H.—loa.

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Dear Sir, — Auckland, 3rd October, 1888. Colonel Boberts and myself, being engaged upon a Commission of inquiry into the Point Eesolution purchase, have had under our notice a valuation made by you showing the sum of £632 to be the right amount payable to the Church Trust Board for their reversionary interest in the land in question, the lease having then forty-eight years to run, and the value of the property at the end of the term being estimated at £6,000. For convenience, I send you a copy of your memorandum. Upon reference to the land-purchase tables of the Eailway Department, I find, by taking Table No. 2, for calculation of lessee's interest, and multiplying by seventeen —representing £17 rent—the numbers given in the line for forty-eight years at 6, 7, and 8 per cent., I get the same results as you give for the present value to the owner of the rental for that period (item b). So farjhe matter is intelligible. But we find no attempt to determine accurately the lessee's interest at that time' —a ■question not submitted to you. Ido not understand the directions given under this head in the notes to the table referred to, but I gather from them that the data must be very conjectural. But t^he data supplied to you must also be to some extent conjectural—viz., the sum of £6,000 as the value of the property at the end of the term ; and, in fact, in dealing with the lessee the same sum— £6,000 —was assumed as the then present value. We should be glad to know whether, upon the data supplied to you—viz., £6,000 at the end of forty-eight years, and rent £17 —you are able to arrive at any approximate estimate of the lessee's interest as compared with the owner's. I hope I have made my meaning clear, and that you will kindly reply without loss of time, as any information on this subject will be of much assistance to us. If you can say anything in the compass of a moderate telegram, we shall be glad to get it in anticipation of your letter. I remain, &c, F. W. Frankland, Esq., Principal Actuary, Wellington. ...^ -- J. Giles.

(Telegram.) Auckland, 4th October, 1888. Youb memorandum to Minister dated 16th December, 1885, states your computation from tables makes interest of Church Trustees £3,040, whereas Mr. Erankland gives £632. Of course, the data must have been different. Could you send us by first mail your computation showing data, method, and result? J. Giles, B.M. C. Y. O'Connor, Esq., Public Works Office, Wellington.

Memobandum for Dr. Giles re Point Resolution Batteky. Ix reply to your telegram of this date, it is difficult for me to answer your question in the absence of the records and calculations, all of which are with you. From what I remember of the case, however, I believe Mr. Frankland's result of £632 was based on an estimated valup for property of £6,000 at end of term of lease, while my calculation— accepting £6,000 as the present value—was based on the assumption that the property would have increased very much by the end of the term (which is, I believe, close upon fifty years); and I think that I assumed, on the basis of the increase in value of land in the past, and in other colonies at present, that the value of these four acres of land fifty years hence would be £20,000. Assuming this to be so, the calculation required is merely the very simple one of ascertaining the value at the present time of £20,000 payable fifty years hence: but in making this calculation I did not adopt 6 per cent., as Mr. Frankland did, as the tendency is, apparently, for interest on money to decrease; and, looking to the length of the period, I assumed, I believe, that 4 per cent, would be a fair average to take for the probable market-rate of interest on freehold security. The calculation was made by means of the printed tables accompanying my report to the Minister for Public Works, attached to the Defence Department file of papers, which you have got. The present value of a pound sterling payable, say, fifty years hence will be the difference between the value of a pound per annum for fifty years-and a pound per annum for forty-nine years, as shown on those tables. Thus, for instance, the value of a pound payable fifty years hence, if market-rate of interest be 4 per cent., paid annually, would be £0-1406, and if the value of the property at the end of fifty years be assumed at £20,000, the present value of a reversionary interest, to accrue fifty years hence, would be £0-1406 x £20,000 = £2,812. The actual figures by which I arrived at the amount you mention (£3,040) are, however, I think, contained in one of the Public Works files of papers which you have got—the one which contains Mr. Mackay's valuation of the property, near the bottom of the file. If Mr. Mackay is still in Auckland he may be able to assist you in finding it. C. Y. O'Connoe, Under-Secretary for Public Works. Public Works Department, Wellington, sth October, 1888.

(Telegram.) Wellington, 6th October, 1888. My calculation was made on assumption that property would be worth £6,000 at end of term. If you think value will bo more, and will give me new estimate of final value, I will make a fresh calculation. Meanwhile I take it lessee's interest is £6,000, minus owner's interest. Dr. J. Giles, Eesident Magistrate's Court, Auckland. E. W. Ekankland.

ExTBACT FBO'M DEED OP GbANT OF TI'.UST PeOPEETY. Whbbeas a school hath been established by the Government at Taurarua, in the suburbs of Auckland, under the superintendence of the Bishop of New Zealand, for the education of children of our subjects of both races, and of children of other poor and destitute persons, being inhabitants of the islands in the Pacific Ocean. ... In trust, nevertheless, and for the use or towards the support and maintenance of the said school so long as religious education, industrial training, and instruction in the English language shall be given to youths educated therein or maintained thereat.