RECOVERY OF RATES

Sun (Auckland), Volume IV, Issue 1067, 3 September 1930, Page 10

RECOVERY OF RATES

LOCAL BODIES’ RIGHT TO SELL LAND EFFECT OF NEW OWNERSHIP A previously unlitigated point under the Rating Act, involving the rights of local authorities to recover rates, was heard by Mr. Justice Herdman in the Supreme Court yesterday. The Devonport Borough Council proceeded under an originating summons against A. G. Quartley for the recovery of £l3 12s 3d in rates for which it obtained judgment against the previous owner of the land. Mr. Prendergast represented the council, and Mr. Quartley appeared in person. The demands for the 1926-27 rates on the property were made on the then registered owner, Roy Bateup. Quartley, who was mortgagee, exercised his power of sale, and the property was transferred to him on October 21, 1927. On June 11 last year the council obtained judgment against Bateup for the 1926-27 rates, and six months later the council lodged a certificate of the judgment with the registrar of the Supreme Court, who, however, declined to sell the property, in pursuance of the provisions of the Rating Act. On behalf of the council, Mr. Prendergast said that the effect of the defendant’s contention, that the judgment was against Bateup personally, and therefore could not be satisfied against the land, meant that a local body would be liable to lose the rates unpaid on any land which was disposed of after the issue of rate demands, and before the council could take effective proceedings for recovery of the rates. He contended that unpaid rates remained a charge on the property no matter what changes in ownership occurred. NOT THE OCCUPIER In the present case the council could sue only Bateup, on whom the demand for rates had been served. The council could not proceed against Quartley for recovery of the rates because he was not the occupier or owner of the land when the rates were struck, and the judgment against Bateup could not be registered against the land because by that time the title had passed from him. The position would be that, unless a charge had been registered against the title, any mortgagee buying in, or any purchaser of land, would not be liable for rates then outstanding. Mr. Quartley said that the attitude of the registrar of the Supreme Court in refusing to sell the property was in conformity with departmental practice for 40 years. He claimed that a local body could not exercise its right of sale unless it obtained judgment against the person who was the owner when the registrar was called upon to sell. He contended that local bodies were protected by being able to obtain charging orders on the land to cover unpaid rates, and these orders would prevent the sale of the property. Mr. Quartley pointed out that not every judgment for rates against an owner of land entitled the registrar to sell. He submitted that an owner, according to the Rating Act. was the person actually holding the title when the local body took proceedings for the recovery of the rates. He also contended that the occupier was primarily responsible for the rates.