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New South Wales Water SupplyRateability-Colonial Statute XXVII. of 1892-By-law--Construction.

An Act of Parliament of New South Wales empowered the appellants to make by-laws in regard to water supply "for determining, making, and levying the rate to be paid in respect of lands and tenements distant not more than sixty yards from any main, . . . although such lands or premises are not actually connected with any main."

The respondents were owners and occupiers of land with a colliery in operation and a private railway, and a water main belonging to the appellants crossed this railway and ran through one corner of the land. The respondents used no water supplied by the board. The appellants contended that lands outside the prescribed limit were rateable when they formed one holding with lands within that limit:

VOL. 65.-P.C.

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Held, that no lands outside the limit of sixty yards were rateable, as there was nothing to shew that the Act intended lands in one occupation to be regarded as one indivisible unit for rating purposes.

Appeal from the Supreme Court of New South Wales The facts sufficiently appear in the judgment.

H. H. Cozens-Hardy, Q.C., F. Vaughan Hawkins, and W. H. Cozens-Hardy, for the appellants.

Joseph Walton, Q.C., G. Wood Hill and H. G. Davies, for the respondents.

LORD MACNAGHTEN delivered the judgment of their Lordships (1):

The appellants are a "board of water supply and sewerage" for the district of the Lower Hunter. They were incorporated by Act XXVII. of 1892 as the "Hunter District Water Supply and Sewerage Board."

The respondents are owners and occu

(1) Lord Hobhouse, Lord Macnaghten, Lord Morris, and Sir Richard Couch. B


piers of a mining property within the district of the Lower Hunter comprising 8,772 acres of land with a colliery in operation and a private railway connecting their works with the Great Northern Railway.

A water main belonging to the board crosses the line of the respondents' railway and runs through one corner of their land.

It is contended by the board that, according to the true construction of the Act of 1892, the whole of the respondents' property, including their private railway, is rateable for water supply.

This contention is disputed by the respondents, who use no water supplied by the board, whose land in some parts is above the level of the board's reservoir, and who, if the contention of the board is well founded, would apparently be liable, in addition to the rate, to a charge of two shillings and sixpence for every horse and every head of cattle kept on their property, and double that charge if they were to use any water supplied by the board.

This action was brought by the board to enforce their claim. There were no facts in dispute, nor was there any question as to the amount of the rate, assuming the view of the board to be correct. A verdict was therefore taken by consent for the sum of 7961. 98. 9d., which was the full amount of the rate claimed for the year, with leave for the respondents to move the Court to enter the verdict for them.

On appeal to the Supreme Court the verdict was entered for the respondents. Sir Frederick Darley, C.J., with whom Mr. Justice Innes concurred, was of opinion that the language of the Act was not so clear as to compel the Court to decide against the respondents, "considering the extraordinary result of upholding the contention" of the board. Mr. Justice Foster, who dissented, thought that the verdict was a gross hardship on the respondents, but, after full consideration, he could not say that he had any such doubt as to the meaning of the words used by the Legislature as to enable him to agree with the rest of the Court.

The board is composed of seven members. Three, who are styled "official members," are appointed by the Govern


ment. Four, styled "municipal members,"
are elected-two by certain specified muni-
cipalities, and two by smaller municipali-
ties within the district of the Lower
Hunter, grouped together for the purpose
of the election. The board, as was pointed
out by the learned counsel for the appel-
lants, is not a trading corporation. It
earns no profits for itself or for any of the
boroughs or municipal districts within the
area under its charge or for the Govern-
ment. The scheme of the Act is shortly
this: The water supply for a water dis-
trict "an expression defined by the Act
as meaning "The area within which water
is or may be from time to time supplied
by the board" (sections 2 and 40)—
is in the first instance provided by the
Government. The main works are con-
structed by the Government and at their
expense. When the works are passed
and approved by the Government officer,
they are by a notification in the Gazette
transferred to and vested in the board
'on behalf of her Majesty." An account
is made up, and the whole cost becomes
repayable by the board by means of
periodical payments. A similar account
is made up every successive year for the
whole amount expended on the works
during the year. The repayments are
divided into two classes under the heads
of "Permanent works" and "Renewable
works"; with different periods of repay-
ment. When the works are vested in the
board it becomes their duty to administer
all matters relating to the water supply
"in correspondence
with the


