Lords Sitting of 7 August 1919

Preamble
The House met at three of the clock The LORD CHANCELLOR on the Woolsack.
BUSINESS OF THE HOUSE.
THE CHANCELLOR, OF THE DUCHY OF LANCASTER (THE EARL OF CRAWFORD): My Lords, I beg to give notice that on Monday next the Lord President of the Council will move that Standing Order No. XXXIX be considered with a view to its being suspended.
MANCHESTER SHIP CANAL BILL.
Read 3a, and passed.
MILFORD DOCKS BILL.
Read 3a; Further Amendments made; Bill passed and returned to the Commons.
BEDWELLTY URBAN DISTRICT COUNCIL BILL.
Read 3a, with the Amendments, and passed, and returned to the Commons.
STRETFORD URBAN DISTRICT COUNCIL BILL.
Read 3a, with the Amendments, and passed, and returned to the Commons.

MESSAGE FROM THE BELGIAN SENATE.
THE LORD CHANCELLOR (LORD BIRKENHEAD): My Lords, I have to announce to your Lordships that I have received the following Message from the President of the. Belgian Senate—
As interpreter of the sentiments of the members of the Belgian Senate, I beg you, on this auspicious and unforgettable occasion when Victory is celebrated, to accept the expression of our deepest and most grateful sympathy for the great and generous British people, and of our lively admiration of the glorious deeds of its mighty forces on land and on sea.
We express to you our most fervent wishes for the greatness and well-being of the British Empire. May the benefits of Peace, so heroically assured, draw still closer the bonds of friendship which unite our two countries.
I beg your Excellency to accept the expression of my high consideration.
(Signed) BARON DE FAVEREAU.
I have taken it upon myself to give directions that a cordial message be sent in reply.

LOCAL GOVERNMENT PROVISIONAL ORDERS (No. 1) BILL.
LOCAL GOVERNMENT PROVISIONAL ORDERS (No. 2) BILL.
LOCAL GOVERNMENT PROVISIONAL ORDERS (No. 3) BILL.
LOCAL GOVERNMENT PROVISIONAL ORDER (No. 4) BILL.
LOCAL GOVERNMENT PROVISIONAL ORDER (No. 5) BILL.
LOCAL GOVERNMENT PROVISIONAL ORDER (No. 6) BILL.
LOCAL GOVERNMENT PROVISIONAL ORDERS (No. 7) BILL.
Moved, That the House do now resolve itself into Committee on these Bills.—(Viscount Sandhurst).
THE EARL OF SELBORNE: Is it not rather a new procedure to commit Bills en bloc?
THE LORD CHANCELLOR: lf the slightest objection is raised to the procedure of taking the Bills en bloc, that course will naturally not be adopted. Before the Motion was made, it was ascertained that no single Amendment was on the Paper in relation to any one of these Bills, and it was thought that it might be economical of your Lordships' time to take them together. Of course, if any member of your Lordships' House desires that the Bills should be taken separately, it shall be done.
THE EARL OF SELBORNE: I do not think that a precedent of the kind proposed ought to be made without some consideration.
THE LORD CHANCELLOR: Very well; the Bills shall be taken separately.

LOCAL GOVERNMENT PROVISIONAL ORDERS (No. 1) BILL.
House in Committee (according to Order): Bill reported without amendment.
LOCAL GOVERNMENT PROVISIONAL ORDERS (No. 2) BILL.
House in Committee (according to Order): Bill reported without amendment.
LOCAL GOVERNMENT PROVISIONAL ORDERS (No. 3) BILL.
House in Committee (according to Order): Bill reported without amendment.
LOCAL GOVERNMENT PROVISIONAL ORDERS (No. 5) BILL.
House in Committee (according to Order): Bill reported without amendment.
LOCAL GOVERNMENT PROVISIONAL ORDERS (No. 6) BILL.
House in Committee (according to Order): Bill reported without amendment.
LOCAL GOVERNMENT PROVISIONAL ORDERS (No. 4) BILL.
House in Committee (according to Order): The Amendments proposed by the Committee made.
LOCAL GOVERNMENT PROVISIONAL ORDERS (No. 7) BILL.
House in Committee (according to Order): The Amendments proposed by the Committee made.
LOCAL GOVERNMENT (IRELAND) PROVISIONAL ORDERS BILL.
House in Committee (according to Order): The Amendments proposed by the Committee made.

ACQUISITION OF LAND (ASSESSMENT OF COMPENSATION) BILL.
Amendments reported (according to Order).
Clause 2:
Bales for the assessment of compensation.
2. In assessing compensation, an official arbitrator shall act in accordance with the following rules:—

(1) No allowance shall be made on account of the acquisition being compulsory

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(2) The value of land shall, subject as hereinafter provided, be taken to be the amount which the land if sold in the open market by a willing seller might be expected to realise: Provided always that regard shall be had to all returns and assessments for taxation made or acquiesced in by the claimant during the three years next preceding the assessment of compensation:

(3) The special suitability or adaptability of the land for any purpose shall not be taken into account if that purpose is a purpose to which it could be applied only in pursuance of statutory powers, or for which there is no market apart from the special needs of a particular purchaser or the requirements of any Government Department or any local or public authority:

(4) Where the value of the land is increased by reason of the use thereof or of any premises thereon in a manner which could be restrained by any court, or is contrary to law, or is detrimental to the health of the inmates of the premises or to the public health, the amount of that increase shall not be taken into ac count:

(5) Where land is, and but for the compulsory acquisition would continue to be, devoted to a purpose of such a nature that there is no general demand or market for land for that purpose, the compensation may, if the official arbitrator is satisfied that reinstatement in some other place is bona fide intended, be assessed on the basis of the reasonable cost of equivalent reinstatement.

For the purposes of this section, an official arbitrator shall be entitled to be furnished with such returns and assessments as he may require.
THE EARL OF SELBORNE THE EARL OF SELBORNE moved to delete the proviso in subsection (2). The noble Earl said: I make no apology for bringing the subject of this Amendment again to the notice of your Lordships' House, because, as ray noble and learned friend on the Woolsack will remember, when it became necessary for the Government to fix last, Monday as the date for Committee—a day on which many of us were engaged celebrating Peace in various parts of the country—I took the liberty of stating that I should feel myself justified in raising on Report anything to which I had not been able to draw attention in Committee. The subject of my Amendment, however, was considered in Committee. There was no Division upon it though there was a considerable amount of speaking, and I venture to think I shall be able to show the House that those speeches did not exhaust the subject, and that it is one still very worthy of the attention of your Lordships' House.
If your Lordships will turn to Clause 2 of the Bill you will find first of all set forth the definition of "value" deliberately chosen by His Majesty's Government, which was so lucidly explained by the noble and learned Lord on the Woolsack on the occasion of the Second Reading. At the end of that definition, however, you will find a proviso which runs as follows:—
"Provided always that regard shall be had to all returns and assessments for taxation made or acquiesced in by the claimant during the three years next preceding the assessment of compensation."
The criticism on those words in Committee largely hung on the question whether they included an assessment to rates, and the noble and learned Lord on the Woolsack, I understood him to say, thought that rating assessments should not be included, and he promised to look into the question further and see whether they were. We shall await with interest what he has to tell us on that subject, but my Amendment is based on much wider considerations than those connected only with rateable value, and I must ask your Lordships to give me your kind attention for a few moments while I go somewhat at length into the history of this proviso and the arguments I shall venture to bring before you against it.
This proviso was not inserted in the original Bill by His Majesty's Government, nor was it inserted in Grand Committee in the House of Commons. It was inserted on Report, and I am not exaggerating when I say that it was inserted after pressure from what is known as the Land Values Group in the House of Commons. It was based on an Amendment moved by Sir Donald Maclean, who stated quite definitely—as I can prove to your Lordships from the Commons Hansard, if you doubt it—that the object of his Amendment was a qualification of the definition adopted by His Majesty's Government. That is to say, the object of his Amendment, on which this proviso is based, was to effect a change in some degree in the definition of value deliberately adopted by His Majesty's Government.
When this Bill was first put down for Committee in this House, the noble and learned Lord on the Woolsack himself gave notice of the same Amendment as I have on the Paper to-day—an Amendment to cut out this proviso—and he told your Lordships in the Committee stage, with the
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most complete frankness, why it was that, having allowed the Amendment to be put down in his name, he directed it to be taken off the Paper. I think he will not correct me when I say that the reason for his action was that the attention of the Government had been drawn to certain obiter dicta of the present Prime Minister which he uttered as Chancellor of the Exchequer when he was working the Finance Bill of 1909 through the House of Commons. I can quite understand that His Majesty's Government attribute some importance to obiter dicta of the Prime Minister, although uttered ten years ago in another capacity, but I do not think your Lordships will be surprised if I say that I do not consider obiter dicta of the Prime Minister uttered on such an occasion conclusive in this matter.
Then the noble and learned Lord on the Woolsack passed on to consider the proviso on its merits, and I would, with your permission, remind him of what he said, or of part of what he said. You will find it in Column 280 of our OFFICIAL REPORT. He said—
"I never have been quite able to understand why this—"
That is an assessment of this kind—
should not be available as one of the criteria by which one measured the valuations of property for these purposes. It is not necessarily conclusive, but surely it is a consideration which no judge should say was irrelevant, or that it was a consideration which might not throw some light upon it."
Now, I unhesitatingly say "Yes" to that proposition of the noble and learned Lord. I admit that an assessment or return of this kind is one of the criteria which should be applied by the arbitrator in coming to a decision on such a question as that which we are considering; but what I contend is that it is only one of the criteria, and that to single it out and place it alone in juxtaposition to the actual definition of value framed by the Government, is to give it a wholly undue importance in proportion to other criteria.
I want particularly to draw your Lordships' attention to that argument. If this one criterion amongst several criteria is deliberately singled out and added to the definition of value, surely it must mislead the arbitrator. Why is it so singled out? I have already told you that Sir Donald Maclean, by whose action in the House of Commons this proviso was introduced, has deliberately said that his intention was

