant's profits and interest on capital invested." Whetlier the liereditament rated be in tlie form of water Tvorks or of gas "W'orks, there are of necessity certain expenses incurred by the occiipier, whether he be owner or not. These are the actual working expenses incident upon the occupa- tion. If the property be gas works, these expenses will be : — Coals ; materials for purification ; suj)ervision and labour ; wear and tear of tools and other implements ; salaries to secretary and clerks ; collectors' commission and pay ; stationery, printing, &c. ; salaries of inspectors. ; wages to lamplighters ; bad debts — this being more strictly a non- receipt of part of the entire income. If water works, they will be : — Coals, oil, tallow, yarn, &c. ; wages ; wear and tear of tools and other implements ; salaries to secretary, engineer, clerks ; collectors' commission ; law charges ; bad debts. Besides these items, which are actual payments by the occupier, there must in either case be deducted a sum in respect of the tenant's own personal remuneration. This sum represents the amount of benefit he will expect to reap in consequence of his occupation of the premises. The amount of this profit, inclusive of interest upon the tenant's capital, i.e., of the capital which he, as a prudent man, must be able to command before he takes the premises, must depend in each case upon its own merits. But two things are equally certain — first, that the tenant must have such an allowance made to him as will induce him to occupy the property ; and, secondly, that the allowance to the tenant must not be so exorbitant that it repre- sents nearly all the dificrcnce between the receipts and the neces- sary expenses. I have known cases in which the rateable value of most flourish- ing undertakings was reduced to an almost nominal sum, in con-j sequence of the amount assigned as tenant's profits having absorbed all the profits of the undertaking. This is in effect raying that 1G8 THE riiixcirLK of h.vtixg. the profits were duo to tlie personal skill of the t enan t, and not, as was a ctuall y the case, t o the innat e A'alii c of tli c here ditame nt.^. The mode of effecting this was by making tlie tenant's capital (the amomit ujDon which the tenant's profits are usually calcidated) much larger than any tenant from year to j'car would require. In the case of the Phcenix Gas Co. and Lee Parish , already noticed (1 L. E. Q. B. 241), i^was argued tha t the t ena nt's cap it al shoul d be suchjis to enable him to p rovi de not only for the Avorking expenses, but also for th e purchase of what were called te nant ' s fixtui'es. It may be remarked, that the works, as distinguished from the mains, consist of land, buildings, and plant. The plant consisting, in the case of gas works, of the gas holders, condensers, scrubbers, purifiers, station meters, retorts, steam engines, and governors, &c., &c., the whole of which are essential to the existence of the gas works ; and of the meters which are used for the distribution of the gas, although they are not ahsolittel// indispensable for that purpose. In the Phoenix case, the whole of these were classed under the head of tenant's fixtures. The amount claimed by the company's witnesses, and allowed by the Sessions as tenant's capital, was such as to include their purchase, it being shown in evidence, that if the works had been constructed upon leasehold land, all of them could be removed when the lease expired. But sui'cly itnuist have been fo rgott e n that the estimate of the rent w as to be such a s the hereditaments would command f rom " y ear to y ear" and that consequently no tena nt from year to y ea r would have topi'ovide these " fixtures." Without these " fixtures," the hereditament in its unfinished state would command no rent from " year to year," although upon a long lease a tenant might be found who, seeing this i^art of a hereditament, would be willing to give some rent for it, and afterwards to complete the hereditament, and convert it into a state to command a rent from "year to year." But the rent given under such circumstances would certainly not be the rent the premises would command from " year to year," It may further be remarked, that the proprietors of gas or water works THE PRINCIPLE OF IlVl'ING. 163 would not allow their tenants to receive interest and profit npoii an amoimt of capital invested in the purchase of things for which they ought to be paying rent to them, and by thus retaining to them- selves so large a share of the total profits, only pay to them some almost nominal sum for the use of the remainder of the heredita- ment, and this the largest portion of the whole. The decision of the Court of Queen's Bench was taken upon the question as to whether the retorts, the exhausters, the steam- engines and boilers, the condensers, the scrubbers, the purifiers, the gas holders, and the meters were to be deemed tenant's pro- perty, and, therefore, not liable to be rated, or to be deemed part of a hereditament that is to be let from year to j-ear ? The case, which is fully given in 1 Law Eeports, Q. B. 241, and carefully describes the above apparatus, found that — " 18. It was proved on the part of tlie appellants, and found, as a fact, by tlie court of quarter sessions, upon the evidence before them, that, according to the practice and course of business in letting and liiiing gas works, the tenant would have to take to and find capital for all the property comprised under the heads meters, retorts, tenant's fixtures, and utensils, and would have to pro- vide ^'150,000 for that purpose ; and that a deduction in respect of such outlay was made in estimating, according to the provisions of the Parochial Assess- ment Act, what rent a tenant from yeai" to year would be A^illing or reasonably expected to paj-. ■ " 19. They found that 17^ per cent, was a fak percentage to allow on ' tenant's capital,' for interest of money, for his own trouble and skill, and for provision against risks and casualties ; and allowed a deduction at that rate not only on .£50,000, which they found to be the amount of working capital which a tenant would require, but also on the further sum of £'150,000. " The question for the opinion of the Court of Queen's Bench was, whether it was competent for the quarter sessions to allow a deduction by way of tenant's profits in respect of any, and if any, of which, of the matters and things com- prised under the heads meters, retorts, tenant's trade fixtiu'es, and utensils, the nature of which is above more particularly stated ; and if tlie Comi of Queen's Bench should be of opinion that in any of the above-mentioned cases it was not competent for the quarter sessions to allow a deduction, tlioj- were to amend the rate accordingly'." The decision of the Court was as follows : — ' 170 THE ruixciPLE or uatjng. Lord Chief Justice Cockburn : '•"\Miatever doubt hung over the case at the commencement of the discussion, has been removed by the arguments. I entirely agi-ee that we must look, not to the position of the particular tenant, as to whether he has had to pay so much money down for the machinery and fixtures which are necessary for carrying on the works, but we must look to see what, as the whole concern stands, would be the rent that an imaginary tenant would give for the thing as a whole, excluding nf course front considcrdtion nJuit would he mere chattels, and therefore would not pass under demise from the actual to the imaginary tenant. The way being thus cleared, I tliiiik the case presents really no diificult5^ First, we tliink Mr. "White has failed altogether to show that the meters are anijthiwj more than common chattels. The other things, it is plain, fall under one of two classes of two articles, which are properly taken into account as enhancing the value of the building. In the first place, with regard to the retorts. ]\Ii*. O'Malley's argument has satisfied my mind upon the facts stated in this case, that the retorts are so permanently attached and annexed to the freehold, so fixed to the freehold, as to become part of it, and they must be taken therefore, not as removable fixtiues at all, but as fixtures so connected with the freehold as to become part and parcel of it. With regard to them there is no difficulty ; the moment they are found to be part of the freehold, then, of course, they are rateable as the entire freehold would be. The other items seem to me, one and all, to fall under the principle of the decided cases referred to in the argument of The Queen v. The Southampton Dock Conqiany, and llie Queen v. The Xorth Staffordshire Railwaij Comjiamj. In the latter case the Court, after taldng time to consider, laid down tliis iiile : — That where thimjs which, though capable of being removed, are yet so far attached as that it is intended that they should remain permanently connected with the undertaking, or the 2>>'emises connected with it, and to remain piermanent appendages to it as essential to its working, those must be taken to he things increasing tlic rateable value of the land, and in respect of which the company were not entitled to have a deduction made. That principle applies directly to tho present case. No one can doubt here that the puriiicrs and the gas holders are part and parcel of the works which are absolutely necessary for tlie manu- facture of gas, which is the purpose of the undertaking. No one can doubt that it was intended when those things were erected that they should remain permanently connected with those premises; that they should remain pei-manent appendages to it as essential to its working. Tiny therefore full witliin the rule laid down by the Court in that case. If jou loolc at tlic equity and justice of the thing, there can be no doubt tliat if tlie company proposed to abandon thi.s undertaking and to let these premised because they found it did THE PRIN'CIPLE OF RATING. 171 not answer, or that they had realised so much money that they did not -want to carry it on any longer, or were desirous to shift their premises to somewhere else, and they proposed to let to another company, or individual or individuals, the gas works, of course what a man would propose to take and pay rent for would not be the land independent of all these articles, all of them essential to the manufacture of the article called gas, because the retorts, purifiers, and gas holders are all as essential to the taking of these premises, and the using and occupying these premises as gas works, as any other thing that can possibly be suggested, however permanently they may be attached to the freehold. They seem, therefore, clearly to come within the principle laid down in that case. There is another rule which is applicable here, that is, the principle on which the Court proceeded in the case of Wahmhij v. Zl/i'/H^. inthe 7th Common Bench Reports, New Series, page 11.3. There the owner of land mortgaged it, and afterwards erected certain buildings thereon to and for the more convenient use of the l^remises in liis business of an mnkeeper, brewer, and bath proprietor ; he affixed a steam engine and boiler, a haij cutter, a malt mill, or corn crusher, and a pair of fjrincUng stones. The lower grinding stone was fixed into the floor of part of the premises by means of a frame screwed thereto, the upper one being fixed in the usual way, and the steam engines and other articles, except the boiler, were fastened by means of bolts and nuts to the walls or the floors, for the purpose of steadying them, hut ivere all capable of bcimj removed without injury either to themselres or to the premises. It is possible that some of the articles here, like the steam engine and this boiler wliich is fixed to the freehold — it is possible that the steam engine, the purifier, and the gas holders may be removed M'ithout injury to themselves or the premises. "What said the Court ? They first say, upon the facts it appears that, as a matter of fact, all those articles were firmly annexed to the freehold for the inii*pose of improving the inheritance, and not for any temporaiy purpose ; then they go on to say * But the man who was the owner, who had mortgaged the premises after having attached these things to them in the way described, proposed to take them away as belonging to him, and not as having parted with them under the mortgage.' The Court says : 'When the mortgagor, who was the real owner of the inheritance, after the date of the mortgage annexed them to the inheritance and for the better enjoyment of his estate, he thereby made them part of the freehold which had been vested by the mortgage-deed in the mortgagee ; and consequently the pluintifi's, who were the assignees of the mortgagor, cannot maintain the present action.' So here we cannot doubt, as a matter of fiict that wlien these purillers, and wlion these gas holders, when this steam engine and this boiler, which are absolutely essential to the working of the manufac- ture, were erected, it was with the view to their remaining permanently tlicre 172 THE ruixciri,K of kating. for the benefit of tlie inhcritauce, just as much as Avlicn a man p^^s up (ho various tilings referred to in this case of Wdhmley v. Milne. I therefore tliink, on both grounds, these must be considered as forming part, if not of the free- hold (the latter tilings), still as so far connected with it as to be intended to be permanently attached to it, and therefore tlicy may be taken into account in determining the rateable value of tlie land and the premises in question, and that no deduction can be allowed in respect of them. I think, therefore, that the sessions were wrong in allowing those deductions, and that those deduc- tions must be disallowed and the rate increased 2>/'o taitto." Justice Blackburn : " I am of the same opinion. The rateable value of the premises is to be detennined, acconling to the Parochial Assessment Act, according to the rent that a hj-pothetical tenant, making the suitable deductions, would give for the rateable property, and the sessions have quite properly proceeded to try to ascertain that. The property in tliis individual parish is a portion of a much larger property which the gas company possesses in this parish and in others. The first thing the sessions had to do was to ascertain the rateable value of the entire thing which the company possessed, and afterwards to see what portion of it belonged to this parish. Now, in proceeding first to get at the value of the entire property, as it was not a thing which in practice is let, you cannot ascertain it by finding what people would give in the market, and they liad, as is common in these cases, to proceed to ascertain it for themselves, looking at the elements which a tenant would take into consideration on taking it from year to year. I tliink we are all agi'eed upon tliis. It was disposed of early in the case that the question is, what would a hypothetical tenant give for the whole of the rateable property? and although, in point of fact, as stated in the I'^^th paragraph of the case, tlie person who actually did occupy would not pay rent for portions of the property which are fixed to the rateable pre- mises so as to become part of it, wliich would be capable of removal, because instead of paying rent he would purchase them; 3-ct we are agreed we must look to what a hypothetical tenant, taking a portion of the premises as they stand, would give for them with those portions which were annexed to the property so as to become part of the rateable property. Upon that, so far as that goes, the sessions were ^vl•ong. Then comes a question which is important if considered with respect to other matters. I take it that it is quite clear that the principle established by the cases is this : to talvc an illustration of the principle, it would be applied in tliis way : — If you are letting a house furnished, you would ascertain what was the rent given for it, and what was the rent for the furnitiu'c and the fixtures, so aa to ascertain how much it would be rateable THE PRIXCIPLE OF RATING, 173 for. The way to do it would be to ascertain how much was paid for the furniture and the things in no way forming part of the rateable premises ; and deducting that from the rent paid for the furnished house, the remainder would be the rent given for the house itself. The question then would arise, and must arise, whether the things for which you are to make an allowance and deduction are in themselves part of the premises, or are, like the fui-niture, not part of the premises. Now there are some things fixtures that are attached to the premises, and part of the i^remises, although as between the landlord and the tenant, and the heir and executors there is a right to remove them Clearly no allowance is to be made for those. There are other thino-s — such as movable furniture in the supposed house — wliich are manifestly not part of what is let, and for which allowance must be made. But there are interme- diate things with respect to which it is sometimes very difficult to determine, and as to which a question may arise whether they are made part of the premises or not ; and upon those the question mainly arises in the present case. The rule laid down has been that where the tilings are attached to the premises so as to be part of the premises, although they are removable afterwards, still they are part of the premises, although there may be a ri»ht to remove them. But if tldngs or chattels he merely Jixed to the jiremises, and so far fastened to the premises as to be still chattels, but fixed and steadied for the purpose of use there, they remain chattels altoi/ether, so that they would not be part of the premises at all — they would never cease to use the pkrase in the case of Hellawell v. Eastwood, to have the character of movable chattels ; although fixed for the purpose of the enjoyment of them, still they remain movable chattels. Tlie common illustration is a mirror, which, in the ordinary way, would be screwed to the wall; still it remains a movable cdattel, and is no part of the premises. On the other hand a (jrate which is built into a chimney, althouyh it is capable of beiny removed by a tenant, would still be fixed to the premises, so that it would be i:)art of the premises, and therefore part of what would be considered to be let to the h3'pothetical tenant, and for wliich he would pay rent. Now comes the difficulty of applying it to the present case. We find in the case of Hellaucll V. Eastwood the Court of Exchequer were dealing with machinery that was fixed and screwed, and attached to the premises, and they laid do^vTi the rule as being a matter of fact, depending upon the circumstances of each case, but principally on two considerations — first, the mode of annexation to the soil or f.ibric of the house, and the extent to which it is miited to them ; whetlicr it can be easily removed, inteyre, salve, et contmode, or not without injuiy to itself or the fabric of the building ; secondly — this is what I am calling attention to — on the object and purposes of the annexation, whether it was for the per- manent and substantial improvement of the dwelling — in the lanfnia"o of tlie 174 THE rrvTXf'TrT.F. or irvTixo. civil law, perpctui iixiis causa, or in tlmt of tlic yonv book, pour uii profit del inheritance — or merely for temporary purposes, or the more complete enjoy- ment ami use of it as a chattel. In that case the Court of Exchequer thought tlie things were only put up and fastened in a way for the temporary use and enjoyment as a chattel ; but they did put it clearly and distinctively tlmt two important elements to consider are, first, the degree of annexation ; and, secomlhj, if it he in fact annexed, the object of the annexation — whether it was for the improvement of the inheritance that it was attached to a part of the inheritance, and whether it was for the enjoyment only of the thing itself. In the case that my lord referred to, of Walmslcy v. Mihu\ in the 7th Common Bench, New Series, page 115, which was very nearlj' a similar case, as far as the facts went, to this of IlcUau-cll v. Eastwood, the Court of Common Bencli laid down the same rule, and came to the conclusion that the machinery and tilings were firmly fixed to the freehold, for the purpose of improving the inheritance ; and, taking that view, they thought it attached to the inheritance, so as to become part of it. That is the rule laid down there, and their dolini- tion as to when the thing ceased to be a chattel, so as to become part of the inheritance, although it might be removed. Tliat was the principle laid down in the case of R.\. North Staffordshire Railway Company, where the things were similar to those in R. v. Southampton Dock Company. It was not, of course, in the precise words, but the same idea is conve)'ed. The things thei'e were cranes, turn-tables, and a variet}- of other things, wliich were attached to the premises of the railwaj' companj-, in one sense screwed down, some of them firmly attached, and some of them not. The Court said that the things vhich were not attached to the freehold were to be deducted, and an allowance made for them ; and the tilings wliich were affixed to the fi'pehold clearly enough would not be allowed for. TJien the rule laid down to guide the sessions in what they were to do was this : ' The articles maj' be divided into three classes — first, things movable, such as office and station furniture.' As I have said, all the cases agi'ce in the principle. It is clear these ai-e not to be included. ' Secondlj', things so attached to the freehold as to become part of it.' It is clear on the principle of all the cases that no deduction is to be made for them, and they are to be considered as part of what is left. ' Thirdly, things which tliough capable of being removed, were yet so far attached as that they were intended to remain permanently connected with the raUwaj- or the premises connected with it, and to remain permanent appendages to it, as essential to its working.' I think that tliat phrase, as it seems to me, contains the same idea identically as is stated in the case of IleUnwell v. Eastwood, citing it from the year book, whore they say if it be fixed pour un profit del inheritance ; and again, as in the case in the Common Bench Reports, where it was said the question was, whether they were for the enjoyment of the inheritance. The THE PRIXfTPLE OF RATXXO. 17-J idea is tlirougliout tlie same : if tlie things are annexed, though but slightlj-' but with a view to the enhancement of the inheritance, and the permanent im- provement of it, they may be considered as part, for which a hypothetical tenant would be considered rateable. Now, that being so, and applj-ing that, I ^yas incUned at first to take an opposite view as to some of them. Look at the various matters put here ; they all, with the exception of the meters, on which I shall say a word afterwards, are, although but slightly, attached to the prenuses ; nevertheless, I think it is clear they all are, in fact, attached to tlie premises, and equally clear they aU are, in fact, attached to the premises with the view of enhancing the benefit of the premises, so as to come within the principle laid down in the three cases I speak of. Then, with reference to the meters, it is a difi'erent matter. The meters are chattels themselves, except so far as they are attached to the houses in wliich they are put up. They are attached to the house, as a pipe comes in through the wall and is attached to tlie meter. That is attached to a house, so as to render it part of the house to improve it. Then it would become fixed property. Then, in fact, it is obvious that the meters are kept as the company's meters, to be used as their chattels for measuring the gas, and were never intended to be for the benefit of the liouse to which tiiey are attached at all. They are no part of the inheritance of the company, and cannot be said to be so. Mr. White endeavom-ed to argue so as to make out that a metn- occupies part of the space of the house, and therefore the company did, by occupjing by the meter, occupy part of the house. That is not so. Although the meter is firmly fixed to the house, steadied by being fixed, that does not make the company the occupier of any portion of the house, just as in the case I put in the course of the argument, of a person who has hired out or let a chattel which is not fixed to the house, but enjoyed as a chattel. He cannot be said to occupy by means of his pianoforte, if it be a pianoforte, part of the premises. For that reason I think the meters are pro- perly matters of deduction, and the rest are the other way. Therefore, the result will be that the amount on the rateable value of that entire chattel — the proportionate sum, I think, £-8,000— will be deducted, as rateable value of that portion of the premises ; that amount ought to be deducted. The figures will have to be rectified, and I do not go into the question of figures now. I believe there will be no great difiiculty in finding out and rectifying them when the facts decided by us are taken as the basis to go upon." Justice Lusli : " I am of the same opinion. The sum to be arrived at is ' the net annual value of these premises at which they might reasonably be expected to let from year to year, free of all usual tenant's rates and taxes, deducting the expenses necessary to maintain them in that state.' The question is, what is the rate- 176 TiiK rnixdri.F. ov uatixo. able subject \vhicli is oomprisod within the premises to be rated here ? Now, I appreheml that the premises to be rated are to be taken as they are, -vvitli all their fittings and appliances, by which the owner has adapted them to a particular use, and which would pass as a part of the premises by a demise of them to a tenant. It strikes me as expressing what in other words has been expressed in the two cases referred to by my learned brethren — wherever they have become so far a part of the premises that they •would pass by a demise of those iiremises, they would form a part of the rateable subject of tlie iaiheritance in the value for the purpose of rating. "When we have to apply that test to any paiiicular footing, the question is not what a tenant might remove, not what might be taken in execution imder a writ against the o^^^ler, hut what, as between the landlord and tenant, would 2)f'ss as a 2>art of the premises which he teas to let, and what the tenant would take. Now, applying that rule, I cannot entertain a doubt that, with the exception of the meters, all the subjects of discussion here would pass as a necessary part of these premises. Without the retorts, purifiers, the steam engines, and the gas holders, the premises Avould bo worthless for the purpose for which these things were erected — they would not be a gas manufactory at all. All these tilings are fixed, and so far annexed as to be intended to be permanent, and as really necessary for the use of the premises as gas works. Therefore, I think, except the meters, that the whole of these items ought not to be allowed in ascertaining the ultimate net annual value. Tlie meters are on a different footing, and in no sense a part of the gas works : they are not upon the land occupied by the company, and are not fixed in such a way as to be a part of the freehold. I was struck in the early part of the argument with the finding in the IHth paragraph of the case. It appeared to me to dis- tinguish this from the other cases, and for a time I entertained considerable doubt whether, on account of what was found there, all those items, althougli forming part of the rateable premises, ought not to be deducted. The finding is, that ' accordinfj to the j)i'actice and course of business in letting and hiring gas works, the tenant would have to take to, and find capital for, all the 2)roj)ertg comprised under the heads meters, retorts, tenant's fixtures, and utensils, and would hare to provide .£150,000 for that purpose, and that a deduction in respect of such outlay was to be made in estimating, according to the jirovisions of the Parochial Assessmrnt Act, what rent a tenant from, year to year woidd give. It struck me at first that, being so, the tenant would bo bound to take these premises, making an outlay by purchasing all these articles, and the rent he would pay would bo so much less, and that rent would represent the rateable value. Upon consideration, I quite agi*eo with my brethren, and I am satisfied that that is not the right view on the hypo- thesis that all these tilings except the meters do form part of tlic rate- THE PKTXrirLF, OF R ATTXO. 177 nble suLject, and ought to be takeu into consideration in estimating the rateable value ; because if a tenant and landlord agree — the landlord before the place is let — agi'ecs that a tenant should j)ay down a price for part — tliat is, purchase part of the freehold — to say that the rateable value would be diminislied would be absurd. I quite agree with my brethren, tlierefore, that it makes no difference at all whether the tenant takes the whole, assuming he did, or whether by conti'act between him and the landlord he purchased the fixed plant, which, if not so purchased, would be a part of the permanent premises, I quite agree that, except the meters, all the other matters are rateable, and that all of thorn ought to be disallowed." It will be seen tlie Court niled that, with tlie exception of the moto's, all the other apparatus was part and parcel of the heredita- ment, and as such was rateable, and was not to bo deemed to be provided by the tenant from year to year. The broad question whether this apparatus was landlord's or tenant's, whether it was rateable or non-rateable, is noticed here, because on the answer to that question would depend the amount of the rateable value of the entire undertaking. After the tenant's working expenses, the rates and taxes payable, and the proper amount for repairs, insurance, and renewals have been deducted from the gross receipts, there remains a clear amoimt divisible f between landlord and tenant. This amount represents two things ! — first, remuneration to the tenant for the labour and responsi- bility he incurs, and for the return on the capital he invests in' working the concern ; secondly, remuneration to the landlord, or the return he gets as interest on the money which he has expended : in creating the hereditament. These two sums, in ordinary cases, make up the dividend paid to the shareholders, 'rIio themselves (when the works are not actually let) fill the position of both landlord and tenant. Now, it will be seen that, since the " net results of working " arc divisible into Ivro parts, the greater the first part is made, the less will the remainder, the second part, become, so that if the first part be made so great as to amount to the " net residts of Avork- ing," then the second part will become nothing at all — that is, if the tenant be allowed the whole, the landlord receives nothing. N ITS THK riiiNciiM.r, of I'.ATiNr;. If, on the other liaiul, the tenant is entirely ignored, then the Inndlord takes all. In the one case, the " rent that may reason- ably be expected " is unduly dinunlshed ; in the other it is \niduly increased. Xow, the tenant's remimeration depends upon the capital he would have to invest in working' the business. If th is be unduly increa sed by assuni in f^ that he would have to purcha se things which he, in fact, would really rent^ then his profit is undu ly increas ed, and^^ ro fanfo the landlord 's .share is unduly dimini shed. Had the Court in the above case ruled that all the apparatus described in the case was rateable, then the tenant would only have had to find £50,000 instead of £200,000— viz., £50,000 for work- ing capital, and £150,000 to purchase the "tenant's fixtures." Consequently, his profits would have been very much less than the Court of Quarter Sessions allowed ; and, therefore, a much larger sum would have remained for the landlord. The Court, however, ruled that the meters Nvere to be considered as belonging to the tenant, and were therefore not to be rated. The case had found that "The motors in nil oasos aro placed on tho premises of the consumers; Ihey nve not in any way connected with tlie manufacture, nor are thcij Inilispcusahle though used for the distribution of gas and the earning of profits. They are maintained in their position by being soldered to the service pipes, which are made of lead. If the service pipes were not required to be flexible, soldering would not be nccessar}-, for the meters might be so placed as to remain in a position witliout being fixed iu any. Meters are taken ofl" when they require repair and renewal, or for other causes, and replaced by others, and when repaired are frequently placed iu a different house, and in a diflorent parish." Tho latter finding is equally true of niaiii^i, wliich arc frequently taken iq) and replaced by others, and these again relaid in a different parish. In the above it is admitted that the meters, though used for tho (li-sfrihufion of gas, are not iiKli-spriisah/r. Imagine, therefore, a gas works C(nnplcte in all ro.sjjects except that it possesses no meters. Xow, imagine this gas works let to a tenant /yow t/rai- to i/oav {i.e., on a tenure deteinilnable at the end TIIK PHlXCTPI-i: OF RATINf!, 170 of any one yenr), Since tlie meters are not indispciifiahlr, tlie tenant may be assumed to work the concern without meters. He "would therefore have to suppl}^ his consumers by contract. In the early days of gas lighting, consumers were thus supplied, Having these contracts to perform, he woidd have to make a sufficient quantity of gas to enable him to carry them out. Making this quantity of gas Avoidd involve certain working expenses. These expenses being deducted from the gross receipts, certain net receipts woidd remain. These would be divisible into two parts— tenant's profits and landlord's rent, At this point a proposition is advanced, viz., that provided the tenant can obtain a certain profit for himself, it is inmiaterial to him what rent he pays to the landlord. If the hereditament is, for example, a fertile flirm, the tenant will give a large rent for it ; for if any tenant wants too much for his own profits, there will be plenty of others to be found, who, knowing what the land Avill yield, will be content with a reason^ able share of the produce as profit, and to give the remainder as rent. If, however, the hereditament is a very poor farm, the tenant, since he must have his profit, will give but a poor rent, and no competing tenant will reasonably give more, for every tenant must have his reasonable profit. Reverting to fja^ u-ofhs : the tenant, out of the net receipts, can afford to pay to the landlord a (;ertain rent. Under these circum- stances the tenant might be satisfied, but the landlord might not. Now, it is submitted that a tenure from year to year involves the yearly readjustment (if necessary) of the rent paid. The landlord being dissatisfied with the rent he receives, and being assimicd to be a prudent man, would consult an engineer, who would ad\-isc him that the gas works, in their present condition, coidd command no more rent, for, owing to the system of supply by contract, the gross receipts are not earned in the economical manner in which they might be. But he would point out that if the works were supplied with meters, Ihe whole concern could be more economi- N 2 180 TTIE rRlNfTPT.E OF T^ATTXG. cally worked, and the net receipts increased — tliat is to say, tlie / . //crcdifaDiciif could ho improvrd. Noav, whose business is it to *y y impr ove an heredita ment — that of the huidlord, or that of the ^ f,/^ fe ienant from year to year ? ,t0f^'^^ "When I read the report of the Phaniix case, it occurred to me that if the above argument had been advanced, the decision of the Court might have been different. The Court of Quarter Sessions found " t hat 17j pe r cent, was a fair per-ccntage to al l ow o n tenan t's capitaL" This was made up thus : — Interest, 5 per cent. ; trade profits, 10 per cent. ; risks and casualties, 2^ per cent. This was the first time in the history of the rating of gas works in which a claim for risks and casualties had been made, although I had previously heard the claim (to the extent of 5 per cent.) made in the case of railways. Although the discussion of this claim, so far as railways is con- cerned, is somewhat anticipatory, yet, as the point Risks and casual- qqqxiys here naturally in the case of gas and water ties. . • . ^ works, it may as well be now discussed once for all. The claim is justified in the case of the tenants of gas works, on the ground of risks to which, as experience has sho^^^l, gas works are exposed. In the case of railways, I have heard it claimed on the ground " that a bridge might fall down ;" and I have heard it claimed on the ground, "that, as in rating the other occupiers of a parish, a deduction for insurance is allowed to them before arriving at the rateable value, so, A\]ien rating a railwaj' companj', a similar allowance shoidd be made. And as the railway company is its own insurer, the amount which ought to be allowed to it is not merely that which it does pay, but that which it woidd have to pay if, like the other ratepayers, it insured Avitli some office which made a profit out of the transaction." This joroposition is per- fectly fair and true ; but when it is advanced in sujiport of the claim made for risks, it is improperly used. The claim for risks is made on behalf of the tenant for the THE PKIXCirLE OF KATIXG. 