Assessor for Lanarkshire v David Colville & Sons
| Jurisdiction | Scotland |
| Judgment Date | 22 February 1923 |
| Docket Number | No. 72. |
| Date | 22 February 1923 |
| Court | Court of Session |
Lord Hunter, Lord Sands, Ld. Ashmore.
ValuationSubjectsRailways in ironworksRailways property of railway companySolum property of owners of ironworksWorks valued on contractor's principleWhether railways to be included.
Under an agreement between a railway company and the owners of ironworks, the owners of the works sold to the railway company the railways within the works, with an option to repurchase them at the expiry of 25 years, it being expressly provided that the railway company should acquire no right in the solum on which the railways were laid. The railways were indispensable to the successful working of the ironworks, and they were used practically exclusively for the traffic of the ironworks.
Held that, in valuing the ironworks upon the contractor's principle, the Assessor had rightly included in his valuation the value of the railways.
Opinion per Lord Hunter that the railways could not have been entered in the Roll as a separate subject belonging to the railway company; opinion reserved per Lord Sands.
At a meeting of the Valuation Committee for the Middle Ward of the county of Lanark David Colville & Sons, Limited, appealed against the yearly rent or value at which the Assessor had entered the Dalzell Steel and Iron Works, of which the appellants were proprietors and occupiers, in the Roll for the year ending Whitsunday 1923.
In making his valuation of the works, which was carried out on the contractor's principle, the Assessor had included approximately 19 miles of railways situated within the works. With regard to 2 miles of these railways the action of the Assessor was not challenged; with regard to the remaining 17 miles the contention of the appellants was that the railways should not have been included, and the appellants craved the Committee to reduce the valuation by a sum corresponding to the value which the Assessor had put upon them. The valuation of the Assessor was also challenged upon other grounds with which this report is not concerned.
The Committee having sustained the appeal, the Assessor craved and obtained a stated case on appeal to the Lands Valuation Appeal Court. [Case 386]
The case stated:
9. The railways within the works are laid upon ground belonging to the appellants. For the purpose of railway communication and transport these railways are indispensable for the successful working of the appellants' undertaking. The value of the ground upon which the railways are laid is included in the value of the site of the works as appearing in the Assessor's valuation. In the year 1900 David Colville, Archibald Colville, and John Colville, then directors of the appellants' Company, were the principal promoters of a Bill, which subsequently became an Act, under the title of The Motherwell and Bellshill Railway Act, 1900. The object of this Act was to authorise the construction by the Motherwell and Bellshill Company, in which the said David Colville, Archibald Colville, and John Colville held the predominant interest, of a railway from Motherwell to Bellshill, to be operated in connexion with the North British Railway Company's system. The town of Motherwell was at the time served solely by the Caledonian Railway Company. The new railway, if constructed, would have competed with the railways of the Caledonian Railway Company for the appellants' traffic and for the traffic of other traders. For that and other reasons the Caledonian Railway Company entered into an agreement with the appellants, dated 26th June 1903, under which, on the narrative that it had been agreed that the new Motherwell and Bellshill Railway should be abandoned, and that the Caledonian Railway Company should relieve the Motherwell and Bellshill Company of the whole expenses incurred in connexion with the promotion and abandonment of the Motherwell and Bellshill Railway and of all payments that might become exigible or require to be made in consequence of or as a condition of such abandonment, it was, inter alia, provided that the appellants should thirl their traffic to the Caledonian Railway Company; that the Railway Company should acquire and purchase all the railways within the works which were used and required for the reception and despatch or loading or unloading of railway traffic into and from the works; that the said railways should thereafter be maintained by and at the sole expense of the Caledonian Railway Company, and should belong to and be the property of the Railway Company; and that on the expiration of the agreement, which was to endure for twenty-five years, the appellants should be entitled to repurchase the railways; and in the event of their not doing so, the Railway Company should be entitled to lift and remove the same, all as more particularly set out in the said agreement, a copy of which is printed as Appendix II. and is held to form part of this case.*
In accordance with the said agreement the railways within the appellants' works, which were put down by them at their own expense, were sold by the appellants to the Caledonian Railway Company, and are used by them for the purposes of the appellants' traffic.
It appears that some use is also made by the railway company of the railways within the works for the purpose of marshalling other traffic, but this use is slight, and as it does not interfere with the conduct of the appellants' traffic it is not objected to by the appellants, and for the purpose of the present appeal may be ignored.
The said railways are not included as part of the Caledonian Railway Company's undertaking in the valuation prepared by the Assessor of Railways and Canals. It has been the consistent practice of the Assessor of Railways and Canals and of his predecessors in office to confine the valuations of railways to subjects within the railway company's boundaries.
The case further stated;10. The appellants maintained that they were entitled to have these railways deleted from the valuation on the following grounds:(1) As regards the railways, they maintained that the materials of these, in so far as embraced in the agreement before referred to, were the sole property and in the beneficial occupation of the Caledonian Railway Company, and formed no part of the premises belonging to the appellants; and (2) As regards the solum upon which the railways of the Caledonian Railway Company are laid, and which admittedly belongs to the appellants, they submitted that the only interest they had in it was already included in the valuation of the appellants' works.
11. The Assessor, on the other hand, maintained that the value of the railways ought to be included in the valuation of the appellants' works for the reasons that the railways could not exist apart from the solum upon which the materials were laid, and which was admittedly the property of the appellants; that they were situated within the works ground, and were essential to the efficient carrying on of operations, and that they were maintained and used solely for the traffic of the appellants.
The Committee, having considered the evidence led and the arguments adduced for the parties, were of opinion:(1) In respect that the materials or the railways belonged to the Caledonian Railway Company, who, for the purpose of operating and maintaining the railways, had acquired, under the agreement before referred to, a legal licence or right to use the solum of the ground on which the materials of the railways were laid, the railways were not land and heritages owned or occupied by the appellants in the sense of the Valuation of Lands (Scotland) Acts, and so could not be included in the valuation of the appellants' works.
The case was heard on 6th February 1923.
Argued for the Assessor (appellant);It was not open to dispute that, were it not for the agreement between the owners of the ironworks and the railway company, the railways would fall to be entered and valued in the Roll as part of the heritages belonging to the ironworks. They were heritable, as opposed to moveable, according to the tests which had been adopted alike in cases dealing with the general law as to heritable and moveable,1 and in cases dealing with that subject in its special relation to valuation.2 The question accordingly was as to the effect of the agreement. Clearly equity was on the side of the Assessor. For all practical purposes the railways might be said to belong to the respondents; they were situated in their works, were indispensable to...
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