The Secretary to the Prime Minister's Department has submitted to me the following memorandum for advice:

I shall be glad to be favoured with your advice as to the procedure to be followed in fixing the amount of compensation payable in respect of the liquidation of properties of German nationals in the Territory of New Guinea under Article 297 of the Treaty of Peace.

Paragraph (c) of this Article provides that compensation shall be fixed 'in accordance with the methods of sale or valuation adopted by the laws of the country in which the property has been retained or liquidated'.

I shall be obliged if you will advise whether there is any law in force in New Guinea respecting this matter; if there is not, would you advise that an Ordinance be passed providing the method of valuation?

Provisional instructions were given to the Administrator some time since to arrive at a valuation by way of a voluntary agreement between the owner of the property and the Administrator. I shall be obliged if you will advise me whether such a method of valuation is admissible.

Will you please also advise as to the date at which the valuation is to be made-that is, whether at the date of the ratification of the Treaty of Peace, at the date of the expropriation of the property, or as at actual date of valuation.

Paragraph (c) of Article 297 is as follows:

The price or the amount of compensation in respect of the exercise of the right referred to in the preceding paragraph (b) will be fixed in accordance with the methods of sale or valuation adopted by the laws of the country in which the property has been retained or liquidated.

I do not think that, so far as expropriated property in New Guinea is concerned, the laws referred to in the above paragraph are necessarily those of New Guinea. I incline to the opinion that the fixation of values and compensation is to be carried out in accordance with the laws of the Commonwealth, which is the country exercising the right referred to in paragraph (b) of Article 297.

The method of valuation should, therefore, be based upon the general practice existing in the Commonwealth. No Ordinance appears to be necessary.

As regards the date in respect of which the valuation is to be made, I am of opinion that, for the purposes of Article 297, the valuation should be made as at the date at which the property is liquidated, that is, the date of the expropriation.⁽¹⁾

[Vol. 18, p.34]

(1)But see Opinion No. 1172.