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to qualify the definition of value adopted by the Government. Therefore, I say—either this one of the criteria, taken alone and placed in juxtaposition to the definition, does not produce the market value as ascertained by that definition, or it does. If it does not, it is quite clearly superogatory. If it does, then Sir Donald Maclean has succeeded in doing something quite different from what, the Government intended. By inserting this proviso he has succeeded in making them change, in some degree, the definition of value which they have deliberately adopted.
I want to dwell on the great importance of that fact, because this House passed this definition of value with great confidence, after the explanation and assurance of the noble and learned Lord on the Woolsack. He told us exactly what, in his opinion, that definition meant, and he told us that in his opinion, to which we attach the greatest importance, it was a perfectly fair definition as between the buyer and the seller. Not only that, but he backed up his opinion by quotations from the judgment of the Master of the Rolls in the Court of Appeal, and explained, without any kind of hesitation, that in his opinion that interpretation of the law by the Master of the Rolls would apply to this definition of value and would be a guide to the arbitrator. Therefore I suggest that this proviso is of the greatest possible importance. Again, I go back to my point that, while this is one of the criteria, it is not the only criterion. There is the question of consequential loss; there is the question of the amount paid by the property in question recently in Estate Duty; Hare are other criteria, a whole list of them, but to put them in the proviso, and direct that the arbitrator should take them into account, would clearly be very bad drafting, and entirely inconsistent with all the principles of legislation which the Lord Chancellor and other legal luminaries in this House have perpetually enforced upon us. Over and over again they have said, "Do not mention one of special contingent considerations, because if you mention one and not all, that one is apt to be held exclusive of all the others;" and that is exactly what I am arguing this proviso will be held to be.
I pass on to a criticism of the actual words of the proviso; and here I would respectfully ask for the attention of the Lord Chancellor. I have entered my protest
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against adding any proviso at all to the definition deliberately adopted by the Government. I have ventured to express strong reasons, I think, against adding in the proviso one of the criteria chosen arbitrally out of the whole list. And now I come to consider the words of the proviso itself—
"Provided always that regard shall he had to all returns and assessments for taxation made or acquiesced in by the claimant during the three years next preceding the assessment of compensation.''
Why three years? Has the Lord Chancellor considered what the effect of that limitation will be? The whole of the provisional land valuation under the Act of 1909–1910 will be excluded by those words, because none have been made within the last three years. Apart from that, think of the extraordinary unfairness. A man might have paid Estate Duty on a definite sum four or five years before, and that is not taken into consideration at all. Although he paid Estate Duty on a valuation of £10,000 he may now be told that his property is worth only £6,000, and he will not be able to bring this fact—the valuation for Estate Duty purposes four years before—before the arbitrator. It may be quite easy within a brief period for a man to pay Estate Duty on one figure and receive compensation on a wholly different figure. Then under Clause 8, subsection (4), either party can require that the Inland Revenue valuation of the land shall become available as one of the criteria. I have admitted that it is one of the criteria, and it is expressly laid down that either of the parties shall claim that this particular one of the criteria should be taken into account by the arbitrator.
That being so, why single out this one of the many criteria, and tack it on to the definition of values chosen by the Lord Chancellor and by the Government, to the exclusion of all others. There is only one explanation; only one meaning. It is not the meaning of the Lord Chancellor or the meaning of the Government; it is the meaning of Sir Donald Maclean and the Land Values Group whom he represents. In order that your Lordships may be quite sure that I have not exaggerated in this matter, let me read what Sir Donald Maclean said. He said this—
"As the Bill now stands it provides that the value of the land shall be the ordinary market value, and my words art intended to be a qualification of that. The words 'ordinary market value'

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as they stand in the Bill are taken verbatim et literatim from the Finance Act, 1910, and my words are a qualification of those words."
I think, therefore, that I have made out a strong case, not in support of my own judgment, but in support of the first opinion of the Lord Chancellor, and I ask your Lordships and the Government to support my Amendment, which would have the effect of taking this proviso out of the Bill, leaving as the one direction to the arbitrator the definition of value selected by the Government after the most careful deliberation, as the Lord Chancellor has told us, with the meaning attaching to it which the Lord Chancellor has explained, to be interpreted by the arbitrator in the light of the criteria available to him, of which assessment is one.
Amendment moved—
Page 2, line 31, leave out from ('realise") to the end of subsection (2).—(The Earl of Selborne.)
THE LORD CHANCELLOR: The noble Earl has explained very clearly, and in language courteous to myself, his object in moving this Amendment. He made it plain that in his view the Amendment is a substantial one. I confess, having had an opportunity of going into this matter more fully than on the Committee stage, I am not able to share that view, and I hope I may be successful in persuading the noble Earl that the view I am about to put before your Lordships is well-founded.
The main argument of the noble Earl is this. He says that in the earlier part of Clause 2, subsection (2), the lines which precede the proviso (which the noble Earl would exclude) a general canon is laid down. That is perfectly true. Then he asks, Why, if you lay down a general standard and method by which you are to assess value in the earlier words, do you single out this one for mention in the proviso out of all the other things which have to be taken into consideration? Really, on reflection, that argument does not possess the force which the noble Earl attributed to it. In the first place the noble Earl is good enough to accept, as I think he may without any anxiety, the statement of the law which I laid down on the Committee stage; and, in the second place, the noble Earl made another admission which I should expect from him. He said that the element of rating, though obviously not having a very direct or important contribution to offer to the question of capital value—
THE EARL OF SELBORNE: I did not say rating.
THE LORD CHANCELLOR: I understood the noble Earl to quote what I said in the Committee stage, and I think he read the exact passage.
THE EARL OF SELBORNE: I mentioned Inland Revenue assessments.
THE LORD CHANCELLOR: I think the noble Earl said "rating," but I will look for the exact words. The column in the OFFICIAL REPORT which the noble Earl quoted was 280. The words used are—
"I have never been able to understand why, when you are attempting to arrive at a true conclusion as to the value of the land, you should exclude altogether the returns and assessments for taxation which have been made or acquiesced in by the claimant during the last three years."
I remember that the point was under discussion in the Committee stage, and I was asked whether the words were apt to cover "rating." I have gone into the matter since, and I have no doubt that the words do cover it.
THE EARL OF SELBORNE: Rating is included.
THE LORD CHANCELLOR: Yes. Therefore what it is necessary to ask oneself now is whether it is or is not a reasonable thing that rating should be included as one of the criteria and, if so, and it ought to be included, is the mode by which it is provided that it shall be considered in this proviso such as to lead to the consequences which the noble Earl anticipated. I argue first of all the point of principle, and, secondly, whether it ought to be singled out to be mentioned. First as to whether it ought to be considered. No one, of course, will pretend, when you are dealing with what is a question of determining the capital value, that the material which is primarily concerned with the annual value should possess very great importance; but the point is this, not whether it should possess very great or decisive importance, but whether it should be available to be considered amongst other materials for forming a judgment by the arbitrators who have to deal with these matters.
Let me say shortly why I make the suggestion that it should be available as one of the elements for consideration. After all, when a man is rated he has the

