123 and to apply it only in cases where the Colonial Goverment is precluded from selling a piece of building land for which it could probably obtain a purchaser, by the existence of the restrictions imposed by "clearance or reserve rights*. In the case now under consideration, where the Military Authorities desire to acquire a large area of Reserve Land (including several building sites) on a nominal rental in the vicinity of Hount Davis, I submit to you that the Colonial Government is within its rights in granting the land only on such terms as it considers equitable.
8.
The view expressed by the late Mr. V. D. Barnes on this question was "that the leases of reserved areas on *nominal rentals should not be perpetual, and that if the whole "or any material portion of a reserved area became of material "value as building land, the Colonial Government should be at "liberty to call upon the Military Authorities to pay an in- *-creased rental for it". This view is practically identical with that I have myself put forward. The view of the Land Officer is contained in the attached letter of the 6th. November, 1911, in which the Director of Public Works concurs, but he points out that lands required by the Military Authorities are never (and should not be) put up to auction.
9.
The nominal rental paid by the Military Authorities for a Reserve is imposed as a recognition of the dormant rights of the Colonial Government over derelict and waste land. The building value remains the property of the Colonial Government and I submit that whenever it may arise, the Colonial Government has an inherent right to claim it.
10.
As the Military Authorities are pressing for
a decision in regard to the clearance area around Hount Davis I
shall
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