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C.-3

tourists and holiday-makers—for the purpose principally of enjoying the hot baths situate within the township—-and the agriculturists settled in the surrounding district. To summarize, the township has not for over a quarter of a century been required for the purposes of mining, consequently the residents and business people are not in the remotest degree connected with mining ; yet they are bound by restrictions under which they hold their tenures that are inapplicable, and in consequence the law has to be strained to such an extent to protect those in occupation that it has practically to be set aside by the Warden, and his own common-sense of justice applied in lieu thereof. Under the Mining Act personal residence is compulsory on residence-sites, and the holders of business licenses are the only persons who may exercise same on the particular sites licensed to them. Also, it is only allowable to hold two sections when they adjoin each other ; whereas to meet the requirements of the tourist traffic, and bring the hotels up to the standard illustrated by the development of the hot springs and domain, by the Government, it has been found necessary to erect buildings, &c, covering up to three sections ; therefore, as the law is at present, the overplus is illegally held. In legislating to remove the township from the Mining Act provision will have to be made securing to the present holders of licenses and leases all their rights and privileges, and extended so far as to dispense with compulsory residence by holders of residence-sites and personal occupation by holders of business licenses. It is held by some that the Warden has power to have the township removed from the provisions of the Mining Act by declaring it as being no longer required for mining purposes. In my opinion this view is not tenable in cases similar to that under review, and is only meant to apply to alluvial-mining districts which have become exhausted. If it were applied to Te Aroha every license and lease would cease from the date of the Warden's declaration. In respect to the basis on which the calculation should be made for acquiring the freehold by license and lease holders, I submit that as it is impossible to ascertain the unimproved value of each section at the time the licenses or leases were granted, and as there is evidence that in acquiring the fee-simple the Crown paid on a basis of £20 in the case of each residence-site and £60 for each business-site, that these amounts should be taken as the unimproved value, and that as the tenures are varied a uniform period of the unexpired term of each license or lease is highly advisable ; and I recommend that this period be fixed at forty-two years from the date of an application for the freehold, and the method provided in the Land Act for ascertaining what would require to be paid by applicants for the freehold applied. In advising the arbitrary term of forty-two years I am guided thereto by the following reasons : — (a) That the holders of business- and residence-site licenses have a perpetual right of renewal for that period : (6.) That in ascertaining what would be the Crown's interest and what would be the tenant's interest under this computation it works out equitably, and is just to both parties : (c.) That under such a computation I feel sure the people of Te Aroha will acquire the freehold of their holdings, and that the town will extend, better buildings will be erected, and a general improvement all round will follow, as is usual when security of tenure is assured by the right of acquiring the freehold. I have, &c, Wellington, 31st August, 1914. Albert Bruce.

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