King-Harman v Cayley

• Jurisdiction: Ireland
• Judge: Ross, J.,M.R.
• Judgment Date: 01 March 1900
• Court: Court of Appeal (Ireland)
• Docket Number: (1893. No. 476.)
• Date: 01 March 1900

KING-HARMAN

and

CAYLEY.

Chancery Division

Appeal.

Landlord and tenant — Rent —— Buildings declared by Land Commission to be tenant's improvements — Poor-rate.

Duggan's EstateIR [1900] 1 I. R. 68.

Guardians of New Ross Union v. ByrneUNK 30 L. R. Ir. 160.

VOL. I.] CHANCERY DIVISION. 255, I accordingly hold that Mr. Connor must be retained on the V.-C. list of contributories, and I affirm the ruling of the Chief Clerk. 1900. In re LIGONIEL SPINNING CO. Ex parte CONNOR. J. MAC M. KING-HARMAN v. CAYLEY. .R088, J. 1900. Landlord and tenant—Rent—Adjustment under Local Government Act, 1898 Jan. 20, 22. —Buildings declared by Land Commission to be tenant's improvements 24. Poor-rate. Appeal. Feb. 26, 27. The fact that the buildings on a holding have been declared by the Land March 1. Commission to be the tenant's improvements, does not prevent the tenant of an " existing tenancy" from making the deductions from his rent, in respect of such buildings, authorised by sect. 54, sub-sect. 1, of the Local Government Act, 1898. Tills case came before Mr. Justice Ross, as Receiver Judge, on an application by the Receiver for direction as to allowances of rates under the Local Government Act to tenants in respect of buildings, if same have been claimed by the tenants as their imÂprovements, and so awarded in the Pink Schedules to the orders of the Land Commission. The facts appear fully from the judgment of Mr. Justice Ross. Campbell, Q. C., and James Little, for the Receiver : Under 1 & 2 Vict. c. 56, lands and buildings are rateable hereditaments. The principle of assessment in the case of land is altered by 15 & 16 Vict. e. 63 ; therefore, buildings are a herediÂtament distinct from land, having a different basis of valuation : Guardians of New Ross Union v. Byrne (1). By sect. 74 of 1 & 2 Viet. e. 56, it is evident that the privilege of deduction is coÂextensive with the liability to pay ; and there is no right of (1) 30 L. R. Ir. 160. 256 THE IRISH REPORTS. [1900. Ross, J. deduction where the hereditament yields no rent. Until 1896 1900. there was no machinery for finding out if the rent paid by a KING- tenant issued out of the land. or buildings. The agricultural HARMAN v. grant only affects agricultural lands ; and the landlord's liability CAYIEY. to allow a deduction remains in so far as the rent is payable on the buildings. As to the argument that the rent issues out of the entire holding, this is not the case in the legal sense since the Act of 1881, as the rent does not issue out of the buildings, but out of the site ; and the buildings are the rateable hereditament, not the site. The present question does not arise in the consideration of the law of ejectment. Chaytor, for the trustees of the estate. Matheson, Q.C., and Powell, for the tenant : "Liable" in sect. 74 of the 1 & 2 Vict. c. 56, means legally liable, in the sense that the liability can be enforced in a Court by action for rent or of ejectment. The Land Commission fix the rent upon the holding as a whole, and in ejectment the entire of the holding is recovered. Notwithstanding sect. 8 (9) of the Act of 1881, rent issues out of the buildings, as otherwise they could not be recovered in ejectment. Jan. 24. Ross, J. :— In this case, in my capacity as Receiver Judge, I am asked to determine a question affecting a large number of landlords and tenants in Ireland. The question arises under the Local GovernÂment Act of 1898. The case is intended to be a test case : all parties submit to the jurisdiction of the Court. The tenant, Patrick Golden, had a fair rent fixed on the 15th February, 1899; the old rent was £29 ls. 6d., and it has been reduced to £27 15s. The valuation of the holding is £29, of which £26 10s. is on the lands, and £2 10s. on the buildings. In the Pink Schedule attached to the order, it appears that the buildings were erected by the tenant, and no rent has been put thereon by the Land Commission. In this state of circumstances it is contended, on behalf of the landlord, that the tenant is entitled to no deduction for the poor-rate on the buildings. The usual practice in such cases would be to direct the receiver to VOL. I.] CHANCERY DIVISION. 