Geita Sebea v Territory of Papua (1941) 67 CLR 544; 15 ALJ 357 [1/1941]

• Jurisdiction: Papua New Guinea
• Court: High Court
• Judge: Rich ACJ, Starke J, Williams J
• Judgment Date: 24 November 1941
• Citation: (1941) 67 CLR 544; 15 ALJ 357 [1/1941]
• Year: 1941

High Court: Rich ACJ, Starke J, Williams J

Judgment Delivered: 24 November 1941

1 Resumption and Acquisition of Land—Compensation—Mode of assessment—Territory of Papua—Land leased by Crown from natives—Aerodrome constructed thereon—Subsequent compulsory acquisition—Prohibition of sale of land other than to Crown—Land Act 1911–1935 (No. 5 of 1912—No. 14 of 1935), s3—Lands Acquisition Act 1914 (No. 7 of 1914), s26, s28 and s29—Lands (Kila Kila Aerodrome) Acquisition Act 1939.

2

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SUMMARY: In 1937 certain natives in the Territory of Papua who possessed a communal usufructuary right to occupy certain unimproved land with perpetual right of succession in their community leased the land to the Crown for a term of ten years at a yearly rental. The Crown transformed the land into an aerodrome, levelling, draining, and making runways, and the Crown and private individuals erected buildings thereon. In December 1939 an Act was enacted providing for the compulsory acquisition of the land by the Crown upon notice by the Lieutenant–Governor in the Gazette vesting the land in the Crown. On 7th February 1940 the Lieutenant–Governor published the notice. By the Land Act 1911–1935 natives are prohibited from disposing of land except to the Crown.

Held that for the purpose of assessing the compensation payable to the natives the land should be valued as on 1st January 1939 with such improvements on it as formed part of the land and such structures upon it as were permanently attached or affixed to it, on the footing that an estate in fee simple freed and discharged from all trusts and encumbrances whatsoever was acquired by the Crown; that the prohibition from sale other than to the Crown did not affect the value of the land; that a deduction should be made in respect of the leasehold of the Crown; and that no percentage increase should be made for compulsory acquisition.

Decision of the Central Court of Papua reversed.

JUDGES:

JUDGMENT–1: Cedars Rapids Manufacturing and Power Co v Lacoste (1914) AC 569 Vyricherla Narayana Gajapatiraju v Revenue Divisional Officer, Vizagapatam (1939) AC 302 Amodu Tijani v Secretary, Southern Nigeria (1921) 2 AC 399 Bain v Brand (1876) 1 AC 762 Hobson v Gorringe (1897) 1 Ch 182 Provincial Bill Posting Co v Low Moor Iron Co (1909) 2 KB 344 Reid v Smith (1905) 3 CLR 656 Pole–Carew v Western Counties and General Manure Co (1920) 2 Ch 97 Whitehead v Bennett (1858) 27 LJ Ch 474 Edinburgh Street Tramways Co v Lord Provost, &c., of Edinburgh (1894) AC 456 London Street Tramways Co v London County Council (1894) AC 489 (1894) 2 QB 189 Melbourne Tramway and Omnibus Co v Tramway Board (1919) AC 667 In re London County Council and London Street Tramways Co (1894) 2 QB 189 Commissioner of Stamps (W.A.) v L. Whiteman Ltd. (1940) 64 CLR 407 Mears v Callender (1901) 2 Ch 388 Webb v Bevis Ltd. (1940) 1 All ER 247 North Shore Gas Co Ltd. v Commissioner of Stamp Duties (1940) 63 CLR 52 Earl of Eldon v North–Eastern Railway Co (1899) 80 LT 723 67 CLR 544 In re Athlone Rifle Range (1902) 1 Ir Ch 433

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March 13,1942. The Australian Law Journal—Vol. 15, page 357

RECENT DECISIONS.*

GEITA–SEBEA V THE TERRITORY OF PAPUA.

Melbourne Feb. 24, Oct 13. Sydney Nov. 24, 1941.

High Court of Australia.

Before Rich ACJ., Starke J and Williams J

Resumption and acquisition of land—Compensation—Valuation of land—Title of claimants—Usufructuary occupation with a perpetual right of succession in community—Equivalent to fee simple—Whether value of improvement and fixtures erected by respondent should be added to value of land—Whether ten per centum of value should be added for compulsory acquisition.