Minister" (that is, the Secretary for Public Works or other responsible Minister of the Crown) "charged with the administration" of the Act and under the control of the Governor and Executive Council (sections 31,32, and 2). It is also their duty, subject to the limitations in the Act, to levy by rates and charges a sum sufficient for the service of the year (section 129), but no money passes through the hands of the board except for the purpose of collection and payment into the Treasury (sections 28, 29, and 30). The board therefore in substance is a Government department acting under a sort of mixed commission.

For the purpose of carrying the Act into execution the board is empowered to

HUNTER DISTRICT WATER SUPPLY &C. make by-laws (section 35). In regard to water supply by-laws may be made for various purposes, including the following:

"(V.) For the appointment of a scale of charges for water supplied by measure and the minimum quantity of water to be charged for where water is so supplied.

"(VI.) For determining, making, and levying the rate to be paid in respect of lands and tenements to be supplied with water for domestic purposes otherwise than by measure or in respect of lands and tenements distant not more than sixty yards from any main constructed by or vested in the board, although the lands or premises by or in respect of which the water is used may be more than one hundred and fifty feet from any water reticulation pipe, or although such lands or premises are not actually connected with any main. . . ."

Omitting words which are immaterial or inapplicable to the case under consideration, the Act declares that by-laws may be made "for determining, making, and levying the rate to be paid. in respect of lands and tenements distant not more than sixty yards from any main, although such lands or premises are not actually connected with any main." Those are the words which seem to have given rise to so much difficulty in the Court below. The enactment says that the board may rate lands within a certain distance from their main. How can that make lands outside the limit rateable? The appellants contend that lands outside the prescribed limit are rateable when they form one holding with lands within the prescribed limit. Where is that to be found in the Act? There is nothing in the Act about lands forming one holding or being held together with other lands. There is nothing to shew that the Act intended lands in one occupation or "held as under one ownership," to use Mr. Justice Foster's language, to be regarded as one indivisible unit for rating purposes.

Mr. Justice Foster indeed seems to think that the contention of the appellants is in accordance with the natural and ordinary meaning of the language used. After commenting on the expression "lands and tenements," "it would be sufficient," he says, "for the purposes

BOARD v. NEWCASTLE &C. COAL CO. of this case to treat the place rated as a tenement." "Two houses," he observes, "or two tenements, are clearly not more distant than sixty yards from one another if the nearest parts of each are within that distance." That may be so. The leading idea in the case put by his Honour is the distance between two places. But here it is not the purpose of the enactment to define or specify the distance between two objects. The purpose is to taxation, which is a very different thing. For the sake of illustration, suppose there were an Act declaring that for the purpose of maintaining a sea wall lands within the distance of one mile from high-water mark should be taxed, would anybody seriously contend that the whole of a man's park or demesne, containing perhaps a thousand acres or more, was taxable because an acre or two of it happened to lie within the area of taxation?

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It may, perhaps, be objected that in the case supposed the tax or cess would be at so much per acre, and that consequently there would be no difficulty in arriving at the amount of the tax for any given quantity of land. Here, as it was pointed out, the tax imposed is according to the municipal valuation when the subject of taxation is within a municipality and included in the municipal valuation. That provision, it was argued, must create serious difficulty if the view of the respondents be adopted. Now the first observation that occurs to one on that line of argument is this: If the respondents are right-if there is nothing in the section by or under which the tax is imposed authorising a charge on lands outside the prescribed limit-why should any such lands be taxed merely because otherwise there may be a difficulty in assessing some lands which are liable to taxation? Even if the difficulty was insuperable, it would be more reasonable that lands declared to be liable to taxation should go scot free than that lands outside the taxable area should be swept within the net. But the truth is that when the Act is fairly construed the difficulties presented to their Lordships in the course of the argument, such as they were, vanish altogether.

It is to be observed that the board is

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