181 rii^ks he incurs hi carrying on Jiis trade. That is, in the case of the tenant of a raihMiy, for the risks he incurs in carrying passengers and goods on the railway which he is assumed to have rented from year to year, and in the case of a tenant of gas works, for the risk he incurs in the manufacture and distribution of gas at the works and throuo-h the mains which he has rented from year to year. In the case of a railway, experience has shown that the risk of the trade is on the average 1 per cent, of the gross receipts per annum, which is the amount usually paid and set out in the printed accounts. The printed accounts also usually contain a payment for insurance, which is but small ^vhen compared with the pajanent for accidents, &c. NoAV, when a railway company seeks, in addition to the claim for tenant's profits, to be allowed a further amount on the ground above stated, for risks and casualties, they seek to unduly diminish the rent ; and they seek to do so by endeavouring to establish a false analogy. An ordinary trader is not allowed a deduction from his rent to provide against any trade risks which he may incur, No deduction is authorised by the Act to be made from the rent "for trade risks and casualties," The claim made in the Phoenix case, of 2i per cent, for risks, v\'as justified by the accidents Avhich, during the last few years, have happened rather frequently to gas works. There was the fire in Wood (Street, for which the Great Central Gas Company were made responsible. There was the explosion at the London Gas Works, by which two large gas holders Avere wrecked. There Avas the fire at Leicester Square, by which Saville House was destroyed, and for which it was sought to make the Gas Light and Coke Company responsible. But the misfortunes which happ e ned to t hese compan ies, hap- pene d to them in their capacitij of landlords. T he fire in Wood Street arose through an alteration in the service pipe. A tenant from year to j-ear has nothing to do with altering service pipes, or with any other repairs. This is made quite clear by the case of R. V. Wells, already noticed. The explosion at the London Gaa 18"2 iiii: rKiN( iri.K oi- kaiinc;. AVorks arose tlirough carelessness; in plasteriii<>' llie gincnior house, llie works being- used before ihev were properly iinislied. 15ut a tenant I'roni year to year has no business to plaster governor houses. He has no business to do anything by whieh the hereditament is either increased or diuiinislied in value. It is quite true that a tenant may undertake to do things he is not assumed to do by the Parochial Assessment Act ; but ia he to claim allowances, which have the effect of lessening the rent ho can give, to compensate him for the risks he may incur in under- taking to do that which he is not called upon to do? The above considerations equallj^ affect the claim for risk made by a tenant of a railwa}' from year to year, on the ground that a " bridge may fall down." The late Mr. Penfold was employed in valuing the Sheffield water works. AVhile the valuation was being prepared, the dam of one of the large reservoirs, which was being constructed, burst, and in consequence great destruction both of the company's and of other person's property, and much loss of life ensued. But did this catastrophe in any Avay affect the rent a tenant would give? It was no business of the tenant. Had the reservoir been con- structed, the whole hereditament Avould luive produced moi'c, and would therefore have commanded a higher rent. Jfad the dam which burst been that of a reservoir, on which the working of the concern did at the time depend, the consequence Avould have been that the Avhole concern Mould hiwc gone out of rating luitil such time as the dam was reconstructed. But when that was done, the rent the concern ■\^■ould then command would (all other things being equalj be the same as before. Nor would the cost of re- building this dam have been any deduction from the rent. If a house falls down, it goes out of the rate, when it is rebuilt the rate on it is i-esumed ; nor is the rate in any way lessened by tlie cost of rebuilding the house. This clearly ajipears from the judgments that have already been noticed. Of course such risks and casualties as the tenant necessarily incurs in carrying on his trade must be provided for. These, ill Tin: I'jnxcn'LE of katino. 183 the case of a rail-.vay, are tlic eliaiices of damage to rolling stock, to the lives and limbs of passengers, and of loss of, or damage to, goods carried. These risks occur year by year, and the loss occasioned thereby is charged in the accounts. In the case of a gas or water works the risks are unlooked for — rise in the price of coals or labour, or from decreased consump- tion of gas owing to bad trade. But seeing that the rent is assumed to be adjusted from year to year, any loss occasioned by these risks is at once shown by the accounts, which form the basis of each successive assessment. In all trades there is more or less risk, and it is t ) provide foi' such risk, and to remunerate the tenant for his personal trouble, that money invested in trade produces 10 per cent., 12j per cent., 15 per cent., or 20 per cent,, according to circumstances, instead of from 3 to 5 per cent., a return which is secured when capital is invested so as to be free from risk, and when no personal trouble is in\-olved. In addition to the expenses already enumerated, there are some- times found in the accounts of gas and water companies items of deduction which, though actually paid, ought not to be allowed in deducing the rent a tenant will give. They ought not to be allowed, because although actually paid, they are not such pay- ments as a tenant from year to year would be required to make. It is quite true that the items may be correctly charged when the directors are accomiting to their shareholders for monies paid and received. The first of these items is " interest to bankers for loans," or " interest upon debentures." These loans have been contracted or the debentures issued by the company, not in their capacity of tenant, but in their capacity of landlord, and these expenses must be discharged out of that income Avhich they as landlord should receive. Tliis income is the balance, after all authorised deductions have been made, of the rent paid, or, in other words, the "net annual value." Out of this landlord's income the landlord's liabilities ought to be discharged. This is reasonable, for the money raised by debentures (for example^ has been raised ISA: TIIK 1'R1X( IPLE Ol- UATIXG. to fini.sli the hcreditainent, the Cii^ntal of the company not hiivhig' been sufficient for tlie pnrpose. But if, insteticl of issuing- deben- tures, they had called up more capital, it is evident that the money now paid as interest -would then have been paid as dividends upon the capital ; and it is also evident tluit the dividend is not a charge to be met b}' the tenant before he arrives at an estimate of the amount of rent he can give. Again, " rent " is not a charge that must be deducted. This outgoing arises from the circumstance of the land, upon which the works are built, not being freehold. It will be evident from what has already been said upon this matter, that such a deduc- tion could not be made before arriving at the rent. This is the same as in the case already noticed, where a hereditament is created upon land belonging to another, and the whole heredita- ment, i(7icii created, let to a tenant from year to year. It is the same in the case of the ground rent of a house, which, as is well known, is not deducted in ascertaining the rateable value. One case in which Mr. Penfold was concerned was peculiar in this respect. A gas company, A, originally existed upon a very small scale. Subsequentlj^ another gas company, B, Mas formed which acquired the interest of the first, not, as is usual, by a lump sum paj-ment, but by the papnent of an annual amount as dividend upon the A shares. But in making an estimate of the rent of the property belonging to the B company, no deduction was made on account of the dividend paid to the A company, because this pay- ment was not one which a tenant from year to year would have to incur. In deducing the rent of tlic hereditament as it was, it was no concern of the tenant tlirough what stages it had passed in arriving at its present condition, nor was it any concern of his what expenses or what liabilities had been incurred. However created, the hereditament existed ; existing, it yielded a certain annual produce, and to enjoy tlie b;.'nefil of this produce a tenant woidd be willing to give a certain rent without regard to any liabilities or incumbrances to which the rent might be subject. Again, such an item as "payment to fund for redemption of THE i'RlXC'lPl.E OF HATING. 185 "lease," or any itoni of similar effect, ouglit not to be deducted in deducing the rent. When such, a charge as this appears, it is because the works, or some part of them, are erected ujoon lease- hold land, and such a payment is towards providing for the loss that must accrue to the shareholders when the lease expires. But, as has already been shown, such a circumstance would not affect the tenant from year to year, nor would it affect the premises in continuing "to command such rent." For assmne that the time has arrived when the lease has expired, then, as in the case of the householder, the hereditament, as a whole, would not thereby be in any way depreciated, or rendered less able to command the rent ; but the case would again be, that of the total rent paid, a larger share would be taken by the owner of the land, and also of the works erected upon the land. It is quite possible that, as a matter of fact, the shareholders, who would still be possessed of the mains and pipes laid in the ground, might not continue to occupy the leasehold land, but rather would have secured a piece of freehold land and have erected fresh works thereon. In such a case the old works woidd not cease to command the share of rent due to them, in consequence of having become valueless, but because the owner of the land and the owners of the remainder of the apparatus had not agreed among themselves. Neither can such a charge as " rent of springs " be deducted before ascertaining the rent of the premises of a water companvw For here again the rent of the springs is only paid because the water company have not been able to purchase the land in whicli the springs are situate. Had they purchased them, this item would not appear in the revenue accounts of the company, but their capital account would be greater. All instance of such a charge occurred in another case in which Mr. Penfold was concerned. A water company whose supply of water was insufficient, having heard of a piece of land in which was a spring, secured a lease of the land, paying for it a heavy yearly rent. They then on this land erected an engine and punqDS, Having done this, they were enabled to increase their yearly rental 1S() I in; iMMXciiM.K or KAiixc;. largely, and consequently so to improve their entire property tliat it could command a greater rent from year to year tlian pre- viously. ]5ut tlie land in wliicli the sj^ring was, ■\vas held upon a somewliat .short lease ; consequently the company not only charged in their aecomits the annual rental paid for the sju'ing, hut also a sum in respect of the recoupment of capital invested in buildings and machinery upon the land, !But neither of these charges could be allowed in deducing the estimate of the rent a tenant would give. For, as regards the rent, it is evident that it stands in the same cate- gory as the ground rent of a leasehold house, and must therefore be paid out of the rent of the entire hereditament when that is ascer- tained, and must not be deducted as an outgoing before deducing the rent. As regards the redemption I'unds : here, as in the case of the leasehold ground of the gas works, it is evident that the redemp- tion fund is not a charge which in any way concerned the tenant from year to year, nor, as regards the landlord, is it a deduction necessary to maintain the premises in a " state to command such rent ; " for, as in the ease of the house on leasehold ground, so here the whole hereditament would continue to command such rent, even though one part of tlie hereditament be owned by one land- lord, a second part by a second, and another by a third. For the whole, so long as the various parts are used in common, ^^"ill con- tinue to command such rent; and if owners of indi\idual parts, by disagreeing amongst themselves, prevent the parts being worked together, and so commanding the given rent, the I'esult is simply a wilful destruction of the rateable hereditament for which no Act of Parliament has made provision. The sum of the expenses and allowances having been determined, the difference between it and tlie gross receipts is the rent which a tenant could give if he had no rates nor taxes to pa}'. But as ho is supposed to pay the taxes, their amount must be deducted before the rent can l)e deduced. The principle up(jn which this is done has already been noticed. TTaving thus deduced llie rent or gross estimated rental, the Tin: nnxcnM.E of kaling. 187 requisite statutable deductions inu.st be made to luaintaiii the pre- mises ill a state to command sucli rent. The nature of these deductions having ah'eady been noticed, it only remains to be remarked here, that 0)ihj such deductions are required to be made as are necessary to maintain the premises in a state to command such rent. The accounts of gas and Avater companies frequently contain not only disbursements for these purposes, but also further disbursements which really are for the extension of the jit'eniises, the result of which is, that they are thereby put into a condition to command a greater rent. As between the shareholders and the directors, this extension of the premises out of the revenue is not only perfectly legitimate, but exceedingly prudent, and is more or less adopted ; but such expenditure must not be allowed in determining the rateable calae of any here- ditament. The rateable value being determined, there would remain nothing further to be done if the hereditament were all in one parish. But in the case of ffas and water "^°"^ °' ,. 1 , ^ , , apportionment, works this rarely happens. (Jonsequently, there arises the exceedingly difficult question of how the entire rateable value is to be apportioned among the various parishes. To deter- mine this question, the Court of Queen's Bench has been frequently appealed to. The first case that must be referred to is that of R v. The Cam- tjridge Gas LigJit Conipaiiij, 8 A. and E. 73. Of the points raised in this case, some had only a local interest, but others involved a universal principle. The property of the company comprised works and mains situate in several parishes clustered around the ^^•orks. 8onie portion of these mains were situate in the grounds of certain colleges which {ire extra-parochial. It had been found by the sessions that the whole property would let for a rental of £2,400 per annum, and the main point was as to how the rateable value should be apportioned among the various parishes. Other questions were raised which require only a brief notice. The first was whether the company 188 THE l'Kl.\(in,E OF KATING. should not be rated upon tlie actual productive Aalue of the vrorks, &c., the amount of which should, it Avas contended, be ascertained by a calculation based upon the company's total receii^ts and expcnditui-e. But the Court decided that the £2,400 rent at irhich the;/ icould let must be the basis of the estimate. The case set out tliat the total annual receipts of the company were . . £o9GG That the expenses, including rates and taxes, were . 3596 Leaving a net receipt of onl}'- ..... £2370 It Avoidd seem, therefore, that the rent of £2,400, as stated by the case, was too high ; for, arguing in the absence of more parti- cular information, from the above premises, no tenant woidd give as rent the total net receipts, inasmuch as he would then get no benefit for himself. It may, however have been that there were other considerations existing, and not stated in the case, such as would induce a tenant to pay that amount as rent. But as the case had found that a tenant Avould give a rent of £2,400 for the premises, the Court, therefore, acting in accordance not only with the Parochial Assessment xict, but with all the previous decisions, determined that that rent must be the basis of the assessment. It was no part of the duty of the Court to inquire whether £2,400 correctly represented the rent for which the premises would let ; but such rent being determined, they could only make that rent the basis of the rate. It is to be remarked that the case did not find that a tenant iras ptiying, or had paid, a rent of £2,400 a year, but that a tenant would j)ay that rent. Next, assuming that the company were bound by this rent, they claimed to make from it the following deductions — viz., for the annual cost of tlie renovation of the buildings, mains, gas meters, and other perishable articles, £500 ; for the annual value of their mains, pipes, and apparatus, within the colleges and halls, which were not rated to the relief of the pool-, £350 ; for the profits in trade of the company, £000. The last of these claims the Court disallowed, pointing out that THE miXCTPLE OF TvATIXG. 189 tlie very fuct that a tenant -would pay a rent of £2,400 involved the fact also that tenant's profits had already been deducted. The claim for £500 for renovation of buildings, mains, &c., was allowed, both upon the authority of a jDrevious case, ii. v. Loirer Hufton, and also in virtue of the special enactment, " Deducting therefrom the probable average annual costs of the repairs, insurance, and other expenses, if any, necessary to maintain them in a state to command sucli rent."' With respect to the claim of £350, the judgment was : — "It remains only to consider whether the deduction of .£'•'350, being the annual value of that part of the apparatus which lies within the colleges and lialls, ought to be made ; and we purposely reserved the consideration of this point to the last, because it is connected with the princij)le which regulated our answer to the last question. For, inasmuch as the rate is imposed upon land used for the apparatus, and as none can be imposed upon that part which lies in those extra parochial places, the amount which would otherwise have arisen therefrom (the aforesaid sum of ^350), must, we tloink, be deducted." Having thus noticed the secondary questions which were raised, the main question of " ITpon ^^'hat principle ought it {the total rateable value) to be distributed amongst the several parishes in and through which the mains and pipes are laid, after deducting ^£150 for the value of the buildings and works in St. Andrew- the-Less," must be considered. Here it is first to be noticed that in this case no question was raised as fo fJie principle upon which the "works" were to berated, but an amount was agreed upon as their rateable value. After the rateable value of the works had been deducted from that of the whole, the remainder of the rateable value would have to be appor- tioned amongst the parishes concerned. In dealing with the question of apportionment, it would be proper to consider first the principle xq)on which the rateable value of the station works ought to be determined ; but it will be more convenient for the present to accept the fact, that their rateable value has been deducted from that of the whole hereditament, and 100 THE rnixcTPi.r, or katixc;. not to make special inquiry into the piint-iple upon -which that roteable value has been ascertained; for the princii)hMvill be found to be developed in the course of the in(iuiry of " liow the whole rateable value is to be apportioned !•' At the hearing before the sessions it was, as appears from the case itself, contended on behalf of the parish, that this apportion- ment should be made in proportion to the gross amount received for the sale of gas in each parish. In giving judgment upon this point, Lord Denman first pro- ceeded to determine " in respect of what " tlie company were rate- able according to previous decisions in analogous cases. lie showed that the effect of the decisions was to determine that the company were rateable as occupiers of land for the " imjiroved raluo of the hiiaJ from the gas pipes being laid in it." And he then went on to show that, this being the acknowledged principle, the mode of apportionment adopted by the sessions was, as a consequence, incorrect ; for if such, as a principle, were adoj)ted, it would follow that in case the land was occupied in any parish by mains and pipes, and no rocoipfs accrued from that parish, then no rateable value could be apportioned to it. '• Suppose (adopting tlioir own rule) the value of the whole works to be .£•2,400 per anmun, minus certain deductions, and the quantity of apparatus in the soil of each of the several parishes to be equal, liut the sale of gas and the receipts for it to be confined to one, the case of 7?. v. The Cnrporotinu of Bath, before referred to, and H. v. 'The Xew Firrr ( 'oiiipmii/, and /?. v. FolcshiU, are express authorities to show that a rate upon the company in that particular parish where all the profits ai-e received could not be sustained Since, therefore, in the present case, the land occupied by the apparatus in eacli parish through which it passes contributes to the whole value to let, it follows that the company must be rated in nxjirrt (f itn occupntion in cacli parish. And if so, we are aware of no rule wliich can be laid down as to the amount, except that it must be in proportion to the iinandt i j of ^^y//<^ovf/m !_situ ate in each parish ." No explanation was given of how the quaiillli/ of (ipparatita was to be measured. "Whether it v.'as by the quantity of ionfi of pipes THE PRINCIPLE OF KATIXG. 191 ill tlie ground, or the quantity of cubic feet tlio pipes contained, or the quantity of money represented. It may be noticed here, that the main principle settled by this judgment was, that the company must be rated in respect of its ocnipation in each 2)arifi/i. In the subsequent case of i?. v. Mi/c End Old To/rn, in which also Lord Denman pronounced judgment, he, after settling certain points which were raised, said — " This apportionment is not at variance with the r/rounds of the jndgment in II. V. C'amhr'uhje Gas Light Company. There the Coiu't deciclod that the parishes in which profits are received are not entitled to all the amount pro- duced by the rate ; but that the parishes in which parts of the apparatus indirectlj'' conducing to produce profit are situate, are entitled to a proportion." The effect of this judgment Avas doubtless to effectuate substantial justice between the various parishes concerned in this particuLar case, and also in other cases where the circumstances are similar, i.e., where the area in which the gas or water is distributed is clustered around the station works. For, whether " quantity of apparatus " is represented by the " quantity of tons," or the *' quantity of cubic feet," or the " quantity of money " possible, the three terms may be pretty nearly equal, either for equal areas or equal receipts. As the experience of fhis method of carrying out the principle of rating the conipanij in re.yject of their oceujxdion in each parish became greater, some very anomalous results were found to be pro- duced. Thus it Avould happen in one case, that the land in a parish was very closely built upon, and consequently the receipts therein were large, compared with the quantity of apparatus in that parish (however measured) used in the supply of gas or water; but in another parish, in consequence of the houses and other buildings being further apart, a much greater " quantity of ajspa- ratus " was required to distribute a quantity of gas or water, for M-hieli the receipts were much less. This being the case, the con- sequence of apportioning tlic rateable value in proportion to the " quantity of apparatus," v,-ould be 1o assign the largest share of 192 'vuy. PinxciiM.E ov t^a rixc;. tliat raloable value (o the parish in -wliicli llic larg'e«t "quantity of apiJaiatus " was situate. But it is evident that in such a case tlic v.vfcnt of a company's occupation is not at all proportionate to the value oi the occupation; for since, on the one hand, a very extensive occupation might be of but little value, a much smaller occupation might be of much greater value. When this method of apporlionmcnt Avas adopted in the case of a property consisting of works, of large trunk mains passing through parishes in which )>o receipts Avere taken, and of distri- buting mains and pipes in parishes where receipts were taken, then the effect was to produce a certain amount of inequality between one parish and another. For, after the rateable value of the station works was proA-ided for, as in the Cambridge case, the remainder of the rateable value, which was due in respect of the jnains and pipes, was distributed " in proportion to the quantity of apparatus." In those parishes through which the main trunk mains pass, the quantity of those mains, whether measured in cubic feet of capacity or in tons weight, is usually a A'ery large proportion of the totid quantity of mains ; consequently a very large proportion of the remainder of the rateable value would by this mode of apportion- ment be assigned to such parishes, while for those parishes in which the receipts arise, and from which the whole hereditament is rendered valuable, but a small share of the rateable value would remain. And, inasmuch as the quantity of apparatus does not necessarily bear any proportion to the rahic of the occujyation, the effect may be to take some of that value from the localitj' to which it really belongs, and to give it to a locality which has no (daim to it. The next case which came before tlie Court of Queen's Bench was that of ]{. v. The IiiJtahitnnts of Mile End Old Touii^ wherein llie Kasl Tjoudon AVater Company were the appellants. The case was argued in 1847, and judgment given by Lord Denman. In this the circumstances were as folloAv : — The entire property of THE PTtlXflPI.F. OF RATIXG, 193 tlie company was situate in several parishes. In some there were simply " Buildings, reservoirs, conduits, canals, bridges, main^, jielding to the com- pany no other profit than as being conducive to the earning of water rates received in other parislies." " The annual value of these uiav be assumed, for the purposes of this case, to be i(i,500, as mere land and buildhigs, w-ith their lixtiu'es and machinerj'' attached, and deriving some additional value from their capacity of beiag applied to such purposes as that of a water company. " In the hamlet of ^lile End Old Tov\ti, there are no works except mains and pipes for the supply of the inhabitants. The quantity of mains and pipes, and of land occupied by them in the different paiishes in which water rates are received (excluding from the calculation all land, reserv'ou-s, buildings, and the other permanent works above mentioned, rateable merely as such without regard to the profit derived from water rates), may be taken in this case to be in the direct ratio of the gross receipts in each j^arish." In'o question was raised with respect to the method in which the rateable value of the whole was to be ascertained, but a total amount was found in the case, viz., £30,000, which amount was deduced upon the principle of taking the gross receipts as a basis. Neither was any question raised as to the ^jrinciplc upon which the rateable value of the station works was to be determined, though the case stated that on which it had been. An amount was foimd in respect of them, and of some portion of the apparatus in addition to them, viz., £6,500. This case differs from the Cambridge case in this : that M'hilc in the Cambridge case an amount w-as found in respect of the tcorls only, in this an amount is foimd in respect of the works and of some portion of the appamtufi beyond the works, i.e., of fiomo por- fion of the mains and pipes. And for this reason : it was argued that the works, and sueli portion of the mains as was classed with the works, only yielded protit imUrectly, whereas the remaining portion of the mains and pipes, namely, those used for distributing the water, was said to be d/'rccfl// conducive of jDrolit. Provision having thus been made for llie works and for a por- tion of the apparatus, the rcmaindov of the rateable value was o 194 TTFE rnixriPLE of ratixo. apportioiied by the case among the parishes in Avhk-h the remainder of the apparatus Avas situate in proportion to the gross receipts which accrued from each parish : — " Tlie result gives an annual value iu JNIilo End Old Town, Avliicli will support the rate. So if this net value be apportioned among the parishes in which the water rates are received in the ratio of the quantity of mains, pipes, and lands occupied bj' them in each, the result will be nearly the same, and will support the rate, inasmuch as those quantities are (as above stated) to be taken, in the present case, to bo in the ratio of the gross receipts." The points raised ■vrere : — " On the part of the company, it is contended — First, That the net receipts do not represent the carninys in each parish, the water rates being in fact earned by all the works of the company employed to collect and to distribute the water from its sources. •' Secondh-, That the deduction iu respect of tenant's profits should bo ascer- tained by a percentage on the gross receipts of the company, and they claun a deduction of 10 per cent, on such gross receipts. As to tliis point, 1 find as a fact that the tenant's profits bear no definite proportion to the gross receipts, and cannot be ascertained solely by reference to such receipts, but aregovenied by other extrinsic considerations. " Thirdly, That some allowance should be made for goodwill ; such goodwill being the pecuniary value of the advantages which a lessee or assignee of the company derives fi*om liis enjoyment of an established business with ciistomerg already secured. " Fourthly', That assuming .£'30,000 to be the net value of the whole works of the company, and the basis of the entire rate on them, the amount ought to be distributed among the parishes in proportion to the quantity of fixed capital or propertj' of the company in each ; that the proportion of such fixed capital or property being fau'ly represented by the sums invested in works in each, the rateable value of the hamlet maj' be ascertained by the following proportions — that is to say, as is the whole fixed capital to the whole net receipts, so is the fixed capital in the hamlet to the proportion of net receipts in the hamlet. "As to the last point made by the company, I find, in absence of proof to the contraiy, that the relative quantity of fixed nijiititl or property of the com- panj' in each parish (including not only mains and pipes, but also their exten- sive permanent works of every description tlirou;,diout the district) is fairly repre.sented by the sum that Ins been invested in works in each parish. Of these, the last only was noticed in \\\v judonicnt, and was decided as^ainst the cfnn]);iny, Tjord Dcnninii s;iyin^': — THE PRIXCTPLE OF HATING. 195 " The rale of law laid down by Act of Parliament for ascertaining the rater able value of any subject refers to an estimate of the rent it should yield. The outlay of capital might furnish no such criterion, since it may have been inju^ diciousli/ e-cpenied, and what was costly may have become wortliless by subse- quent changes." Having- thus decided against an apportion in p ro]30i'tion to the fixed capi tal, the r emain der of the I'u do-ni eut was d evoted to a c om-> pariso n of the Yarious methods of apportionment sub mitted— viz., by " gross receipts," or by " quantity of apparatus." But in making this comparison, a mode of apportionment was named by Lord Denman which the case did not suggest — '\dz., in respect to the service j^ipc^- What the case did was to separate the apparafiisi, i.e., the mains and pipes, into two parts — viz., the large mains through those parishes where no water was distributed ; and the smaller sized, but exceedingly numerous mains from which the water was distributed into the service pipes, leading from these mains into the houses. The whole property may be compared to a tree ; the works, under which term is included the engine and all the apparatus upon the site of the works, being the root ; the large trunk main, the trunk (timber) from which the branches grow ; and the rest of the mains, the smaller branches (the top and lop). But the Court introduced the further distinction of the service pipes, which may be likened to the foot sfalks of the leaves. Having done this, a comparison was instituted between appor- tionment by " gross receipts," b}' "net receipts," or by " quantity of apparatus," with a view of establishing a principle of apportion- ment in those parishes in whicli the receipts wore iiof in the same ratio as the quantity of apparatus. And here it may be remarked that the introduction of the service jnpes as an element of appor- tionment produces a more equitable residt than if apportionmc>nt by " quantity of apparatus " had been made the rule. l-'or it has already been shown, that the quantity of apparatus in two different parishes might be very different for equal gross receipts, in conse- quence of one parish being densely built upon, and the other but sparsely. Although tlie apparatus may thus vary, a nnich closer () 2 196 THF. TRTXriPT,?, OF RATTXO. relation will exist between the gross receipts and tlie number of the services. For although there may be a large quantity of pipes, yet, in consequence of there being few houses, the pipes would have but few services leading from them, and it is the number of occupied houses in any parish tliat really determine the value to the company of their occupation in the parish. In pursuance of the comparison between gross receipts and net receipts, Lord Denman said — " It is c lear that tlie )irt pr ojUs i n each parish would bo the bost criterion of such rent, and they, therefore, would givejlie proper ratio. •' It is also clear that the ratio of the / oi apparatus, yet a certain number of service pipes j)iai/ produce the same amount of gross receipts which a larger number of service pipes does in another parish ; either because a greater use is made of them in one parish than another, or because a greater charge for the same use is made, i.e.^ for the same quantity of the article sold. It would appear, in the first instance, that this judgment is con- trary to that in the Cambridge gas case, for in this an apportion- ment by " gross receipts " is sanctioned, while in that such an 108 lllK I'KINC IPhE Ol" RATlMi. apportionment was not only repudiated, but an apportionment according to "quantity of apparatus" required. But it Avill be foimd that each of these is only used as means. So far as the resxdt is concerned, the two cases agree. That is, that 'svhore-vor there is a beneficial occupation there must also be a rateable value in respect of that occupation, which rateable value, moreover, mu.st be such as ivill fairh/ measure the value of the occu- pation ; and that consequently the whole profit in respect of the entire occupation must not be assigned to the locality in which it arises, but out of the said profit the rateable value of all parts must be provided for. But it was nowhere laid down that the ra/ae of the oeeitpafioii was in proportion to tJie extent thereof ; and when it became evident that an apportionment according to the "quantity of ai)i)aratus " woidd in'actically apportion the rateable value upon sucli an assumption, then the mode only of apportioning was, by this judgment, modified, yet the result to be achieved left the same. In the next case, that of R. v. The Wed Middlesex Water Com- paiii/, questions were raised which resulted in a fuller development of the principle laid down in the Hile End Old Town case, and in the settlement of the ^;/7'>?