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opportunity of making certain observations and submissions, and Although that with which he is dealing is a question of the annual value, nobody who knows anything of the methods by which actuarial computations dealing with actual value are arrived at will suppose that you can ignore any material which throws light upon the annual value. After all, one of the methods is by capitalising the annual value, and no one will claim more for it than that it is one of the elements which may be properly placed before the arbitrator.
Then the noble Earl says, Why is this alone of all the indicia to be singled out? I think it is singled out for a very clear reason. It is the first time that rating bits been admitted as one of the indicia in attempting to ascertain the capital value, and therefore while the words which precede have precisely the meaning which I attribute to them, that alone is the reason why this is the only additional method which is selected, because if the proviso did not contain the words to which the noble Earl objects it would not have been possible to include rating. That is the answer to his objection.
"But why three years" asks the noble Earl. That is a fair question; but then he suggests that the effect of limiting the period to three years might be to exclude valuations made under the Finance Act 1909–10. That observation is not well founded. "Provided always that regard should be had" lays en injunction upon the arbitrator and. compels him to take into consideration the assessment for taxation and so forth for three years, which otherwise he would not have been legally entitled to consider, but it does not prevent the person whose estate is being taken from putting before the arbitrator any consideration which he thinks will assist him in his view of the market value of the property. The only object is to enable the arbitrator to consider things which he would not have been entitled to consider. There is nothing and never has been anything in the law which disentitled a claimant to go before the arbitrator and say, "These are things which you should consider."
THE EARL OF SELBORNE: Or the purchaser?
THE LORD CHANCELLOR: Certainly, but that does not affect the argument at all.
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As I understood the noble Earl, he says "Why is it you limit it to three years? "And I say there never was any reason why he who applied to receive compensation should not put the whole of this material before the arbitrator, but this proviso is necessary to entitle the arbitrator to consider it. If the noble Earl is not satisfied with three years the Government will be quite prepared to make it five or six years, or any period which the noble Earl thinks may be necessary. We took the view that three years was a reasonable period, and such as might appear likely to afford proper guidance.
The whole question is this, whether there is any discontent with the general definition given of market value. Such apprehensions as were felt and expressed in the debates on the Committee stage could not and did not survive she explanation of the law which. I gave and which was fully acquiesced in by Lord Parmoor, who has great knowledge on this subject; therefore we are all agreed that the determination of market value is one which may be and ought to be accepted. The only question which remains is whether or not this proviso ought to stand. If it does not stand the arbitrator cannot look at the taxing or rating returns for the three years which precede the moment at which the property is taken, and therefore the one and only point to which your Lordships should give attention is this, Are those considerations, or are they not, which ought to be borne in mind inter alia by the arbitrator in arriving at his decision. It seems to me that they are. When the noble Earl speaks of what the then Chancellor of the Exchequer stated on behalf of the Government in the House of Commons as obiter dictum I do not think he very appropriately employs that phrase. "Obiter dictum" is an observation made by a Judge in the course of a case, and generally, if I may say so, is very wisely avoided by the best Judges, because it is on a matter which does not require decision and is binding on no one.
THE MARQUESS OF SALISBURY: I shall not say anything about the earlier words of this subsection. I think it is true that the noble and learned Lord, upon the Committee stage of the Bill, satisfied your Lordships that the phrase "sale in the open market by a willing seller" had been the subject of interpretation in the Court of Appeal, and that we might look upon the definition so arrived at as quite satisfactory.

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Nor will I say anything except a phrase about the point raised by my noble friend as to the unfairness of limiting the assessment in the proviso to the three years, because I understand the noble and learned Lord on the Woolsack is prepared to consider an Amendment on that point. But I should like to say a word or two on the proviso.
In the first place, the noble and learned Lord has defended the insertion of the proviso on the ground that it opens the door to the valuer to consider amongst other things these returns of assessment. It does more than open the door. I am not sure that the noble and learned Lord put it strong enough. It directs him to consider it. He said, "There is no unfairness upon the seller that other assessments are excluded or other indicia are excluded, because it is always open to the seller to bring them before the valuer." That is true. It is true of the purchaser, too. And even without the proviso it is perfectly possible for the local authority or whoever is the purchaser, to bring all the relevant evidence of any kind before the valuer, and so far as that is concerned there is no reason to treat the seller and purchaser on a different footing. In either case they have access to the same judicial authority, and they have liberty to bring the same kind of evidence on the one side or the other, and I cannot see why they should be treated on a different footing. They ought to be treated exactly the same. There ought not to be a direction in the Act of Parliament that the judicial authority is to consider the case of one side unless you direct him also to consider the case on the other side. This is inequitable direction—inequitable I mean in the sense that it prefers, of the two parties to the suit, the one (a purchaser) and gives him an assistance in the Act of Parliament which is not given to the other party to the suit—namely, the seller. That is the first point I would make.
The second point is in reference to the question of rateable value. The noble and learned Lord will forgive me for saying that his attitude has very much changed on this subject since the matter was discussed in Committee, because in Committee he was much surprised that rateable value was included; indeed, he did not believe it. He said over and over again across the floor of your Lordships' House to my noble and learned friend Lord
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Parmoor that he did not think that rateable value would be included. Now it appears that rateable value certainly is included, as the noble and learned Lord, Lord Parmoor, said it was.
THE LORD CHANCELLOR: At the end of the discussion I said this—
"As to the point raised by the noble and learned Lord on the rating, I am prepared, if it meets his views in any way, that it should be a little more carefully considered whether the language used in this section does cover the case of rating. Perhaps the noble and learned Lord between now and the Report stage will allow me to have a word with him to discuss that."
Thereupon the following was said—
LORD PARMOOR: I am much obliged for the answer which the noble and learned Lord has made. I may speak again on Report. The noble and learned Lord has said that we are dealing here with questions of assessment of compensation—that is to say, arbitration proceedings.
THE LORD CHANCELLOR: Yes.
LORD PARMOOR: If the noble Lord is willing, as I understand he is, to consider the question as to whether the rating value should be eliminated from the general principle of taxation of values, I will certainly get into communication with him on that point.
Since then I have been in communication with the noble and learned Lord.
THE MARQUESS OF SALISBURY: It is not material. I certainly thought that the noble and learned Lord on the Woolsack, when he spoke in Committee, was under the impression that rateable value was probably not included. I want to address myself for a moment to the substance of the matter. Why should rateable value be included? The noble and learned Lord said that it ought to be included because, after all, every ratepayer had the right to challenge the assessment of rateable value, and if he had the right to challenge if it was his fault if it was wrongly fixed. I feel great diffidence in calling the attention of so great an authority to the real condition of the rating law, and I do not think that I should dare to do it if my noble and learned friend Lord Parmoor were present, but I have sat, as have many of your Lordships, on rateable appeals, and the noble and learned Lord on the Woolsack will I am sure allow me to say—he will correct me if I am wrong—that the assessment of rateable value is upon a totally different value from the assessment of capital value, because what the law directs is that the rateable value shall be fixed upon what a willing tenant, taking one year

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with another, would be willing to give for one year. That is the law of rateable value.
Consequently in the case of a great deal of property, especially house property, the assessment of the rateable value is very far below the capital assessment, and rightly so, because a willing tenant from year to year would not for one year be prepared to give a very large rent for it, and therefore the rateable value is low. That is not because of any undue favouritism on the part of the rateable authority, or of any man, but is because that is and always has been the law. Because of this very special provision of the law, rateable value in many cases is far below the capital assessment. The same is true of woodlands. The assessment of rateable value in the case of woodlands is far below, and is meant to be below, the capital value. Is not that a very strong reason why it should be eliminated from the consideration of an arbitrator whose business it is to consider the capital value and nothing but the capital value? I should have thought it was absolutely conclusive that it was most unfair that a valuer, or an authority whose business it is to consider nothing but the true capital value of a particular piece of property, should be directed to consider the annual value, which has nothing to do with the capital value. I am not a lawyer, but I believe that I have stated the law quite accurately as it stands.
I think that the result of reading these words into the proviso is that the arbitrator would be directed to consider annual value, which is expressly and purposely less, and in some cases very much less, than the capital value in question. The noble and learned Lord said, "He only has to have regard to it." I honestly do not know what having regard to a thing means, but I am quite sure what the ordinary man would mean by it. He would take it to mean that it was to be a governing consideration. I do not understand what other meaning it can have. I do not say that it is a consideration that is conclusive, but that it is a governing consideration which must never be left out of account. In no circumstances could the valuer leave it out of account if you were to give a true interpretation of the words. I submit to your Lordships, in whatever part of the House you sit, that to allow those words to stand, including as they do, by the admission and statement of the noble and learned Lord
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on the Woolsack, rateable value, is unfair on the face of it, and that your Lordships ought to amend it.
THE MARQUESS OF CREWE: Unfortunately I did not hear the greater part of the reply of the noble and learned Lord on the Woolsack. It is clear, of course, that there are two distinct points in the discussion. The last one raised by the noble Marquess had reference to rateable value. At the earlier stage I expressed an opinion very much on the same lines as the noble Marquess, that if rateable value did come under the terms of this clause it ought to be excluded for the same reasons that the noble Marquess has given, namely, that, that being the lettable value of a particular subject for one year, it was not reasonable to regard it as any guide or basis for the computation of the capital value of the same subject. I still hold that view, but I am very far from agreeing with the noble Marquess that the whole proviso ought therefore to be struck out.
I hold the opinion that the object to be aimed at throughout is that the value for taxation should be the same as the value for sale. And the value for sale should be accordingly the same as the estimated value for taxation. That is to say, any land that is to be sold should be sold at a capital figure parallel to the annual charge imposed upon it for taxation, neither more nor less. That being so, the proviso ought, in my opinion, to stand. But assuming it to be possible, as it well may be, to exclude consideration of the rating value altogether, I think this ought to be done. Of course, it may be argued that the rateable value is so remote from the valuation which the arbitrators will have to arrive at that their minds are not to be brought o bear upon it at all, and therefore the inclusion of all values for assessment from that point of view does not matter; that is to say, no smaller sum would be given by the arbitrators because the assessment for rating happened to be low. But I do not think that that is quite a complete answer, and in my judgment some provision ought to be made for excluding consideration of that value altogether. But I am firmly of opinion that the taxable value ought to be maintained.
LORD WITTENHAM: I was all through the Budget debates of 1909–1910, and it strikes me very clearly that this is an