Reported by J Bales, LL.B., B.J. Jeffriess, C.C. Brebner, LL.B., and OJ Gillard, B.A., LL.B., reporters for CLR

By a lease of land from natives to the Crown dated 23rd March, 1937, Geita–Sebea and a number of other natives of Papua leased to the Crown approximately 50 acres for the term of ten years from 19th March, 1937, at the yearly rental of £15. After the lease was entered into, the government of the Territory of Papua constructed certain works on the land and after draining and levelling the ground an aerodrome, known as the Kila Kila Aerodrome, was constructed thereon. Customs and quarantine buildings were constructed and the Commonwealth government erected thereon a building for a meteorological office and for [Top of Page 358]

358 The Australian Law Journal—Vol. 15. March 13. 1942.

wireless signalling, together with a house for the necessary machinery therefor. With the consent of the Government of the Territory, certain private firms erected business premises on the land. All the buildings with the exception of the machinery house were erected on concrete pillars but there was no evidence of how they were affixed to the pillars. All the buildings were erected for using the land as an aerodrome and for no other purpose. The value of the work done in making the aerodrome was approximately £2,740 and the buildings thereon were valued at approximately £3,400.

After all the abovementioned works and buildings were completed, the legislature of the territory on 6th December, 1939, passed the Lands (Kila Kila) Aerodrome Acquisition Act, 1939, whereby the Lieutenant Governor of the Territory was empowered by notice to declare the abovementioned land together with some 38 acres of other land vested in the Crown and upon such notice the lands would become vested in the Crown "for an estate in fee simple freed and discharged from all trusts and encumbrances whatever."

By the same ordinance it was provided that the Government should pay compensation for the land and the amount thereof and the persons entitled thereto were to be determined as nearly as possible in the manner prescribed in respect of land compulsorily acquired under the Lands Acquisition Act, 1914.

On 7 February 1940, the Lieutenant Governor published a notice in the Government gazette vesting the land in the Crown. Geita–Sebea and the other natives claimed £4,478 12s. 6d, for compensation and £1,000 damages for severance; the government offered £269 58. 9d, in full settlement. The latter offer was refused by the natives, and on 13th June, 1940, they commenced an action in the Central Court of the Territory.

Gore J., who heard the action, gave judgment for the natives for £464. He held that the acquired land had no potentiality, except for use as agricultural lands, and assessed the compensation on that basic, totally disregarding the work that had been dons on the land or the buildings erected thereon. The natives appealed to the High Court by way of case stated. The questions asked for the opinion of the High Court were as follows.

1. Whether the judgment of Gore J, was correct in law?

2. Whether the natives had a common law title, equivalent to a freehold or fee simple in the land?

3. Whether the provisions of the Lands Act restricting the right of the natives to sell or otherwise deal with the land affected the value of the land?

4. Whether the potentiality of the land as an aerodrome should be taken into account in valuing the land?

5. Whether the natives were entitled to claim compensation for their interest in reversion in (a) the works on the aerodrome such as levelling draining and constructing runways and (b) the buildings on the land?

6. Whether the natives were entitled to ten per centum or any other amount for compulsory acquisition of the land?

7. Whether the value of the land should be assessed according to the value on 1st January, 1939, and if not, on what date?

8. Whether the decision of Gore J, was against the evidence and the weight of evidence?

S29 of the Lands Acquisition Act 1914 provides that the value of any land acquired should be assessed in the case of land acquired for a public purpose authorised by a special ordinance according to the value of the land on 1st January, preceding the first day of the meeting of the Legislative Council in which the special ordinance was passed.

There was no appearance on the appeal for the appellants who submitted an argument in writing.

T.W. Smith for the respondent.

THE HIGH COURT (RICH, ACJ, and STARKE and WILLIAMS, JJ.) unanimously allowed the appeal with costs and remitted the matter to award compensation in accordance with the judgment of the Court.

RICH, ACJ., concurred in the judgment of WILLIAMS J.

STARKE J., said that the principle upon which compensation was to be assessed was the same as in English law, namely, the value that a willing vendor might reasonably expect to obtain from a willing purchaser for the land with all potentialities, but any enhanced value attaching to the land by reason of the fact that it was being compulsorily acquired for the purpose of the acquiring authority must be disregarded. The natives had a communal or usufructuary occupation with a perpetual...