("//>/r upon which the station works and the indirectly profit yielding apparatus is to be rated. In this case, as in that of the Mile End Old Town, the whole of the company's property consisted of works, reservoirs, trunk mains, and distributing mains, situate in various parishes. The company's principal station was at Hampton, where they drew their supply of water from the Thames. The locality in which the water was sold was a part of liOndon, and was situate some miles from the principal works. The source of sui)ij1}- aiul the locality Avherein the water was contsumed were connected by a large trunk nuu'n lying partly in the parish of llan)ptoii, but no water rates Mere received in that parish. "TIio company doiivo no i/irrct profit whatever in the pnrisli of Haniptot), nor have they any freehold or loasohold inleresl in the soil of the higlnvay THE rHINCirLE OF RAT1^■G. 199 through which the main is hiicl ; but they could not supply the water so raised to their customers without using the main in question for its conveyance. " The questions for the consideration of the Coui-t are, whether and upon what principle the buildings, works, and mains of the company are rateable in the j)arish of Hampton. " The company contend tliat they are not rateable at all in respect of tliis main, and that the company's works in Hampton are to be rated as ordinary buildings, without reference to the profit earned by the company ; and if the Court sliould be of opinion that the company were liable to be rated in respect of theii' main, the company then contend that they are only liable to be rated in respect of the land actually occupied by the mains, and not in respect of the profits derivable from the other parislies which they supply. " The parish contend that the whole works and mains are rateable, and that they are to be rated in reference to the profits derived in the other parishes to which the water is conveyed by their agency. " The questions for tlie opinion of the Court are : — 1st. Whether the com- pany are rateable for their main ? and ^nd. On what principle the company are to be rated '? " Judgment was delivered by Mr. Justice Wightman. The question of rate- ability for the main was decided against the company, the Court saying : — " In tliis case, the first question is whether the company are rateable for their mains which are laid under the surface of the liighways, without any freehold or leasehold interest in the soil thereof being vested in the company ? We think they are. These mains are fixed capital vested in land. " The company is in possession of the mains buried in the soil, and so is de facto in possession of that surface in the soil which the mains fill for a pm-pose beneficial to itself. The decisions are aU uniform in holding gas companies to be rateable in respect of their mains, although the occupation of such mains may be h._ beyond ans itiuin;/ llmf ih,// ,irr :./rn nnt in /nn/ i'"r 'til ""-/ '■":/'"'-^,^ "If an apparatus occupied by one occupier, cousibting of several parts, lies 200 THE riU-NCirLK OF KATIXG. ill one paiisb, the rate is ou the whole, and is received by that pai-ish. If such au appai'atus lies in several parishes, the occupier is liable for the same amount of rateable value, and no more : but that amoimt is to be apportioned among the parishes in which it lies : and the question then arises (as in this case), what is the principle which regulates such apportionment? It is clear that each parish must rate the part which lies within it, as such part becomes a separate rateable subject in that parish, and must be rated according to the Pai-ochial Assessment Act, upon the estimate of the rent which that part would yield after proper deductions. In practice the tenant of the parochial jjortion of a canal, railway, gas works, water works, or the like, has rareh' if ever been known : but a hypothetical tenant must be assumed, and the terms of such tenancy are not difficult to be conceived. But in the hypothesis some neces- sary incidents ai*e also assumed to be involved, such as : First, that each pai't of the apparatus is to continue in joint co-operation, no one tenant of an essential part being able to stop liis part ; secondly, that the title to the required land is permanent, so that there is no risk of being compelled to move fixed capital ; thii-dly, that there is land in the required quantity, and capital to be invested therem, and occupants ready to take and work plant yielding profit as tenants at rack rent; luul purls not yichVuifj projUs as c())itr((ct<)r!t fur reinuncratiun, prov'uh'd din/ (jrcater j/rojits cent he ohtdined thnn onVuKtru in such rehitious. " If the tenancy of each parochial part be assumed according to this hypo- thesis, then although each pai'ish rates separately upon its own estimate of the value of the land lying witliin it, and the law gives no power of making all the parishes co-operate in rating the several i)arts lying in each, nevertheless this Court is bound to protect the occupier of such an apparatus from being rated beyond the rateable value of the whole taken together : and it is mth reference to tliis protection that the Court must take into its consideration at once all the separate rates as so many claims upon one common fund, and must apportion that fund, bearuig in mind that every addition to the rateable value assigned to one parish must be a subtraction from the rateable value Avhich might be given to some other paiish. " Supposing then the apparatus to be apportioned to several tenants accord- ing to the parts in several j)arishes, the ten an ts of t h e lands d ir ectly oarnhig net p rofits in a parish would be rated by t hat p a rish for all the prollts earned tlierem , this beings the paroch ial principl e of apportionment, which has been unanimously upheld hitherto in respect of all canals, railways, water companies, gas companies, and bridges. But the tenants of the lands directly earnin" no profit would not be liable to be rated in respect of any rent in the ordinaiy sense (which is profit remaining after all deductions have been taken from the receipts I, but as these parts of the apparatus lUrathj ciiniimj iiolliiinj, but THE J'RIXCIPLE OF HATING. 201 iiuUri'ctlii condacuni to such curniniia chcwhcrc are assumed to coutiuue ill •' . . . n operation, the company to whose interests such continued co-operatiqn_ isv * (^ essential, //(».s'7 \>r assumrd to paij lolcqinttf remuneration to a eontraetor for lund^ S find fixed eopitnl rested tl/eninAir^ethei- with the labour and sldll requisite for « V ^^ the eJGfectual co ntinuance of such operati on : and these contractors with the company would stand in relation of occupying tenants in the parish, and the t part within the parish would be the rateable subject, and the loeal rateable 1 calue would be such a sum as would piiij the rent of the land and the profit on I the fixed capital therein. * " It is said in the Mile End case, that the parts indirectly conducing to pro- duce profit are to be rated as mere laud, kc, with some additional value from their capacity of being applied to such purposes as those of a water company. " The meaning of these words would be exemplified in tliis case, if it be supposed that the bank of the Thames and the underground of the highways in Hampton were heretofore of no rateable value ; but that when a work on the bank was required to raise water from the Thames, and when the under- ground of the highways was required for the laying mains giving transit to such water, the owners of the soU of the bank and that of the highways could get some payment for allowing the use of their soil. " Thus, laud which before produced nothing, would produce something, and so have a rateable value, wliich would be an addition arising solely from its capacity, for being used for a water company. Value is derived entirely fro m the relation of demand and supply ; a nd if a water companjy cgajesinto compe- tition with a mere agriculturalist for liind for water^works,^n addition is made to the value of such land by the additional competition. "Tliis principle might raise land worth nothing into being worth something, as above supposed, and land worth something into a higher value in the case of a site for a steam-engine, with yard, and shed, and cottages attached ; or a site for a reservoir, a filtering bed, and the like ; — upon the common principles regulatmg value, it is enhanced in proportion to the scarcity of the thing in demand, so that if a few levels only were suitable for the required transit, or a few sources of water alone were accessible, the price would be higher. In this sense the words cited above, from the Mile End Old Town case, are applied to the mains in Hampton in its ordinary meaning, and in the meaning in which tlicy ai'e applied to stations, warehouses, yards, workshops, and the other pre- mises appertaining to railways and canals, rated on the principle of indirectly conducing to the direct earnings of railways and canals. " On this principle the company contended that the rateable value of the part of the apparatus in the parish of Hampton is to be ascertamed, and we are of opinion that the company is right. The parish contended for a liigher rateable value, and it remains to consider on what ground. 202 TiiK i'j;i.\t iri.i: of i;AriN(;. " First, ^Ir. Lusli rtr;;uo(I that every part of tlie apparatus was equally essen- tial for the delivery of water fi-oin Hampton to the consumer in other parishes, and tliat, therefore, the rate should be on the quantity of apparatus in Hampton. " The answer is twofold. In the first place, all the apparatus is not equallj' essential. The subject of purchase by the consumer is U((tcr delivered at the required place ; it matters not to him whether tlie water is from the east or the west, or been raised on the spot from a well. "Transit of water is not the subject of demand, as in the case of goods or passengers to be conveyed by railway and canals, but the water itself brought to the seiTice pipe of the consumer ; the junction of such pipes with the main being the source of profit, sucli deliver}' is the one indispensable requisite for purchase, whereas the course of transit might be varied in manifold directions, according to convenience, without affecting the value of the water to the pur- chaser. " In the next place, no definite meaning was, and, as it appeared to us, could be given to ' quantity of apparatus ' for apportionment of rateable value. Quantity must be ascertained ]>y some measure, lineal, superficial, or solid, and if any of these measures were applied to steam-engines, reservoirs, filtering- beds, cottages, mains, and the like, and the rate upon the sum total of earnings apportioned accordingly, the sum total would be disposed of upon a principle not more rational than a lotters*. " The cases relating to the apportioning of rateable value on water companies are worth considering. In Ji. v. The Xcir Ilivcr Coinji'tni/, in INlaule and Selwyn, the question was whether Amwell should rate CluidweU Mead at £o or i-300. " The case stated that no profits arose in Amwell ; that tlic land alone, without the spring, was of the value of_±u, but if the advantages which tlie com- pany derived from tlie use of the spring may by law be included in the rate upon the land, the land and the spring together are of the annual value of ^_i:300. Tlie ju dgment is fo r the rate on Jt:'-Kn.). T liis case has been supposed to sanction the notion that the parish of Amwell was entitled to rate land in ibnweU by reference to profits made in Islington and elsewhere. I'robably the parish officers and sessions may have included a reference to those profits jn the amount ; but the Court entirely ignores any such reference, and takes the question to be, whether the rate is to be on two acres of mere land, according to tlie value of the land of that kind in Amwell, or with reference to its value in the occupation of the company, with tlie power of using it for their pui-poses, and with eai)ital laid out for making it lit for those jjuiqioscs. •' Lord KUenborough confines his judgment expressly to the local value in Amwell, for he says, ' the water has a certain ascertained value at the fountain THE rKINCllM.i: OF KATING. 203 huad.' ' And if it lias, it is rateable for that value, irrespective of profits which may or may not be derived elsewhere from distribution through pipes.' - "In Ii. V. 2'hc Miiyor of Buth, 14 East, the question of apportionment was again api)roached, but left undecided. There the corporation had collected springs in the parish of Lyncome and Widcombe into reservoir's, and distri- buted the water there and in Bath, making i'50 profit by the sale of water in the parishes, and i"350 in Bath. The parishes rated for ilGOO, claiming the whole profits because all the water was derived from the fountain head : but the rate was quashed because a large i^ortion of the apparatus and the soil in which tlie pipes are laid, and eleven-twelfths of the water rent are situated in Bath : tlierefore, Lpicombe and "Widcombe is wrong in rating for the whole water rent, the source of the water not being rateable for all the profits of the supply. The Court decides that the profit from the water ought to be uppor- tioned, but gives no rule for ai)portioiiing it. " In R . v. T he Mil e End Old^Touii , the principle of apportionment above mentioned was adopted. It has been said to be inaccurate in laying the rate for the dii-ect source of profit on the service pipes which belong to consumers, as the rate must be on the property in the occupation of the party rated. The principle of the judgment is, that the direct source of profit from water or gas is the delivery of the article to the consumer, and that the instniment of the delivery should be rated for the net profits ; and that if the service pipe belongs to the consumer, the J unction of the ser vi ce /lipc iiitJi the D uiin is i n th e occupation of the company and is rateable. Oiu* judgment here is founded upon that case, and we have thus endeavoured to apply the principle there laid down to the rathig of the premises here in question. " I may here observe, speaking for myself alone, that fi'om this judgment, in which Lord Campbell, my brother Erie, and my brother Hill concur, I do not dissent, as it is founded upon the principle laid down in the case of i?. v. The Mile End Old Toun, which is the leading case as well as one of the latest cases upon the question before us, and it is most desirable to preseiTC uni- formity of decision, if possible. " There appears to me, however, so much difficulty in satisfactorily applying the parochial principle of rating by estimating the rent which the tenant would give for the subject-matter in such a case as the present, as practically to amount nearly, if not entirely, to an impossibility of doing so satisfactorily. I may also add, that I am not quite satisfied that the distinction which has been taken between direct and indirect sources of profit applied to the mains and pipes of a water company running through different parishes is well founded, and more especially in cases where the mains only belong to the company and not the service pipes. Indeed, the whole subject-matter appears to me to be involved ill so much difficulty aud ncort.uuty, that I cannot but hope that the legislature 20-1 ihp: I'Kix iri.K oi kaii.ng. may iuterfore or iiuike some provision adapted to the rating of the property of such companies as that in question, and vhioh may dechire the principle upon which such companies are to be rated, and establish some uniform and prac- tical mode of carrying that principle into effect." From this judgiucnt it "will bo seen that the Court was evidently of opinion that the whole rent, wliieh, as has already been shown from the Sheffield ease, must be founded upon the gross reeeipts of the hereditament as a basis, is to be considered as being made uj) of the rents of the various parts. In effect, the entire hereditament which is occupied by the tenant (who may be also the owner of itj is to be deemed as being- occupied by one tenant who pays a rent for it as a whole, which rent is then to be split up into the rents of the various parts. And the assumptions which the Court makes as to the manner in which the whole hereditament is constituted, viz., by the united action of various owners of property, is not inconsistent with our experience, at least in other properties, if not in those of gas and water com- panies. The ballast pit already described is a case in point, and although at present the sum of the various rents paid by the actual occupier of that property may not be such as fairly represent the sum of the values of each part, yet, when the leases expire, it may be readily imagined that out of the rent of the whole, determined from the gross receipts, the rent of the various parts necessary to the joint action of the whole would be paid ; and, further, that if the occupier had to pay such rents, he would be influenced in deter- mining their amount by considerations similar to those used by the Com-t in the "West Middlesex case. It will be evident, from the previous pages, thai various circum- stances may influence the tenant in determining the amount he can give for any property ; and it will have been seen that the rent of the various properties considered, viz., of land, dwelling houses, manufactories, tithes, gravel pits, &.<:., has been determined cither by a consideration of the " acconnnodation afforded," or by a con- sideration of the "actual produce." JJut in this case loth \)xc>iG considerations are brought to bear in deteiinining the rent of the THE PRIXCTPLE OF KATIXO. 205 wliole and of the parts : a consideration of the actual produce in determining' the whole, and a consideration of the accommodation afforded in determining the rents of the parts. It may be observed that the " contractor " assimied by the Court is not a '' contractor " in the ordinary usage of the term ; that is, one who imdertakes to execute a certain Avork, and upon the execution thereof receives again the amount he has expended, and, in addition, a further sum as profit upon the transaction ; but the " contractor," as used i n tha t judgment, must be regarded as a capitalist who wishes to invest his capital, and not, like theordinar}- contractoi:, to inc rease it. The Court then assumes that such capi- talist, finding that by investing money in providing certain accom- modation which is required, he can secure a greater interest upon liis capital than if he invested it in the ordinary securities, under- takes to construct and maintain such accommodation. And, on the other hand, that one who has the privilege of supplying water or gas in certain localities, will pay a rent to such investor, for the necessarj" accommodation, to enable him so to supply gas or water. It by no means follows as a necessary consequence that the pri- vilege of supplying gas or water involves the command of the requisite capital, nor that the command of capital involves the privilege of sujjpl)^ ; although our general experience of such matters is, that they are co-existent in the same hands : the com- panies who have the privilege, having also the capital to provide the requisite accommodation. But abroad, we continually find that " concessions " are made to individuals or corporate bodies, who then seek the aid of a capitalist to carry out the concession. To the capitalist who thus invests his money it matters nothing in what description of property ho invests, for the return he may receive will be such as, after allou-inr/ //iui co)itiii>iatt// to reneic Jiix ^ropertj/, will pay a rate of interest greater than is \isual ; and it will be remarked that the judgment assumes not only that the rent of the whole is sufficient to pay all out goings, such as the rent of the A-arious parts, but that the investment also will take place under such cireunistances as will secure the contractor from loss. 200 THF, nUXrilMK OF KVTINfi. The possessor of the pririlcgo of supplying- gas or -water will bo willing to pay such rent ns will render liis privilege a valuable one. The mere privilege, until exereised, is valueless, and it might be that the possessor of the privilege is unable to exereise it for want of tlie necessary accommodation. That being provided, the privilege iu ('O)ij miction ivitli iJie appanitua, mayor may not constitute one whole and more than usually ^ aluable hereditament ; but the crfraordinari/ ra/iic of such hereditament, if any exists, is due to the r.risfonco of the prin'/cf/r or monopoh/, and, consequentl}', the rating in respect of the occupation of such privilege, ougbt to be made where it exists. Such rating, the judgment declares, would bo for all the " profits " earned by such occupation, and subse- quently defines " rent in the ordinary sense to be profit i-cmaining after all deductions have been taken from the receipts," and that consequently, in determining the profits of the "privilege of supply," the rent paid to the creators of the necessary accommodation must be included among the deductions. Nor is this inconsistent with what has already been stated respecting the proper allowances to be made from the gross receipts, when it was shoAvn that rent paid was not among those proper allow- ances. In that case, the object was to ascertain the rcid of the vhole. Here, where the object is to ascertain the rent of oiic part, it is evident that the rent which is paid for the other parts must be one of the deductions ; for the rent of the other parts must be paid so as to enable any one part to earn a ])rofit at all. It is the same here as in the case of a house built upon leasehold ground. IJefore the rent of the Iioiisc alone can be ascertained, the rent pay- able for the ground must be one of the deductions. But when wc are ascertaining the rent of the whole hereditament, of the /lOiiso (ind the (jroiind, no deduction is made in respect of the f/roiind-irnf payable. Tlie last case in connection with gas and water woi-ks is that of li. V. T/io Sliofficld Gas Compomj, which has already been partially noticed. The remainder of the case raised a second time the question of how tho rateable value in respect of the )nafn>i, whether THK PRIXflPLE OF RATING. 207 they be directly or indirectly yielding profit, is to be apportioned. This was done in order to enable the Court of Queen's Bench to review the decision given in the "West Middlesex case. In the Sheffield case, where there Avere no trunk mains situate in a parish in which the receipts were nil, the proposition was made to apportion the rateable value in respect of the mains and pipes according to their Jongfh% in each parish. But the Court declined to allow such mode of apportionment. " It is veiy true that the mode they propose of dividing according to the portion in each township has the great advantage of simplicity; and when applied to such a Iiomogeneous subject as the present, it probably brings out a result not far from the true one." "But we cannot say that this is the rule given by the Parochial Assessment Act." ""We think we must I'efer to the judgment in the case of the Queen v. The We^t Middlesex Water Works, as giving the last exposition of the Parochial Assessment Act, to which, asalread}' said, we must adhere, and require these parties to apply the rule as there laid down, as well as they practically can.'' " If this is found not practically possible, as it certainly geems not strictly tlieoreticalhj rii/Jtt, application must be made to the legislature to interfere and relieve the parish officers and justices from the obligation to apply the Paro- chial Assessment Act to such cases as these, which we agree with my brother Wightman in thinking it practically impossible to do satisfactorUj-.'" It is to be noticed that the impossibility of the " satisfactory application of the Parochial Assessment Act " refers only to the mode of apportionment of the rent of the whole when ascertained, and not to the ascertaining of the whole rent. But it certainly seems difficult to devise any method which shall move Just/// assio-n a fair share of the whole rateable value to each parish, than the method arrived at from the considerations cmijloyed in the Mile I]nd and West Middlesex cases. For Avhichever of the other methods which have been proposed is adopted, it can be shown that, among the numerous gas and water companies' properties, many cases peculiarly situate will arise, in wliicli much greater injustice would be done to one or another parisli by tlie aj^plication of some peculiar ukkIo of ai^poi'tionment fouii(k'd upon expediency, 208 TiiF. rKiN(iri,i: of katino. than can cvov be done by the application of the nio(U» of apportion- ment laid down by the West Middlesex case — a mode founded upon the principle that the rent in any parish must be measured by the rahio of the occupation — a proposition -which is most just. THE TRINCIPLE OF KATIXG, 209 RAILWAYS AND CANALS, The principles tliat have alreadj' been considered will be of service in determining- the rent which such extensive properties an canals and I'aihvays may be expected to command. It will not be necessary to consider these two descriptions of liereditaments separately, inasmuch as the same considerations AA'hich determine the rents of railways will also determine the rents of canals, in all cases where the rateable value of the latter depends upon the rent. For in many of the canal acts a special clause states in Avhat manner the particular canal in question is to be rated. When such is the case, it has been determined that the proviso in the first section of the Parochial Assessment Act comes into force. It will not be expedient to consider any of the ques- tions involving- a judicial decision which have arisen under these special acts ; since such decisions have but a local interest, and merely depend upon the special wording- of a clause in each parti- cular act, they are without general interest. Before proceeding to consider the principles which determine the rent a railway, or a part of a railwa}^ will command, it will be well first to review the Mirious conditions under which railways exist. In doing so, we will trace the successive changes that have occurred in railway propert}'. The conditions under which it was first intended that railways .shovdd exist Avere that, the owners of the railway liaving- bought the land forming its site, and having constructed it, it should be open to any person to run engines and carriages upon it by paying- toll to the proprietors. The railway was to be simply a road made in a special manner and by private persons. Though this was the original llicuvy, it hardly existed as a fact, r 210 THE rRIXCIPI.E OF IIATINO. for tlic owners thomsolves ran tlioir cng-inos and carriages upon it, and tlie public' did not ; but wlioevcr rcHpiirod to use the raihvay did so by using both the raihvay, the engines, and the carriages of the proprietors. As the raihvay system increased, either the owners of the original railway extended it and made brandies to it, or else other persons made and "s\'orked new railways -which were in their turn connected with those already in existence. Gradually the branches, which were made and worked by inde- pendent companies, were either leased by the original company, who then Avorkcd them in conjunction with their own line, or were simply worlrd b}' the company owning the main line. Then, as the nuniber of main lines increased, it became neces- Bory to transfer traffic from one main line to another. In order to (noid inconvenience, this transfer was effected by the engine and carriages of one company passing over the raihvay of a second com- pany, for the use of which toll was paid ; cither in virtue of the original theory of railwa3^s, or by virtue of special agreements. Again, the proprietors of main lines of railway have extended their property, either by the purchase of railways nuide by others, or by the renting of them or parts of them. AVherc one railway is rented by another company, the rent agreed to be paid has been arranged upon a variety of bases. In the progress of railway extension it has sometimes occurred that the proprietors of a railway have been unable to purchase the ground, or parts thereof, upon which the railway has been built, and have therefore been obliged to rent the same ; or they liavc rented a part of a railway, and made the extensions there- from. At this time railways Avill be found to exist under one or other of the following conditions : — 1st. An entire system of railway from beginning to end is owned and worked by its proprictoi's. 2nd. A system is but partly the property of tlie company who work it, and have the use of the remainder secured by some, or all, of the following means — THE PRINCIPLE OF RATING. 211 a, They may have rented a railway made entirely by another company, for which railway they pay a fixed rent for a term of 3'ears, or a rent dependent upon the net profits made. h. They may have rented some portion of the site, and subse- quently made the railway and sucli station accommodation as exists thereon. c. They may simply have running powers over a portion, of which portion they \va\c not the sole use. These running powers may have been secured by the payment of a lump siun down, or by a certain annual paynient for a term of years, or by a payment, tlie amount of which is periodically revised, or by a payment of toll for each carriage or vehicle running. d. They may undertake to work a portion of the railway for a certain fixed proportion of the gross receipts. However a railway system is constituted, the entire system will always be found to extend through many parishes. The question that now presents itself is, how to determine the rent of the Avhole system, and of any parochial portion of it under any or all of the above conditions. It will first be evident, from what has already been said, that if a railway, imdcr whichever of the above conditions it exists, were situate entirely in one parish, its rateable value is 2iot, as a whole, in any way affected by the conditions midcr which its various por- tions are held ; for the hereditament will, as a irJioIe, command a certain rent, and the rent depends upon what, as a whole, the rail- way can produce. Ncitlicr will tlie magnitude of the occupation affect the principle upon ^^•hich the rent must be determined. What then is the produce of the land occupied as a railway, to enjoy which a tenant is willing to give a rent ? Evidently an amount of money arising from the traffic that can be carried over tluit land. The first question which has arisen from this subject is, as to wliat that amount is, havinf? rcg-ard to two maxims wliich are indis- l)utablc ? — first, that whatever is produced by the land is the foun- dation of tlie rent {the niarn due to tlw pkoi-kkty) ; and secondly, r 2 212 TIIF. rUTNClPI.K OF UATlNTi. tliat profits ill trade {fJtc reirard of laijotu) arc not liable to be rated. It may be remarked, that railways are of that class of property which is almost invariablj' occiij)i('(f by its owners, and that conse- quently the entire produce received by them represents not only the return due to the propertj', but also the reward due to labour. Under the original constitution of railways the proprietors could perform two functions. First, they could receive the tolls allowed to be charged to any person wishing to run carriages upon the railway. Second, they could themselves run carriages, and so make a profit. And when it became necessary to rate the pro- prietors for their occupation of land used as a railway, they made the objection that, though their total receipts included receipts from both these sources, yet, as the receipts from running the carriages were entirely due to the trade of a carrier carried on by themselves upon their OM'n railway, tliese receipts ought not to bo taken into account, but that the receipts from f/ic toll charged for vehicles running upon the railwa)' (whether the vehicles belonged to themselves or to others) Avere alone the produce of the land, and consequently the sole basis of the rent that might be expected. This question was brought before the Court of Queen's Bench in the case of B. v. The South IFcstern Baihaii/ Conqximj (1 A. «Jc E., N. S. 558). After a long argument, the Court took time to consider its judg- ment, wliich was given by Lord Denman, who, after reviewing the facts of the case, proceeded to discuss the proposition laid doAm by the comi)any — viz., that to determine the rent, the property must be supposed to be let from year to year. The question would then be— •'"What the tenant would take hy the demise. Tlic answer lo whicli wonUl be the railway itself and Die perception of the tolls as before fixed by tlic com- pany.' But it was pointed out by Lord Denman, that a lea.se of the railway would involve a demise of the stations, warehouses, and approaches. THE PRINCIPLE OF RATING. 213 " The supposition of a lease of a portion of a railway with no ilcmise of the stations, warehouses, and approaches to it, or, at all events, some provision for the use of them, is merely absurd."' It was also pointed out, that though the railway itself was " Tlu*o\ra open to the public as a highway; no corresponding provision ap- pears to have been made with regard to the warehouses, wharfs, stations, and landing-places." And as these were necessary adjuncts to the railway, it would follow that a " Free competition of carriers upon the same railway is practically little less than absiu-d." " If all difficulties were removed as to the stations, warehouses, landing- places, and approaches, and all these were supposed as much laid open to the public as the railway itself, the very nature of the mode of convej-ance forbids the free competition of rival carriers. But how can we suppose any competition possible with the company, now the carriers, or indeed any fi-ee use of the rail- way, even by a private carriage, the company retaining the independent oc- cupation and control over all the existing approaches '.' ' Lord Denman next proceeded to inquire how the company woidd have been rated before the Parochial Assessment Act was passed ; for the proviso therein declares that the principles of rating are not to be altered or affected by it. '■ They woidd then have been found oecupj-ing buildings and lands on an entire liiiG of railway, and carrying on a trade not merely therein, and thereon, hut therein/, a trade iuseparahl ii connected uith such huildinfjs and such lands, and for the sake of which, in a great naeasure, the lands themselves are occu- pied in a particular manner. The profits of this trade would be included in the fares received for the conveyance of goods and passengers ; and the question wiiuld be, whether these profits ought in any or what degree to affect the rate- able value of the lands and buildings ? ' Ha^'ing referred to previously-decided cases, and compared them with the present, Lord Denman continued: " Then do i\\G fares increase the value of the buildings and land. No one can doubt ; indeed, the case has answered that they do ; that a liigher rent for the buildings and land might be obtained in consequence of the facility afforded by the occupation of them to tlio carrying on a lucrative trade, and earning the profits on those fares." 214 TiiK rRixcin.K of rati no. Haviiio' thus shown lliat the vent is to include the lares, or receipts i'or the nse of the carriages, and not mcycJij the toll, the remainder of the judoiuent -was devoted to a consideration of the question of the heal value, -svhich is at present immaterial. A second case, -wherein the same question as to the tolh onhj being the basis of the rent, Avas shortly afterwards brought before the Court. This was the case of 11. v. The Grand Junction Raihcaij Company, 4 Q. B. IS. This case diflfered from tlie last in tliis, that in it there only existed a jw-ssihi/itt/ that other persons might run their own car- riages upon the company's railway, while in the present other persons actually di(/ do so. The total receipts of the company were made up from four sources : — First. Receipts accruing from the use of their own engines and carriages upon their own railways. Second. Receipts, being toll paid by other persons who ran their own engines and carriages upon the appellants' railway, and who had, independenth' of the appellants, " coke and watering places, and all other things necessary and convenient for the conve3'ance of passengers and goods, and separate stations, with needful branches into or communication with the same." Third. Receipts from persons who paid to the ai)pellants sums of money for the use of the stations, and the hire of locomotive en- gines, and as toll for running over the appellants' line, but who themselves provided carriages. Fourth. Receipts produced by the ai)pellants' own carriages and engines running upon another company's line, for which they paid toll t(j the other company. It Avas contended by the company that, in consequence of other persons actually running their carriages iqjon the a2)pellants' rail* way, the principk laid down in the case of li. v. tSotith Weateni liailnaij did not hold in their case. THE PRINCIPLE OF RATING. 