Scottish Court of Session Decisions

The North British Railway Company obtained in the year 1873 an Act of Parliament (36 and 37 Vict. cap. 209) authorising them to construct certain railways and other works, and, inter alia, to enlarge their College Street Station in Glasgow.

In the year 1877 the company obtained another Act of Parliament (40 Vict. cap. 21) for the enlargement and improvement of their Queen Street Station. Under the powers conferred upon them by these Acts the company became possessed of tenements of houses and others lying within the City Parish of Glasgow, which at the date they were so acquired were liable to assessment for the relief of the poor in the said City Parish. A number of these houses were then taken down.

This was an action at the instance of the Collector of Poor-rates for the City Parish for deficiency of poor-rates in respect of the subjects so lying vacant for the year 1880–81 and 1881–82, amounting in cumulo to £336, 1s. 9d. The claim of the pursuer was founded on the Lands Clauses Consolidation (Scotland) Act 1845, sec. 127, which clause was incorporated with and to be read as a part of the Acts of 1873 and 1877 before referred to, and enacts—“That if the promoters of the undertaking became possessed by virtue of this or the Special Act, or any Act incorporated therewith, of any lands charged with the land tax, or liable to be assessed with the poor-rates or prison assessment, they shall from time to time, until the works shall be completed and assessed to such land tax and poor-rate and prison assessment, be liable to make good the deficiency in the several assessments for land tax and poor-rate and prison assessment, by reason of such lands having been taken or used for the purposes of the work, and such deficiency shall be computed according to the rental at which such lands, with any building thereon, were valued or rated at the time of the passing of the Special Act; and on demand of such deficiency the promoters of the undertaking or their treasurer shall pay all such deficiencies to the collector of the said assessments respectively; nevertheless, if at any time the promoters of the undertaking think fit to redeem such land tax, they may do so in accordance with the powers in that behalf given by the Acts for the redemption of the land tax.”

The pursuer averred that the ground had become vacant and yielded no assessable rental.

The defenders averred that the greater part of the ground once occupied by the houses now formed part of the station, and was as such liable to assessment, and that the rental at which the undertaking in the parish was valued or rated during the period in question was greater than the rental at which the undertaking together with the lands and houses acquired by the defenders under the Special Act were valued and rated at the time of the passing of the Act.

After a proof the Lord Ordinary ( M'Laren) decerned in terms of the conclusions of the summons.

“ Opinion.—In this case the Collector of Poor-Rates for the City Parish of Glasgow sues the North British Railway Company for a sum in lieu of assessments chargeable on buildings taken by the company for the purposes of their undertaking, and since demolished. Credit is given in the statement of claim for the value of certain sidings which were formed on a part of the lands in question, and which are included in the valuation of the assessor of railways and canals. Subject to this deduction, the whole unoccupied lands—the site of the demolished houses—are treated as the subject of a claim under section 127 of the Lands Clauses Consolidation Act, which provides—‘That if the promoters of the undertaking become possessed by virtue of this or the Special Act, or any Act incorporated therewith, of any lands charged with the land tax, or liable to be assessed with the poor-rate or prison assessment, they shall from time to time, until the works shall be completed and assessed to such land tax and poor-rate and prison assessment, be liable to make good the deficiency in the several assessments for land tax and poor-rate and prison assessment by reason of such lands having been taken or used for the purposes of the work; and such deficiency shall be computed according to the rental at which such lands, with any building thereon, were valued or rated at the time of the passing of the Special Act.’

The chief interest of the case centres on the interpretation of the words of the statute defining the deficiency which the company is bound to make good, but the defenders also disputed the fact that there was unoccupied land, and contended that the whole or part of the subjects in question were part of or pertinent of the company's railway stations. On this subject I will only say that the evidence of Mr Thomas Smellie, confirming that of the pursuer, proves to my satisfaction that the lands in question are unoccupied ground—taken no doubt for the purposes of the company's undertaking, but not forming part of a completed work, and consequently not liable to assessment as part of the company's undertaking. The evidence of the assessor of railways and canals, Mr Munro, is to the effect that the lands in question (other than the sidings) have not in fact been valued as part of the company's undertaking, and while that circumstance is not conclusive, it is proof that Mr Munro's opinion, formed without reference to the present action, coincides with the opinion of Mr Smellie as to the character of the subjects. There is a question whether the sum allowed under the first head of deduction, £212, 10s., is

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a sufficient allowance; but as the defenders adduced no evidence in favour of a higher figure, I am prepared to accept this entry, as well as the figures in the pursuer's statement, as correct.

Both parties referred to a decision of the Court— Hall v. The Glasgow Union Railway Company, 8 R. 688—which, for a reason to be explained, I have difficulty in applying to this case; and the different views prescribed in arguments involve the consideration how far, in estimating the ‘deficiency,’ which is the measure of the claim under section 127, it is competent to take an account of the increase in the assessable value of other parts of the company's undertaking within the parish. I shall first state my own opinion, irrespective of authority, as to the true meaning of the section when applied to the present case. The hypothesis of the section is that ‘lands’ are to be acquired. It is clear that the lands here referred to are not the undertaking as a whole, but the proceeds of land which may be acquired under the authority of the Special Act, and which are separately charged with land tax, or liable to assessment for the relief of the poor. It is, I say, the hypothesis of the section that lands are to be acquired from time to time, to be used for the purposes of the undertaking, and that in the progress of the work such lands are neither assessable in the ordinary way nor under the special mode of assessment applicable to the completed undertaking of a railway or canal company. There is, then, prima facie, a deficiency in the assessment by reason of these lands being temporarily withdrawn from the category of assessable subjects, and the question is, whether this is not the deficiency which the enacting part of the section professes to supply? I think the lands referred to in the enacting words of the section—the lands upon which the deficiency of assessment is said to arise—are the same lands which are characterised in the introductory or hypothetical part of the section. Lands are to be acquired from time to time, and upon these lands, respectively and successively, a deficiency may arise by reason of their being in use for the purposes of an uncompleted undertaking, and being withdrawn from liability to assessment. I should therefore be disposed to answer this question in the affirmative.

