Spencer v. Commonwealth

5 CLR 418

(Judgment by: Barton J)

v. Commonwealth

High Court of Australia

Judges: Griffith CJ

Barton J
Isaacs J

Subject References:
Resumption of land

Legislative References:
Property for Public Purposes Acquisition Act 1901 (Cth) No 13 - the Act

Hearing date: PERTH 13 November 1906; 14 November 1906; 15 November 1906; 16 November 1906; 22 November 1906; 23 October 1907; 24 October 1907; 25 October 1907; 29 October 1907;
Judgment date: 29 October 1907


Judgment by:
Barton J

The amount of the valuation being PD2,640 19s. 10d., and the defendant having paid PD3,000 into Court without any denial of liability, the first question is whether the plaintiff is not entitled to have at least the whole PD3,000, and I think he is. Section 17 of the Property for Public Purposes Acquisition Act 1901 provides that in determining the amount of compensation the Justice who tries the case shall not be bound by the amount of the valuation notified to the claimant. But I do not see how the defendant can have the benefit of that section after paying into Court, irrespectively of the valuation, a sum exceeding it in amount and tendering issue on the bare averment that the sum so paid in was enough. The plaintiff was entitled to join issue on the plea as filed, and to prove, if he could, that PD3,000 was not enough, and thus the contest invoked by the defendant was solely on the sufficiency of that sum. The plea deliberately abandoned the valuation as the subject of contest, and by offering PD3,000 without denying liability, disabled the defendant, in my opinion, from contending that a less sum should be assessed as compensation. Any contention that a less sum was enough became irrelevant to the issue raised by the defendant, by whose own pleading the sole question was, PD3,000, or how much more? It is true that the Statute does not expressly authorize the plea of payment into Court, but it does not exclude it even by implication (although in some circumstances it may be rather an imprudent plea to an action under the Statute). The authority given to the claimant by s 15 to proceed for compensation refers only to an action, and if an action is brought, it is reasonable to conclude that the practice and procedure in ordinary actions are to be applied as far as may be. Now as to their application.

In the first place, keeping in mind that the payment into Court was unaccompanied with any denial of liability, it must be taken to admit the plantiff's cause of action to the extent of PD3,000, and the interest, PD86 1s. 2d., follows as of course under s 20 of the Act: Hennell v Davies [F1] . The Chief Justice has made a close analysis of the Rules under Order XVIII. which are relevant to this case, and I cannot add to that; further, I think it impossible to resist the construction of Order XXVII., Rule 3, which lays it open to a plaintiff to treat such an admission of fact as this plea as the foundation for an application, at any stage of the cause, to the Court or a Justice, for the payment out to him of the amends tendered with the plea. From that construction it follows, not only that the refusal of such an order is scarcely to be thought of, but also that the right to it is not dependent on the result of the action. The comprehensive Rule in question, so construed by its framers, is probably the reason why it has not been thought necessary to provide specially for payment out of Court, as in England is done by Order XXII., r. 5. I am, therefore, of opinion that the plaintiff was and is entitled to the whole of the money paid into Court.

The remaining question is whether the plaintiff has shown a right to compensation exceeding the sum paid in. For it is on him to show it, and he undertook to do so. As in most cases of the kind, the witnesses, called as experts in land values, presented a view for each side difficult to reconcile with that for the other. The differences were upon a matter in which the worth of opinion, and not the degree of truthfulness, was in question. Still, the matter was one of credibility in that sense, and the conflict was strong. In such a case a Judge who sees and hears the witnesses has a distinct advantage over others who are asked to review his decision. Therefore I am very loath to attempt such a process in this case, and can only do so on the ground of necessity. But, after giving my best attention to the judgment of Higgins J., I am unable to find that he has applied certain principles which, as it appears to me, should be applied to a question of this kind. I am unable to say that the bare market value of the land for workingmen's residences on a particular day would be a value constituting a real compensation for this taking. The Court must take into consideration all the circumstances, and, to quote the admirable judgment of the Supreme Court of New Zealand in Russell v The Minister of Lands [F2] , at p. 253, must "see what sum of money will place the dispossessed man in a position as nearly similar as possible to that he was in before." His loss is to be tested by the value of the thing to him: Stebbing v Metropolitan Board of Works [F3] , at p. 5, per Cockburn C.J., and the loss he has sustained is not necessarily to be gauged by what the land would realize if peremptorily brought into the market on a day named.