21-5 Lord Demnan ill this case also delivered judgment. He began by contrasting the facts in the two cases, in order QpQgg receipts to to ascertain whether the difference in the facts of be the basis of the the cases necessitated the application of a different principle of rating. He showed that in the SoiiJ:h AVestern case, " The company was in the sole and f,ir/«.sar occupation of the railway, ware- houses, stations, and hxnding places ; and being so, were solely and exclusively carrying on a large business as carriers thereon," although in theory other persons might have carried on a business on the company's railway'. " To this state of facts we applied the established principles ef rating — that the rate is to be on the occupier in respect of the beneficial nature of his occupation — in estimating which, as to amount, or, to put it in other words, iu ascertaining how much net rent such and such an occupation may be expected to command, parish officers are to consider not drily and only what would legally pass by a demise of it, hut all the existunj cin-umstaitccs, iilicthcr pcr- tiianent or tenijxirari/, wherever situated, however arising or secured, wliich would reasonably influence the parties to a negotiation for a tenancy as to the amount of rent to be asked or given. "We therefore thought it impossible in that case to separate . . . that whole line from the warehouses, stations, and landing places, or these again from the peculiar conveniences which a tenant would have for carrying on, as occupier, a lucrative business, if not the effective monopoly, which the provisions of the act appear to give to the occupier for carrying it on. What under the act was possible by law, what, in point of fact, might be in future, however near, we thought immaterial as to the prin- ciple, though very fit to be taken into account when maldng the calculation as to the quantum ; but in principle the parish officers were to look to the actual state and value of the oceujmtioii." Here, however, the appellants were not in sole possession of the railway, nor the warehouses, nor stations ; for, as has been stated, other persons ran engines and carriages upon the railway, and others, again, hired from the appellants the use of their warehouses, stations, &c., and of locomotive engines, but supplied their own carriages. With respect to this state of thing.?, Lnnt Dcnman said : "It is unnecessary after this statement to point out the difierence in fact between the two cases. But We cannot perceive how tliis (.Hffen-ncc bears upon the in-incqilc on which the pre- 21G TUH PRIXUPI.E Ol' RATING. sent rate is to bo cxamineil. or wliich governed tlio Conrt in (he former derision, for that proceeded not upon specnlations as to what might bo in future, but expressly on the then existing state of facts. " Each of the two companies ' {i.e., the South- Western and the (Irand Junc- tion) " must be rated in respect of the occupation of land ; one of them" (the South-AVestern) " derives no bouelit from that occupation, except by carrying on upon the land the business of conveying goods and passengers, the division of tliat profit on tolls and fares being merel}-^ nominal ; the other " (the Grand Junction), •' in addition to this mode of profitably carrying, oho de- rives a profit from allowing otlicrs to carry goods and j)assengers, and this latter profit is properly called tolls. Still in both the inquiry must be the same — What is the idhic of the occujxttioit from nJuitcver nourcc deriral .' In neither can the profits of trade as such be brought into the rate; but ifthedbility for carrifinfj on a gainful trade upon the land adds to the value of the land, that value cannot h^ excluded because it is referable to the trade. " But it is said that in the cases supposed, all is referable to the occupafion under the supposed lease ; that conveys the exclusive dominion, thence fiow entii'ely the means of making profits. We have in truth already given the answer to tliis ; but it will be plainer if it be observed that there is a fallacy in confounding that uhich the lease ronvnjs a legal title to and, that u-liich it gives the lessee the mi'inis of doing or enjoging. No two things can be more distinguishable, and it is the latter which regulates the rent a tenant can give, and not the former It is (^uite true that if the railway were let to a tenant, the lease would convey the land and railwaj- only, and give a title to the tolls only ; but the lessee would undoubtedly consider the facilities and advantages which the occupation as tenant would afford him of carrying on a locomotive trade as carrier, and in whatever proportion that consideration would increase the rents, in the same proportion, after due allowances, would Ills rate be raised also. " Two propositions arc equally true — that the rate is not to be imposed in respect of tlie profit of the trade, and that it is to be imposed in respect of the value of the occupation ; and two propositions that are true and applicable to the same subject-matter cannot be inconsistent; we think that the respondents in the present case, by the scheme they propose, have shown that they are not so. The gross gearlg rercijits of the company as occujiiers of and carriers on the railway, must at least include the proper subject-matter of the rate. They have, therefore, taken a sum agreed to represent tliem as the first point to start from. The}- then assume an amount of capital employed in the trade, and deduct from the former sum two percentages uj-on tlie latter for the interest of this capital, and the itroiits wliieli ought to be made upon it, and a tliii-d for the depreciation of stock leyoud usual repairs and expenses ; fourthly, THE PRIXCIPLE OF RATING. 217 they deduct from the gross receipts the annual cost of conducting tlie trade ; iifthly, tliey deduct the annual value of all the land occupied by stations, &c., and elsewhere rated ; and, sixthly, a sum per mile for reproduction of rails, chairs, sleepers. These deduction)! taken tor/ether seem[f() Jis to include uhatcvcr is iiropeihj rcfcrnhle to trade, and distinguishable from the increased value ■\vliich that trade gives to the land. We do not now speak of the amounts allowed under each item ; and we decline to give any opinion upon this point, which is properly for the sessions ; but if these are the proper heads of deduc- tion, then the residue must rejv'esent the value of the occupation; and if so, this alone is brought into rate, and the profits of the trade are excluded ; accordingly the sessions have found as an inference from the facts, that the residue is the sum wliich a tenant from year to year might reasonably be expected to give for the railway' and corporeal hereditaments, now occupied by the company in connection with the railway, exclusive of the stations and other buildings rated separatel}-, and such tenant being assumed to have the same and no other power of using the railway, the same and no other advan- tages and privileges as the company now possess. If the deductions exhaust that portion of receipts referable to trade, the inference of the sessions is fair. If the advantages and privileges which the company possess are attributable to their occupation, and would pass with it, their assumption is well-founded. We agree with them in botli." From tlicsc judg-ments it will be seen tliat tlie f/ross receipts of ;i railway company must be taken as tlie basis of the estimate of the rent the hereditament woidd command. Such gross receipts must, in all cases, be those arising from the eidire hereditament occitjn'cd. No inquiries must, in the first instance, be made respecting the different tenures by which the various parts are held. But the gross receipts arc the produce of the entire hereditament as a whole. It may, and does happen, that the gross receipts of a railway company inchide certain sums, not the produce of the hereditament which the company occupies, but the produce of trade carried on upon another company's lines. Of this nature was the fourth item of receipt in the above case of the Grand Junction Company. And with reference to this. Lord Denman said : "Again, it is contended (liat the existing facts of lliis case show tlic unrea- sonableness of the rate. The carrying trade of the company goes beyond their 218 TlIK IMlINCiri.K Ol" K.VTIXG. own line upon the mihvays of tlic other sot of proprietors ; but the receipts arising from this have been exchided from the rate. This, it is said, is incon- sistent. How can the profits which the same engine earns b}' drawing goods over one mile, be of a different character fi'om those which it earns in the same employ over the next mile ? 80 far from there being any inconsistencj' in this it is necessarily involved in the principle on which the rate rests. That the distinction can be made, and has been made, is no slight proof of the sound- ness of the principle. The moment that the engine leaves the railway of the company, what it cams ceases to have any connection with their occupation of the railway; it nuiy, and of course does, increase the value of the occupation of that other line on wliich it then ■works, and will, of course, in the shape of toll, proper tionably increase the rate which the occupier will pay ; but if it were allowed to swell the charge upon the company, it could only do so in respect of the profits of trade, and these our principle excludes." Let it be assumed that the whole gross rcceq^ts of a railway company have been earned entirely upon a system of railway occupied by the company. The first step in deducing- the rent from such gross receipts is, to deduct therefrom the annual " costs of conduct- Tenant's working -J ^Yic trade," which of necessity are borne by a expenses. o > j j tenant from year lo year. These expenses will be:— 1st. Locomotive power. 2nd. Carriage and Avaggon repairs. '3rd. Passenger traffic charges. 4tli. Goods traffic cluu'ffes. oth. Mineral traffic charges. 6th. General charges. 7t]i. ^Miscellaneous ehai'gcs. 8th. Legal expenses. 9th. Government duly. The sum of these deducted from the //ros.s rcccipU leaves the nrt rrrripf.s, out of wliieli tlie tenant must be comjiensated, and the rent and taxes paid. It is not pretended that the above arc all the expenses which arc found in companies' accounts. But they arc all the working THE riUXCirLE OF KATINC;. 219 expenses that tcould he incurred hi/ a toiant fro))i year to year. Sometimes it happens that the companies' accounts contain charges for rent paid. Such will be the case when a portion of the entire system occupied is rented ; or when rent is paid for land upon which the company may have made a portion of a railway ; or when they have rented a station or part of a station from some other company. But such an item cannot proper!}' be deducted in ascertaining the rent which the whole Avould command ; for it is the rent of a part, and must necessarily be included in the rent of the whole, and if deducted as one of the working expenses, would not be included in the whole. Again, companies' accounts ^^•ill sometimes contain large sums that have been actually expended in parlUoitentary husiiie-sii, but such smns are not expenses which a fenant from year to year tcould //are to incur, for they are incurred in respect of new lines, and it is no business of the tenant from year to year to engage in such constructions. It must be borne in mind that a railway company, occupying its own property, fills the two functions of landlord and tenant, and care must bo taken that the respective interests of the two functions must be clearly separated in dediieing the rent which the railway company, as landlord, will expect to receive from itself in the capacity of tenant. Again, the accounts frccpiently contain also a large item in respect of income tax. But when this is in respect of the total net receipts, a great portion ought not to be charged ; for, as pointed out by the Court of Queen's Bench in the case of li. v. (fOodcJiild, already noticed, the income tax upon the rent is a land- lord's tax, not a tenant's. Having found the net receipts, the first diminution thereof to be made is in respect of tenant's profits. Upon this point the question has been raised, as to the basis on which these profits are to be computed; whelher on that of the gross receipts, or on that of the capital employed. This question was raised in the case of the Q,ueen v. The Great Wedern Hailuay 220 THE rRixciiM.i; oi- uatino. Compani/, G Q. B. 170, wlien it was contcndod by the company tluit the profit ought to be computed on the gross receipts. It was also raised in tlie !Mile End Old Town case ; but tben it "svas found by the arbitrator that " the tenant's profits bear no definite pro- portion to tlie gi'oss receipts, and cannot be ascertained solely bj- reference to such receipts, but are governed by otlier extrinsic considerations." In the Great "Western case the Court refused to entertain the question, pointing out that "this was not a princijjle of law," but a matter entirely for the sessions ; and in tlie Mile End case no remark seems to have been made upon tlic subject. These profits arc usually based upon tlic capital which a tenant would have to find. Then comes tlic question, "What capital will the tenant of a railway have to employ ? The total capital of a railway company is expended for two pur- poses. One to create (if it does create) the entire Tenant's capital. system of the railway, with all the requisite stations, warehouses, approaches, watering places complete, so that a tenant from year to year could, upon taking possession, at once begin business. The other purpose for which the remainder of the capital is employed is to provide locomotive engines, carriages, and waggons, the requisite moveable furniture at the stations, and a certain quantity of stores and movable tools. It will be seen that these two divisions of a company's cai)ital correspond with the two functions of landlord and tenant which the company fills. The expenditure in the first division — a very large proportion of tlie wliolcca])ital, is in respect of the comjiany's po.sition of landlord, and the exi)enditurc in the second division is in respect of the comi)any's position of tenant. The latter sum, though in itself a large amount, is but small in proportion to the total capital. And it is this sum only which has to be dealt Avith in deducing the rent a tenant can give. If the company only filled the position of landlord, it would THE PRINCIPLE OF RATIXG. 221 oiil}'- liavo to provldo the amount required for the creation of the hereditament. The tenant of the company -would have to find the cajiital required for the purchase of locomotive engines, carriages and waggons, (.tc, &c., and upon this amount he would require his profit. Although those things are the only movable property connected with a railway, and consequently such only as a tenant from year to year Avould naturally he expected to find, yet it has frequently been claimed that, in addition, a tenant would himself have to provide certain other things. Upon this point the decision of the Court has been taken. In the case of li. v. The North Stafford ahi re Railtccnj Compcui)/, 30 L. J. (N. S.) M. C. C8, it was stated that— " In addition to tliis (rollingi stock, the company has been obliged to provide, at a cost of X'.j:2,950, turn tables, cranes, weighing machines, stationary steam engines, lathes, electric telegraph and apparatus, office and station furniture and gas works used for supplying the stations with gas. The turn tables, and some of the weighing machines, are affixed to the freehold by means of an iron bolt, inserted in a large stone sunk in the land. The lathes and steam engines are connected with the buildings in which they are placed by means of iron bolts. The electric telegraph consists, fir.st, of posts driven into the ground ; socondlj', of wires passed through sockets annexed to such posts, but which wires may be disconnected from the posts without injurj- or displacing them ; thirdly, of the electrifying machines, wliich are in no way affixed to the freehold. The gas works consist partlj' of buildings and partly of gasometers, retorts, and the other usual plant for making gas, and of the pipes for conveying the same fi'om the gas works to the railway station.'' The questions for the opinion of this Court are — " Secondly, whether the appellants arc entitled to a deduction for interest on capital and tenant's profits upon the said sum of .4;5:2,i)50, the additional amount of capital invested in turn tables, cranes, weighing machines, stationary steam engines, lathes, electric telegraph and apparatus, office and station furniture, and gas works, or upon any and what portion of such items ".'" To this (piestion the Court replied : " The second question is, whether the company arc entitled to a deduction in respect of (he various articles therein specified, beiug things necessary fur ooo THE PRIXriPI.E or RATINf;. canyiiig on the business of the company ? Tlic aitidos to which such a question may have reference may be divided into three chisses — first, things movable, such as oflice and station furniture ; socon Uv, things so attached to the IrcehoUl as to become part of it; and, thirdly, things which, though capable of being removed, are yot so far attaclied as that it is intended that they shall ronuiin permanently connected with the railway or the premises used with it, and remain permanent appendages to it as essential to its working. It is clear that in respect of the first class of articles, a deduction sliould be allowed. It is oquallj- clear that no deduction should be allowed as to the second. As to the third, the question is finally settled by the decision of this (.'ourt in the case of the Queen v. The ISouthmiiptoit Dur]; Coihjkiiiij, 11 (^, B. 5'^7, '20 L. J. (N. S.) >I. C, !.").->.•' Ill that case the fuct.s funnel were : "In addition to the deductions allowed by the Court, the appellants claimed tu'o further deductions ; they contended that certain fixtures or fixed plant, consisting of cranes, steam engines, shears, derricks, dolphins, and other like ponderous machinery attached to the freehold and essential to the business of the company, should be taken into account in estimating the rent, as fixtures for which a tenant would require to pay on taking possession of the premises, and ought to be treated as personal stock in the nature of stock in trade, and part of the capital which a tenant would have to invest in the business ; that if so considered, such fixtures would diminish instead of increase the rateable value of the property of the companj-. The fair value of the fixtures, if pur- chased by an incoming tenant, would be i'(i, .').')() ; and the sessions find as a fact, that the fixtures in question were attached to the freehold, but are capable of being detached from the freehold as easily and with as little injury to it as other fixtures put up for the purpose of trade or business of the tenant, and usuall}' valued as between incoming and outgoing tenants. If those fixtures onglit to be regarded as stock in trade, or personal stock, then the appellants are entitled to the same deduction in respect of interest and tenant's profit as oa the sum of i;15,000 above mentioned." Judgment vvns delivered by Lord Cainphell, C.J., \\\\o said: " The fourth question arose upon a deduct ion claiuiod by the appellants, whidi was disaUowed. They contended that tlicir cranes, steam engines, and oilier like ponderous machiner}', althougli attached to the freehold, ouglit to be treated as stock in trade, and part of the oa])ital which a tenant would have to invest in the business, so as to diminish, instead of incroasing, the rateable value of the property of the company. Tlic sessions did find, as a fact, tliat these fixtures, worth £'H,.;.30 to an incoming tenant, although attached to TTIE PRIXflPI.E OF RATING. 223 the froehold, are capable of being detacbecl from tbe freehold as easily, and with as little injury to it, as otliev fixtures put up for the purpose of the trade of the tenant, and usually valued as between incommg and outgoing tenants. But this is a rate upon buildings, to which machinery is attached for the pur- pose of trade, and it has been solemnly decided that such real property ought to be a ssessed according to its existing; value, as combined with the machiner}', without consideri ng w h ether the machinery be real or personal propert3% or whether it be liable or not to distress or seizure under a fieri facias, or whether it would go to the heir or e xecutor, or, at the expiration of a lease, to the landlord or tenant — The King v. The Birmingluim and Staffordshire Gas- Lii/ht Companij. In tliis last case, all the arguments pressed npon us to show that such fixtures are stock-in-trade, and not to be taken into account in a rate on the reality were urged, but urged in vain. It is of the greatest importance that a rule upon such a subject, which has been laid down and acted upon should bo adhered to, and we see no reason why this rule should be now disturbed." In determlnmg- the tenant's profits, the following considerations must be Aveighed. In the first place, tlie tenant must be assured of sucli a sum as will induce liim to invest his capital in any under- ^ , , . ,, ,, 1 . v • • ' \ 1 • Tenant's profits. taking, rather than let it remain invested in other securities. But he must have something more than this, he must be repaid for his personal labour and responsibility. Yet, on the other hand, the value of this labour, and the amount of this responsibility must not be unduly exaggerated. The labour which it is necessary to bestoAv is not of that highly-skilled kind ^^•hich commands for itself a high remuneration. The tenant himself is not assumed to undertake the technical business matters ; for this purpose he employs tlie requisite skilled labour in the secretary, engineer, traffic manager, general manager, &c., the remuneration for which is a charge, among the other expenses, upon the fjrosa receipts. The labour which he himself expends is that of general supervision. Then as regards the responsibility. Its existence must not bo denied, but be fairly measured and recompensed in all cases. In addition to the allowances for tenant's interest and profits, other deductions are required. It will be char that whatever 224 THE PRT\('I1M,K OF UVriXO. amount Ihe tenant roccivos for liis own remuneration, he will ex- pect to receive that amount free from any deduction ; lience tlie taxes he must pay upon his profits Avill be one of the deductions from the net receipts. Of this nature is fcnnnf'f< income tax, which is payable in respect of his profits, and which must be distin- guished from the income tax payable in resj^ect of rent. Again, the property in which the tenant's capital is invested is liable to much -wear and tear, and possibly to dej^reciation, by which, if not counteracted, its value will, at tlie end of the tenancy, be mucli diminished. Against any loss from tliis diminution in value the tenant will also expect to be secured ; for it would be of small benefit to him if he made a certain sum by his occupation, and then found, when that terminated, that he retired with a dhninished capital. "With regard to the wear and tear of the tenant's stock, it will iisually bo found that it is continually counteracted by constant repairs, the expense of which is included under the heads of locomotive power, and of carriage and waggon repairs. In con- sequence of these repairs the rolling stock is kept in a constantly efficient condition. This system is to a greater or less extent adopted on almost every railway ; but the practice as to thorough- ness of repairs varies. Before, therefore, it can be determined whether any allowance is to be made, it must be ascertained whether the repairs executed are of a fair average amount. But notwithstanding repairs, the engines and carriages will ulti- mately require renewing. Even in this respect it Depreciation ot ^^ \i,s\iallv found that the working ex])enses include rolling-stock. . i r • i ? i i- i a charge not only lor repairs, but also lor renewals; if in any particular case this is not found to be the fact, it is clear that some allowance should be made under this head ; if a charge for renewals is contained in the accounts, then it only remains to be seen whether such charge is a fair average amount. The question as to the principle on which the allowance for the depreciation of rolling-stock is to be made, was raised in the Ilaugh- h'lf case, 1 T^aw Pieporls, Q. B. GG6. The case stated that — THE PRIXCirLE OF RATING. 225 " (0(ir.) The arbitrator was also requested by the appellants to raise, as a question of law for the opinion of the Court, the proper mode of making the allowance for the depreciation of rolling stock. " The arbitrator has, in the items for locomotive expenses, and carriage and waggon expenses, made a full allowance for the annual repairs of roUing stock taken upon an average of several years ; and as the stock would, after a cer- tain number of years, be worn out, he has allowed the item of £76, in paragraph 4, as the proportional part of a fund for the renewal of the stock worn out. The appellants contended that the arbitrator ought, as a matter of law, to have allowed for the depreciation of stock by taldng its value at the beginning of the year, and then ascertaining what a new tenant would give for it at the end of the year, and making the difference the amount to be dis- tributed over the line for this deduction. " The arbitrator understood the question to be brought before him as a question of fact, and as the mode of arriving at the supposed value, both at the beginning and the end of the year, is by estimate and valuation, and not satisfactory (the parish not having the means of testing it), he adopted the first-mentioned mode as more easily applied, as well as more correct in principle. " If the Court should be of opinion that the arbitrator ought, as a matter of law, to have adopted the mode contended for by the appellants, then this item of deduction should be increased by the sum of ^'50, and the rateable value dhninished by a corresponding amoimt." On wliicli Lord Chief- Justice Cockburn said : " The other question is, whether in making the allowance in respect of the depreciation of railway stock which, of course, must be deducted before the profits can be got at, the learned arbitrator has been right in proceeding upon the assumption that the hypothetical tenant will make his estimate of what he can atlbrd in the way of rent, upon the supposition that the stock is to be replaced and renewed at the termination of what may be called its natural life ; or whether the deduction is to be taken as the diflerence between the value of the stock at the beginning of the hypothetical year and termination of it . Mr. Coleridge urged upon us ver}' strongly that we should be dei>arting altogether from the statute, and, in point of fact, making law instead of ex- pounding it, if we said the arbitrator was right in his view, namely that you are to make the deduction on an average, over the whole of what may bo called the supposed natural life of the stock. I quite agree with Mr. Cole- ridge that, if we were to start upon any other assumption than that we are deahng witli, a case of letting from year to year, we should be construing tliis statute in a manner in which we should not be warranted in doing. Q 226 THE PRIXCIPLK 01' KATLNO. " But I think it is one thing to start with the assumption that you arc dealing with a tenancy from j-ear to year, and auothor tiling to say that the hypotliotical tenant, in calculating what he can roasonahly pay as rent for the promises, is necessarily to assume that his tenancy is not to last beyond a year. I tliink the possibility of its longer duration is one of the surrounding circumstances whiclx the tenant from year- to year would take into account. It may be that the circumstances are such tliai it is worth his while to deal with the stock as though he were certain that his tenancy would not he put an end to at the expiration of the year. He is to calculate for himself how much his stock will be depreciated, and what it is worth his while to give, having taken that matter sufficiently into consideration. Now that seems to me to bo a question of fact for tiie ses.sions ; if there were five hundred sucli tenants, and it was found in all instances, except a very small minoritj', that tenants of that class did deal with their stock in a given manner, that would be a circumstance for the sessions ; or, in the present case, for the arbitrator to take into account in ascertaining what a tenant from j-ear to year would be reason- ably expected to give as rent for the premises which are the subject-matter of tlie assessment. A tenant might make the deduction upon the one principle, or he might make it upon the other; that is a question of fact to le ascertained b}' those who are the judges of it. I do not think there is anything in the statute that makes it necessary or incumbent upon us to say that if the sessions or arbitrator have found that fact in a particular way, they must ne- cessarily be wrong. The tenant must be taken as coming in as a tenant from year to year, and then the question remains, wliat may he be reasonably ex- pected to give as the annual rent of such premises. Before that fact can be arrived at, a deduction must be made from his profits in respect of what lie would allow for the depreciation in the stock used for the purposes for whitdi lie takes the premises, and liow he would calculate this is a pure question of fact dependent on the surrounding circumstances. Being, tlien, a question of fact, wo are not called upon to express an opinion ; it is sufficient to say that tlie arbitrator has not deviated from the rule laid down in the statute in taking into account the surrounding circumstances." Justices ]\Icllor and Slice delivered judoinciil.s to the f-aiuc effect. 13ut it may Lc objected that, onintiii<>- lli(> i'act that the aecomit.s contain charges holh for renewals and repairs, yet, inasmuch as the conditions of the lenaney are to be from year to year, the tenant might be exposed to much loss in consequence of his recei\'- ing a smaller sum for his stock at the end of his tenancy than ho gave for it, not because it Avas really less effective, but because the THE PRTXCTPJj-: OF RATixa. 227 market price miglit then b3 lower, or simply because it is not actually new. To this it may bo answered, that although the tenancy is to be assumed to b3 from year to year, yet this assumption does not involve a change of tenancy j'-early, but it simpl}^ allows the possi- bilit)' of a yearly revision of the rent, and that, therefore, imder this assumption, the time might never arrive when a change of tenancy takes place. Then, subject to this remark, it must be considered that such a depreciation does take place. It must be borne in niind that such doprociation is not cumulative, and that, therefore, the stock will sim^ily cease to be worth the same amount it originally cost, and that the time will never arrive when it is worth nothing. Of course, it is assumed that the necessary depre- ciation, owing to wear and tear, is being counteracted by continual renewals. The liability of the stock to depreciate to some extent from its prime cost has caused the question to be raised as to the amount upon which the interest and tenant's capital is to be com- puted ; whether upon the amount the stock originally cost, or upon its present value. This question was determined by the Court of Queen's Bench, in the above mentioned case of R. v. The North Staffordshire Raihcai/ Comjmni/. Therein it was ^^^^^^^ ^''^'^^ °^ stated that the rolling stock of the company, the appellants, had cost £356,843, which, it was admitted, was a fair price at the time the stock was purchased. Chief Justice Cockburn, in delivering judgment, said : " Four questions are propoumlod in this case for the decision of the Court. Tlie first is, whether the percentage amount to be allowed for iiiterest on capital and tenant's profits is to be calculated upon the cost price of the rolling stock, or on the depreciated value which that stock may bear at the time the rate is actually made. We arc of opinion that the allowance must bo made with re- ference to the actual, and not to the original, value. The point has already been decided by this Court in the case of Tlie Queen v. Tlie Great Western PiaUwiiij Coiiipxnii, (i Q. B. 171), in wliicli decision we entirely concur. In addition to the reasons given in the judgment of the Court in the case, it may be observed thai, as mider the Parocliial Assessment Act, tenant's profits upon 228 TiiF, rRiNcin.E or rating. Btoclc must necessarily bo calculated with a view to their (leduction from the gross earnings, in order to ascertain wliat a tenant -would give for the entire property, nothing could be more inconvenient than that a dilleront principle should prevail in calculating the profits in the two cases. " Now, tlie question, when considered under the Parochial Assessment Act, must be looked at not with reference to the railway company, who may have ex- pended on the purchase of the stock a much larger sum than such stock would now realise, but with reference to an incoming tenant, and the amount of capital which such tenant would have to lay out in the purchase of the rolling stock necessary to carr^^ on the undertaking. It is obvious that what it would be worth the wlxile of a person or company about to embark in a commercial undertaldug to give as rent for the premises in which it was to be carried on, would depend on the amount to be deducted, in addition to repairs and other necessary outgoings, from the gross earnings, in respect of the profits due to the capital to be employed in the concern. But it is plain that a tenant would calculate such profits on the amount of capital actually required to be expended, not on what may have been the value of such stock at some other time, or in other hands. Now, it must be assumed, that the stock in its exist- ing condition is sufficiently effective to produce the earnings, wliich, after the necessary deductions, constitute the improved value of the railway ; and it cannot reasonabl}' be supposed, that if the company were about to give up the undertaking, they would not be wiUing to part with their stock at its actual value, or that, if they refused to do so, the incoming tenant could not procure other stock of an equally efficient character at its real value to sui)ply the deficiency. In estimating, therefore, under the (> and 7 "Will. IV., cap. 90, what a tenant would pay, the profits must be calculated on_the actual value of The amount of the tenant's interest and profits having been ascer- tained and deducted from the net receipts, the remainder is the amount which a tenant could afford to pay if he neither paid rates nor taxes nor did any repairs. But as he is assumed to pay rates and taxes, the amoinit in respect of them must be deducted. The method of Rates and Taxes. computing tliis lias already been indicated under the head of the tithe rent charge. The rates and taxes having been deducted, the remainder is the rent which a tenant can give for the entire hereditament. The rent having been ascertained, the next step is to deduce the THE PRINCIPLE OF EATING. 229 rateable value of the whole. It will be remembered tliat the Paro- chial Assessment Act assumes that the tenant does not execute repairs, &c., but that the landlord does. This assumption may- very reasonably be made, and although, as a matter of fact, the repairs are always done by the railway company, and form the first charge against the gross receipts, yet this reparation must be taken to be done by them in their character of landlords. The prohahle average annual amomit of the repairs of way and works must be deducted, and the only question of fact that can arise upon this point is whether the Deductions from amoimt which appears in the company's accoimts is ihQ 2irohahIe average amount. But the hereditament, like the rolling stock, is liable to an amoimt of wear and tear greater than can be met by mere repairs. A time ultimately arrives when a certain amount of reconstruction is required to maintain the premises in a state to command the rent. In the earlier cases the claim for an allowance to meet this renewal, when it should occur, was disallowed by the Court of Queen's Bench ; but subsequently, in the case of i?. v. T/ie London, Brighton, and South Coast Eaihcay Company, 15 Q. B. 313, the question was again raised, and the Com-t requested to review its former decision, which it did, and as follows : — " The second question submitted to us is on the right to a deduction from the rateable value in order to counteract the depreciation whicli takes place in tlie value of the permanent way, and to maintam it in a state to command the supposed rent, which is the measure of the assessment. As a general principle we do not understand the respondents to deny that a deduction for the pur- pose here stated, and as stated, is proper to be made. The objection which they raise to the particular claim of the company is founded on two circum- stances : first, that the proper provision is already made under a head called working expenses, in which we do not agree ; secondh', that if more may be at any time necessary, the necessity has not j'ct arisen, because the company has not yet incurred the expense, nor laid by from their receipts any sum to meet it when it shall arise. This question, under nearly the same circumstances, came before the Coiut in the case of R. v. The Great Western JRuihcay Conipani/ (G Q. B. 179, 203), and was decided against the company. But we are desired to review that decision. We then said that we thought such an expense, as 230 TUK ]>K1X{ Il'LE Ol' KATIXG. distinct from mere annual repair, fell under the same prineii)lo, and was an unobjectionable head of deduction when it should cither be actually incurred or provided for ; we thought that as uo allowance would be made for annual repair's in any year in which no repairs took place, so none should be made for tills annual depreciation in value, unless, at least, there were funds set aside to meet it when it should be thought expedient to do the work of renewal. In that case too there was a further circumstance ■\\liieh had some influence on our judgment, and which is not found here ; that whatever expenses had been in fact incurred, the company had chosen, riglitlj' or wrongly, at all events conclusively on themselves, to make a charge on their capital and not on their receipts, converting it, therefore, into landlord's improvements rather than tenant's repairs. The difficulty which we now feel arises from the same fact, that no charge has, in fact, either by way of outlay or setting apart, been made on the company's receipts. If the depreciation be, as probably it is, both certain and capable of an annual average, though not proper to be, in fact, repaired annually, we tliink it should be met by laying by a certain sum annually ; and that if the company, in order to swell their dividend, or for s\ny other motive, neglect to do so. the}- act unlawfully in one of two ways: cither they make a dividend which in substance impairs their capital, because they throw a burden on the latter which ought to be thrown upon the former, or they cast the whole burden of a heavy restoration of the permanent vr&y on the dividend of some future j-ear, to the manifest injury of the then proprietors, and for the unfaii' benefit of the present body. In such case, too, there may arise some difficulty in resisting the claim to be allowed — the whole deduction from the rate of the year in which the expense shall actually be incurred, although it would be manifestly unjust to allow it twice over, first in detail and then in lump. This difficulty was met in the argument by instancing tlie ordinary case of house property, as to which a larger dillerence is made between ' gross estimated rental ' and 'rateable value' than in the case of laud, on account of this very annual depreciation of the thing itself and the necessary prospective restoration ; and yet it was said you never inquired whether the owner did in fact la}- by a portion of his annual rent to meet that distant expense. " "\N'e have considered tliis question with nuuh ndention, and, upon the Avholc, we think that the company are entitled to a deduction on this head. We cannot make a substantial distinction between this and house property, or any other of a perishable nature which must require renewal ; and although we think that the company ought to set apart the sviu wliich flicy claim to deduct, we cannot compel them to do so in this indirect way. And we lliiuk tiuit wlicnever the lime shall come for actually )iitikiiig the restoration, Ihcj'will be stopped from claiming more than that annual deduction which they now insist THE TRIXCIPLE OF RATING. 