257 proceed to have the matter decided by the ordinary Courts. If, Ross, J. however, the determination of this question be delayed, the 1900. ING- administration of the Receiver side of this Court will be seriously ARMAN interfered with. In a similar case (Duggan's Estate (1) ) involving v. a question arising under the Local Government Act, I decided CAYLEY. the question on argument here ; and, on appeal from that decision, the opinion of the Court of Appeal was promptly and cheaply obtained, to the great advantage of the estates in this Court, and to the great advantage of the public. As their Lordships, so far as I know, did not disapprove of the course taken, I believe that I am justified in dealing with this case in the same way. It is necessary to ascertain what was the legal position of the landlord and tenant respectively at the time the Local GovernÂment Act was passed : and next, to determine what change is effected by the new legislation. In this view we turn to the Irish Poor Relief Act of 1838. Section 61 directs rates to be levied on every occupier of rateable hereditaments ; section 63 declares what hereditaments are rateable, and among them it mentions lands and also buildings. Section 64 enacts that the rate is to be a poundage rate, and that it is to be made on an estimate of the net annual value of the hereditament, on the supposition that it is in the hands of a tenant. By section 11 of the Valuation Act, 1852, the method of ascertaining the value of the buildings is the same ; but the method of ascertaining the value of the land is altered, and directed to be made upon an estimate of the net annual value with reference to the price of several articles of agricultural proÂduce specified. Returning to the Act of 1838, section 71 directs the rate to be paid by the actual occupier at the time the rate is made. Section 74 enacts that where the occupier shall be liable to pay a rent in respect of the property he occupies he may deduct from such rent, for each pound of the rent, one-half of the sum which he shall have paid as rate in respect of each pound of the net annual value. To this right of deduction by the tenant a limitation was subsequently imposed, providing that in no case shall the occupier's deduction be more than half the actual amount of rate paid (12 & 13 Vict. c. 104, sect. 11). (1) [1900] 1 I. R. 68. 258 THE IRISH REPORTS. [1900. Ross, J. These are the sections in the earlier rating statutes that bear 1900. on the question, and from these we arrive at the conclusion that a KING- building is a hereditament by itself—that it must be valued HARMAN V. separately from the land, that the method of ascertaining the CAYLEY. value of the land is different from the method of ascertaining the value of the buildings. We now turn to the Land Acts. In the Act of 1881, sect. 8, sub-sect. 1, empowers the Land Commission Court to fix the fair rent on a holding. Sub-sect. 9 enacts that no rent shall be allowed or made payable in any proceedings under this Act in respect of improveÂments made by the tenant. I now turn to section 1 of the Land Law (Ireland) Act of 1896. Sub-sect. 1 directs the Court to add a schedule to their order showing the gross rent, on the assumption that all the imÂprovements were made by the landlord. It must also show the improvements made by the tenant, and the deduction made from the rent on account of them. This record is directed to be adÂmissible in evidence, and is intended to show the way in which the fair rent was arrived at. We are now in a position to ascertain the respective rights of landlord and tenant in the matter of deÂduction of poor rates at the time of the passing of the Local Government Act of 1898. I pointed out to Mr. Campbell, if his contention as to the effect of sect. 8, sub-sect. 9, were well founded, that from the time a fair rent order under the Act of 1881 was made, the tenant had no right of deduction in respect of improveÂments. He assented to this, and explained that until the Act of 1896 was passed, making the Pink Schedule evidence, it was imÂpossible to show what improvements were exempted from rent. Mr. Campbell's contention is that in a composite holding, the tenant's building is a separate rateable hereditament—that as no rent is allowed in respect of it, no deduction from the poor-rate can be made in respect of it—that the privilege of deduction is co-extensive with the liability to pay rent, and that when the liability to pay rent ceases, the right of deduction goes with it. He has further satisfied me that if the tenant's contention is right, having regard to sect. 1, sub-sect. 3 of the Act of 1896, it was possible for a tenant, between the years 1896 and 1898, by building houses unsuitable to the holding, to add to the landlord's liability Vor.. I.] CHANCERY DIVISION. 259 for rates in respect of such buildings, though the landlord can Ross, 1. get no additional rent. I do not think such a ease has often 1900. occurred. BINE- HARMAN The Rating Act of 1838 contemplates a tenant in possession of V. CA . property, composed of one kind of rateable hereditament, such as YLEY land, or of two kinds, such as land and buildings. It contemplates the payment of a single rent for such holding, and it enacts that for each pound of the rent which the tenant is liable to pay, he may deduct half the sum which he shall have paid as rate in respect of each pound of the valuation. Whether the buildings are made by the landlord or the tenant is, in my opinion, wholly immaterial, the proportionate reduction must be allowed on every pound of rent. Does the Land Act of 1881 make any change ? I think not. In section 8, sub-sect. 9 is to be read with sub-sect. 1. The Court is required to fix a fair rent upon a...