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echo, perhaps a far-off echo, of what was raised by the then Chancellor of the Exchequer as really a nova res. I remember perfectly well how all the opponents of that famous Budget certainly were influenced by, and I rather think voted against what then seemed to be a new idea—the idea that in arriving at the value of land regard ought to be had in various ways to the value which the owner himself had put upon the land for different reasons. Now we come to this Bill, and it really is important to look at the history of it. Because when it was introduced the Government draftsman did not put in this proviso at all. One must assume, I think, that that was the mind of the Government—that the Government. were perfectly satisfied to leave it to the arbitrators to discover the price of a willing seller, and the file has been pointed out by the noble Earl, Lord Selborne, it seems to me with great force, that this proviso having found its way into the Bill at all was the work of Sir Donald Maclean and the land values group. I have not looked at the, House of Commons Debates to see how it was that that steered its way successfully through the Lobby, but it did. So we must assume—must we not?—that the Government for some reason gulped down the original idea that it had of leaving the ascertainment of the value of the land on the old lines.
When it got here (and here I speak with the greatest diffidence, and I feel I am treading on rather difficult ground) the noble and learned Lord on the Woolsack thought the same, because, doubtless for very good reasons, he himself put an Amendment down striking out these words. Coming from such an eminent authority, and from one in his great and distinguished position, one cannot look upon that as an Amendment put down by a humble back bencher such as myself. It was put down evidently for a very good reason—that the noble and learned Lord was satisfied with the old way of ascertaining the value for the purposes of this Bill. But then suddenly it disappears from the Amendment Paper. In the House of Commons it was always thought to be rather a significant circumstance when an Amendment suddenly disappeared from the Amendment Paper. I am not at all sure I would not sooner have the noble and learned Lord's first opinion on this matter rather than his second.
And I cannot get rid of my own past, if we are going to divide upon this matter.
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Because in 1909–10 I was fervently opposed to a proviso of this kind, and so we all were. The noble Earl who directed our fortunes in those days (Lord Crawford), I suspect, was just as strongly opposed as myself. Are we to swallow our old opinions, and if so, why? Now if I swallow part of mine it would be for this reason, that the noble and learned Lord on the Woolsack has pressed this point—it seems to me, at any rate to have a good deal in it—that this is a nova res, that no arbitrator would have regard to those facts described in the proviso unless his attention was particularly called to it by the purchaser; that it was introducing a new system altogether, and although it was mentioned in the Budget of 1909–10, and great force was ascribed to it by the then Chancellor of the Exchequer, that it did not find its way into legislation until now; and therefore it was necessary to single that out from all the other considerations that would pass like a panorama before the arbitrator's mind, because the arbitrator would be hound to exclude this unless his attention were specifically directed to it by the Statute. That seems to have a great deal of force in it as regards assessment for taxation. I am not going to say a word about rating, because I think it must be clear to us all that some words must be introduced there; the assessment for rating is for an entirely different purpose. Much stronger and acuter intelligences than mine have made that clear.
But with regard to capital assessment, is it unfair to direct the arbitrator's mind specially to the fact that he must have regard to the value which a man for capital purposes has put upon his own land? Using such intelligence as I possess and trying to apply the canon that one ought always to apply—the canon of justice—I ask, is it just? I think it is. For instance, a man is assessed for Death Duties; he has passed away, but his executors assess his land for Death Duty purposes. It passes the usual criterion of examination in the office which deals with such things, and it becomes a canon of value. Now, is it unfair, if the land is sold afterwards, that regard should be had to the circumstance that the executors with all the knowledge at their command and looking at the whole matter came to the conclusion that this land was worth so much, and that on that the Death Duties are paid? Then afterwards this very land comes up before the arbitrator to have its capital value assessed.

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Is it unfair that you should turn up the pages for the Death Duties and say to the present owner, "You now say that your land is worth £20,000. Why, God bless my soul! When I look up the papers of two or three years ago I find that the executors of your father assessed it at £10,000; and the circumstances have not changed." Looking at it in that way, I cannot think that it is unfair. Therefore I am driven to the conclusion, for what it may be worth, that part of the proviso is fair and reasonable in the circumstances—namely, assessment for capital value; but that words should be introduced making it clear that the arbitrators ought not to take into consideration any question of rateable value.
THE DUKE OF BUCCLEUCH: I think it is obvious what this proviso means when put in plain language. It means that for Government taxation such as Death Duties there is one consideration, but when the Government wish to take the land there is another consideration. I will give your Lordships an instance of the way in which any Government Department looks at it. I have lately had all my lands in Scotland valued for Death Duties. Shortly after this valuation was settled a Government Department wanted some land from me. I worked out the value on the same lines as the valuation for Death Duties, but I was immediately told that the price asked was either "excessive" or "exorbitant"—the very price at which the Government had valued it. It. is done simply for this reason. Say that an estate is valued under the Finance Act of 1909, or for Death Duties. If after the lapse of three or five years they wish to take the land they say, "Oh no, we are not going to pay you this price; we are going to pay you a price based entirely on the annual rental."
I would not pretend, of course, to argue with the noble and learned Lord on such a question as this, but I think it is obvious that anyone taking the value of land always deals with the rental, and that for practical purposes is almost the same as the rateable value. It is obvious that the way in which attention is drawn to this must influence the arbitrator or the valuer to a great extent. We are aware that in many of the Acts lately passed—especially Acts dealing with finance—there have been expressions in the Court of Appeal's and in the House of Lords' decisions as to the difficulty of interpreting these things; they are invariably in favour of the Treasury or
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Inland Revenue and against the individual. There will be explanations when the Bill is going through that everything is all right and that it means this that and the other but when it comes before the Courts a very different interpretation is put upon it. I feel convinced, as I think your Lordship who have heard the debate to-day will be convinced, that the sole reason for this is to have one valuation for taxation on Deat Duties and another valuation for any Government Department that wishes to take the land. I trust that your Lordships will support and carry this Amendment.
VISCOUNT MIDLETON: Before the noble Viscount replies I want only to ask a concrete question and not to add to the arguments already advanced. The case I am going to mention actually occurred within the last few days and I should like to know how it would be dealt with under the Bill. A commercial firm in the year 1914 had its premises valued at £100,000. The rateable value is based on that valuation and amounts to something like £5,000 a year, which sum is being paid at this moment. Last year this firm was taken over by another firm, and for that purpose a very close valuation was made as it was obviously necessary for the purchasing firm to obtain the premises on the lowest possible valuation. Finally the price was agreed at £150,000.
VISCOUNT PEEL: In what year was that?
VISCOUNT MIDLETON: The first valuation was in 1914 and the second in 1918. Now, within the last three weeks those premises, not being required by that intending purchasing firm, have been sold to a willing purchaser for £200,000. I would ask the noble and learned Lord this question. Obviously the price at which the land is sold in the open market to a willing buyer is £200,000, but equally obviously—or so any layman would assume—provided "regard is to be had to all returns and assessments for taxation made or acquiesced in by the claimant during the last three years," those returns will be on the basis of—100,000. Therefore it seems to me clear that if you put in this proviso it is impossible for the arbitrator to give the sum which a willing purchaser not only was willing to give but has actually given in the last few days, although the case might arise on the same property