231 ou, exactly as a landlord could uot claim to deduct the expense of res,toration made by liim of a house." At the present time the accounts of railway companies usually do contain charges in respect of renewal of way and works, although, it may be, that such charges are either above or below the average. But they sometimes contain sums, under this head, which are not a legitimate deduction from the rent. These charges are in respect of operations which are really landlord's improvements. An illus- tration will make this clear. In one case a railway had originally been built in a less durable manner than usual ; there were many wooden bridges, and the permanent way was less substantial than Avas advisable. The consequence was that the expense of the repairs and renewals necessary to maintain the premises in a state to command the rent were large, and consequently the rateable value or net produce of the land less than it would have been had the original construction of the railway been better. Moreover, oven the wa}^ and works had not been kept in such a perfect state of repair as sound economy would require. The result was that, latterly, for a series of years, the expense of maintenance and re- newal of Avay was very high, and not only so, but, a better system of management having been adopted, the wooden bridges were gradually transformed into brick and iron ones, and an improved way substituted for the inferior. Part of the expense of these im- provements was charged to revenue, and part to capital. But no part of this expenditure could be allowed as a deduction from the rent, for the expe nditure was in respect of an improvement of the property, and not merely for the conservation thereof. Although by this improvement the entire hereditament would not command more reiif, yet, inasmuch as thoanmud expense of maintenance and renewals of way and works woidd be less, there woidd be a less deduction from the rent, and, consequently, an increased rateable value — that is, an increased net produce of the land, A case having reference to the deduction to be made under the head oi inaintciiance of t//c pennanod icai/ was brought before the Court of Queen's Bench on the 20th of January last (1870). 282 THE rRixciPi,E of rating. The appellants ■were the London (Oid North Western Haihvaij Conij)(ini/, and the respondents Viere the Assessment Committee of the King's Norton Union. The case stated for the opinion of the Court was that, the appel- lants are the owners and occupiers of the London and North AVestcrn Ivaihvay, a portion of which, called the Stour Valley line, runs through the j^arish of Ilarborne, in the King's Norton Union. The whole length of the Stour Valley line is fourteen and a half miles, of which a length of two miles thirty-eight chains is situate in Ilarborne parish. A poor rate for that parish was made on the 30th of November, 1867, in which the company were assessed at a rateable value of £5,538 for the portion of the railway and the stations in the parish. Against this rate the company appealed to the Quarter Sessions. The question which was raised being as to the amount of deductions to be made from the gross receipts in the parish in respect of the expense of maintaining and renewing the permanent waj^ It appeared that the London and North Western Railway is divided into several sections, and a separate account is kept of the cost of maintaining the permanent way upoi> each of those sections. It is possible, therefore, to ascertain exwtly the amount so expended upon each section of the system. The Stour Valley line is the section of the system which lies bet\veen Birmingham and "Wolverhampton. There are several coal mii\e8 near to some parts of the Stour Valley line, and, consequently, th\ cost of maintaining the jDcrmanent way upon that section is much, \ greater than over the rest of the system. None of these mines, \ however, are in the parish of Ilarborne, and the maintenance of the permanent way in that parish is not affected by the existence of those mines. The bulk of the traffic passing over the Stour Valley line is local, but a jjortion of the passengers and goods traffic over the Stour Valley line, before arriving at and after leaving that line, passes over other parts of the London and North Western system. The appellants contended that the amount of the expense of main- taining the permanent way to be deducted from the gross receipts THE PRINCIPLE OF RATING. 233 earned on that portion of the Stour Valley line -within the parish of Harborne, should be arrived at by ascertaining as nearly as practicable the avcrarje actual exjjense per mile of maintaining the way on the whole of that section of the line. The respondents contended that the amount of the expense of maintaining the permanent way to be deducted from the gross receipts earned in the parish, should be arrived at in one of the three following ways — that is to say, either by taking the average actual expenses per mile of maintaining the permanent way over the whole system, or that the extraordinary expense of maintaining the permanent way on the Stour Valley line should be distributed amongst all the parishes through which the traffic carried over this section of the railway also passed, in pro- portion to the amount of such traffic passing through each parish, or that, the ajjjjellant should be entitled to deduct only the cxp)ense of maintaining the permanent u-oaj within the parish. The Court of Quarter Session, subject to the opinion of this Court, affirmed the principle contended for by the appellants. A. S. Hill, Q.C., appeared for the appellants ; and Gray, Q.C., and Bosanqnet, for the respondents. Per Curiam : Each parish is entitled to the benefit of the vahie which the land witliin it . has acquired for the pui-poses of rating. The proper mode of maldng the deduc- tion in respect of the maintenance of the railway from the gi'oss annual value is not by following the mileage principle, hut simply Inj taldwj the actual outlay in the pi'i^ish ; and this item is not to be varied by expenses under this head in other p)arishex along the same railwa}-. The judgment must there- fore be for the resjwrideiUs. It will now be well to speak of certain claims which have been made, but disallowed by the Court. These claims , , . ,. ^ , .111 1 , , As to claims for must be considered here, because they can be pg^^ p^jj ^pj arranged imder no other head than as a deduc- on other points. tion from the rent. They cannot be made a deduction from the gross receipts, for they are not tenant's working expenses, nor, some of them, even expenses at all ; neither can they be deducted from the net receipts, 234 Till', rRiNCirLE of katixg. for Ihcy in no Avay couceni the (cuaiil. ^Xcitlier can lliey be deducted from the rateable value, for the rateable value is tbat Avliicli remains after all deductions have been made. The first of these is for an allowance for goodwill. In making this claim the allegation ispracticalh', that the amount paid by the tenant, and -syhich has hitherto been called the rent, is not so, in fact ; but that it includes, not merely the rateable value and the amount for repairs, but also an amoiuit in respect of the lessor's goodwill, which amount is not tlu- produce of the hereditament, but of a something which is not liable to be rated. This claim was made in the case of H. v. T/ic Grand Junction JRailtcai/, 4 Q. B. 18, and also in the case of 7?. v. T/ie East London Water Companij. "With respect to the claim for an allowance in respect of goodwill, made by the Grand Junction Eailway Company, Lord Denman, in his judgment, said: "The appellants, however, contend tluit, even if the j) >' t iic I ji I c oi the rate be fair, some reasonable deductions are oniitted. AVe have used the sufficiency of the deductions made as a mode of trying the principle ; but the objection of the appellants, now to be considered, is one of detail. The only instance vhi(di they specify and rely on, is, that an allowance ought to be made, and is not for goodwill. "We presume bj'this is meant that a person bargaining with the company to become their yearly tenant of the railway in expectation of succeeding to their trade, as a probable consequence of succeeding to their occupation, would probably be called upon to pay them something for the goodwill of that trade ; and this would be, in the nature of an outgoing, a de- duction from profits. This objection appears capable of two answers : the first and a decisive one, is, that tlie purchase of a goodwill implies that a trtule is sold ; that the company are bound to surrender their trade to the lessee, and to be no longer carriers on that line. But the calculation of the sessions pro- ceeds on no such supposition. All those sjiccid! dfJiudit/ii/ctt, indeed, for carrying it on, which the occupation gives them, whatever iJioy may be, tluy must jio<;cssarily surrender; but the moment they liad leased the railway, they would become a part of the public, and have the right to carry on their trade, retain- ing all the goodwill, with all those advantages which the statutes have carefully reserved for the public. Secondly, though the supposition of a tenancy is to be made, yet what the incidents of a tenanc}' must be, as to actual terms and allowances, must be determined fur the purpose of fixing tlie amount of rate b}' the actual state of things ; for this supposition of a tenancy is only the mode of THE TRIXCIPLE OF KATXNC. 235 ascertaiuiug the existing value of the occupation to the existing occupier. Now, here there is no tenancy in fact ; no goodwill is in fact paid for, and therefore no deduction ought, in fact, to be made on account of its price." Tke next claim to be noticed Avas that made by tlie Great Western Raihraij CompcDiy, G Q. B. 184, for an allowance of 5 per cent, interest on £420,000, being the outlay for promoting the Great AVestcrn I\ail^^'ay Comi^any, obtaining tlic act of incorpora- tion, and the like. It is evident that such a deduction as this cannot be one "which concerns a tenant from year to year, for it is no part of his business to incur any expenses, even in creating the hereditament, much less in preparing to create it, and the deduction must therefore, if made at all, be made from the rent. Eespeeting this claim. Lord Denman, in his judgment, said : " One of the claims made by the appellants, and rejected by the respondents, was for a sum of £'-21,000 yearlj', interest on the sum expended in raisiug the capital of the company, getting the Act of Parliament, purchasing land, and other similar expenses. The Court was of opinion that there was not the slightest foundation for this claim. These expenses were not in any way con- nected with a rateable value of the railway. As well might the purchaser of an estate, Avho had borrowed money to complete his purchase, claim, after the termination of expensive litigation, deductions from the poor rate in respect of the money he had therebj- been compelled to spend." Another claim made in the same case must also be treated of before proceeding to discuss the question of the apportionment of the entire rateable value, inasmuch as, if allowed, the deduction would have had the effect of reducing the rateable value. This was in respect of a deduction of £10,500, the annual loss upon two branch lines rented by the company. Here the entire hereditament occupied ■\\"as, as a A\'hole, created by the Great AVestern Railway Couipany, they luiving nuidc some and rented other parts thereof, and by that means secured the occupation of the whole. Tliey, if the entire lieredltauient had been let, would have secured to themselves a greater annual rent than if the part only which thoy themselves had made had been let. But the rent which they had agreed to pay for the branch lines was 236 THE nUXCIPLE OF RATING. greater tlian tlic rent Avliicb the net produce of the branct lines would have yielded. But in consequence of the occupation of these, the extni net produce on the main line A^'as much greater than it -vvoidd have been without them, and moreover was so much greater that, after bearing the loss occasioned by those branches which the company rented, the rent remaining in the hands of the company, in respect of that part which they had themselves made, was greater than would huxe been the case had the company not rented those branches. The Court disallowed this claim also, saying : " Then came the claim for deduction in respect of the losses on the two branch lines. This claim would be well enough if the rate was laid on the land wliich formed part of those lines ; but though those lines were themselves worked at a loss, thej' must, so long as they were worked, be considered, in the ordinary sense of the term, a means of profit, and the loss would not be deducted from the profits on the main line, but must be treated as money laid out in the improvement of that line." This renting of the branch lines to secure a jDrofit on the main lines is analogous to the case of the owner of a house securing a piece of ground as a garden, at a rent much higher than the garden itself is worth ; but the efi'ect is to make the house and garden command a rent so much higher, that out of the increased rent of the whole, the OAvner can well afford to bear the loss on the garden. This matter may be put in another way, thus — That it is no concern of the tenant of the whole how the whole was created : he can give for the whole a certain rent, and the rent of any part thereof is no concern of his, and consequently he woukl not deduct it before arriving at tlio rent of the whole ; neither can it be deducted from the rent of the whole in deducing the rateable value, for it is not a deduction necessary to maintain the premises in a state to command such rent : hence it cannot be deducted at all. Rateable value of The next question is, how tlie rateable value of ^*^^'°"^' the stations and warehouses must be arrived at ? THE PRINCIPLE OF RATING. 237 If tlie whole liereditament were situate in one parish, no such, question as this would arise, but the inquiry would be complete. It will be convenient to assume that the entire hereditament, which, as already has been seen, consists of the line of railway itself, and " warehouses, wharfs, stations, or landing places," neces- sary to the occujjation of the railway, is situate in but two parishes ; and that the line of railway is situate in one parish, and the ware- houses and stations in the other. It will at once be evident that it would not be just to assign the whole rateable value to the parish in which the railway is situate, neither would it be just to assign the whole to the parish in which are the stations. But the whole rateable value which has been earned by the joint co-operation of each part must be divided between the two parishes. And in doing this, regard must be had to the vahte of tJie occupation in each. In the earlier cases which came before the Court, this question seems somewhat obscure. In the first case, that of R. v. The Great Western Itaihcay Com- panii, no dispute respecting the stations arose. In the next case, that of R. V. Grand Junction Railway Company, a rateable value of the entire line was found in the case, exclusive of the rateable value of the stations, which were separately rated in the parishes where they were situate, at an aggregate sum of £9,150. In this case no question was raised either as to the correctness of the amount at which they were rated, or as to the principles on which the amount should be determined. But in the case of R. v. The Great Western Raihcay Company, 15 L. J., M. C. 80, wherein the parish of Tilehurst was the respondent, in which there was no station, the case stated that the entire rateable value of the stations, " rated separately from the railway," was, on the main line, £35,000 a year, and on the branch, £10,000 ; and the appellants claimed that a projDortion of this total amount should be deducted from the rateable value of the line in Tilehurst. The judgment of the Court upon this point was not clear. " Another objectiou related to the mode of calculating the outgoings that '2']S TiiF. riiTXdri.F. oi' uatixc. wore allowoil. Tlu^ rospoudeiils troato'l the dodiicliuns as; if tla\v ought to ho lUiule in respect of outgoings upon tlie whole line, assuming it to he indilVerent iu point of priufiphi whctlier the stations were iu cue jiarish or iu another; and the Court agreed witli tluin." Ill the ca.sc of Ji. v. T/io North Slafonhhire Raihca)/ Coinpaiii/, 30 L. J. (N. 8.) M. C. G8, a question relating- to the stations avu.s again raised. It was '• Wliethcr the dcdurtiou to l)e aUowed in respect of the stations, huihlings, and sidings, along tlie line of railwaj-, ought to he ascertained hy taking the rateahlc value at which the same are assessed to the relief of the poor, or hy allowing fi per cent, upon the original cost of construction, as contended forhy the appellants; or how, otherwise, a deduction should he made in respect of the said station, huildings, and sidings." It was agreed that £360,000 was the amount of the original cost of construction. To this the answer of the Court was : " As regards the fourth question, we are of opinion tliat the deduction to he allowed in respect of stations, huildings, and sidings, must he calculated on tho actual value at which they ought to be assessed, and not on the original cost of construction. " This judgment was rather of a negative than a positive character, inasmuch as it did not point out tho principle upon which the " actual value " ought to he ascertained. The case of T/tP Eastern Counties llailtrai/ Couipani/ v. Tlio Orcr- soors of Great Amirell, 32 L. J. (N. S.) ^l. C. 174, progressed another step in determining this ]n-incipl(% by further showing how the rateahlc value must not be ascertained. The point in this case was, that the rateable value should bo based upon the capacity which the stations have, to earn certain monies which, it was said, were received in respect solely of tlie use of the stations. Continuing the assumption that has already been made, that the business of a railway company is carried on entirely upon a railway occupied l)y themselves, it is a])])arcnt tlial, in oi'dcr to earn tlicfare which is paid by a passenger for conveyance from one place to another, certain accommodation must be provided in addition to a THE PRIXriPLE OF PATIXG. 239 service rendorod. The accommodation is the use of the .stations at each end of his journey. The service rendered is tlie transport of the passenger from one station to another. It is i^erfecth' possible to divide the total amount of the fare into two parts ; one part may be assigned as the recompense for the use of the station, and the other part as the recompense for tlie service rendered in transit. "When the carriages of a railway company pass on to the railway- of another company, the total fare paid is actually thus divided into parts. This division is made by mutual agreement between the various companies concerned, and is affected through the mediiuu of the clearing house. Of the various parts into which the whole fare is in such a case divided, one part is assigned for the use of the station, and for the services of .the staff at the station from whence the passenger departs; anotlier part for the like use of the station, and the staff of the station at which he arrives ; another part for the payment of the expenses of transit ; anotlier part for the iise of the engine ; another for the use of the carriages ; and the other parts for the use of the railways over which the traveller passes. The same system is adopted for goods. The amo unts allotted for the use of t he stations at either end arc called " terminals." Where, however, a company only uses its own stations and rail- way, no such division of the fare is made. In the above ease of TJte Groat Eastcni liathrai/ Companij v. TJte Orcnecvsof Great AnucvJl, the company claimed to deduct from the gross receipts the amount that would have been received for the use of their stations, had they been used to the extent they were by the passengers and goods of other companies, instead of by their own passengers and goods. "• Tlic questions fortius Court arc — 1. "Whether, in ascertaining the general earnings of the said i^ortion of the said line, the appelhmts arc entitled to deduct the said sum of ^-^.f^'^i), the amount that would have been received for the terminals under the above hypothesis. 2. Whether the Ciipacit}' to earn the said sum is to be considered in determining tlio rateable value of the station. " May -li. — The judgment of the Court was now delivered by ^Mr. Justice 240 THE PRINCIPLE OF RATING. Blackburn : In this case it appears that if the station and lino in Amwell belonged to ditloront eonipaiiies, and if the clearing house system were in force, certain allowances would be made to the company owning the stations by way of remuneration for the accommodation aflbrded in receivmg and unloading, despatching and delivering goods, either taken in or given out at the station. The appellants contend that these allowances, which are called " terminals," are not part of the earnings of the line, but are to be considered as earnings of the stations. "NVe are, however, of opinion that we must, in conformity with the established practice, treat the station as only indirectly contributing to the profits of the line, and, consequently, as being to be rated as land and buildings whose value is to some extent enhanced by their capacity of being emploj-ed in connexion with the line. "We think the amount of those terminals, and the amount of the expenses in earning them, are parts of the general earnings and general expenses of the line, and are to be treated in the same way as any other part of the gross receipts and outgoings." The Court having by this judgment laid down the principle that the stations are only " indircctlij contributinrj to the i^^'ofits of the line,'" and having also laid do^^^l in the West Middlesex Water case, 28 L. J. (N. S.) M. C. 135, the principles upon which those parts indirectly contributing to the profit are to be rated, the proper principle of deducing the rateable value of the stations, &c., may from this time be taken to have been judicially determined. This has been confirmed hy the judgment recently given in the case of The Company of Proprietors of the Birmingham Canal Navigation v. The Overseers of the Parish of Birmingham, 19 Law Times Reports (N. S.), 311. The comj)any were owners and occu- piers of a portion of a canal, and of wharves and reservoirs ancil- lary thereto, situate in the parish of Birmingham. Some of the reservoirs being " summit " reservoirs, it was necssary to provide an engine for the purpose of pumping water into them. It was only necessary to work this engine for a fnr dai/s during the '/ear, but it was necessary to Iceep it always ready for work. The quan- tity of work it did depended on the rainfall during the year. The company were authorised by their act to levy tolls on goods carried on their canal, and other tolls on the goods landed at their wharves, and further tolls if the goods landed remained on the wliarves more than forty-eight hours. The company were author- THE PRINCIPLE OF RATING. 241 ised to demise certain of tlieir wharves if tliey should so think fit. They do not, however, either coUect any demurrage toUs, nor demise any of their wharves, but they allow certain of their customers, wood merchants and coal merchants, to store wood and coal on their wharves. They require certain j^aths and spaces on their wharves to be kept always clear so as to allow free passage to the canal. Under these circumstances the parish officers of Birmingham rated the wharves and reservoirs as " Land and fixed capital vested therein, and deriving some additional value from its capacity of being applied to sucli piu'poses as that of a canal com- pany." And they rated the canal by ascertaining the gross receipts from tolls, making the necessary deductions and allowances. The company objected to the amount at which they were rated for their wharves and reservoirs, and contended that they ought to have been rated cither at the net value of the tolls they charged for the use of their wharf, or at the net value of those tolls ^j/?^s the value of the demurrage tolls had they charged them, or at the rent they could have got had they let their wharves. The assess- ment arrived at by the respondents was higher than any of these modes would have given. They moreover contended that even were the respondents right in their method of arriving at the rate- able value, they ought not to have included in their calculation the land which was used solely as pathways ; also " that the reser- voirs have no rateahh value beyond what is dealt with in rating the other parts of the imdertaking ;" and also that in rating the en- gine power, the respondents ought to have rated it only to the extent to which it was actually used during the year, and for that portion of the year during which it was imused ; that it ought to have been rated on the principle laid down in the case of Sfa/ci/ v. Casfkfon, 33 L. J., M. C. 178 (in which it was decided that a building in which a large quantity of machinery was erected, but which machinery was standing idle in consequence of a failure of trade, was rateable as a warehouse used for the purpose of storing R 242 THE PRINCTPLE OF RATING. machinciy ; tlie position taken up by the appellants being, that so long as the machinery was standing idle the building was not rate- able). Cockburn, C. J. : " I must say I tliink ]\Ir. Keane is right. You cannot give the whole canal or those who travel the whole length of the canal, a benefit at the expense of the parish. The parish is entitled to a rate upon the property of the canal for what occurs in Birmingham, and for the profits wliich might be made in Bii'- mingham — that is to say, not only in respect of the profits which tlie company do make, but in respect of the profits wliich the company might make, hut which they arc jjleascd to forego, from no doubt a very uisc 2yoUcy — namely, that by foregoing those profits in Birmingham ^/i^?/ 7nake a greater profit upon the whole area of the canal. Tlierefore Mr. Keane's contention is right, that whatever might be the value of tliis property in Birmingham, the company which is to make the value that they might extract from it with respect to that, to that extent would be rated. I have expressed my opinion before, that as to the reservoir the rate is right. With regard to the engiiie house, it has a certain value by reason of the land or the building erected upon it, and of the machinery attached to that building, all of which is ncccssaiy for the purpose of the canal. It is situated in Birmingham ; it is only made available, and put to a j)articular use on cer- tain occasions, or if you lilr/ror//_^^m>:>j^/^.s in each pnri.sh must be ascertained, and the rate for that parish based upon Ihom. This important question was raised in the cases of H. v. T//r Lo)iflo)i fiHfJ Jh'i fill ton Baihra;/ Company, 15 Q. B. 313, already re- THE PRINCIPLE OB^ RATING. 245 ferred to, R. v. The South Easterti Raihcay, 15 Q. B. R. 344, R. V. The Midland Railicaij, 15 Q. B. R. 353. In tlie Brighton case the question was raised by the parish officers, the respondents, who " claimed a right to rate the comi^auy on the priuciplo oi parochial earnintjs — that is to say, at such a sum as a solvent tenant should pay as annual rent for the stations and portions of railway within the parish, regard being had to the net revenue earned within the parish." In the South Eastern case the company raised the question : " The appellants contended that the rate ought to have been based on the in-inci])le oi parochial earnings, that is to say, that they ought to have been rated at such a sum as a tenant might be expected to give as annual rent for that portion of the branch railway situate within Westhere, regard being had to the net revenue earned by the portion of the branch railway situate ^^■itl^in that parish, such rent being ascertained by taking the gross annual receipts of the company, arising fi'om that portion of the Ashford, Ramsgate, and Margate branch of railway, situate in Westhere parish (such gross receipts being ascer- tained by taking a proportion of the fare paid by every passenger who has, during the course of the year, been carried by the company over any part of the railway in Westhere, such proportion bearing tlie same ratio to the whole sum paid by such passenger for liis fare for the whole distance travelled by liim over the company's main line and branches, as the distance travelled by him in Westhere bears to the whole distance travelled by him on the company's main line and branches) , and also by taking a proportion of the gross receipts for goods traffic in Westhere, calculated on a similar principle ; then b}' taking fi'om such gross receipts for passengers and goods traffic in Westhere the de- ductions prescribed and directed by the Parochial Assessment Act, 6 and 7 Win. IV. c. 96, according to the mileage principle, applied to such Ashford, Margate, and Ramsgate line only ; the result showing the rent which a tenant might reasonably be expected to give for tlie portion of the railway situate within Westhere ; which mileage principle the appellants contend gives tlie nearest approximation to the actual expenses and usual allowances in respect of the respondent parish which can with am' certainty be arrived at. " In the Midland case the question was raised by the company, the appellants, who contended that the rateable value ought to be esti- mated "with reference solely to the net projits earned by the rail- way within that parish." 246 THE PRINCIPLE OF RATING. Ill the above ijroposition of tlic South Eastern Company, three pro2)ositioiis are made. 1st. That the rate ought to have been based on the principle of the parochial earnings. 2udly. That the rent of the parish is represented by the difference between the gross receipts in the parish, and the expenses neces- sary to earn those receipts. Srdlj-. That the expenses arc to be ascertained by a mileage ap- portionment. Of these propositions it is the first only which is now inmicdi- atcly imder consideration. Of the second no further remark need be made, the proposition having almost become an axiom. Judgment in all the cases was given as a whole by Mr. Justice Coleridge, February 22, 1851, who in a very detailed ruling, de- cided that the company must be rated upon the principle of ^^rtro- ], chicd earnings, regard being had to the net revenue earned within the parish. It will have been seen from the quotation from the South East- ern case, that the foundation of the net revenue is allowed to be the gross reccij)ts. But questions have been raised by the London and Brighton, and by the Great Eastern Counties Railway com- panies as to what are to be deemed the gross receipts in the parish. In the case of this Brighton Company, 15 Q. B. 313, the cir- cumstances were somewhat pccuKar. The company not only used the railway themselves, but they allowed the South Eastern Com- pany also to use it. For this use they did not charge the South Eastern Company toll, because they themselves used a portion of the South Eastern Comjoanj^'s lines without paying tolls. Under these circumstances, the company contended that if they were to be assessed upon the net revenue, such assessment should be upon the actucd net revenue, and not iq)on what the net revenue would liavc been had they received toll from the South Eastern Company. But the Court disalloMcd this claim, considering that this exchange toll, represented " rent in kind," and as such would add to the "annual value " of the occupation. THE PKINCIPLE OF RATING. 247 " It seems to us exactly the same iu substance as if so many tickets vrere daUy issued without money paid for them to the South Eastern Railway Com- pany, in return for so many received fi-om them. The tickets mutually trans- ferred would on either side represent so much money earned. But then we think these eaiTiings must be subject to exactly the same deduction as if they Avere received in money." Again, in tlie case of TJie Eastern Counties Railway Company v. The Oveneo's of Amwell, 32 L. J. (N. S.) M. C. 174, wherein the company claimed to base their rateable value of the stations upon their capacity for earning certain terminals, and to deduct the amount of these terminals from the gross receipts earned in the parish; but the Court disallowed the claim, riding that the amount of those terminals were parts of the general earnings of the line, and the expenses of earning those terminals part of the gross ex- penses. Notwithstanding this judgment, railway companies even now often make a deduction from the gross receipts, the right to make which must some day come before the Court. The nature of the claim may be thus explained : Let A and B be two terminal stations. Let station A belong to the X railway company, and station B to the Z railway company. Assume a gross amount earned for the carriage of goods betweeen A and B. Assume (to make the case clear) that the engines and carriages of the X company do all the transport work, and in doing it use the station A of the X compan-y, the railway X of the X company, the railway Y of the Y company, the railway Z of the Z company, and the station B of that company. Now, it is a fact, in many systems of railway, that goods are carried between A and B at two rates, called by the clearing house ** cartage rates," and "non-cartage rates." When goods are carried at " cartage rates," the X company woidd collect, or cause to be collected, into their station A the goods to be carried to B. Arrived at B, the Z company would distribute the goods. When goods arc carried at *' non-cartage rates," the senders of the goods 248 THE TRINCirLE 01' KATING. take them to the one station (A), and the consignees of the goods fetch them from the other station (B). The gross amomit above assumed to have been earned would be distributed between the companies X, Y, Z by the clearing house. Fii'st, the X company is remunerated for the cost of transport, and for the use of its engines and carriages. Next (in the case of goods carried at cartage rates), a deduction for the expenses of cartage at each end of the journey is made. Then a deduction is made for the use of the stations, i.e., for terminals, and the residue, which is for the use of the railway between the two stations, is divided between the X, the Y, and the Z companies, in proportion to the length of railway belonging to each. Now, when one railway company occupies both the terminal stations and the railway between them, the aid of the clearing house is not required to distribute the amount earned. In arriving at the gross receipts per mile in any parish, the proper mode is to divide the total amount so earned by the distance between the two stations. In the Amwell case, the company had not done this, but had deducted from the total earnings the amount the clearing house would have assigned to the stations, and then divided the residue only. This the Court declared was wrong, and ruled that the " tcrminah " ought not to have been divided. Notwithstanding this, some companies, in arriving at the gross receipts, deduct not the amount which the cartage has cost them, but the amount the clearing house would allow for cartage (such amount being more than the cartage would cost the company), and so make the gross receipts less than they would be if the actual pa}Tnent for cartage only were deducted. From these judgments it may be gathered that the j^ropcr gross receipts, from which to deduce the net profits, are the total gross receipts which ougJit to be received in any jiai-ish. The gross receipts in auij parish being settled, the next question is, in what manner is the net revenue in that parish to be deduced. THE PRIXCIPLE OF RATING. 