Scottish Court of Session Decisions

The Assessor for Railways and Canals in Scotland assessed the Caledonian Canal and the Crinan Canal, which are administered by the same commissioners as one undertaking, and valued the combined canals for the year to Whitsunday 1894 at nil, the loss on the Caledonian Canal more than extinguishing the profit on the Crinan Canal. Against this valuation the County Council of Argyll appealed to the Sheriff of Argyll, who sustained the appeal, fixing the valuation of the Crinan Canal at £290, 19s. 6d. The Caledonian Canal Commissioners, who had objected to the jurisdiction of the Sheriff on the ground that the canals being one undertaking situated in different counties—Argyll and Inverness—the appeal should have been to the Lord Ordinary on the Bills, brought an action of declarator and reduction against the County Councils of Argyllshire and Inverness-shire to have it found and declared that the two canals formed one undertaking, and to have the deliverance of the Sheriff reduced,

The defenders pleaded, inter alia—“(3) The pursuers being neither a canal nor a railway company within the meaning of the 21st section of the Valuation Act 1854, the declaratory conclusions fall to be dismissed.”

The Valuation of Lands (Scotland) Act 1854 (17 and 18 Vict. c. 54), by sec. 20, provides that “In order to the making-up of valuations and valuation rolls of lands and heritages in Scotland belonging to or leased by railway or canal companies, and forming part of the undertakings of such companies, it shall be lawful for Her Majesty to appoint, as occasion requires, a fit and proper person to be assessor of railways

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and canals for the purposes of this Act.” Sec. 21 enacts that “the Assessor of Railways and Canals under this Act shall, on or before the 15th day of August … enquire into and fix in cumulo the yearly rent and value in terms of this Act of all lands and heritages in Scotland belonging to or leased by each railway and canal company, and forming part of its undertaking…

The Commissioners of the Caledonian Canal were incorporated in 1848 by the Act 11 and 12 Vict. c. 54, which also vested the Crinan Canal in the said Commissioners. The canals belong to Government, and the powers of the Commissioners are merely administrative, being regulated by various Acts of Parliament.

Upon 23rd June 1894 the Lord Ordinary ( Stormonth Darling) assoilzied the defenders.

“ Opinion.—The Commissioners of the Caledonian Canal desire by this action to establish that the Caledonian Canal and the Crinan Canal, which are vested in them for public purposes, both form part of their undertaking within the sense and meaning of section 21 of the Valuation Act of 1854, and ought to be valued and assessed as one subject, with the result that the valuation would be nil, the loss on the Caledonian Canal more than extinguishing the profit on the Crinan Canal.

The defenders dispute the proposition that the two canals form one undertaking, but they state another plea which requires to be considered ante omnia because it strikes at the root of the declaratory conclusions of the summons. It is to the effect that the 21st section of the Valuation Act applies only to lands and heritages belonging to or leased by railway and canal companies, and that the pursuers are neither the one nor the other.

I have given anxious consideration to this plea, because, if well founded, it unsettles the practice which has long prevailed of having these two canals valued by the Assessor of Railways and Canals, and also because one cannot help seeing that it must lead to highly inconvenient consequences. If a subject like a canal, running through a succession of assessment areas, is to be valued by the ordinary assessor of the county instead of by the Assessor of Railways and Canals, the valuation must be made without the aid of all those elaborate provisions of the Act of 1854 and amending statutes which have been enacted for the guidance of the special officer. The inconvenience in this particular case is somewhat diminished by the fact that the Caledonian Canal is situated wholly in the county of Inverness, and the Crinan Canal wholly in the county of Argyll. But there are other cases where the inconvenience would be very great. By section 23 of the statute, water companies and gas companies and any other companies having continuous lands and heritages liable to be assessed in more than one parish, county, or burgh, may elect to have their assessment made by the Assessor of Railways and Canals, and I was informed at the debate that this privilege had been largely taken advantage of. Now, if waterworks, like the Glasgow waterworks which run through several counties, cannot be assessed in this way because they happen to be vested in commissioners and not in a company, it is obvious that they cannot get the benefit of the uniform mode of valuation provided for other undertakings of a similar description, and that the assessors of each of the counties through which they pass may all differ as to the proper mode of valuation. Moreover, it is plain that the reason for having a special officer and a special mode of valuation for all such undertakings had nothing to do with the kind of body in which they happened to be vested, but arose entirely from their having a continuous line of property running through a succession of assessment areas. I have therefore had every disposition to come to the conclusion that Canal Commissioners might be held to be included under the phrase ‘canal companies.’

I have, however, found myself unable to come to that conclusion consistently with what I believe to be the true principles applicable to the construction of statutes. The pursuers are not a company in any legal sense. They were in existence as a body of statutory commissioners when the Act of 1854 was passed. The Act omitted to notice them, and I must conclude either that the omission was intentional or that it was accidental. I believe that it must have been accidental; but even in that case it is, I think, beyond the function of a court of law to supply the omission. That must be done by the Legislature itself.

A question not unlike the present arose in England in 1870 on a construction of section 55 of the Local Government Act of 1858, which enacts that the occupier of any land used only as a railway constructed under the powers of any Act of Parliament for public conveyance shall be assessed in the proportion of one-fourth part only of its net annual value. The question was whether this provision could be construed so as to cover the case of a railway originally constructed without any Parliamentary powers and afterwards sold to a railway company under an Act of Parliament and used for public traffic under the general Railway Statutes. The Court of Queen's Bench decided that it could not, and Lord Chief-Justice Cockburn in giving judgment said—‘I cannot see my way to putting such a construction upon section 55 as would meet the equity of the case and include a railway like the present, though I have no doubt the Legislature would have drawn the clause so as to embrace the present case had such a case been present to their minds.’ The reference is— North-Eastern Railway Company v. Leadgate Local Board, L.R., 5 Q.B. 157.

It follows that the Crinan Canal must, in my opinion, be valued by the ordinary Assessor of Argyllshire, and that the defenders are entitled to absolvitor.”

The pursuers reclaimed, and argued—They were liable to assessment (March 19,

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1872, 10 Macph. 639), and therefore under the Valuation Act provisions which enacted that railways and canal companies should be valued by a special assessor appointed for the purpose. It was the nature of the undertaking—its being a railway or a canal—that led to this provision; whether its administrators were a company or commissioners was quite immaterial. It would be strange if the two most important canals out of five then in existence were excluded from the benefits of the Act. The Lord Ordinary had needlessly narrowed the meaning of the word “company.” There was no reason, especially in an Act passed in 1854, to confine its meaning to that of a joint-stock company engaged in trade. Its evident ordinary meaning contained in any first-class English dictionary was to be taken. That would include a body of commissioners. “The largest ordinary sense is that in which words ought to be construed where there is nothing in the occasion on which they are used or in the context to restrict them”—Tindal, C.J., in Hughes v. Overseers of Chatham, 1822, 5 Manning & Granger, 80.

Argued for respondents—Admittedly the interlocutor reclaimed against was wrong if a wide and popular sense were to be given to the word “company,” but the Lord Ordinary was right in giving it its technical legal sense of an association engaged in trade. The Commissioners were merely administrators; they could not make gain, or sell the undertaking, or introduce new partners. It may have been that the Act of 1854 intended to give the benefit of a special assessor to canal companies engaged in trade. It could easily have expressly included the canals now in question but had not done so, and it lay with the Legislature and not with the Court to bring them under the Act.

At advising—