1. I think the statute supposes a necessary deficiency, and not merely a possible deficiency, depending on an examination of the assessable value of the aggregate of the undertaking within the parish. 2. I think the cause of the deficiency is indicated in these words,’ by reason of such lands having been taken or used for the purposes of the work,’ not, as contended for by the company, by reason of the whole undertaking within the parish being of less assessable value than it formerly was. 3. I think the measure of the deficiency which the undertakers are to make good is distinctly specified in the statute—‘such deficiency shall be computed according to the rental at which such lands, with any building thereon, were valued or rated.’ That is, the rental which was the measure of the assessment before the lands were taken is to be the measure of the deficit caused by the withdrawal of the lands from assessment. If it was intended that the deficiency should be otherwise ascertained, and that the rental should be used only as a limit of the possible liability of the undertakers, I think some indication of such a principle might be found in the language of the enacting clause. Looking to the words of the enactment alone, I should say that the company—the undertakers—are taken bound to continue to pay on each separate subject in course of conversion to their uses and purposes the same assessment as would have been payable at the time of the passing of the Special Act. That the parish may be benefited by an increase in the assessable value of the completed portions of that undertaking is immaterial in my view of the meaning of the clause. Whether such increase is a real gain to the parish depends on the further inquiry, whether the increment or ratio of increase in the value of the company's property is greater than the increment of the value of other heritable property in the parish. This, in the case of the City Parish of Glasgow, would obviously open a very extended field of inquiry.

It is contended by the company that the Legislature must have contemplated a general deficiency upon the whole account of the year between the company and the parochial board, otherwise the enactment would be a violation of the principle of equality of assessment. I have already suggested a reason for doubting whether the principle of equality is really infringed, but I would further observe that assessing statutes only aim at approximate equality, and that it has not been the practice of the Court to allow much weight to equitable considerations where the meaning of the enactment is otherwise ascertainable. I see no hardship to the company in requiring them to pay the amount of the old assessment on each separate subject until such subject becomes liable to assessment as part of the railway undertaking.

But it was further contended by the railway company that the case of The Union Railway Company had decided that some effect must be given by way of set-off to the increment of assessment upon the company's other lands, and that the only question is, whether two accounts are to be struck—one for the College Station, and one for the Queen Street Station—or whether there is to be one account for the whole lands of the company within the parish, including the two stations and a part of the line. If it had appeared that this question was settled by the case of The Union Railway Company, I should have followed that decision, and applied it to the facts of the case. But I am asked to determine whether the deficiency contemplated by the statute is a deficiency arising on each station or on the whole lands of the company within the parish; and I have no materials to guide me in determining between two constructions which appear to me to be equally at variance with the statute. I must therefore, with the greatest respect for the opinions of the Judges who decided the case of The Union Railway, give judgment in conformity with my own opinion of the meaning of the statute, which I give with the reserve due to the high authority which is opposed to my construction.

I therefore decern in favour of the pursuer for the sum brought out in the amended statement of claim.”

The defenders reclaimed.

It was admitted that there was a deficiency in regard to the land taken for the purposes of the

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Queen Street Station. With regard to College Street Station they argued—(1) That there was no deficiency in the poor-rate, because the works were in point of fact completed, and therefore the ground taken was liable to assessment. (2) That supposing the work was to be held as not completed, the principle upon which the deficiency was to be computed was to take the value of the whole undertaking of the company in the City Parish at the date of the Special Act plus the value of the land and houses taken under the Act, and contrast this with the value of the whole undertaking in the parish in the year in which the deficiency arises. On this construction of section 127 there would be no deficiency, as the value of the lands and houses taken under the Act of 1873 was only £1667, 11s., while since this date there had been an increase in the value of the whole undertaking of the company within the parish of about £14,000— Hall v. The Glasgow Union Railway Company, March 18, 1881, 8 R. 687; Stratton v. Metropolitan Board of Works, November 25, 1874, L.R., 10 C.P. 76; Wheeler v. Metropolitan Board of Works, June 22, 1869, L.R., 4 Ex. 303; Reg. v. Metropolitan District Railway Company, February 1, 1871, L.R., 6 Q.B. 698; East London Railway Company v. Whitechurch, May 19, 1874, L.R. 7 Eng. & Ir. App. 81.

The pursuer replied—The railway company was not entitled to impute the increment on the whole undertaking in the City Parish under whatever statutes, but in computing the deficiency to be replaced regard must be had to the undertaking as under the Act of 1873, and to the land taken under that Act. The principle of the cases of The Union Railway Company and Stratton had been given effect to here by deducting from the value, as at the date of the Act, of the lands and houses taken, the valuation, as appearing in the railway assessor's roll, of that portion on which the station had been constructed, and also by deducting the rateable value of that portion on which houses were still standing.

At advising—