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within a few weeks from now. I ask the noble and learned Lord whether, as a matter of law, it would be possible for the arbitrator to give the whole £200,000 if he has to have regard to the assessments which had been acquiesced in for three years past.
There is then the question with regard to the small owners of houses. For three years past they have not been allowed to ask additional rent for their houses by Act of Parliament. It is perfectly obvious that a large number of those who buy house property—which is a favourite form of investment for small people—do so, not on the existing rental, but in the belief that a larger rental will be obtained. Parliament stepped in and kept down the rent. Your Lordships will no doubt have had experience that during the past three or four years much larger rents could have been obtained if you had been so minded and had been allowed by Act of Parliament. The rents, however, have been kept down, although the capital value has, as everybody knows, increased and is far in excess of the rental value in the majority of instances. Again, I ask, Is the owner to be compensated subject to this proviso, which must undoubtedly cut down the capital value which he would get from a willing purchaser?
I think there was considerable force in the remarks of my noble friend Lord Salisbury. After all, rateable assessment precedes value; it cannot follow. It is made solely upon the existing order of things for one year. Therefore it leaves out of account an enormous area of the value which is part of that which you must take into consideration. If you leave the proviso out entirely, the arbitrator would have those facts, amongst others, before him. Surely if you direct his mind to them in this way there can be but one conclusion—that he must cut down the actual price which has been paid by the willing purchaser in order to arrive at the value.
VISCOUNT PEEL: I should like to make one observation with regard to the speeches of the noble Lords on this point. I think if anybody had come into this House and, without looking at the clause, had heard their speeches he would have supposed that the only direction in this clause was that the price of the land was to be taken on the basis of the annual value. There was no trace during the arguments of noble
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Lords opposite of what is the real meaning of the clause, which deals with returns and assessments to taxation. Those, of course, include not, merely rateable value but assessments to Death Duties, valuations, and matters of that kind. Your Lordships are assuming from your reading of the clause that the sole and only point to which the arbitrator is to direct his attention is the annual value, and this in spite of the provisions in the first portion of the subsection to which the rest of the words are merely a proviso.
The noble Duke who spoke on this point talked of property in Scotland which has been valued for Death Duties, and he said, "I see the object of the Government perfectly well. After they have valued this land for Death Duties at any particular sum you like—half a million or whatever it may be (a high sum)—they are going to come down, and when they want to purchase the land they are going to take it at a totally different valuation." I do not think the noble Duke can have read the clause, because this proviso precisely takes into account and tries to avoid that particular mischief. Without this clause it would be quite possible that the arbitrator might not take into consideration at all the question of that valuation.
THE DUKE OF BUCCLEUCH: The proviso is only for three years. It. therefore practically wipes out any assessment which might have been taken four or five years before.
VISCOUNT PEEL: I will deal with that point, although I thought it had been dropped by the noble Marquess opposite, because it had been so fully dealt with by the noble and learned Lord on the Woolsack. Let me, however, finish my first point. I will take the three years first. What this proviso does is to give a direction to the arbitrator to take into account that particular valuation made within the last three years which might not be taken into account if that proviso was not there. The noble Duke says, "But how unfair that is, because the valuation might have been taken four, five, or six years before. Why is he not directed to take that into account also? "I thought the noble Marquess rather accepted the explanation of the noble and learned Lord on that point, that no particular stress is laid upon the three years; you might alter it to four or five if you like. The three Years was put in for

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the protection of the seller in order that some valuation made at some anterior period when the price of laud possibly was much lower might not be specially taken into consideration. The period of three years, therefore, is of assistance and not a detriment to the seller, and I think the noble Marquess rather assented to that.
The noble and learned Lord further pointed out that those valuations are not excluded because they are advantageous to the seller of the land. He is perfectly justified in bringing them forward and they would no doubt be considered. I think that is an answer to the objection of the noble Duke. I may say, in passing, that I thought he rather assented to the case about rating, because he told us that rental was much the same as rating. I therefore assume that he would not object to the point about so many years' purchase on the rental. You have been arguing this paint solely on the question whether it is the rateable value.
THE MARQUESS OF SALISBURY: I do not think I did.
VISCOUNT PEEL: No, I do not say that you did.
TEE MARQUESS OF SALISBURY: We, of course, discuss the points as they arise. The proceedings of your Lordships' House would be unduly prolonged if we always recited the criticisms on our speeches each time. I do not think it would be possible to do that. We, of course, took the points which were being argued at the moment.
VISCOUNT PEEL: I was only giving the general effect on my mind of the speeches. May I say one word upon the rateable value, to which the noble Marquess has so much. objected? The noble Marquess has entered into an elaborate argument and criticised the rateable value as the basis of capital value. He says it is simply the value for the year for the particular tenant.
THE MARQUESS OF SALISBURY: Not the particular tenant.
VISCOUNT PEEL: Well, for any hypothetical tenant.
THE MARQUESS OF SALISBURY: Yes, That is the right word.
VISCOUNT PEEL: What I was going to say was that these considerations which are present to the mind of the noble Marquess will, of course, also be present to the mind of the arbitrator. This clause does not say that the arbitrator shall make that the basis of the assessment; it merely does not wish to exclude it from the general purview of the arbitrator.
THE MARQUESS OF SALISBURY: He is to "have regard'' to it.
VISCOUNT PEEL: He shall have regard to it, among, of course, all the other circumstances of the ease.
THE MARQUESS OF SALISBURY: It does not say so.
VISCOUNT PEEL: The first part of the subsection says—
" The value of land shall, subject as hereinafter provided, be taken to be the amount which the land if sold in the open market by a willing seller might be expected to realise."
He might be in a difficulty. The land might not have been sold fur some time, and it might be difficult therefore to arrive at a proper selling value. All that this says is that in trying to arrive at the capital value the arbitrator shall take all these other matters into consideration, including of course the assessments for Death Duties, and so on. In taking them into con-consideration we must assume—because I think he is to be a very highly paid official, who is to have £3,000 a year and will be a distinguished surveyor possessing a great deal of experience in these matters—that he is not going to fall into the elementary blunder which the noble Marquess thinks he will fall into of saying that in all eases the rateable value is the only and most reliable basis on which you can assess the capital value. The noble Marquess wants to prevent him from taking that into consideration and to exclude altogether one of the elements, which may be in some cases a large element, and in others a smaller element, and, I quite admit, in some cases a very unfair element, while in other cases it may have some bearing. He wants to shut it out of his mind altogether. I submit that in arriving at these valuations the arbitrator is not unfairly told to consider all these different circumstances—assessments, returns, valuations, of whatever kind and character—and then form his judgment.
THE LORD CHANCELLOR: Before putting the Question I would make a suggestion. As objection has been taken to the words "regard shall be had to," I would substitute "he Shall be entitled to consider." I think that would cover the point raised by the noble Earl and still leave open the question whether rating ought to be included or not, and. I should propose, with the assistance of the draftsman, to offer the noble Earl an opportunity on Third Reading of specifically raising the rating problem. The original Question was to leave out all words after "realise" to the end of the subsection, but I under-
Resolved in the affirmative and Amendment disagreed to accordingly.
THE EARL OF SELBORNE: I beg to move, after the word "assessments" in the proviso, to insert the words "of capital value." It is quite unnecessary that I should repeat the arguments that have been addressed to the House. The object of the Amendment is to leave out the rateable value.
THE EARL OF CRAWFORD: Does it only apply to Death Duties?
THE EARL OF SELBORNE: Of capital value.
THE EARL OF CRAWFORD: For taxation?
THE EARL OF SELBORNE: Yes.
stand it is desired to vary the Amendment by leaving out from "realise" to the word assessments."
THE MARQUESS OF SALISBURY: That will reserve the rating question.
THE LORD CHANCELLOR: Yes.
On Question, whether the words proposed to be left out shall stand part of the clause?—
Their Lordships divided: Contents, 31; Not-Contents, 20.

CONTENTS.

Birkenhead, L. (L. Chancellor.)

Haldane, V.

Hylton, L. [Teller.]

Peel, V.

Islington, L.

Crewe, M.

Kintore, L. (E. Kintore.)

Birmingham, L. Bp.

Newlands, L.

Bradford, E.

Ranksborough, L.

Chesterfield, E.

Annesley, L.

Rotherham, L.

Jersey, E.

Blyth, L.

Shandon, L.

Kimberley, E.

Chalmers, L.

Sinha, L.

Lytton, E.

Cochrane of Cults, L.

Somerleyton, L. [Teller.]

Colebrooke, L.

Wigan, L. (E. Crawford.)

Sandhurst, V. (L. Chamberlain.)

Denman, L.

Wittenham, L.

Finlay, V.

Emmott, L.

Wyfold, L.

NOT-CONTENTS.

Northumberland, D.

Malmesbury, E.

Brodrick, L. (V. Midleton.)

Selborne, E.

Clanwilliam, L. (E. Clanwilliam.)

Lincolnshire, M.

Stanhope, E. [Teller.]

Ebury, L.

Salisbury, M.

Verulam, E.

Forester, L.

Monk Bretton, L.

Ancaster, E.

Hood, V.

St. Lavan, L.

Doncaster, E. (D. Buccleuch and Queensberry.)

Stuart of Wortley, L.

Askwith, L.

Willoughby de Broke, L. [Teller.]

Avebury, L.