True, it is "value" which is to be assessed, but the value to the loser of land compulsorily taken is not necessarily the mere saleable value. See Russell v The Minister of Lands (No. 2) [F4] . I make these observations without losing sight of the fact that, in arriving at the market or saleable value of PD2,250 for workingmen's cottage sites, which is the only value that I think he found, Higgins J. was perfectly entitled to follow, as he did, that one of the defendants' witnesses who gave the lowest estimate of market value, and I should not be at all disposed to disturb his conclusion on that element of the case, as an element.

The plaintiff's witnesses attributed considerable value to this land, or a great part of it, as a site for a factory-one of them said a freezing-house. One cannot shut one's eyes to the fact of the importance of Fremantle as a port, or refuse to see that Australian ports generally are growing in trade and consequence. It may be that commerce and manufactures will for years be concentrated on the part of the port south of the river, but probably that will in a reasonable time cease to be the case with this the chief port of this State. A man is perfectly entitled, so long as he escapes government resumptions, to hold his land, in view of such progress as he sees going on, in the hope and belief that it will realize its best return to him before many years as a site for some manufacture or the like. And its value to him in that regard, though often called prospective, may even be a very present one if he exercises due care and does not exhibit too great anxiety to sell. The plaintiff's witnesses have attributed such a value to the land, and though I do not doubt that they have been sanguine as to amounts, I still think that something should have been allowed the plaintiff in this regard, that is, that it was a factor of the value which Higgins J. left out of consideration, but which the plaintiff was entitled to have estimated: See In re Gough and Aspatria, Silloth and District Joint Water Board [F5] , and In re Ossalinsky (Countess) and Mayor etc of Manchester [F6] , at p. 661. All "reasonably fair contingencies," as Grove J. put it in that case, are to be considered; and then he uses these words:"What it would sell to a willing purchaser for in consequence of its having these additional advantages."

Of course, the price for which land would sell to a willing purchaser is there intended by Grove J. to be the test, whether there are special advantages or contingencies to be valued or not. And I should say, in view of the many authorities cited and upon the sense of the matter, that a claimant is entitled to have for his land what it is worth to a man of ordinary prudence and foresight, not holding his land for merely speculative purposes, nor, on the other hand, anxious to sell for any compelling or private reason, but willing to sell as a business man would be to another such person, both of them alike uninfluenced by any consideration of sentiment or need.

But while I think with great respect that His Honour did not take into consideration all the factors that he might have done, or apply principles as broad as such a case required, I am still not satisfied that the plaintiff has proved himself entitled to more than the PD3,000 paid into Court. As it is now for this Court to name the sum which will really compensate the plaintiff, I am bound to say that, taking all things into consideration, I think the fair value of this land to such a vendor as I have described exceeded on 1st January 1905 (s 19), the sum found by the learned Justice, but that it did not exceed the sum of PD3,000 paid into Court. Ordinarily that conclusion would mean a verdict for the defendant, but in view of ss. 17 to 20 of the Act I agree with the Chief Justice that the proper form of judgment is for the plaintiff for PD3,086 1s. 2d., being the whole amount, including interest, paid into Court.

As this is a finding that the sum paid in was enough, it is a result which on an ordinary trial by jury would involve the payment of the costs by the plaintiff from the time of payment in. Though Higgins J. ordered the sum of only PD2,250 to be paid out to the plaintiff, he did not order him to pay costs. But, as we have been unable to agree with his judgment, we cannot say how he would have treated the costs after deciding the compensation on the principles now applied, and as we cannot possibly say how he would then have exercised his discretion, we must use our own. For my part I cannot see any reason why, awarding the plaintiff the PD3,086 in Court, we should exempt him from the normal consequence of such a result in costs; while the costs up to payment into Court should be paid by the defendant. I think the respondent should pay the costs of the appeal, as the appellant has succeeded in having the amount awarded to him increased by PD750.

As to the question of amendment, I do not see how we could possibly allow so radical an alternation in these pleadings at such a stage.