249 It has already been shown what items must be deducted from the total rn-oss receipts of the entire hereditament in ordLev to arrive at the rateable value of the whole raihcay, . ^ ' . exclusive of the stations, and the question now ceipts, becomes, in what manner is a due proportion of these items, to be charged in any parish against the gross receipts therein, to be ascertained. Before proceeding to consider this question, it will be as well to notice a distinction which it has been sought to make between the parishes upon a branch railway and the parishes upon a main line. This occurred in the second Great Western Raihcay case, 21 Law Journal, M. C. 84. The Great Western Company possessed and occupied a branch railway twenty-five miles long. It was managed in common, with the remainder of the whole Great AYestern system. No separate accomits were kept of the receipts and expenses on the branch, but the amounts were merged in the general accounts of the Great Western Company. But a certain number of engines and carriages were specially devoted to working that particular branch, and a certain number of officers and men specially employed thereon. Under these circumstances the appellants claimed to be rated at the sum of £30 per mile, being an amount arrived at by considering the railway in the parish as a portion of the branch railway, and which was considered as being an independent line. AVhereas, the respondents claimed to rate the company at the sum of £254 per mile, which amount was arrived at on the consideration that the branch railway was a por- tion of the entire system of the Great Western Railway. Upon this point the Com't said : " But the separation of the branch from the trunk is in its ctToct the substan- tial gi-ound of dispute between the two parties, producing, it may be said, nearly the whole difference between I'-^ol and .f30 per mile ; and, nnless they are justified in tliis, it is impossible that their mode of ascertaining the rateable value can prevail, and we think tlioy ai-e not. We wish it to be distinctly understood that we came to this conclusion solely on the facts of the case. "NVe 250 THE PRINCIPLE OF RATING. are far from saying that there may not be cases in wliich the two lines, con- nected for many pui-poses, and worked by the same company, may yet have been kept so distinct by the statute or agreement which creates the connexion, or by the circumstances under which they are worked, that for the piu'pose of rating they would have to be separately considered as two distiuct subject- matters. "When such cases arise they must be dealt with according to their respective cii'cumstances ; but in the present case the fusion of the two lines is complete." After examining the circumstances of the case, the Coui't continued : " "We conclude, therefore, that a rateable value, ascertained by considering twenty-five miles as a distinct whole, cannot be correct." Reverting to the consideration of the question — " In what maimer is the due proportion of expenses and allowances, to be chai'ged in any parish against the gross receipts therein, to be ascertained ?" Let it be assumed, in virtue of the above judgment, that the railway in any parish is a portion of a whole system. In the case of R. v. The South Eastern Railicay, already alluded to, 15 Q. B. R. 344, it was seen that the company claimed to charge the expenses and allowances against the receipts according to a mileage division. In the above case of R. v. The Great Western Railway Company, the appellants had apportioned the expenses as follows : — " They took the gross receipts per mile per annum in the respondent parish exactly as the respondents had done, and they deducted from these the actual expenses of each mile ascertained or estimated. In order to do so, they ascer- tained the actual expenses incuiTcd on the branch alone; and where those expenses were common to the entu'c branch, they divided such expenses by the number of miles in the branch ; and they consider the result to be the expense of each mile in the branch. A small portion of the general expenses of the entire railway, being those of central superintendence, i^rinting, and advertising, were apportioned on the branch in the ratio of the business or traffic iipon it ; and such portion was then subdivided as before on the mileage principle." In the same case the resjmndcnts had apportioned the rateable value of the whole railway, "qua" railway, in the ratio of the gross receipts : — THE PRINCIPLE OF RATING. 251 " And they assessed the appellants, in respect of the said two miles and a half of railway in their parish, in the ratio which such annual receipts bore to the gross annual receipts of the company in respect of the enthe Great Western Railway, trunk and branches ; the rateable value of a mile of railway in the respondent parish being calculated in the same proportion to the rate- able value of the whole line of railway, exclusive of the stations, as the gi'oss annual receipts in respect of such mile bore to the total of such actual annual receipts of the company." By this mode they practically apportioned the expenses and allowances in proportion to the gross receipts. The case, however, found that " The actual expenses of the company are not in the proportion of the actual gross receipts on the branch or through the entire railway ; nor are either such gross receipts or such expenses at one unifonn rate per mile throughout the entu-e railway." Upon this point the Coiu't said : " The remaining question is, what is the net rateable value of the two miles and a half. Now as the net rateable value is that which remains of the gross receipts after aU just deductions are made, it might seem at first sigbt that we might confine our inquuy to the two mUes and a half, and that we only encum- ber the investigation uselessly by introducing into it any consideration of the gross and rateable value of the whole line. But the cii'cumstances of a rail- way make this absolutely necessary. The inquiiy may become, and un- doubtedly does become, more complicated and difficult thereby, but it would be wliolly incomplete and illusory, even in its result, unless we did so. Of the outgoings of a railway, some are general, having no more connexion with or nfl uence on one part of the whole line than on any other incurred for the sake of the whole line, and contributing to the profits everywhere. Of coiu'se these must be distributed, and to every mile must be apportioned some share, on whatever principle the apportionment is to be settled. Some, again, seem purely local — a tunnel here, an inclined plane there (we purposely mention striking and definite peculiarities) : yet even these are contrihutuxj to the earn- inijs everywhere : without these, the traffic upon either side could have no exist- ence. It would be wrong to set these wholly and exclusively against the receipts earned in the same part of the line. "\Vo need not dwell on this, because in i)rinciple some distribution is on all liauds agreed to be necessary, the only difficulty is in determining what is to be adopted for making it justly — a difficulty we believe actually insurmountable in fact, if strict mathematical accui'acy were insisted on. 252 THE PRINCIPLE OF RATING. "It is our business, however, only to lay down the general rule, and appljdng it must be left, not only to the experience and acuteness, but also to the good sense, and good faith, and candour of the parties concerned, whose interest wUl be found in the end to be best consulted by this mode of dealing. How, tlien, are the deductions from the total gross revenue, which constitute the diflerence between it and the total net rateable value, to be apportioned, so as to arrive at the actual sum which constitutes the rateable V'^lue of the two miles and a half. There is no difficulty in giving the lirst answer ; indeed principle and authority leave us no option ; it must be done by acting upon what is called the parochial principle. "We are dealing with a parocliial ques- tion, A\-ith one in which the interests of the several parishes on a line of railway are quite distinct. "NVe ai'e to ascertain what expenses are incurred in earning the gi'oss receipts on the two miles and a half; what charges, parocliial or otherwise, they are Hable to ; and what is fairly to be deducted for tenant's profits, and so on. The same process in kind is to be gone through with regard to the two miles and a half as would be with regard to the whole line if that were all in one paiish. We need not now repeat the reasoning wliich appears in our judgment before referred to, R. v. The London and Bri/jhton JRaihidi/. But, as we then said, and have now repeated, this principle does not preclude a consideration of charges and expenses wherever arising locally, which ai"e necessaiy for keeping the subject of assessment at the value which is made the measure of that assessment. "And further we must add, that wherever it is found that such charges and expenses do in fact apply equally to every mile of railway, it is a convenient and allowable mode to arrive by a mileage division at tlie proportionate part to be assigned to the miles in any particular paiish. Tliis is no departure from the parocliial principle, if it be assumed as to particular charges (central super- intendence, for instance), that a separate investigation of them, as they actually arise in, or are referable to a particular parish, would lead us to the same result as a mileage distribution of the whole. It becomes by the hypothesis but another mode of arriving at it ; in many cases it will be the more convenient and just, in some perhaps it may be the only practical mode." The Court having thus laid down the 2)rinciplc, proceeded to review the method of apportionment employed by the appellants. Having done this, the Court continued : " This explanation shows that the appellants have, in fact, sepai'ated the branch from the trunk, except as to what they call a small portion of the general expenses of the entire railway, and then divided the expenses of the branch thus separated on the mileaye principle. AVe do not think them ncccs- narilij tirontj in this last particular ; it may have been no practical departure THE PRINCIPLE OF RATING. 253 £i-om the true x^i'inciple, but only an allowable instance of what we have above stated to be a convenient practice where the actual expenses were the same on every mile ; and as no objection is made by the respondents, we must assume that it was so." The case, however, had found — " Nor are either such gross receipts, or such expenses at one unifonn rate per mile throughout the entire raUway." The Court then proceeded to consider the mode of rating adopted by the respondents, " It appears by the statement in the case that the respondents have taken the deductions at the same rate for every mile of railway, for, they say, as the gross receipts of one mile to the gross receipts of the whole, so the rateable value of one mile to the rateable value of the whole. This is in effect to strike off from the gross receipts of a mile an aliquot part of the sum wliich is struck off from the gi-oss receipts of the whole, and assumes at least that the expenses are at one uniform rate throughout the whole line. If the ease were sUent on this subject, we might have presumed thjt the respondents had ascertained tliis to be fact, and then there would have been no objection to n mileage division; but the case, reasonably understood, excludes tbi^. for it finds that the actual expenses of the company are not in the proportion of the actual gross receipts, either on the branch, or throughout the entii'e railway ; nor are either such gross receipts or such expenses at one uniform rate per mile throughout the entire railway. The counsel for the respondents laboured in vain to explain away the clear meaning of this passage, and, failing iu that, they equally laboured in vain to show that all the expenses on a railway were necessarily to be distributed in calculation cquallj' over the whole line. In the result we cannot adopt either of the modes suggested to us, or confirm the rate at either of the sums stated; the consequence must be, which we very much regret, that the award must be referred back to the learned arbitrators, to whom the parties, and we ourselves, are so much indebted for the labour and ability which they have bestowed on the case. We trust that tlie principles we have laid down wUl enable them to agree on a satisfactory rate, and there may be no more litigation on the subject." The whole of a tenant's working expenses of a railwa}', the tenant's allowances, and the landlord's deductions, may be divided into two classes. 1st. Those which depend on tlie amount of business done — that is, on the receipts. 254 THE PRINCIPLE OF RATING. 2ndly. Those wliich depend on the work done, i.o, the number of trains run. Of the first-ehiss is the item "passenger traflic charges." Under this head are placed such items of expense as the following : — Salaries of superintendents, clerks, wages of guards, ticket porters, collectors, police, clothing, &c. It will be evident that such items will vary more or less according to the receipts. On those parts of the railway where there are many passengers, tliere will be required many booking clerks, porters, &c., while on those parts of the line wliere there are not many passengers, but few of these officers and servants will be needful. It would, therefore, be incorrect to divide such an expense as passenger traffic charges by a general mileage division. Again, such an expense as locomotive power does not depend so much on the number of passengers, as it does on the number of miles travelled and the weig-lits moved. The dead Aveight of an emj)ty train is great. To move this dead v>'cight a given distance a certain expense must be incurred. If the train be full of people, its weight is of course somewhat increased, but the increase in weight does not involve a proportionate increase of expense. For of the various items which make up the whole cost of moving a train, say one mile, some will remain constant, whether the train is full or empty ; such an item is ''wages to drivers and stokers." The passage of a train over any parish does not necessarily involve the production of gross receipts to that parish, for the train may be almost empty, and consequently the receipts in respect of that train due to the parish will be but small. The same train, before passing through another parisli much further " up " the line, may have been filled, when the gross receipts due to that parish in respect of the same train will be great, but the expense of haidage Avill not have been proportionally increased. Hence it woidd not be just to divide the expense of haulage in proportion to the gross receipts. Again, over some parishes many more trains pass in the course of the vear than over others. In such a case it would not be THE PRINCIPLE OF RATING. 255 right to divide the total expense of locomotive po\\'er by a general mileage. Then, to comply \rith the principle laid down, that parochial expenses must be deducted from parochial receipts, it is usual to apportion such expenses as locomotive power, &c., in the ratio of the train miles run in a parish to the total train miles run, and other expenses in proportion to the gross receipts. Other expenses again, having merely a local existence, having been incurred to secure a local benefit only, must be charged locally, just as local receipts, such as the rent paid to the Great Eastern Company for the use of Peterbro' Station must be locally assigned. The result of this apportioning is to assign to parishes in which the gross receipts are great, great working expenses ; and to parishes in which the gross receipts are small, less ^^ 'orking ex- penses ; but in neither case do the expenses rar)/ in projyortion to the receipts. This mode of apportionment is unquestionably not mathemati- cally correct. But it is much more correct than either of the others suggested. In whichever of the above methods the expenses are appor- tioned, it continually happens that in some parishes situate far from large towns no net revenue, and Parishes in which consequently no rateable value, remains. This ine''eappearsto be ^ , p 1 .1 /-,.•••• -, "0 rateable value eiiect was loreseen by the Court m giving judgment of a railway. in the Brighton case, wherein the Court said : " And this suggests the answer to a clifFiculty raised in the argument in this case. If you give Croydon the full benefit of all the earnings made by the railway in the parish, what is to be done in the case of a parish on some branch line, and which the company may work at a loss ? The answer is, that that case must be decided when it arises between the company and that parish on the same principle as the present, without reference to Croy- don." Such a case did very soon arise. It continually happened that in certain parishes the working expenses and allou-anccs absorbed the whole gross receipts in that parish. And this anomaly existed. 256 THE TRINCirLE OF RATING. that wliile a station, whicli only indiredli/ contributed to the profits of the line, was rateable (inasmuch as the rateable yalue of the in- directly contributing: portion is the first charge upon the rateable value of the Avhole property), and the line of raihra//, as a whole, had a large rateable value, yet a portion of the same line appeared to have no rateable value at all. Although this state of things ap- peared to exist, it was found, nevertheless, that companies continued to work lines which appeared to produce nothing ; and further, for lines whicli were not the property of the occupj-ing company, such company was frequently paying a large rent. The first case that occurred afiecting the question of the rateable value of a railway in a parish in which there appeared to be no rateable value was that of E. v. NeirmayJict EaUicay Company^ 23 Law Journal, M. C. 7G. In this case the Newmarket Railway Company had made a rail- way from the Eastern Counties Railway to Newmarket. The Eastern Coimties Railway Company, " In consideration of the benefit likely to accnie to tliem from the constnic- tion of the brnnch and the working of the railway," guaranteed that if the profits of the Newmarket Company were not sufficient to pay £3 per cent, on the Newmarket Company's capital, they would make up the dividend to that amount. The gross receipts of the Newmarket Railway in the respondent parish were insufficient to provide for all the working expenses and allow- ances, and on the entire railway, insufficient to pay the £3 per cent, to the shareholders. Consequently the Eastern Counties Company had, during the year in question, paid £3,700 to the Newmarket Company to make up the dividend. Under these circumstances, the question was raised, whether the overseers were entitled to rate upon a proportion of this £3,700 ? The Court, however, ruled that tliey were not, inasmuch as this sum did not arise out of the occupation, and would not of necessity pass to a tenant of the Newmarket Company's Railway. Tlie Court, however, were not unanimous. Lord Campbell dis- senting from ^fr. Justice Coleridge and ^Ir. Justiee Ei'le. THE PRIXCIPJ.E OF RATING. 257 The next case that came before the Court on this pomt was that of H. V. T/w SoiitJi Eadern li((i7/ca// CoDipanij, 24 Law Journal, M. C. 84. In that case the South Eastern Company had leased for a thou- sand years, the railway from Reading to Heigate, at a rent of £33,000 per annum, and also imdertook to pay £8,000 per annum, the interest on a debt incurred in making the line. Subsequently the Reading Company was dissolved, and its powers transferred to the South Eastern Railway Company, and a perpetual annuity of £41,000, payable to the shareholders of the dissolved company, was charged on the revenue of the South Eastern Railway Company. Two rates were made on the South Eastern Compan}'. The first before the dissolution of the Reading Company as occiqn'cr.s of the branch railway, and the second, after the dissolution of the Read- ing Comi^any, when the South Eastern were both oirncrs and occi(j)U'rs of the branch. In the first rate, the rent, £41,000 — viz., £33,000 and £8,000, paid, was made the basis of the rate, and the case found that, if the rent paid under lease was the pro- ■pev criterion of the rateable value, then the rate appealed against was correct. The case further foimd, that the gross earnings of the South Eastern Railway on the Reading railway, less the proper deductions did not amount to £41,000, less the statutory deductions. It was also found that the Reading line brought a great deal of additional trafhc to the main line of the South Eastern Railway, and that the latter companj' thus derived benefit from the Reading- line as a feeder of the main line in respect of the traffic conveyed upon that line. It was also found, that the Reading line, if in the market, might be an object of competition between the South Eastern and other companies. The questions for the Court were — " First, whether the appcUauts were properly assessed i:i the two rates appealed against in certain specified amounts, the assessments being founded on the said rent as to the first, and the said annuity as to the second rate, wliich assessments were taken as the proper criterion of annual value in each case? " Secondly, whether they were liable to bo assessed in respect only of the net profit derived from the traflic passing through Dorking, irrespective of any 258 THE PRIXCirLE OF RATING. rent paid by the company, aucl the value of the Heading, Guildford, and Reigato lino as increasing the traflic on the main line? " Tliii'dly, whether the respondents were entitled to take into consideration, in their assessment, the value of the line to the appellants as an intcgi'al pai-t of the South Eastern Eailway, in (chUduii to the net profit as derived from the traffic passing through the parish of Dorking '.'" Upon the first question the judges "were unanimously of opinion Rent actually paid that the rent or the annuity paid under the lease not sole criterion ^^^, agreement coiihl not be Uthni to he the 6ok of the rateable ., . „ , , y2lyg_ critenoH oj the annual valHe. But upon the second and third questions the Court were divided ; Lord Campbell, Mr. Justice Crompton, and Mr. Justice Coleridge being of opinion that the appellants were liable to be assessed for the total profit arising from the occupation of the land in Dorking parish. Lord Campbell said : " I am of opinion that the liabHity of the appellants cannot be confined to the net i^rojlt derived by the (q^j^cUants from the traffie 2>iist>inf/ throwjh the parish of Dorkiwj. They are only to be assessed in that parish in respect of jn-operty occupied by them in that parish ; but its value in the 2)ari$h may be enhanced by circumstances existing out of the inirish. " The appellants say truly that they are not to he rated in this jMrish for profits made elsewhere. I wish implicitly to abide by what is called the ' parochial principle ' of rating. But upon that principle we must see of what value the property rated in that parish is to tlie occupiers, and this is not necessarily determined by the pecuniary receipts for the ttseofit within thepiarish. The rent that was paid by tlie appellants is strong evidence that it was of giX'ater value to them than the mere net profit fi'om the traffic upon it. " "We have an express admission that the Picaduig line brings a great deal of additional traffic to the main line, and that they derive benefit from the Reading line as a feeder to the main line in respect of traffic conveyed upon thai line, and that the Reading line, if in the market, might be an object of competition between the South Eastern Company and other railway companies, the traffic on the main lines of which woidd be increased by the possession and control of the Reading line. Therefore, phis the net profits derived from the traffic passmg through the pari.-^h uf Dorking, the appellants do derive a profit from the occupation of the portion of the line in that parish. But it is said tliat in respect of this last profit they ought only to be assessed in the parishes THE PRIXCirLE OF RATING. 259 tlu'ough which the main line passes. I am of a contrary opinion. Tliis profit, although not received for the traffic upon the line in the parish of Dorking, originates from the occupation by the appellants of land in the parish of Dorking ; and if they are assessed in that parish in respect of this profit, in estimating then- profits in the parishes tlu-ough wliich the main line passes, there ought to be a deduction in respect of what is paid for the line which is worked as a feeder to the main line. This calculation, though difficult, may be made upon data which are accessible, and is not more difficult than calcula- tions which must be made in railway rating, where stations and inclined planes affect the traffic in another parish. Adhering to the parochial principle, I inquii-e of Avhat value the land rated is to the occupier. Of this value the rent which he is willing to pay affords evidence, and from any profit wliich he in- directly makes from it out of the parish, part of the rent wliich he pays for it in the parish is to be regarded as a deduction. At the bar it was hardly denied that tliis would be the result if the two railways belonged to two com- panies, and if the company whose railway is fed were to pay a reg-ular fixed annual smn to the company whose railway is the feeder. But I do not see how it would make any difierence to the parish of Dorking that both lines are oc- cupied by one company, and are worked as one concern. The advantage derived from the occupation of the portion of the line ia the parish is still the same, although the process by which the amoimt of that advantage is to be calculated has changed. I adhere to the rule of rating which is laid down in R. V. Tlie Neivmarhct Rallwcvj Comjximj, which I there attempted to support and illustrate. This, I think, is in entire harmony with oiu- decision in R. v. The Great Western Railway CoinjMinj, 15 Q. B. 379. In many cases the supposed advantage derived by a railway company from a portion of a railway iu a par- ticular parish, bringing passengers and goods to another portion out of the parish, may bo almost inappreciable, and I would earnestly dissuade parishes from ever making any claim under this head, unless upon clear e^idence that the claim can in point of fact be established." Mr. Justice Coleridge said : " I understand the second and thii'd questions to be intended to raise three points. Fii'st, must the assessment be made only on the net profits earned by the passage of goods over the land occupied in Dorldng, and must any additional value, which the occupation iu truth may have, as increasing the traffic on the main line, be excluded? Secondly, may any aihJitional value, wliich the occupation of the land in Dorldng may have, by reason of the amalgamation of the two lines, be included in the assess- ment ? These two questions, I presume, were framed with a view to the different circmnstances imdcr wliich the two rates were made in respect of the amalgamation. INIy answer to these questions will be tliis— nothing is to be excluded which— I do not say has a tendency to add to (for of this no notice 8 2 260 THE nuNC'iiLK of rating. can be takom — but wliioli actually adds t() the value of the occupation ; for the rate is to be regulated in amount by that value, and it is a principle which I believe to be established by numerous [decisions, that the inquiry is not so much where the profits are produced, as whether any alleged profits are so directly referable to it as properly to be considered profits of the occupation, so that, to adopt the words of j\Ir. Crisp, in his sensible essay on the subject, ' the rateable value within the parish inuy depend on matter without the parish.' " Mr. Justice Crompton said: " Secondly, I lliiuk that in strictness the value of the branch as a feeder is to be taken into account in ascertaining the rateable value. It is a profit derived from the occupation of land, and it seems to me impossible to say that the value to the person willing to take the lines, or the rent likely to be got from them, would not be increased by the advantage of tliis line to, and from its being a feeder of, the large railway. The value of the land in the parish is increased and enhanced bj^ its being useful as increasing tlie profit that may be made in another place, and I tliink that the rateable value within the parish may clearly be enhanced by matter in another parish." Mr. Justice Erie dissented. In Ids judgment he reviewed the various cases that had been decided, and showed that, m the Great Western case (15 Q. B. 1085), tlie Court sanctioned a rateable value founded upon the uct eariiitigs in each parish, and that, in the cases of E. v. London and Brujliton, It. v South Eastern, 11. v. Midland, this principle was, after much consideration, confirmed. Mr. Justice Erie thus concluded: "Also it is clear that no tendency to create profit is rateable ; no tenant would j)ay rent for a tendency to profit unless it resulted in profit ; and certainly no tenant of part of the line in Dorking would pay rent to increase the profit of some other tenant of some other part of the line, as was mentioned in the case of 11. v. The Newmarket Railivaij in this term. I have disposed of all that was material in the ques- tions submitted ; but as the judges difier on the question whether a railway can be rated for more than it produces in the parish, on account of its tendency to make profit elsewhere, which is expressed by a metaphor from feeling; and, on the question whether, in a case for apportionment, one parish, in making its rate, can disregard the positions of other parishes within the apportionment, and as a generality cannot be tested without a specific appli- cation, I suggest, if a case is again brought up relating to these i)oints, it should state specifically what is the railway profit arising out of the parish which is liable to be rated Mithin it. " Tn a subsequent case, that of The London and North IFcsfcrn Haihrai/ v. The Prirish Offirrr-s of Can nod,-, t^fnff'ordxhirr, reported THE PRINCIPLE OF P.ATIXG. 261 in the Tlmefi of November 1"2, 180-3, and in Lair Tinirs, X. S. 325, the parish officers had rated the London and North "\Yestern Railway at the siun of £325 in respect of their occnpation of two and a half miles of the Cannock Mineral Railway, situate in the parish of Cannock, wherein the gross receipts were £358 for the two and a half miles, and the tcorl-infj e.rpoises alone £807 for the same distance. The London and North "Western Company liad leased this line, the total length of which is seven and a half miles, paying £5,500 per annum. In the course of the argument it was admitted that the line, though worked at a loss, was necessary to the earning of profit on the rest of the London and North Western Railwa5^ After much discussion judgment was given in favour of the parish, although no formal judgment is reported. The principle that the rateable value within any parish is to be measured b}'' the ^';;//>c profit derived from the occupation of land therein, and not merely by the profit which actually arises in the parish, being by these judgments laid down and confirmed, the question presents itself, as to how that entire profit is to be ascer- tained ? To determine this, it wiU be first desirable to analyse the entire gross receipts in some one parish, which, it shall be assumed, is near a large town. The manner in which such gross receipts will have been calculated has already been described in the extract from the case B. v. South Eastern Railicai/. From that description it will be seen that the gross receipts in such parish are produced by the conveyance, during the year, of passengers and goods from various stations to various other stations situate at distances above and below the parish in question. From any one station, a certain number of passengers and quantity of goods have been conveyed, during the year, to each of the other stations on the raihvay. The gross receipts arising from the conveyance of pas- sengers and goods will be made up of as numy parts as there are difierent stations. Any one of those parts will be the result of the traffic between any one station, and one of the other stations, 262 ' THE rRlNCirLE OF KATINO. on tlio railway. The amount of one of these parts lias been earned hv the railway lying between the two stations. And, moreover, each mile of railway lying between these two stations has cqualhj earned the amount ; for, without the joint co-operation of each portion of the railway, this amount could not have been earned. Hence, then, the receipts, divided by the distance between these two places, will give the gross receipt per mile in respect of this particidar traffic. The total amount of receipts between any two places shall be termed a " stream of traffic." From each station there will emanate many streams of traffic. Now, over the parish of which we are at present speaking many such streams of traffic ma}- pass, each stream travelling over a (tiffcreut total length. Then the entire gross receipts in such parish will be made up of the a o-o-reo-ate of the share of the parish of rack stream of traffic. Con- sider one stream of traffic onlj^ which shall have passed between two places, say one hundred miles apart ; each mile of railway between these places would be entitled to one himdredth part of the whole stream. Now, take a parish through which only this single stream of traffic passes. The gross receipts of that parish per mile would then be one hundredth part only of this stream. Again, take another parish through which this stream, as well as many others, passed ; the gross receipts in such parish would be the aggregate of its shares in each stream. Next, with regard to the net profit. It has already been seen that the expenses do not vary in proportion to the receipts. It is therefore evident that, an increase in a receipt for traffic docs not involve a corresponding and proportionate increase in the expenses. Hence, if the gross receipts can be increased in some parish, wherein there are already many streams of traffic, tlie profits in that parish will be increased to a greater ratio than the gross receipts. " Gross receipts " in a pari.sh may bo increased in two ways. First, by increasing the total annual amount of a stream of traffic. This is the result of increase of population or of business in any two places between which the stream of traffic passes. Secondly, THE PKINCIPLE OF KATIXG. 