The Secretary, Department of Home Affairs, has forwarded the following memorandum asking for advice:

Referred for favour of advice as to the advisability of the Commonwealth acquiring the rights of Mr A. under an inferior lands lease from the State of New South Wales, and whether the Commonwealth can legally hold an inferior lands lease.

It is understood that the Bill granting Sovereign rights over certain land at Jervis Bay, of which A.'s lease forms part, has been passed, and the Royal Assent given, but the Proclamation has not been issued. Section 5 of the Lands Acquisition Act 1906 defines land as follows:

'Land' includes any estate or interest in land (legal or equitable), and any easement, right, power, or privilege over, in, or in connexion with land, and also includes Crown land, but does not include public parks vested in or under the control of municipal or local authorities and dedicated to or reserved for the recreation of the people, or such other lands dedicated to or reserved for the use and enjoyment of the people as have been specified by Proclamation.

Section 15 and subsequent sections make provision for the acquisition of land by compulsory process, and sections 16 and 17 set forth the effect of the publication in Gazette of the notification of acquisition.

I am of opinion that the Commonwealth may, if it thinks fit, acquire by compulsory process the interest of any lessee in any Crown land, and that provided the notification of acquisition is so worded as to relate only to that interest, the title of the Crown to the land will not pass.

If the Commonwealth acquires the interest of the lessee in this way, it will acquire it subject to the obligations attaching to it.

I understand however that the subject land forms portion of an area sovereign rights over which the State proposes to transfer to the Commonwealth without compensation for the Crown's interests, and that a State Act has been passed (though not yet proclaimed) to ratify the surrender of the area to the Commonwealth.⁽¹⁾ In order to complete the surrender of the area, it will be necessary for the Commonwealth to pass a Bill accepting the surrender, and a Bill for this purpose is now being prepared.⁽²⁾

Under these circumstances I am of opinion that unless the matter of the acquisition of the lessee's interest is one of very great urgency, the more desirable course would be to await the passage of the Bill through the Commonwealth Parliament, and the surrender to and acceptance by the Commonwealth of the area. Upon such surrender and acceptance the Commonwealth will be able to acquire the lessee's interest in the land, and will not be in the position of the holder of an inferior lands lease.

A third alternative which exists is for the Commonwealth at once to acquire the fee simple of the land, and not merely the interest of the lessee. In this case however, the Commonwealth would in the first place be liable to compensate the State for the value of the Crown's interest in the land, and such liability might possibly not be extinguished in the event of sovereign rights in the land being subsequently transferred to the Commonwealth.

On the whole, therefore, unless it is desirable for administrative reasons that the interest of the lessee should be acquired forthwith-I am of opinion that the second alternative outlined above is the most desirable of the three.

[Vol. 13, p. 410]

(1)The seat of Government Surrender Act 1915 (N.S.W.).

(2)Enacted as the Jevis Bay Territory Acceptence Act 1915.