THE EARL OF CRAWFORD: It is only Death Duties.
THE MARQUESS OF CREWE: Land valuation.
THE EARL OF SELBORNE: If these words can be improved upon, it can be done on the occasion of the Third Reading. It is quite sufficient now to raise the question of limiting this proviso to assessments of capital value for taxation, to the exclusion of rateable values.
Amendment moved—
Page 2, line 32, after "assessment") insert ("of capital value").—(The Earl of Selborne.)
THE MARQUESS OF CREWE: The noble Earl has made his object quite clear in moving this Amendment. I supported the Government on the last occasion, and from what I have already said your Lordships

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will not be surprised that I should support the noble Earl on this occasion. I was one of the people responsible for the 1909–10 Budget, and have not changed my opinion since those times, and it is clear that the estimate of capital value, whether arrived at by Death Duties or by a system of land valuation must, in my opinion, be the basis of the value for purchase. But I confess I find myself in agreement with the arguments that have already been used with regard to rateable value. Rateable value does not seem to me in any case to be a guide to the proper amount to be paid for purchase. I was rather surprised to hear the noble, Duke say that he cousidered rental value should be the basis of purchase value.
THE DUKE OF BUCCLEUCH: I must have expressed myself vary badly. It was not what I intended to say at all.
THE MARQUESS OF CREWE: I am afraid I misunderstood the noble Duke. The noble Viscount also understood him to say that the rent ought to be regarded as a considerable guide to the value for purchase. As a matter of fact in the case of much land in urban neighbourhoods it can be taken as no criterion at all, and even in agricultural districts it is a very unsafe criterion. One has known agricultural land to be sold at quite a small number of years' purchase on the rental of the farm, and also on the basis of a number of years purchase which might seem almost ludicrously high. Therefore for this particular purpose, although so far as Imperial taxation is concerned I am convinced it is right that the arbitrator should bear it in mind, I should be sorry to see him advised to pay any attention to rateable value. I trust that the Government may be able to agree to the insertion of these words.
THE LORD CHANCELLOR: I may say that in the observations that I recently made to the House I was under the impression that I was accurately expressing the pure and undiluted doctrine of what is sometimes known as "The People's Budget."
On Question, Amendment agreed to.
THE EARL OF SELBORNE THE EARL OF SELBORNE moved, in subsection (2), to leave out the words "during the three years next preceding the assessment of compensation." The noble
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Earl said: It is quite unnecessary for me to argue the case. It has been admitted by everybody that there is no virtue in the period of three years.
Amendment moved—
Page 2, line 33, leave out ("during the three years next preceding the assessment of compensation")—(The Earl of Selborne.)
THE LORD CHANCELLOR: I will accept that.
On Question, Amendment agreed to.
VISCOUNT MIDLETON VISCOUNT MIDLETON moved, in subsection (3), to leave out "the special needs of a particular purchaser or ". The noble Viscount said: During the Committee stage of the Bill the Lord Chancellor undertook to consider what words could be substituted which would carry out the intention. What he was anxious to avoid was monopoly value, and I do not think there is any one who contends for that. But undoubtedly cases do arise in which land has been purchased at a higher price than would otherwise be the case because it is adjacent to undertakings which are expanding It really would be unfair to rule out the fact that some one else is willing to give a larger sum. A man might actually have had an offer which cannot be considered. A larger offer can only come from the needs of a particular purchaser. It must be excluded and the land taken, not at the price which at any time for some years past a small owner might have got for it, but at a price which does not consider the actual sum which has been refused. The Lord Chancellor promised to consider whether words could be inserted to meet this point.
Amendment moved—
Page 3, line 1, leave out ("the special needs of a particular purchaser or")—(Viscount Midleton.)
THE LORD CHANCELLOR: The noble Viscount is perfectly right in saying that I promised to consider the scope and propriety of the words "the special needs of a particular purchaser." To me, I confess, they seem reasonably plain, and I think all those who spoke in the debate, including the mover of the Amendment, agreed with the object, but one noble Lord expressed doubts as to whether the words were carefully chosen. I have considered the matter with the draftsman and he has come to the conclusion, and I confess after con-

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sideration I agree with him, that it is not possible to suggest words which more clearly convey the meaning. This, as I tried to make clear, was that under special circumstances there is a particular purchaser (in the case of the infirmary I quoted) and in such a case as that the question of the value should not be considered. I think every one would agree that the case given requires to be treated, but we have not discovered words more precise, nor do I think the words are open to the charge of ambiguity. I really am anxious to relieve the apprehensions of the noble Viscount because our object is the same. I do not want to eliminate from consideration the case of an ordinary bona fide purchaser who might have an individual reason for making a bid, and if the noble Viscount would discuss the matter with the draftsman between now and the Third Reading I will try and be there and we will try to frame some form of words which will cover this case.
Amendment, by leave, withdrawn.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, after subsection (5), to insert the following new subsection—
(6) The provisions of Rule (2) shal not affect the assessment of compensation for disturbance or any other matter not directly based on the value of land.
Amendment moved—
Page 3, line 19, after subsection (5), insert the said new subsection.—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 5:
Provisions as to costs.
5—(1) Where the acquiring authority has made an unconditional offer in writing of any sum as compensation to any claimant and the sum awarded by an official arbitrator to that claimant does not exceed the sum offered, the official arbitrator shall order the claimant to bear his own costs and to pay the costs of the acquiring authority so far as such costs were incurred after the offer was made.
(2) If the official arbitrator is satisfied that a claimant has failed to deliver to the acquiring authority a notice in writing of the amount claimed by hlm giving sufficient particulars and insufficient time to enable the acquiring authority to make a proper offer, the foregoing provisions of this section shall apply as if an unconditional offer had been made by the acquiring authority at the time when in the opinion of the official arbitrator sufficient particulars should have been furnished and the claimant had been awarded a sum not exceeding the amount of such offer.
The notice of claim shall state the exact nature of the interest in respect of which compensation
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is claimed, and give details of the compensation claimed, distinguishing the amounts under separate heads and showing how the amount claimed under each head is calculated.
VISCOUNT MIDLETON VISCOUNT MIDLETON moved, in subsection (1), to leave out the word "shall" and insert "may." The noble Viscount said: This is a question which was discussed in Committee. The local authority make a bona fide offer to an individual owner for his land. He has not had an opportunity of a full hearing, but he asks for a hearing, and if he does so he does so with a rope round his neck because he may have to pay all the costs. Conceive the position of a small man who has ample reason for believing that he has been made an offer which he can show to be inadequate. If he does not accept it he is to have the chance, perhaps, of £100 of costs being put upon him by the local authority. What is snore you put the arbitrator in a most unpleasant position, because the arbitrator on proceeding to give his award knows that unless he gives the claimant a sum which exceeds that which is offered he is going to saddle the unfortunate claimant with very heavy costs. I do not think it is right that there should be a position of that kind, more especially as the offer is made by a local authority who by all the rules must wish to get the land. I hope that having regard to these considerations the noble and learned Lord will accept this Amendment, leaving it always in the power of the arbitrator to do such justice as he thinks fit.
Amendment moved—
Page 4, line 20, leave out ("shall") and insert ("may")—(Viscount Midleton.)
EARL GREY: I should like to say one word in support of what has been said by the noble Viscount. I have in my mind a particular case which I think would have some bearing upon this matter. I know the case of an estate owned by trustees in a northern town, which two years before the war was valued under the Land Values Act at£46,000. The corporation now desire to purchase that estate, and sent their official valuer to value it. He happened to be one of the three valuers who put the value two years before the war at£46,000. The official valuer put the value at£36,000, and in private conversation he has admitted that in arriving at that figure he took into consideration the rents which it was possible to charge and the cost of the