263 by increasing tlie number of streams. This is effected when the number of plaees between which traffic is carried on is increased. Now, since " gross receipts" may be increased -odthout increas- ing the expenses in the same proportion, it follows that an increase of "gross receipts " may produce a greater proportionate increase of net profits. It will now bo clear how a railway company may secure to itself a benefit by securing to itself the occupation of branch lines. For, by so doing, it increases the number of places to which it carries. By securing the occupation of branch lines, in considera- tion of a rent, the company avoids increasing its capital account by the construction of the railway. And the rent which the com- pany can afford to pay is measured, not by the net profit it makes upon the branch, which may be nothing at all, but by the net profit it makes altogctJter out of the extra streams of traffic which it secures by the occupation of a branch. Reverting to the consideration of the particular stream of trafiic i-eferred to above, it will readily be seen that in a parish through which the single stream only of trafiic passed, no rateable value in respect of the railway might exist, because it is possible that no net profit may exist there ; inasmuch as the expenses and allow- ances apportioned to that parish by being all charged against that one stream of traffic, might considerably exceed the gross receipts. Follow that stream until it reaches a parish through which many other streams also flow. The expenses apportioned to such parish will be chargeable against the sum of all the streams. Now, as the expenses are not in proportion to the receipts, there will exist in this latter parish a large net receipt in respect of the total gross receipts. Consequently there will exist a net receipt in respect of each stream which makes up the total gross receipts, and conse- quently, of the particular stream in question. As the stream may be assumed to pass through many parishes, in some of which there may be no net receipts, but in others, a considerable amount of profit, the entire profit of the stream will consist of the sum of the profits in each parish in which 004 THK PinNCllM.I', OK HAl'ING. profits do arise, k\, and //. v. f.ondun and South Western TiaUudjf CunijiKni/, 1 Q.T). '}')><. So again in It. v. /jonrr Hutton,i) B. and C 818, it is laid down that if a portion of a canal in one parish is more productive than portions in other parishes, either because there is more traffic, or because the yearly outgoings and expenses there are less, it ought to be assessed at a higher proportionate value ; and it is decided in J{. v. I'he London, Briijhton, and South Cotuf ndilicai/, 20 L. J. M. C. 124, 144, that ' the value which the land occupied in each parish produces after the due allowances, is that upon which the occupier is to be rated in each.' No doubt it is very diflicult in the case of railway companies, and in the case of a part only in one parish of a long line of railway, to applj'- the principle of the Parochial Assessment Act, that principle being that the rate on the property in a parish (and on a railway like all other property, for there is no distinction) is to be made ' upon an estimate of the net annual value of the several here- ditaments rated thereunto — that is to say, of the rent at which the same might reasonablj' be expected to let from year to year.' ' Lord Chief Justice Cockburn, Mr. Justice IVIellor, and Mr. Justice Shee arrived at the same conclusion — viz., that the arbitrator was right ; but they arrived at this conclut^ion by two different roads. The Lord Chief Justice and Mr. Justice Mellor laid down the proposition that the accession of traffic below Ipswich was an accident, and therefore the vahie of the railway in Ilaug-hley ought not to benefit by that accident. Let it be granted that the accession of traffic is an accident. Then assume that such accident does not happen, but that the traffic which has passed through Haughlcy continues imincreased as far as Lr)ii(l( m . Its passage through Ilauglilcy produces a certain rateable value in tlial parish. Xow assinne llial just before it THE PKIXCIPLE OF KATIXG. 269 reaches London it must pass up a steep incline. This incline necessarily involves much increased expense in working the traffic. But it was ruled in the Great Western case, 21 L. J. M. C. 84, that this expense must not be a local charge. "Yet, even these (the tunnel or inclined x)lane) are contributing- to the earnings everywhere." Therefore, in such a case, since the expenses of the incline must be shared by all those parishes whose traffic uses the incline, the rateable value in Ilaiighley would be affected by it ; that is, the rateable value in the parish is to be h'ssenecl by an accident (for the existence of the incline is essentially an accident in the sense in which the term has been used in the argument) occurring out of the parish. Yet by the decision in the Haughley case the rateable value in the parish is not to be increased b}^ some accident M'hich exists out of the parish. But is this accession of traffic an accident ? Is it not in the very nature of things ? Is it not a necessary con- sequence when traffic approaches a large town ? "What would be the state of things if there were no railway between JSTor-wich and Ipswich? Why, the expense per mile ofworking between Ipswich and London would continue nearly the same, but the gross receipts per mile would be very much lessened, and therefore the profits per mile would be lessened. That is, the possession of land in the parish of Haughley (and in the other parishes between Norwich and Ipswichj does, as a fact, enable the company to make greater profits than they otherwise would, between Ipswich and London. Mr. Justice Shee said that the contributive value could not be taken into account without adopting the mileage principle and abandoning the parochial. ])ut giving each parish a mileage pro- portion of all the profit if had //c/jjcd to earn (for that was in effect the contention of the respondents), is a very different thing from giving each parish a mileage proportion of all the profits made, whether that parish had contributed to earn them or not. In the one case, if a parish had helped to earn profit from many streams of traffic, it woidd claim its share of the nuiny, and so have a high 270 THE riiiNcu'LE of kati>;g. rateable value. If it had helped to earn profit from one stream only, it would claim a share in one stream only. Mr. Justice Shec says that : " It appears from all the cases that a railway is rateable iu the parLsh where the particular profits are earned." But !Mr. Justice Coleridge, in the Dorking case, 23 L. J. M. C. 84, said that : " It is a principle which I believe to be established by numerous decisions, that the inquiry is not so much whiuie tlie profits of the occupation are pro- duced, as whether any alleged profits are so dii'cctly referable to it as properly to be considered pai'ts of the occuj)ation." In the Haughley case it was not deemed that profits were made elsewhere. There are many miles of railway in England and Wales which have no rateable value, because the expenses alone exhaust all the receipts ; and yet we find railway companies giving high rents for such lines. And why? Because these lines are the means of enabling the renting companies to make greater profits on their own main lines. Surely if such lines, when rented, have a value somciclicrc, they have equally a value if the renting companies purchase them. If this decision of the Court he not rerieurd, this auornalu u-ill exist, viz., that miles and miles ofrail/rai/,fo)'ntin/J2)arts of a valuable whole, irill tJtemsehcs have no rateable value ; yet if they icere cut off from the n-hole, the value of the whole would be seriously diminished. On the 24th of April, 1869, the following case was brought before the Court of Queen's Bench with the evident intention of inducing the judges to review their decision in the Haughley case: — Reg. v. Llantrissant. This was a case stated by the Quarter Sessions of Glamorgan- shire, upon an appeal by the Great AVestcrn llailway Company against an assessment of the company to u poor rate of the parish of Llantrissant, in the Pontypridd Union, in respect of the Ely Valley Kailway. The Ely Valley llailway is leased to the Great Western llailway THE PRINCIPLE OF RATING. 271 Company for 999 years, they undertaking to pay a fixed rent of £4,000 a year. Tlie entire length of the railway is about ten miles, of which about seven arc in the parish of Llantrissant. The traffic is chiefly minerals ; and the greatest portion of that traffic is brought by the Ely Valley Railway to the South Wales Rail- way, which it joins a short distance beyond the boundary of the parish, and is conveyed for some distance over that line and over other portions of the Great Western lines. The South Wales line is the property of the Great Western Company, and the Ely Valley Railway acts as a feeder to that line. In assessing the Ely Valley Railway within the parish, the value of the traffic contributed by that line as bringing traffic to the South Wales line was taken into consideration ; and it was agreed that, if this contributive value was to be excluded in the computation, the rate was to bo reduced from £400 to £270. Mr. Eield, Q.C., contended that the case was concluded by the decision in The Great Eadern Raihcaij Company v. The Overseers of Hauglileij, 35 L. J., 229, M. C, where it was held that the rateable value of a portion of a railway, consisting of the net aimual profits from the traffic upon the portion rated, cannot be increased by any part of the profits caused by the same traffic upon the other ])ox- tions of the line. Mr. Michael, contra, relied on the decision in the case of The London and North fFcstcrn Eaihcaij Companij v. The Overseers of Cannock, 9 L. T. Rep., IN". S. 325, where it was held that the rate- able value of land in a parish may be increased by its producing a return to the occupiers out of the parish, as when a branch rail- way, occupied by a company owning the main line into which it runs, produces a profit by virtue of the traffic which it carries over such main line. TAe Neicmarket Raihcaij Company v. St. Andrea-'' 6- the-Less, 23 L. J., 7G, M. C, was also cited. Mr. Justice Mellor (Lord Chief Justice Cuckbiuii being absent) : " It appears to mc that it is immaterial whether the lino be a branch liuc or a portion of the main liuc ; the quosliou is — what is the value of the liuc to 272 Till; I'KiM iri.K of uaiing. the parisli 'i It is, wliat woukl bo the amount tliat tlie liypothctical tenant would give ? The question asked is whether the respondents are entitled to take into conh^idcration in their assessment the value of the line to the appellants, as bringing traffic to the Clrcat "Western llailwaj' Company's South "Wales line, in addition to the net profit derived from the traffic passing tln'ough the parish of Llautrissant ? I think the case is governed by the Haughley case, and that the Lord Chief Justice did not intend to abide in that case by what he said in the Cannock case. I think there should be no addition to the rating in Llautrissant because the traffic of Llautrissant comes on to the Great Wester Railway's line." ^Ir. JiLstice Hayes : "Tlie Haughley case settles the question, and reduced to the ordinary rule certain aberrations which had crept into the subject." Judgment accordingly. It only now remains to speak of cases in Avliicli tlie entire re- j 11 ceipts of a railway company arc earned, partly on tlie system occupied by the company, and partly on some other system occupied by another company. It will be seen, from the case of R. v. The Gmnd Junction llail- ivaij Company, that so much of the receipts as have been earned on foreign lines, and so much of the expenses attending such earnings, must be deducted from the gross receipts before proceed- ing to deduce the rent of that portion of the system which the company do so occupy, for the rent is to be fomided upon a con- sideration of what is produced. And it cannot be said that that which is produced on another company's line is any part of the produce of the hereditament occu2)ied by the company, tlie value of whose occupation is the subject of inquiry. With regard to the expenses attending the receipts earned over foreign lines, it may be remarked that the ex])enses may be ar- ranged in two classes. In the first class will be placed those expenses and allowances which are necessary to the carrying on of the trade. In the second class will be placed those expenses which, if the company were the occupiers, instead of the users merely, Avould represent the rent and taxes. To the question, liow tliese receipts are to be ascerttiined, it may THE nilXCIPLE OF RATING. 273 be replied that tlie receipts between any two places will be equally earned by each portion of the railway lying between those places, whether some of it is owned and occupied b^' one company, and some owned and occupied by another company' ; or whether it is all occupied by one company. So that, whatever proportion of the distance between those places is iised only by one railway com- pany, that proportion of the traffic between those places can be justl}^ deemed to be the gross receipts earned otherwhei-e than on the hereditament occupied by that company. The diiference between the gross receipts and the carrying ex- penses and allowances will be the toll the company can afford to pay for the use of the other company's railway. But it does not always happen that the use of a railway is secured by the payment of the amount of toll which a company can afford to -[tnj. Sometimes it happens that such user is secured in one or other of the following ways : — Firstly. The use may have been secured for ever by a lump sum paid down. Secondly. The use may have been secured by an annual rent paid for a term of years, imder agreement. Thirdly. The use may have been secured by a payment, depend- ing upon the use made of the railway. Fourthly. The use may be derived from the exercise of the right given to the public to use a railway upon payment to the occu- piers of such toll as the special Act of Parliament authorises them to demand. In each case the amount of payment for such user may be either less than, equal to, or greater than the difference between the receipts earned, and the expenses and allowances incurred. In the event of the amoimt of toll payable being greater than the difference between the receipts and expenses, the important question arises whether the extra (ononnt is to be paid to the detri- ment of the rateable value of the hereditament which the com- pany does occupy, or whether such extra amount must be deemed T 274 TiiK riaxcirr.K of ti.vting. a landlord's improvement, just as tlic extra rent paid for a brancli railway was deemed to be of that nature. An attempt was made to raise this question in the case of the North London Railway Comjmnij, appellants, v. The ChurcJiwardens of St. Pa»eras parish, respondents, 32 L. J. M. C. 145. The Korth Loudon Eailway Comi^any occupied their own rail- way of a length of about seven miles, situate between Hampstead Road and Bow. At Bow it joined the Blackwall Railway. The North London Comiiany carried passengers from Hampstead to Fenehurch Street and all intermediate stations ; their engines and carnages ran over their own line as far as Bow, and then, for about two and three-quarter miles, over the railway of the Blackwall Company, which they iised. For the use of this railway the North London Company paid to the Blackwall Company the sum of Id. for each single passenger, and l|d. for each return passenger. The amount of the papucnt to the Blackwall Company was, for the year in question, £10,900. The Blackwall Company, previous to the oj)ening of the North London Railway, had a station at Bow, to and from which they used to carry passengers. When the North London Railway was opened, the North London Railway Company then carried in their carriages that Bow Station traffic which had previously been carried by the BlackAvall Company. iViid in addition to the above smu of £10,900, they handed over to the Blackwall Company the entire receipts for the Bow traffic, subject only to a very small payment (about 11 per cent.) for work- ing expenses. It was contended, in deducing the rateable value of the North London Railway, that the toll aetuall;/ paid to the Blackwall was not, as a matter of course, to be deducted, but that the inquiry was first to be made whether the toll so agreed upon to be paid was a fair amount, and such as, had the railway been occiqned by the North London Company, would represent the rent a tenant could reasonably give for that portion of the line. Upon investigation it was found that the toU actually paid to the Blackwall Company was greater than the net receipts earned over the Blackwall Rail- THE PKINCIPLE OF RATIXO. 275 way, and not only so, but that it was greater also tlian the net profit arising from the whole of those receipts which were earned in consequence of their connection with the Blackwall Eailway. But it appeared in evidence that the amounts actually paid to the Blackwall Company Avere less than the company could, imder their Act of Parliament, have charged if no special agreement had been made by them. Under these circumstances it was found, as a fact, that the amount paid to the Blackwall Company was a reasonable sum. " The questions for the opiuion of the coiu't are — first, wliether in ascertain- ing the rateable value of the subject matter of the rate, any sum should be deducted in respect of the said payments by the appellants to the Blackwall Company ? Second, whether, if any sum ought to be deducted, as the fii'st question mentioned, the sums mentioned in the said agi'eement payable by the appellants to the Blackwall Company for passenger tolls are the sums which ought to be deducted ? If the court should answer botli questions in the affirmative, the order of sessions and amendment to be confirmed. Lord Chief Justice Cockburn gave judgment : " This case is very clear, and I think the sessions came to a right decision upon it. Complaints have often been made of the inapplicability of the land- lord and tenant principle mentioned in the Parochial Assessment Act to rail- ways. But in tills instance, that principle may be advantageously applied, because in considering the yearly tcnantable value of the land in the possession of the North London Railway in the parish of St. Pancras, it would be proper to exclude the amount paid over to the London and BlackwaU Piailway Com- pany. " It appears that the entire line is made up of two parts. That in the possession of the Korth London Railway extends to Bow Junction, and there they would have to put their passengers out, if it were not for the agi'cemeut they have entered into with the Blackwall Company to pay to the latter one penny or three-halfpence, as the case may be, for each passenger carried on to Feuchurch Street. But not a fartliing of this last mentioned sum goes into the pockets of the North London Railway Company ; it is taken wholly on behalf of the BlackwaU Railway Company ; and therefore it could not be included in any rent which a tenant would give to the North London Railwaj', in respect of laud in the parish of St. Pancras. Again, the BlackwaU RaUway Company arc assessable in their own parish for aU their receipts, and the money paid them by the North London is a part of those recei]3ts. If, therefore, St. Pancras parish P o 276 Tin-: riuNtiPLK of hating. were to receive a rate in respect of tliis sum, aucl tjic Blackwall Railway Com- pany were also to pay a rate in respect of the same, the result would be that a rate would bo raised in two difl'ercnt parishes upon the same subject matter. I think, tliercfore, that the amount in question was rightly allowed to be de- ducted." Crompton, Blackburn, and Mellor, J. J., concurred. This judgment -svas a necessary consequence of the sessions ha\-ing found " that the pa)/mcnfs made hij the appcUaiits to the BlaehicaU Compani/ ircre reaso)iah/e." It leaves undecided tlie question -whether, if the toll or rent, or other compensation which has been agreed upon to be paid by one company to another for the use of that other company's railway, or railway and station, be found to be greater than the net receipts arising from such user, the actual amo\int so agreed upon to be paid, irhaterer it maij he, is to bo deducted in determining the rent of those premises which the one company do so occupy, or whether such amoinit only as is represented by the difference between the gross receipts earned over the other company's property, and the carrier's expenses and allowances incurred in earning such gross receipts, is to be deducted. The latest decisions on this question of toll are those in the two cases of TJte Midland Baihcay Company v. The Overseers of the Parish of BadcjH-orth, 34 L. J. M. 0. 25, and The Great Western JRailira// Conipan// v. The Overseers of the Pari.sh of Badgicorth, 2 Law Reports, Q. B. 251. In this instance, the railwa}' between Cheltenham and Gloucester was made imder the authority of G Will. IV. c. 77. It was to be made by the joint pajTnents of two companies, one of which ulti- mately became united with the INlidland Railway Company, thC' other with the Great "Western Railway Company. The railway was actually made by the Midland Company, and the Great "Western Company subsequently i)iii(l <(> the ]\H(llaiid one half the cost of con .s't ruction. The Midland Co}iipany repaired and main- tained the half nearest to Gloucester, the Great "Western the half nearest to Cheltenham. The line was u.sed by the trains of both companies, and was laid with llncc rails to accommodate both THE rRIXCIPLE OF RATING. 277 broad and narrow gvwgc traffic. The traffic of the Midland Com- pany far exceeded the traffic of the Great "Western Company. The parish of Badgworth was situate on the half of the railway nearest to Cheltenham. The Great Western Company, seeing that their traffic over the Midland Company's half was less than the Midland Company's over their half, liad brought an action against the Midland to recover tolls from that company ; but it was ultimately decided by the House of Lords that the Midland, under the pecu- liar circumstances of the case (the railway having been authorised to be made by the two companies jointly), were not liable to pay toll to the Great Western Railway. Under these circumstances, the Midland Company contended that they were not rateable in Badgworth, as they had merely an user of the railway there situate. The Court decided in their favour. After this decision the parish officers of Badgworth rated the Great AVestern at an amount made up of the value of the Great Western's own occupation, |;/^^s the value of the toll that would have been paid by the Midland had they had to pay such. The Great Western Company raised the question whether they were properly rated. The Court decided that the company was rateable for the value of its own occupation in the parish, 7)^^?, not the value of the Mid- land toll, but the value of the Great Western Company's ease- ment over the Midland Company's half. This decision, as it depeiids entirely on the peculiar circum- stances of a particidar case, cannot influence the general principle of rating. During argument, the Lord Chief Justice said : " No doubt, if tlicrc were no mutual running powers, but the case were simply that the INIicUand Company had the right, either by Parliamentarj-- enactment, or by agreement, of running over (he appellants' half of the line on payment of tolls, and the appclhtnts had a corresponding right of running over tlie INIidland's half of the line, then the amount of tolls received by the appel- lants would enhance the rateable value of their line, and they would be rate- able accordingly ; but, when the appellants receive no tolls, the only way in 278 THE nuNciri.E of rati>'g. wliich the vftluo of thoir propcrtj' is ciilianced is by their having an easement over the MiiUaml half of the line." McUor, J. : " The vnhie to the ai^pellftiits, who arc the occupiers, is not the value of the actual amount of use made by the Midland Company over the appellant's half of the line, but the value to them of the arrangement by which they run free over the Midland half." The judgment Avas to the same cfFeet. Tlius was the principle laid dovrii by Mr. Justice Coleridge \A'lien lie said : " It is a principle which I believe to be established by numerous decisions, that the inquiry is not so much whekk the profits of the occupation are pro- duced, as whether any alleged profits are so directly referable to it as properly to be considered parts of the occupation." Again judicially asserted. THE PRINCIPLE OF RATING. 279 APPE^^DIX. Some remarks upon the present system of railway rating, togetlier with a suggestion as to the best mode for the prevention of railway companies escaping the payment of their due share of the parochial rates. The following important article on railway rating appeared in the Journal of the Chamber of Agrieulture, on the 25th of April last, and, as I believe the subject discussed to be of considerable interest to ratepayers generally throughout the kingdom, and particularly to those who hold large tracts of land in agricultural districts, through which lines of railway pass, I here insert it, in exteniio, and am of opinion that, in addition to its being of general interest, it may also be the means of more fully demonstrating the present unsatisfactory system of rating such properties. " Producing a veritable egg out of a palpably empty bag is a conjuror's feat not to be paralleled by any Chancellor of the Exchequer two years in succession ; but Mr. Goschen has an excellent chance of rivalling Mr. Lowe's financial magic of last j'ear if he will but bring in a supplementary Budget for dealing with the minor taxation called 'rates.' The black stick might work wonders in many difierent directions : meanwhile we can astonish some of our readers by declaring it both possible and easy to 2S0 THE ruiNcirLE or katixo. relievo the ratepayers of England and "Wales io the extent of three- pence in the poiDid, or, in other words, to pan onv-haJf of the eanntij rate, Jiundred rate, borough rate, and police rate, ni'thoiit diminiiiJiinfj the present sca/e of expenditure, without adrancing a sixpence out of tlie imperial revenue, u-ithout introducing an additional tax of an)/ hind, without equalising the rates heturcn one union and another, ui'thout disturbing the sijstem of assessment now existing, and without rating any description of properttj that does not alreadg contribute to the poor rate. To lower tlie average ratal burden of England and Wales bij threepence in the pound, thereby saving the present ratepayers oke million and a quarter sterling i'er ANNUM, we have only to insist upon an adequate valuation of the property in the hands of rail/ray companies. What is the true ' rateable valne ' of that property. In eompliance with the terms of the Parochial Assessment Act of 183G this value must he the estimated rental, free of all tenants' rates, taxes, and tithe rentcharge, if any, which a supposed tenant might reasonably be expected to give for the occupation from year to year of all the I'ailway property in England and Wales, deducting therefrom the probable average annual cost of repairs, insurance, and other expenses, if any, necessary to maintain the property in a state to command such rent. And the figures and data by which the estimate may be framed are given in the returns made to the Board of Trade by the several railway companies — the latest published being fiir the j'car 18G7. If we subtract llie total working expenses fromtlie total receipts from all sources of traffic, we shall have the net receipts which are to be divided between tlie landlord and the hj^oothetical tenant. What were these working expenses in 1807? They consisted of maintenance of way and works, £3,030,802 ; locomotive power, £4,020,041 ; repairs and renewals of carriages and waggons, £1,392,044 ; traffic charges, £4,818,903; Governnuiit duty, £441,755; compensation for injury, &c., £322,985; compensation for loss, &c., £140,400; legal and i)arliamentarv expenses, £310,724 ; and miscellaneous expenses, £956,000 ; making a total of £10,040,980. The item THE PRINCIPLE OF RATING. 281 >^^ of rates and taxes is omitted, as it will bo deducted laterin the calcu- latioii. The total receipts from all som"ces of traffic amomited to £33,398,222 ; and the difference between this sum and the working expenses, £16,040,980, is £17,357,242. This has to be divided between the landlord and the suj)posed tenant, the tenant's share being arrived at first ; and the calculation proceeds in the following manner : — The prime cost of the rolling stock, furniture, stores, &c., which a tenant woidd have to take to on entry, is known to be about equal to the gross receipts — namely, £33,398,223 ; but, according to the decision of the Court of Queen's Bench in the case of H. y. North Sfaffovchhtre Railway Company (30 L. J. M.C., 68), the tenant's profit is not to be calcidated upon the "prime cost," but upon the " present value" of the stock. Hence an allowance must be made for depreciation. The correct deduction under this head might be stated at 30 per cent ; but as railway companies do sometimes admit as much as 25 per cent., we will take this rate, making the deprecia- tion of stock £8,349,555, and the present value of stock, therefore, £25,048,667. This represents the amoimt of capital which a tenant would require to take to the stock upon entry at a valuation, and upon this capital he must be allowed a fair remuneration. But, in ascertaining what this remuneration should bo, it is to bo borne in mind that no sliill or lahour is required of the tenant in the management: this is already pro- vided for in the working expenses, which include directors' fees, salaries to managers, neeretaries, &c. ; and, in fact, every outgoing, both actual and contingent. And further, // the accounts have been propcrhj aitd honeisfly audited, )io depreciation, either in the stock or in the way, or worhs, can have tahcn place during the year in question. Under such conditions as these 10 per cent, should be an ample allowance; but as Courts of Quarter Sessions, not going very deeply into tlic subject, have allowed more, we may, perhaps, venture to take the liberal rate of 15 per cent, as the profit upon tenant's capital, amounting to £3,757,300. This being the supposed tenant's share of the net receipts, which we have shown 2S'2 THE rKixnri-E of rating. to bo ,£17,357,242, the remainder of the net receipts, or a simi of £13,599,942, represents the landlord's share, or net rental, to"-ethcr with the rates which we have not yet deducted. The next step in our calculation is to find this net rental or rateable value by separating from the sum of £13,599,942 the proper amount of local rates. We cannot take this item as it appears in the returns, because it is wholly inadequate, the simi actually paid for rates being far below the just and rightful amount. According to the twenty-fi.rst Report of the Poor Law Board and the Local Taxation Hcturns (497), the total rateable value of property in England and AVales in the year 1867 was £100,012,734 ; and the total amount of local taxation raised by rates on that property in the same year was £16,727,174, the average rate in the pound being thus 3s. 3'9d. But as railway companies are exempt from the full payment of certain of the rates — paying on only one- fourth of the ' net annual value ' rates which are levied under the Local Board of Health Act, the proportionate average rate payable by railway companies is reduced to as nearly as possible 3s. in the poimd. So that we have now merely to work out this simple equation: — As 208. + 3s. : 3s. : : £13,599,942 : ^,— where £13,599,942 is the sum to be divided into net rental and the amount for rates, and X represents this amount for rates. Multiplying the second and third terms and dividing by the first, in the usual way, we find that ^•=£1,773,905 ; and this is the amount of local rates which ought to be paid by the railway companies, if they contriluited their proportionate share in common with owners and occupiers of other rateable property. Lastly, deducting this proper amount of rates, namely, £1,773,905, from the sum of £13,599,942, we have £11,826,037 as the net rental or rateable value of tlie railway pro- perty in England and Wales for the year 1867. That this cannot be very far from the minimum of rateable value may bo verified iu the following manner. According to the returns, the total amount of capital expended in the construction and planting of railways ^including rolh'ng stock, &c.) to the end of December, 1867, was THE PRINCIPLE OF RATING. 283 £327,250,569 : and subtracting from this total the prime cost of tenant's working plant, namely, £33,398,222, there remains the sum of £293,852,347 as landlord's capital exi^enditure. The not rental, £11,826,037, as calcidated above, amoimts to only 4 per cent, upon this capital ; and is the least that can be allowed to the supposed landlord or owner of the corpus for his investment. The result has been arrived at by allowing the supposed tenant a liberal profit of 15 per cent, net upon his capital. But, as already remarked, IQ ^er cent, should be considered enough ; and we will, therefore, see what would be the rateable value imder that more moderate allowance to the tenant. Ten per cent, upon the tenant's capital amounts to £2,504,866, which, deducted from the net receipts, leaves £14,852,376 for the landlord's rental and the rates. By the same equation as before, the calcidated amount of rates which ought to be paid is £1,937,266; and this being subtracted from the £14,852,376, makes the net rental or rateable value £12,915,110. This rental is 4-39 per cent, upon the landlord's capital. Having now shown that the true rateable A'alue of railway property in England and Wales for the year 1867 was at least £11,826,037, and might very well be stated at £12,915,110, and having shown that the amount of local rates which ought to have been paid in that year was from £1,773,905 to £1,937,266, we are able to say that the railway companies escaped the pajTnent of a very large propor- tion of those rates. Under the head of ' rates and taxes,' the total given in the returns is £723,540. But it is known to include payments for law in settling appeals, salaries to surveyors, to rating officers, aud A^arious other expenses, amounting in the aggregate to £50,000, if not more. It further includes a very large amoimt for income tax, which item is in many cases included under this head in the accomits of railway companies. Not knowing what portion of the income tax from railways is charged under this head of ' rates and taxes,' we must make a guess and put the total sum actually paid for local rates in 1867 at, say, £650,000. Then it appears that, if the normal amount of rates due for that year was £1,773,905, f//c rai7ica>/ companies 28-1 TIIK ]>UlN('iri.K OF llATIISO. escaped the pni/uiriif of £1,123,905 ,- and if llic normal amount of rates was £1,937,26G, f//e// e^capi^d thr juti/mciif of no /ess than £1, 287,260. AVe have no hesitation, therefore, in asserting that, if the matter were thoroughly sifted, it would be found that rail- way companies in England and AVales are escaping the pajnnent of local rates justly due from them to tlic extent of one and a quarter miUiou pounds annua////. While the average rate in the pound upon the rateable property of England and Wales in 18G7 was 39. 9d. upon rateable railway property, it A^•as practically 12d. or 13.18d. in the pound. The deficiency of payment, amounting to £1,123,905, or to £1,287,2GG, is etpiivalent to a rate of 2-G8d. or 3d. in the pound upon the whole rateable property of England and AVales, and would defray, as we said at starting, half the county rate, half the hundred rate, half the borough rate, and half the police rate. What M'ould be the effect of fairly assessing the rail- way property ? If we suppose the £G50,000 of local rates to have been paid by the railways at the general average for 1867 of 39. 9d. ill llio pound, tliis will represent a rateable value of £3,909,774, paving its fair proportion of rates. Deduct this from the total rateable value of the railway property — namely, either £11,82G,037 or £12,915,110, and we see that £7,916,263 or £9,005,336 worth of railway property remains to be brought under assessment. Or, in other words, instead of the total rateable property of England and Wales for 18G7 having been £100,612,734, it would have been, by a proper valuation of railways, £108,528,997, or £109,618,070; and the total of local rates— namely, £16,727,174 — would have averaged not 39*9d. in the pound, but only 36'62d. or 3G-98d. in the pound, being a reduction of 2-92d. or 3-28d. in the pound. That railway companies are heavily burdened with imperial taxes we are quite aware ; and if the Clumcellor of the Exchequer bleeds them too much, let them be relieved at the cost of the whole community of taxpayers. But we will not admit that inequality of imperial taxation is to excuse tliem from paying tlicir rightful quota to the local rates, or tliat tlie faults of any number THE Plll>CirLE OF HATING. 