Grace Brothers Pty Ltd v Commonwealth [1946] HCA 11

Grace Brothers Pty Ltd v Commonwealth [1946] HCA 11 - HCA 1946 case summary — Zoe

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"place i in connection with rates and taxes, and they afford an analogy. "It is, of course, unreal to treat land values as if they changed - where there is a change - at regular intervals of twelve months, remaining static in pe meantime, but it is a convenient course, which does substantial justice. Sub-section (2) of s. 29 is a kindred ion ; it does not cover the same ground as sub-s. (1), but it "throws some light on the purpose of sub-s. (1). The plaintiff's second ground of objection is closely related to the first ; both, it _ is submitted, involve an erroneous assumption as to the effect of the relevant provisions of the Act. Section 29 (1) (a), in taking the valua- tion back to 1st January, does not intend that the value of improve- ments effected after that date is not to be taken into account ; they ; must be taken into account, but their value is to be assessed as at the a anterior date. Moreover, there is nothing in s. 28 or s. 29 to suggest "that what is to be regarded as the value of the land is not the value to the person who is in fact the owner at the time of resumption, _ regard being had to actual and potential user at that time. All the _ elements which make up the true value of the land must still be taken into account. Section 29 is directed merely to eliminating something which is not an element of the true value. As to the third ground of _ objection, that s. 40 is unjust in fixing three per cent interest on com-

pensation, it is a sufficient answer to say that Parliament need not _ have provided for any interest at all. The interest is by way of _ recompense, not for the taking of the land, but for delay in payment of the compensation for the taking of the land. Parliament need not have concerned itself with anything beyond compensation on just terms for the taking ; the question of interest raises no question _ of just terms. However, the plaintiff's argument, which attempts to poste the question to just terms, amounts to this: The Act cannot _ validly fix any rate of interest ; no rate is "just" unless it is the "current rate (or more) ; enced high the rate fixed, however favour- able to the expropriated owner, it is always possible that the market Tate may be higher in the future, and then the presently existing m of the Act, if it remains in existence, will operate unjustly. Therefore, it is said in effect, a provision fixing the interest is invalid ig 'initio even though the rate fixed is higher than the market rate | Prevailing at the commencement of the Act. This objection has not a ea sustained. The rate of three per cent is not unreasonably low, and the section is a reasonable eae to achieve certainty in the

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require not only valuation, but payment, almost as at the acquisition. Further, a statute which fixed some anterior date the ascertainment of value because values were known gener: be lower might be open to attack. Here, however, we are not cor fronted with any such question. The contention is based simply the view that justice requires the legislature to accept a date at about the time of acquisition. 4 Tt is true that under the Lands Clauses Consolidation Act 18 (Imp.), the notice to treat was looked upon as fixing the date as which the value of the property acquired should be assessed, that is not a course uniformly adopted under other legislation. instance, s. 28 of Act No. 1288 of 1893 of the State of Vi (Railways Lands Acquisition Act) provided that the purchase should not exceed the value of the land taken at the commenei of the session of Parliament in which the authorizing Act was p Section 12 (2) of the Compulsory Acquisition of Land Act 1925 State of South Australia takes a period of twelve months prior to th taking of land or, where land is not taken, the execution of work and directs that the value of the land at the beginning of the shall be taken to be its value together with that of bona-fide imy ments made in the meantime. Section 35 (1) of the Lands tion Act 1910 (No. 11) of Tasmania makes a provision almost the sa as that of the Commonwealth Act now in question. The Railway At of the Dominion of Canada makes the date of the deposit of p! with reference to which compensation shall be ascertained, that the lands are actually acquired within one year of the See Toronto Suburban Railway Co. v. Everson (1). Are we to say that these statutes are based on unjust conception: They are different ways of meeting the same difficulty Commonwealth Parliament had in mind in enacting s. 29 (1 appears to me that we cannot say that it was not fairly open t Parliament to-regard that provision as a just expedient. Its lo, efficacy or wisdom is not the matter in question. Nor do I think we are required to test its validity by imagining conditions in wh its operation might cease to be just: ef. Australian Temi Ltd. vy. The Commonwealth (2). The second ground for impeaching the validity of the Acti is it does not contemplate recompensing the owner by asses value of the land to him. I do not propose to go into the co) tions which are involved in the phrase " value to the owner

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19, and either House could have disallowed it under s. 48 of the Interpretation Act. In all these circumstances it would not be -, I think, to hold that the regulation was not justified as an exercise of the defence power. _ As to (2), I have already indicated shortly in Dalziel's Case (1) my wn opinion of the proper approach to the determination of the ion whether an Act which provides for the acquisition of pro- y contains just terms within the meaning of s. 51 (xxxi.) of the Constitution. In Commonwealth v. Huon Transport Pty. Ltd. (2) and Marine Board of Launceston v. Minister of State for the Navy (3) I 7 the opinion that in the case of income producing property is a necessary incident of such terms that interest should be paid the person dispossessed between the date of acquisition and the te of payment of the compensation. Section 40 of the Lands Acquisition Act provides, so far as material, that the compensation bear interest at the rate of three per cent per annum from the te of acquisition of the land until payment. There is a proviso to the section that where the compensation awarded in an action is "not more than the amount offered by the Minister in satisfaction of claim the compensation shall only bear interest to the date when e offer of the Minister is communicated to the claimant. But a 'imant in an action for compensation who obtained an award of a which was not immediately paid could enter the award as a udgment of the court, which would carry the same rate of interest any other judgment, and he could do so even when not awarded e than the amount offered by the Minister because there could be reason why interest should not be payable upon such an amount d where it is not paid immediately after the award. Thus the n for payment of interest at three per cent is a direction which only operate during the period required to ascertain the amount the compensation. Division 2 of Part IV. prescribes the prelimi- ry steps that must be taken before a claim becomes a disputed im for compensation. No time is provided within which the er must take the step required by s. 34 (2) but he would have to withina reasonable time. There is nothing to prevent a claimant 'ing the full time allowed for taking the requisite steps on his

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is open to the objection that it may include purposes other than those