621
houses. If valuers are going to take that sort of question into consideration in arriving at their valuations, and reduce their own valuation accordingly by 25 per cent., surely it ought not to be considered unreasonable for the trustees, whose duty it is to protect the interests of the estate, to go before an arbitrator. Therefore I hope that the Government will consider favourably this Amendment.
THE LORD CHANCELLOR: I confess that I never have seen that a very strong case in equity can be made out for this Amendment. Everybody agrees that it is desirable as far as possible to avoid the multiplication of these arbitrations, and that public policy dictates that as many cases as can reasonably be settled without the expense of a hearing should be so settled. The method adopted in the Bill is simply this: The authorities come forward and say to X., "We desire to take land and are prepared to offer you so much for it." X. "No, I won't take that figure; I prefer to take my chance of litigation and see if I can get more." I conceive that he is in exactly the same position as an ordinary litigant. There are cases where great public interest, intervenes, whore one might even have expected that he would find himself in a worse position; but he is in exactly the same position as if he were in the law courts. Suppose a man makes a claim against me, and I pay £200 into Court and say that that is sufficient to meet the claim. If he goes on with his litigation, and it goes against him, he does so at his own expense and he has to pay my costs also. I cannot see any reason in equity why similar proceedings should not be adopted in this ease. I do not, however, wish to prolong the discussion, and I do not know whether the suggestion which I am going to make, subject to consideration in the House of Commons, will meet the noble Viscount's views. I would suggest that we should leave in the word "shall," and insert after it the words "unless for special reasons he thinks proper not to do so." That, would give the Arbitrator a discretion, while not making it absolutely peremptory.
VISCOUNT MIDLETON: Like the noble and learned Lord, I have no desire to prolong discussion, and I am prepared to accept the Amendment he suggests.
Amendment, by leave, withdrawn.
THE LORD CHANCELLOR: Perhaps the noble Viscount will now move the Amendment, after "shall," to insert "unless for special reasons he thinks proper not to do so."
Amendment moved—
Page 4, line 20, after ("shall") insert ("unless for special reasons he thinks proper not to do so ")—(Viscount Midleton.)
On Question, Amendment agreed to.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, at the end of subsection (2), to insert: "and when such a notice of claim has been delivered the acquiring authority may, at any time within six weeks after the delivery thereof, withdraw any notice to treat which has been served on the claimant or on any other person interested in the land authorised to be acquired, but shall be liable to pay compensation to any such claimant or other person for any loss or expenses occasioned by the notice to treat having been given to him and withdrawn, and the amount of such compensation shall, in default of agreement, be determined by an official arbitrator."
The noble and learned Lord said: This Amendment will not cause your Lordships much trouble. It is only to meet the case that after a notice of claim has been delivered the acquiring authority, on payment of all costs, may withdraw if they desire to do so. There must be such power.
Amendment moved—
Page 4, line 37, after ("calculated") insert the said words.—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 6:
Finality of award and statement of special cases
6—(1) The decision of an official arbitrator upon any question of fact, shall be final and binding on the parties, and the persons claiming under them respectively, but the official arbitrator may, and shall, if the High Court so directs, state at any stage of the proceedngs, in the form of a special case for the opinion of the High Court, any question of law arising in the course of the proceedings, and may state his award as to the whole or part thereof in the form of a special case for the opinion of the High Court
(2) The decision of the High Court upon any case so stated shall be final and conclusive, and shall not be subject to appeal to any other court.
THE EARL OF SELBORNE: I should like to ask my noble and learned friend on the Woolsack a question in regard to

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Clause 6. I notice in the report of the debate in the Committee stage that he kindly undertook to consider the argument of Lord Bledisloe on an Amendment proposing to insert at the beginning of Clause 6 words to this effect: "On the application of the claimant to any person having an interest in the land." Has the noble and learned Lord anything to communicate with regard to that?
THE LORD CHANCELLOR: The matter was considered in accordance with the pledge that I gave, but it was found that the language was modelled exactly on the language of the Arbitration Act which has worked very successfully.
Clause 8:
Saving of power to refer to arbitrator by agreement.
8.—(1) Nothing in this Act shall prevent, if the parties so agree, the reference of any question as to disputed compensation or apportionment of rent to the Commissioners of Inland Revenue or to an arbitrator agreed on between the parties.
(4) Either party to a claim for compensation may require the Commissioners for Inland Revenue to assess the value of the land in respect of which the claim arises, and a copy of any such assessment shall be sent forthwith by the Commissioners to the other party, and a certified copy of such assessment shall be admissible in evidence of that value in proceedings before the official arbitrator.
Amendment moved—
Page 7, line 22, leave out ("so") and after ("arbitrator") insert ("under subsection (1) of this section").—(Viscount Peel.)
On Question, Amendment agreed to.
VISCOUNT MIDLETON VISCOUNT MIDLETON moved, at the end of subsection (4), to insert "and the servant of the commissioners who made the valuation shall attend, if required, for cross-examination by the official valuer." The noble Viscount said: On this clause the Government intimated in Committee that they could see no objection to the official arbitrator cross-examining the gentleman who had made the valuation, but that they-saw great objection to the Inland Revenue valuers being cross-examined by outside parties. Taking that objection into account, I have another Amendment which is very nearly on the same lines as the one which I moved in Committee. The Amendment in its new form will, I understand, be acceptable to the Government.
Amendment moved—
Page 7, line 33, at end insert ("and the servant of the commissioners who made the valuation shall attend, if required, for cross-examination by the official valuer").—(Viscount Midleton.)
THE LORD CHANCELLOR: The noble Viscount is quite right. The new words are acceptable to the Government.
On Question, Amendment agreed to.
LORD FORESTER LORD FORESTER moved, after Clause 8, to insert the following new clause—
". An official arbitrator may on the application of any person certify the value of land being sold by him to a Government department or public or local authority and the sale of the land to the department or authority at the price so certified shall be deemed to be a sale at the best price that can reasonably be obtained."
The noble Lord said: I moved an Amendment for this object in a somewhat different form on the Committee stage, but the noble Viscount, Lord Peel, who then replied for the Government, although he did not regard it without sympathy, could not accept it because it was outside the scope of the Bill. Since then I have endeavoured to get expert advice to enable me to bring the Amendment within the scope of the Bill, and I hope that I have succeeded in doing so. I submit that this Amendment is really necessary. Its object is to indemnify and safeguard by every possible means those landowners who are tenants for life and their trustees. I must refer once more to the point that was made by the noble and learned Lord on the Woolsack. It is perfectly true, as everyone who knows anything about land knows, how very widely divergent are the valuations placed on pieces of land by experts—
VISCOUNT PEEL: I do not know whether the noble Lord would prefer to conclude his speech, but I was going to tell hint that the Government are prepared to accept his Amendment.
LORD FORESTER: I certainly do not wish unnecessarily to take up the time of the House.
Amendment moved—
After Clause 8, insert, the said new clause.—(Lord Forester.)
On Question, Amendment agreed to.

GOVERNMENT OF THE SOUDAN LOAN BILL.
Order of the Day for the Second Reading read.
LORD HYLTON: My Lords, this Bill, for which I ask a Second Reading this afternoon, is one authorising the Treasury to guarantee the payment of interest on the loan to be raised by the Government of the Soudan. A White Paper has been presented to Parliament, dated July 26 last, giving a full explanation of the subject, but as it is one of some interest and the sum of money involved is by no means inconsiderable, I think it only respectful to your Lordships that I should say a word or two in detail following the lines of the Paper that has been presented to Parliament.
By the Government of the Soudan Loan Acts 1913–14 it was provided that the Treasury should guarantee interest at a rate not exceeding 3½per cent. on any loan raised by the Government of the Soudan for the purposes set out in the Schedule to the 1914 Act, not exceeding in the aggregate an amount sufficient to raise £3,000,000. The Schedule of that Act set out under three heads the various works for which this money was to be applied. In the first place the most considerable item was works for the purpose of irrigating the Gezireh Plain, to which £2,000,000 was allocated. Then there was a smaller sum of £800,000 applicable to the extension of the Soudan Railway system, and a smaller sum of £200,000 was provided far other irrigation works and contingencies.
The Schedule to the Bill which is now before your Lordships is as follows:—Works for the purpose of irrigating the Gezireh Plain, including the repayment of any temporary loan raised for those works under the last Act has been raised from £2,000,000 to £4,900,000. The extension of the Soudan Railway system money is a slight reduction on the last Act; it now stands at £700,000 instead of £800,000. The money asked for in regard to the Tokar irrigation and Railway Extension now stands at £400,000 instead of £200,000 in the last Act.
Your Lordships who are acquainted with Leal conditions will know that the Gezireh plain is situated between the Blue Nile and the White Nile immediately south of Khartoum, and the works for the purpose of irrigating it comprise a masonry darn or weir near Sennar on the Blue Nile, some
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170 miles south of Khartoum, to hold up the level of the river, a main canal to carry the water by free flow from the dam to the land to be irrigated and a system of subsidiary canals to conduct the water throughout that land, the area of which, as the scheme was originally designed, was to be 100,000 feddans, a feddan being about the same area as an acre. In January, 1914, the sum of £500,000 was advanced to the Soudan Government by the National Debt Commissioners against bonds issued under the 1913 Act to enable a commencement to be made with the Gezireh irrigation works pending time amendment of the Acts and the flotation of the Loan. The works were begun, and when war broke out in 1914 arrangements were on foot for issuing an instalment of the Loan, but no issue was ever made, and the £500,000 has now been expended on the work which has been carried on slowly during the war upon the main canal and certain other portions of the scheme.
Further study of the scheme in view of the altered conditions attributable to the war showed that the area to be irrigated bad to be increased to make the scheme financially a safe enterprise for Government, while it should not be too large for the population and resources available. These considerations fixed the area to be irrigated at. 300,000 feddans instead of the 100,000 feddans originally contemplated. Apparently in the Soudan, as everywhere else, there is an immense increase in the cost of all materials and labour, and the estimates for the scheme, including interest during construction, now amount to £4,900,000. When the works were going to cost only £2,000,000 and money was a great deal cheaper, it was intended that the Soudan Government should provide out of its revenues the annual interest and sinking fund payments in respect of the Loan. This is no longer possible in view of the enormously increased annual charges in this respect and the strain thrown upon the Soudan Government's Budget by present conditions. It has therefore been necessary to include in the Loan £1,000,000 to provide for interest during construction of the works, and until the time when it is anticipated that the receipts derived by the Government from the scheme will be sufficient to support the annual charges.
Those of your Lordships who are interested in these subjects will be aware that criticisms have from time to time been