285 of Budgets arc to be made good by those unlucky scapegoats, the ratepayers." If the above figures be correct, of which there can be little doubt, it must be evident that raihvay companies do escape thepa}-- ment of local rates to the extent mentioned — viz., o)ie and a quarter inilUon of pounda aimnalhj, and that other ratepaj'ers are pajong on the average about od. in the jmund more than they ought. Railway directors, as a body, are too honourable to wish those burdens to be thrown upon others which ought to be borne by their companies. I therefore attribute the inequality which now exists to the present unsound system of rating railways. Before suggesting any remedy for this state of things, I will briefly review the changes which have been made by the legisla- ture, in the law of rating, during recent years. Until the passing of the Union Assessment Committee Act of 1862, the assessment of property was entirely in the hands of overseers, the majority of whom were wholly unacquainted with the value of property', and with the principle upon which it ought to be assessed. In the greater number of cases the only document they had for their guidance was the old rate hook transmitted to them by their predecessors, and this rate book had probably remained for years and years unaltered except by the insertion of new property. The cause of this was to be attributed to the fact that although the Parochial Assessment Act of 183G clearly defined the princiijlc of assessing all rateable property, it provided no machinery by which such principle could be carried into effect, beyond the appointment of overseers, who were to receive no remuneration, and consequently incurred all the responsibility and expense of establishing a proper basis of assessment. One result was that if an overseer on coming into office attempt- ed to increase any of the old assessments he incurred much local hostility, and if he happened to be in a business ran great risk of 286 THK rUlXCIlM.K OF KATIXG. losing Ills customers. Hence, it usually happened that overseers couteuted themselves with levying rates upon the old assessment. Occasionall}', however, in parishes where the property of rail- way companies happened to be situate, the overseers, not fearing the hostility of such neighbours, would raise the assessment of their property. The result of so doing, might be an appeal to Quarter Sessions, or it might not. Allien the company did threaten the overseers with an appeal to Quarter Sessions, and at the same time questioned the correctness of the assessment of other property in the parish, they, seeing the justice of the objection, would often again reduce the amount. Further, even assuming that such objections were, in a parti- cidar case, groundless, an appeal to Quarter Sessions is a very ex- pensive contingency. A solicitor must be employed to conduct the case, briefs prepared, professional witnesses engaged, and counsel retained. The risk of incurring the expense of all this to a single parish is a serious matter, and was of itself sufficient to deter the parish officers from contesting the point. It has, how- ever, happened that Overseers, having persuaded themselves of the importance of such property being fairly assessed, have de- fended their rate before the Quarter Sessions. When the case came on for hearing, important points as to facts would at times arise, the settlement of which would have kept the Court sitting for many days and even weeks, and to avoid such Icno-thened occupation of the time of the Com't the case was usually referred to arbitration. The arbitrator chosen was generally a Queen's Counsel in large practice. It might then happen that either his engagements, or those of other persons engaged in the case, ^\■()ul(l necessitate the postpone- ment of a sitting from day to day, and in some cases the ar- bitration was thus protracted for months and even years. And during the whole of this time the appellants might either be paying no rates at all, or else merely paying on the original low assessment. THE PRI^X•IPLE OF RATING. 287 Is it, therefore, a raatler of surprise that, with such difficulties to contend with, parish officers generally should have been chary of disturbing tlie original assessment of railway pro- perty ? The Union Assessment Act changed this state of things, and caused Assessment Committees to be established in every Union throughout England and Wales, and conferred upon them, at the same time, powers very extensive. The overseers of the various parishes in the Unions were com- pelled to prepare and return to the respective committees, annual valuation lists, showing the gross rental and rateable value of each of the hereditaments in their respective parishes. These valuation lists the committee were empowered to alter and amend as they thought proper; and they were further em- pov/ered, if they deemed it necessary, to employ professional valuers to re-value the whole or any portion of the Union imder their jurisdiction. In some cases the committees have themselves entirely revised the valuation lists, in others they have had the whole Union re- valued by l^rofessional valuers; and in others, again, they have only had the special properties, such as railways, gas and water works, manufactories, brick fields, coal mines, chalk and clay pits, &c., re-valued. These lists, then, having been settled one way or another, were handed over by the committee to the overseers of the various parishes, who were compelled to make their rates upon the araonnts contained in such lists. But here the power of the committee ended. The responsibility of defending the rate stiU remained with the Overseers, and the entire expense so incurred had still to be borne by their parish alone. If, therefore, the assessment of the property of wealthy rate- payers (and the railway companies were the wealthiest) was in- creased and an appeal to the Quarter Sessions ensued, the overseers were at times imprcpared Avith the necessary evidence to support their rate, and, their witnesses understanding very little of the 288 THE nuxcii'LK of kating. subject, were unable succcssfiJlj' to coup with tliose wliom the raihvay companies were able to call. The Com't of Quarter Sessions, having to decide according to the evidence before it, would reduce the rate ; and thus it hap- pened that property which ought to liave been assessed at a high amoimt was really assessed at a mere fraction of its true value. And thus it was that the assessment committees, although in- vested with important functions, still lacked the power requisite to enable them to establisli the proper assessment of such property as that held by wealthy and influential companies. It is evident that the Legislature quite understood the bearing of the case when it passed the Union Assessment Act of 18G4, by which assess- ment committees are empowered to become co-respondents with the parish overseers in the event of appeal, and to charge the expenses so incurred in supporting the rate to the common fund of the Union, thereby relieving, to a Avonderful extent, an individual parish of the very serious burden to which it had hitherto been subject. The Poor Law Amendment Act of 18G8 still advanced another step in the same direction as that of 18G4, inasmuch as it em- powered the guardians of fuljoininrj Unions to combine in defending a rate appealed against in which a question of principle was in- volved. But, although assessment committees have these powers, it is only a very few that have so far availed themselves of them ; and to this general unwillingness to exercise such power is, in my opinion, to be attributed the fact that at the present time we find the railway companies in England and Wales escaping the payment of parochial rates to the extent of something like one AND A QUARTER MILLION STERLING annually. And what is true of railway companies is equally true, I believe, of gas and water companies also, though perhaps, it may be, not to quite the same extent, yet still in a very considerable degree. Having thus briefly investigated the origin of the shortcomings of the svstem, and at the same time endeavoured to demonstrate THE rRTXCIPLE OF EATING. 289 its unsoundness, I next propose to show how, in my opinion, these defects should be remedied. In the first place, speaking from my own practical knowledge as a railway valuer, I may say that to ascertain the rateable value of the u-Jtole of the property of one railway company is not a very difficult matter, and as long as railway companies are assessed at no more in the aggregate than this total amount, they should have little cause to complain. In the second place the question arises as to how this total rate- able value should be apportioned among the parishes in which the particular company possesses property. I would suggest that it should be done in this way : Having ascertained the rateable value of the Avhole, divide it into two portions, viz., rateable value of line proper and rateable value of station buildings, &c. I would then apportion the rateable value of the line /;/ proportion to its gross 2)aroe/fial earnings, that is to say, if the rateable value of the whole line proved to be 25 per cent, of the gross earnings over the whole system, and, supposing the earnings in a particular parish were £10,000, I should say that the rateable value of the line in that parish was £2,o00, and to this amoimt I would add the rateable value of the station buildings, &c. (if any), in that parish. This mode of apportionment, I admit, woidd not be strict/// accurate, but still it would be far more acciu'ate than the mileage system which has for many years been adopted in Scotland, and I feel convinced that a more accurate and practical mode could not be adopted without leading to many complica- tions. If such a system were adopted, the railway companies would be required, say every five years, to extract from their traffic ledgers for the previous year the gross earnings between the various sta- tions on their system, and to siibmit them to the officers specially appointed by Government to make the necessary apportionment. Upon this the rates should bo made for the ensuing five years, when a revision would again take place. Assuming such a plan as the above to be adopted, what would be its cftect ? It would u 290 THE rRixciPLE of k.vtixg. cfiectually put a stop to all litigation between railway companies and parishes on questions of rating-. And such a result would unquestionably be to the interest of both parties, and would therefore be mutually beneficial. It would certainly — and this I do not wish to deny — impose iq)on railway companies the necessity of paying more rates than they do at jjrc- sent ; but, on the other hand, the companies would have the satis- faction of knowing that they were only paying their fair and just proportion of the burdens borne by their neighbours. Further, it would satisf\ictorily settle the vexatious question as to the assess- ment of branch lines of railway, the receipts on which are, in most cases, entirely swallowed up by the expenses incurred in working them in such a manner as to be of proiit in the capacity of feeders to the traffic of the main line. To do this many trains are rmi, irjiirh irould not ho run if the branch line was a distinct occupation. For such lines companies arc willing to pa}' heavy rents, for by securing them they are enabled to vrork their main line traffic to much greater advantage. Assuming one or two of these branch lines not to be in the occupa- tion of the company to Avhom the main line belonged, what would be the result ? Why, the occupiers of those brancli lines instead of running perhaps eight trains each way daily half fall ^ would run only four each Avay full. If only four trains ran there might not be quite so much traffic I admit, but it would not make much difference. Upon the arrival of these well filled trains at the junction, the main line company woidd have to put on trains specially to convey the traffic to its destination. Tliis system of working the traffic would be most inconvenient to the main lino company; therefore, rather than do it, they find it pays them better to rent the branch lines at such a sum as their owners could make out of them, or jierhaps a little more, and then work tliem as I said before, to act as feeders to the trains running iqion their main line. The law as it is at present defined by the judges of the Court of Queen's Bench declares such branch lines to have no value, because the receijifs are absorbed by the expenses, and THE PliI^•CIPI,E OF R.VTIXG. 291 transfers the wliule value to the main line, which, it is easily seen, would, without the branch lines or feeders, he of considerably les8 value. It seems to me that the judges cannot have had the matter clearly placed before them. In the Haughley case C. J. Cockburn said — '• Two questions liavc Leon presented to us in this case. The first is wlietliev in assessing the railway in th.e parish of Haughley, the traffic beyond Haugh- lej' is to be taken into account with a view to re.lac3 the expenditure of tlio line in the parish of Haughlej- ; for of course the lower the expenditure can be reduced, tlie larger will be the amount of profit in Haughlej-, and therefore the greater the rateable value of the railway in that parish.'' The learned judge, after giving as an illustration the earnings of a stage coach running between London and Xorwich, went on to say— " So it is \A'ith a railwaj'. When they are ^^■orkiug from Norwich to Haugh- ley they are probably worldng at a loss. "When thoy are working beyond Hanghlej- towards London the}' take the traffic at Ipswich and other places of consequence that lie on the line, and then the traffic becomes remunerative." Now I Avill put the question : Assuming the line from Norwich to Haughley belonged to a distinct company, would they work it ftt a loss ? — that is to say, would they require so much stock, or run so many trains daily as to cause the whole of the earnings to be swallowed up by the expenses which the Great Eastern Railway Company may find it necessary to do in order to make a greater profit elsewhere ? Certainly not. I will put another question. In estimating the rent such a branch line was worth from year to year, would the Great Eastern Railway Company take into con- sideration the local expenses they might f/iemseh'cs incur in work- ing it, or wovdd they not rather consider the expense it might bo worked at b}- an indeiJcndcnt company, whicli had its own inte- rests alone to study, and not those of the Great Eastern Railway Company ? I say most decidedly the latter, and this, in my opinion, is the clear solution of railway companies paying heavy rents for branch TJ 2 292 THE rRINCIPLE OF RATING. HiiGS, Avliicli appear to be worked at a loss, but arc not so actually. Tlic result of all tliis is, that parishes having main /incs of rail- way passing through them are to benefit at the expense of parishes having ojili/ hrnncJt //'iics passing through them. The system, however, which I propose would bo the means of apportioning to every parish having railway property in it, its fair share of the rateable value of the whole, which I again say ought to depend upon the gross jyaroc/n'al eann'nr/s and not upon the local net earnings, wliich entirely depend upon the number of trains run by the company to the junction station, to suit the con- venience of their ]nain line trafhc, and not the number of trains which would be run if the branch was a distinct occupation. I trust, therefore, that in order to establish a more equitable mode of rating, this subject may bo considered worthy of the attention of the committee of the House of Commons appointed to inquire into the incidents of local taxation. "W. Marshaij.. THE PRINCIPLE OF KATIXG. 293 COPPER, TIN, AND LEAD MINES. As it seems to be the intention of the Legislatui'e to make the oc- cupiers of the above, and all other mines hitherto held to be exempt from rating, now conform to the intention of the Act of Elizabeth — viz., " that every man should assist in supporting the poor accord- ing to his ability " — a few practical remarks on the principle of ascertaining the rent a tenant may reasonably be expected to give for such hereditaments, may shortly be found to be of some assistance. The inquiry to be made will be the same as in the case of coal mines. "What are the receipts and what are the working expenses ? Take one from the other and a sum is left representing two things — profit and rent. Then, how much profit and how much rent ? As an example may be useful, I will take the revenue accounts for twelve months of one of the large Cornish copper mines, and then proceed to ascertain its rateable value approximately. I say approximately, since the amount of tenant's capital required is a matter of uncertainty which could only be correctly ascertained by an actual inspection. Receipts. By sale of 18,500 tons of copper ore £143,040 Do. tin . . . 2,533 Do. arsenic. . 144 £145,717 Expenses. Agents' salaries £3,344 Tutwork bargains 2(5,177 Bargains on surface, A\'ages, i^c. . . 2,539 Carried forward .... 32,000 294 THE PRINCIPI-E OF HATING. Broug'lit IbrAvard .... £o2,UG0 Curpeutert;, masons, siiiitlis, en- gineers, &c 3,099 Carriage and liorse work .... 922 3Iatcrials 15,008 Engine or water cost 15,415 Expenses on ores 7,803 Tribute, subsist, and balances . . . 25,031 Sundry payments 1,872 Doctor and club 795 102,005 Net receipts. . . . £43,712 Tenant's "Wokkinc; Caitjai,. Casli required for wages, timber, candles, iron, safety fuse, oil, gunpowder, repairing and re- newing tools, &c. — say 4^ months' expenses — xiz . . . £38,250 Cash required to pro^■idc picks, wedges, shovels, mallets, borers, scrapers, tamping bars, &c., say 550 Sundries, say 1,000 £39,800 Capital required by a tenant from year to year, say £40,000 Tenant's profits, including an amount for risks and casualties, say 25 per cent, on £40,000 . . . 10,000 Carried forward .... £33,712 THE PRINCIPLE OF KATINC. 295 Carried forward .... £33,712 Less for renewal of buildings and ma- chinery (ordinary repairs, insur- ance, &c., have ah'eady been de- ducted), say 2 per cent, on £80,000 / - £1,600 llateable value and rates .... £32,112 Less rates at 3s. in the pound . . . 4,188 Kateable value . . . £27,924 Kow, if this mine happened to be entirely in one parish, the above sum of £27,924 would be about the amount upon which the parochial rates ought to be levied. Eut in this particular case (and I might say in nearly every case), the workings extend through many parishes. The pit's mouth is in one parish, but the ore is obtained from several. It, therefore, becomes necessary to deduct from the rateable value of the whole, the rateable value of the indi- rectly productive portion of the hereditament, viz., the bidldings, machinery, &c., which should be assessed in the particular parish in which it is situate. AVhat then remains will be the value which should be apportioned to the various parishes out of which the ore has been taken, in proportion to the quantity extracted from each. The royalty, or lord's dues, paid for the ore raised during the years in question amounted to £C,071. It will therefore be seen that the rent paid for the privilege of exhausting the earth, is no measure of the value the hereditament maj^ reasonably be expected to let for from year to year, enhanced as it had been in value by the expenditure of capital to the extent of nearly £100,000 in build- ings, machinery, &c. In making estimates of the rateable value of lin, copper, and lead mines, it must be borne in mind that, like the mining of pre- cious metals, the work is very precarious. Veins which are very promising when first opened, may suddenly 296 THE riUXCIPLE OF RATING. fall off and occasion immense loss, or they may be Avorked •svith little or no profit. On the other hand, veins "which at first promise little, may in time yield large profits. Therefore, before arriving at the rent which a prudent tenant might reasonably be expected to give, a very liberal alloM-ance ought to be made him to provide against such risks, but the amount of this allowance ought to entirely depend upon the cha- racter of the mine. Some mines produce a steady profit for a series of years, while others fluctuate ver}' mucli from year to year. To give a specimen of this fluctuation, I insert the following, which were the profits made out of a large Cornish copper mine in ten successive years : — £10,330 16,800 28,520 38,880 60,480 47,040 29,760 48,000 32,640 31,680 Parochial authorities, in estimating the rent of such heredita- ments, would also do well to remember the words pronounced by Lord Denman in his judgment in the case of Queen v. Everest, 10 (i. B. 178— " I'aiish ofiicers having to make a jifospective rate may well look to see what it is probable the land will be made to produce in the current year." In the case of a mine certainly no better criterion of the pro- duce of the current year can be found, assuming the same state of things still to exist, than what it produced during the past. In the Succession Duly Act, 16 and 17 Vict., cap. 51, section 26, it is enacted tliat — THE PRINCIPLE OF RATING. 297 " The iieavhj vuluc of any manor, opened mine, or other real jtt'opertij of a Jluctuatimj yearly income shall either be calculated upon the averaye profits or income derived therefrom, after dedwtiny all necessary outyoinys dui'ing such a number of preceding years as shall be agreed upon for tlais purpose between the commissioners and the successor, before the first payment of duty on the succession shall have become due ; or, if no such period shall be agi'eed upou, then i\i& principal value of such property shall be ascertained, and the annual value thereof shall be considered to be equal to interest calculated at the rate of three pounds per centum per annum on the amount of such, principal value." It may be mentioned that the value of the minerals annually raised in England and "Wales, and which are at present not rateable, amounts to about £5,600,000. Assiuning, then, that the propor- tion of rateable to gross value which ^ye have just deduced in the foregoing example holds generally — viz., in the proportion of £145,717 to £27,924 we shall have upon the law being extended, the present aggregate amount upon which rates are now being levded in England and "Wales increased by about £1,100,000. W. M. 298 THE PRIXCirLE 01' RATING. ON CERTAIN INEQUALITIES IN THE RATING OF RAILWAYS. Inequalities in the rating of railways, as between company and company, with some remarks attached, to show the unsoundness of certain claims made by the witnesses of railway companies, in order to reduce the rateable value. The following- extract I'roin an article on the subject of railway rating which appeared in The C/iaiiibcr of Agriculture Journal on the 12th of last September may be foimd interesting, as it points out the great inequality the present unsatisfactory system of rating this class of property causes to exist, as between company and company : — " "We have shown that the railways, as a whole, escape the pay- ment of about 3d. in the pound upon the rateable property of England and Wales. Is it easy to bring home the charge to par- ticidar companies ? In the first place, it is very evident, from the Board of Trade Returns of 1867, that great inequality exists in respect of rates and taxes between the twelve companies which have termini in the metropolis. Of the net receipts, the percentage paid for rates and taxes is by the London, Brighton and South Coast, J7.07 2)er cent. ; by the London, Chatham and Dover, 1:2.21 per cent. ; by the South Eastern, 9 2)er coif. ; by the London, Tilbury and Southend, G.o per cent, ; by the London and South "Western, 0.8 per cent. ; by the North I^ondon, o.lS per cent. ; by the Great Eastern, 5 per cent. ; by the Metropolitan, 4.71 j)er cent. ; by the Great Northern, ^.per cent. ; by the Great Western, 3.92 ^yer cent. ; by the Midland, 3.27 per cent. ; and by the London and North Western, 2.8o per cent. The London, Brighton and South Coast, and tlic London, Chatham and Dover Railways are paying consi- derably more than their fair share of local rates ; which arises, we believe, from their occiipying a large proportion of unprofitable line of railwaj''; in fact, lines through the working of which they arc annually losing large sums of money. Their Acts of Parlia- THE PRIXC'IPT-E OF RATING. 299 iiient, liowever, compel tlieiii to pay local rates, no matter whether the portion of line assessed be profitable or unprofitable. If unpro- fitable, the company has to pay simply upon the (((jyicuUuml value of the land which it has abstracted from the parish ; but parish officers being- seldom satisfied with this, and insisting on something more than mere agricultural value, the company commonly gives way in order to avoid litigation upon what may bo, in any one case, a comparatively small amount. The South Eastern E-ailway pays somewhat less than the sum which ought to be levied upon it for local rates ; and all the other railways having termini in London pay rery niuc/i less titan f//eirfair share, averaging, indeed, less than half the smn due upon their proper rateable value. Let us take the case of the London and ]^orth Western Railway. The rateable value is the estimated rental, free of all tenants' rates and taxes, and tithe roitcliange, ichich a supposed tenant might rcasonahJ;/ l)e expected to (jice for the oecnpation of the property, from year to year, deduct^ ing front that rental the prohahJc average annual cost of repairs j insurance, and other expenses, if any, necessary to maintain, the pro-' perty in a state to command such rent. If we subtract the total working expenses from the total receipts from all sources of traffic, we shall have the net receipts which are to be divided between the landlord and the hypothetical tenant. According to the Board of Trade Returns, the gross receipts for the year 1867 were £6,752,567 ; the working expenses, including rencu-als, but exclud- ing rates and taxes, which will appear later in the calculation, were £3,008,244 ; and deducting one amount from the other, we have £3,744,323 to be divided between the supposed landlord and tenant. The tenant's portion is a fair remunerative profit upon the capital which he would require in order to take to the stock upon entry at a va/uation, every outgoing for management, and for all expenses, both actual and contingent, having been allowed for in the working expenses. The tenant's capital is represented by ilie present value of the stock. The prime cost of the stock is usually taken as equal to the gross annual receipts, being, in this case,^ £6,752,567. Deducting 25 per cent, ior depreciation, or £1,688,142, 300 TIIK nUNClPLE 01' RATING. "\vc have £-3,064,425 as tlie present value of tlic stock or amount of toKDtfs capital. A profit of 16 j}cr cent, upon this comes to £7o9,664 ; and this, deducted from the £3,744,323, Avliich Ave had to divide between tenant and hmdlord, leaves £2,984,659 as the proprietor's share or net rental, together with the rates which wc have not yet deducted. To ascertain what was the proper amount for rates that should have been paid by the London and North Western Railway Company in 1867, we ought to reckon the rate in the pound at the average rate of the poor law nnions which are traversed by the main and branch lines of the company ; but it will be sufi&ciently near the truth if we take the average rate of tJie seirral counties through which these lines ^ass. This will certainly be favourable to the company ; for as the railway cuts through the most populous districts, the rates payable will, in reality, be more than the general coimty averages. We have taken the trouble to calcidate from the items of total rateable value and rate in the pound, deducting such portions of rate as are not payable by railways (Local Board of Health rates, for instance, which railways pay upon only one-fourth of the net annual value), as given in the Local Taxation Returns (497), the average rates in the pound payable by railways in the coimties of Middlesex, Herts, Bucks, Northampton, AVarwick, Leicester, Stafford, Salop, Cheshire and Lancashire. The average rates for these counties, through which the London and North AVestern Railway passes, range from Ls. 11 3d. up to 3s. 2d. ; the general average (not the mean) for the ten counties being 2s. 93d. in the i)ound proiK'rhj payahlc hij railu-ayH. To separate the proper amount of rates from the sum of £2,984,659, which was for the landlord and the rates together, we must work the following simple equation : — As 20s. + 2s. 92d. : 2s. 9id. : : £2,984,659 : x. AVe find tluit x equals £365,580, n-hicli in the amount of rates that the eoinpat);/ ouyht to hare paid in the year 1807 ; and deducting this from the £2,984,659, the land- lord's net rental, or the true rateable value of the whole of the London and North "Western Railways and stations, is seen to be THE PRIXriPLE OF RATING, 301 £2,010,079. A rate of 2s. Old. upon this value comes to £365,580 ; hut the amoimt actualli/ paid in the i/oa}'18G7, as .stated hj the compani/ ifsrlf, in the Board of Trade Returns, ur/s onti/ £103,884, shou-infj that the company escaped the payment of no less tJian £261,690 in the year 1867, in consequence of the property being assessed very far under its real vahie. UjDon the net receipts, namely, £3,640,439, the amount of rates which ought to have been paid, namch'-, £365,580, are 10.04 per cent. The sum actually paid, namely, £103,884, was only 2.85 per cent." In dividing the net receipts of the London and Xorth "Western Railway Company, in the above calculation between the landlord and the hypothetical tenant, I observe that the latter has been allowed a profit of 15 per cent, on the capital he would "I'cquire to work the line. Now, I should like to know where any person, or body of persons, could invest a capital of fice mit/ion pounds sterling and obtain a return of 15 per cent, profit, without inciu'ring any of the ordinary risks ; without requiring to give any portion of their time in conducting the undertaking, for this is all done for them by 2)aid directors, managers, &c. ; and without any depreciation taking place in the value of their stock, which is prevented by repairs and extensive annual renewals charged to the revenue. I know from experience that the rating officers of railway companies, in order to reduce the rent, are in the habit of claiming absurdly extravagant allowances for the assumed tenant. The following is a specimen of what they sometimes claim : — Interest 5 per cent. Profit. ......'. 10 Risks and casualties ... 5 ,, Depreciation of stock . . 5 ,, Total 25 With regard to the first two claims — viz., interest and profit, observe what T. F. Ellis, Esq., recorder of Leeds, said in his judg- ment in the case of The Midland Bailu-ay Co)npany v. The Overseers of Armley* * " liaihva}- laiting," by Hodgson, page 'Ji. 302 THE PRINCIPLE OF RATING. " The next item I will consider together with the item which is next but one to it in the estimate of the appelliints. They say that the value of the money wliich a supposed tenant of the line would have to invest in locomotive stock is ^49,140 ; and such a tenant, they think, would, in estimating the rent which he is to pay, expect to he allowed — First, 5 per cent, interest on this sum, and then 15 per cent, for tenants' or trade profits. Secondly, they .'^aj' that, if 5 per cent, is allowed for interest, no more than 10 per cent, ought in addition to he allowed for profits. As to //(/.s-, / cioiiint donht that theaUoir- ancc which thei/ ju-ojwsc is extremely liberal, A very short consideration of the principles upon which such deductions are allowed will, I think, show this. " The subject of the rate is the value of the occupation. When we ask, v^-hat is the rateable value of anj' subject of occupation, wo ask, in eticct, what is it worth while to give for the permission to occupy ? This is what the legislature meant in proposing as a test of rateable value, what a tenant would pay as rack-rent. The tenant pays for the permission to apply his capital and labour to the subject of occupation and take the resulting profits. But, in applying this test, we must exclude any consideration of the greater or less case in obtaining the capital requii'ed. The question is not, whether a tenant can easily be found? The tenant is introduced merely as a hypothetical test of the value of the right to occupy. We mast, therefore, take it as if we had tenants readij icith nitliinited capital, or [irhich, in practice, is the same thimj) as if there nerea lar(je joint stoch coinpaini intoaVnuj to invest their money in the speculation. " Now, the considerations which determine (independently of local and accidental disturbing causes, which of course are net now to be taken into account) the rent which a tenant would pay for the right to occupy are — Can he cm/jloy his money at better interest.^ Can he emjiloy his labour at letter 2)rojit ? In other words, can he, by employing the same money and labour, and at the same risk, get more return than, bj- giving the rent which is asked for, he will get here? The ansirer uill be determined by the average value of ca]iit(d and labour in the country, includiny the consideration for risl,\ " It does not much signify, therefore, whether we first allow interest for the money and then allow for the value of the labour and risk, or put the two together, and call them trade or tenant's profits. But it is dear that what the appellants in effect assert is, that money applied to the hire of this railway ou"ht to produce :20 per cent, profit; and that the respondents arc content to allow 15 per cent. "It is to be observed here, thnt the risk is very little. There is no specific charge made for insurance ; but tlie insurance of the buildings must have been taken into account in the estimate of the rateable value of the buildings ; and the ri.sk upon the rest must, from the nature of the property, be very slight ; THE nUXCIPLE OF RATING. 303 less ccrtuinhj, venj much, than in the case of standiDj crops, ships, cotton goods, dc. " Thou, a3 to the labour, that lias already been allowel for. The previous items inclufle what, in the case of a farm, would correspond to the farmer's personal exertions in the tillage ; in the case of a ship, to the superintending the details connected with the navigation ; in the case of a shop, to the trouble of providing the goods, regulating the business, superintending the clerks, and so on. That which in agriculture or trade takes up most of a man's time, is here done for the suj^posed tenant. In the consols, the interest now attainable is between 3i and 4 per cent. Hon- much more labour and risli ivoiild a party incur bj/ cm^tarlcing his monc)/ in the hire of this railroad, all expenses heinj paid ? The trouble of takimj the moneij from the clerks would be somewhat more ; the risk of destruction is rather greater ; and something must be allowed for the less facility of sliifting capital, once so embarked, to an}' new investment. J5ut when all these allowances are made, the 15 per cent, which the respondents propose to allow, seems to me far to exceed what would be suggested by comjjarison with other investments. The o i^er cent, interest must therefore be strucl: off'.' As to the tliird claim — viz., 5 per cent, for r/s/.-s and camaltm. It may be said that the amount aciuaUij spent under the head of compensation for injuries and Josses, is ah-eady allowed in the work- ing expenses. AVith regard to any possible or imaginary risks beyond this amount, it raay again be said that no person can get more than 3^ or 4 per cent, for their money without incurring some risk, and even then, they incur a sIi(jJif risk. Lastly — as to the claim of o per cent, for defreciaiion of stocJx. When a line of railway is first opened, it is usually worked by nen- stock, but as years roll on, this stock annually decreases in A^alue until about the tenth or fifteenth year, Avhen \{ becomes de- preciated in value about 20 or 30 per cent, of its original cost ; beyond this, it cannot depreciate, that is, if the accounts of the company are honesthj audited, and the certificates attached to Ihem and signed botli by the auditors and engineers arc to be relied upon ; for out of the yearly revenue, the whole of the working stock is not only obliged to bo kept in repair, but the old worn out stock replaced by new stock being brought upon the line ; so 304 THE PRIXCiri.E OF RATING. tliat, the stock having once deteriorated to a certain extent in vahie, cannot deteriorate heyond. The 30th section of the Railway Companies' Act of 1867 has pnt a stop to the old system of robbing the line and stock for tlie benefit of present shareholders at the expense of future ones ; and the 5th section of the Act of 31 and 32 Yiet. c. 110 renders persons found guilty of signing false ac- counts liable, on conviction, to fine and imprisonment, or a penalty not exceeding fifty pounds. To substantiate therefore such a claim as the above, even par- tially, companies would have to admit that the amounts spent an- nually out of the revenue, were insufficient to prevent deteriora- tion going on, and that a time irould come when a thorough re- newal of stock would be required, but to provide against which, no annu(d linking fund had heoi laid hi/ out of tJie revenue. In plain words, that the accounts had been cooked in order to pay a larger dix-idcnd to the present shareholders, and that the certificates at the end of them, signed by the auditors and eiigineer, were mere fabrications to suit the convenience of existing circumstances. The foregoing remarks will equally apply to a claim the wit- nesses of railway companies are in the habit of making for the ultimate renewal of the permanent way, c^e. When the Local Taxation Committee of the House of Commons deals with this important subject, it is to be hoped that it will not allow itself to be influenced by the opinions of the Chairmen of Kail way Companies, as the Ijords' Committee seems to have been in the year 18o0 ; but will rely more upon the evidence of Account- ants who arc in the habit of auditing the accounts, not only of public companies, bitt those also of large mej-cantile firms. The evidence of such gentlemen on the all important subject of tenanffi' profits would be invaluable. AVilh regard to claims for imaginary risks, depreciation of stock, &c., the common sense of the Committee, without evidence, Avould be sufiicient to determine such points. ^v. M. rrr OK[Vt: J^OUNM UC SOUTHERN REGIONAL LIBRARY FACILITY AA 000 855 840 5