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lodged against this scheme on certain grounds. There has been a considerable correspondence, I think in The Times, and these criticisms were considered by His Majesty's Government to be of such a nature that it was only right that an investigation should take place into the accuracy of the allegations brought against this scheme. A Commission was appointed by the Foreign Office to consider them and the Commission decided that the criticisms were entirely without foundation and should never have been made. Copies of the Commission's report have been laid in the Library of the House. The burden of the criticism was that Egypt would suffer by the abstraction of water from the Nile to meet the needs of this project in the Soudan. His Majesty's Government is satisfied that as a matter of fact the Soudan can be developed to the extent contemplated by this Bill without in any way prejudicing Egypt.
The second item in the Schedule to the Act of 1914, viz., "Extension of the Soudan Railway System, £800,000," was intended to provide for the repayment to the National Bank of Egypt of the advance of £800,000 which they made to the Soudan Government for the building of the extension of the Soudan Railways from Khartoum through the Gezireh to El Obeid. Since that time the Soudan Government has been able to make provision out of revenue for the reduction of the debt to £700,000, and this constitutes the second item in the Schedule to the new Bill.
The Tokar cotton-producing area is situated about sixty miles from Suakin and is flooded annually by the flood of the River Baraka. Cotton has been grown there for many years and the average annual yield is about 4,000,000 lb. of ginned cotton, but the industry is capable of improvement and development by the construction of a modern irrigation system and the provision of railway transport from Tokar to Port Soudan, the port of export of the country, by extending the hue from Suakin to Tokar, a distance of about 60 miles. In the schedule to the Act of 1914, these items were not specifically provided for, but an item of £200,000 for "other irrigation works and contingencies" was included in it. The development and improvement of the Tokar cotton-producing industry is a work of some importance, not only to the Soudan but to British cotton interests. The present schedule provides
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for these works the sum of £400,000, which includes, in addition to the estimated cost of the works, an allowance for interest during construction for the reasons given above in the case of the Gezireh scheme.
Your Lordships will see that, although the amount of the Loan originally sanctioned is to be doubled, no new schemes are involved. The necessity of applying to Parliament for additional financial assistance is due to the conditions resulting from the war. The experimental cotton-growing areas in the Gezireh have been at work for a number of years and have produced a very valuable and satisfactory type of cotton which has sold at high prices in the Liverpool market. The Soudan Government believes that the results obtained from these experimental stations are a true index of the yield which may be expected from the whole area.
Moved, That the Bill be now read 2a—(Lord Hylton.)
LORD EMMOTE: My Lords, perhaps may be allowed to say one or two words in warm support of this Bill. I believe that this money will be well spent, and that it will prove of great advantage to the Soudan. I do not think it will be of any disadvantage to Egypt. On the contrary, I believe it will be of advantage to Egypt. It will certainly be of advantage to Great Britain if we get the produce that we hope, and therefore it will be of advantage to the British Empire as a whole. We are liable to forget in these tithes how enormously rapidly the trade of some of our Dependencies abroad was increasing before the war. In the years that I spent at the Colonial Office immediately before the war—I think in many respects they were the happiest in my life—it was a great pleasure to me to see how our tropical Dependencies were increasing in their import and export trade; it was being doubled in many of them in a few years time. I believe that a great increase of trade may be done in the Soudan if the means of communication and of irrigation are improved. The supply of cotton is likely to be a very serious factor in the future. The supply in America is decreasing; their own consumption of cotton is enormously increasing; the quantity, therefore, that is left for consumption in the other countries of the world is greatly diminishing. The quality of cotton being produced in the Soudan is, I believe, very high indeed; it has been most satisfactory in every way; and the more of this fine

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quality of cotton that we can get from Egypt and the Soudan the better it will be for Lancashire, for Great Britain, and for the British Empire as a whole. I believe, therefore, that this money will be wisely spent, and I think it will assist materially in increasing our supplies of cotton. I have great pleasure in warmly supporting this Bill.
On Question, Bill read 2a and committed to a Commitee of the Whole Ho se.

GOVERNMENT WAR OBLIGATIONS BILL.
Order of the Day for the Second Reading read.
LORD HYLTON: My Lords, this is a Bill to make provision for the special obligations incurred on behalf of His Majesty's Government for the purposes of the present war, or in connection therewith. I am informed that the Bill concludes a series of War Obligations Bills passed during the war to cover undertakings given by His Majesty's Government which involved financial obligations extending beyond the financial year. If any such obligations involve actual expenditure, Estimates, as your Lordships are aware, are presented in due course. The present Bill is merely a means of obtaining at the earliest moment Parliamentary authority for what the Government has undertaken. I am authorised to say that no more general Bills of this kind will be presented.
If your Lordships glance at the Bill you will see that Clause 1 covers obligations, of a like kind to those covered by previous Bills, entered into in the period from August 8 last—when the last War Obligation Bill was passed—to the present date. The main obligations covered by it are £6,000,000 worth of bills drawn for the purchase of sugar. This obligation is purely technical, because no actual payment is involved as the bills are met by receipts from the sales of sugar. Clause 2 applies to a new head of obligation namely, that to Messrs. Pearson & Company in order to pay them the actual expenses they have incurred in boring for oil in the Midlands, up to a sum of £1,000,000 sterling. Clause 3 is declaratory, and brings within the definition of a "war litigation" certain guarantees given by the Board of Trade in connection with the flax crop in Ireland. The maximum liability, I am told, may be about £400,000,
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but the actual payment required should be much less.
Moved, That the Bill be now read 2a.—(Lord Hylton.)
On Question, Bill read 2a, and committed to a Committee of the Whole House.

WEST INDIAN COURT OF APPEAL BILL.
Order of the Day for the Second Reading read.
THE LORD CHANCELLOR: My Lords this Bill needs but a brief word of explanation. The proposal to establish a West Indian Court of Appeal, with a wider scope than the existing Windward Islands Appeal Court, assumed definite shape as the result of an inter-Colonial Conference held in Trinidad early in 1915. The Bill for which I now ask a second Reading was submitted to and concurred in by the various Administrations concerned. It provides for the constitution of a Court of Appeal for the Colonies of Trinidad and Tobago, British Guiana, Barbados, Leeward Islands, Grenada, St. Lucia, and St. Vincent, and power is taken by Order in Council to add any other Colony. As the proposed legislation affects several Colonies simultaneously it is necessary to proceed by Imperial Statute. The new Court of Appeal will take the place of the existing Windward Islands Court of Appeal constituted under the Act of 1899. The Court will consist of the Chief Justices of the Colonies to whom the Act applies, or, in the case of the inability of a particular Chief Justice to sit, power is given to the Governor of the Colony in question to appoint some duly qualified substitute. Power is also taken to appoint an additional Judge of the Court of Appeal, who shall be a barrister of not less than eight years standing. The expenses of the Court of Appeal, in so far as they are not met by fees, will be defrayed out of Colonial revenues. The Act will not affect the right of appeal to the Judicial Committee of the Privy Council except in so far as provision may be made by local legislation for appeals to be taken in the first instance to the new Court of Appeal.
Moved, That the Bill be now read 2a—(The Lord Chancellor.)
On Question, Bill read 2a, and committed to a Committee of the Whole House.

RESTORATION OF PRE-WAR PRACTICES (No. 3) BILL.
Read 3a (according to Order), and passed.

WELLS PARTICULAR BAPTIST AND CONGREGATIONAL CHAPELS CHARITIES BILL.
NATIONAL TRUST CHARITY BILL.
BROOKE ROBINSON MUSEUM CHARITY BILL.
CONGREGATIONAL CHAPELS CHARITIES BILL.
EATINGTON WESLEYAN METHODIST CHAPEL PROPERTY BILL.
PLUMTRE HOSPITAL CHARITY BILL.

HEADCORN BAPTIST CHAPEL CHARITY BILL.
House in Committee (according to Order): Bills reported without amendment.
EDUCATION (COMPLIANCE WITH CONDITIONS OF GRANTS) BILL.
Read 3a (according to Order), and passed.

POLICE BILL.
Amendments reported (according to Order).
House adjourned at twenty-five minutes before six o'clock until three o'clock to-morrow