Landholding in England/Chapter 22

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CHAPTER XXII.—LEASEHOLD VERSUS FREEHOLD


IT is two hundred years since King William's Assessment, and one hundred years since Pitt's Act. During these two hundred years the value of land in England has increased nearly five -hundred fold. For as the Land Tax was to be, at its highest, 4s. in the £, and realised at this highest £2,037,627, the whole value of the whole land of England in 1792 must have been £10,188,135 (4 being the fifth of 20). Mr Fawcett estimated the capitalised value, in the last third of the nineteenth century, at £4,500,000,000. The freeholder receives and the leaseholder pays enormously more than in 1792, but the ground landlord is still supposed (if he has not redeemed his tax) to possess property no more valuable than in the days of William III. And even so, the rate is very unequal. As the proportions fixed by Pitt's Commissioners were made invariable, no parish pays the full original rate, and many pay only id. in the £, and even the fraction of a penny.[1]

The law regarding leasehold property is conceived almost entirely in the interests of the "ground" landlord, although he has spent less upon the "ground" than anyone else connected with it. Most of the occupied land of England is leasehold; that is, it is not the permanent property of those who build houses, streets, make roads, drains, wharves upon it, or who have cultivated the soil in order to produce the fruits of the earth, or who have sunk mines below the earth, in order to extract the mineral wealth of the earth. Whether land is the site of a town, or of a farm, or of a mine, whether corn and grass grow upon it, or the traffic of a city passes over its streets, or coal and iron mines burrow beneath it, it belongs but as a temporary possession to those who are using it. They are said to have "bought" the property, but this only means that they have bought the right to use it for a certain time. When that time expires they must "buy" it again in the same way. And if, as almost always happens, they have made it more valuable by their exertions, and by the money they have spent on improving it, they will have to pay more for the right to go on using what they have made more valuable. They will have to pay more, not as a contribution to the general purposes of the community (as they do when they pay taxes), but to enrich the individual who owns the ground. This ground landlord receives an increment earned by other men. Each time that the ground returns to the ground landlord it may return more or less enriched, and if so the enhanced value is carefully described in the bills which notify that the lease is once more for "sale," that is, for hire. And the landlord in many cases benefits twice over by these improvements which he has not made; for in a very great many instances he has made the tenant pay for permission to make them, though they were eventually to become his own! He is paid for allowing them to be made, and when the lease is transferred to another leaseholder he makes the new leaseholder pay a "premium" (the modern word for "fine") over and above the price of the lease, for permission to buy the lease, and this "premium" is high in proportion to the value of the labours of the outgoing leaseholder. And if the lease is renewed, it is the same. The leaseholder has to pay a higher "premium," as well as a higher price. The leaseholder "improves the property," and the ground landlord makes him pay a heavy fine, not to the community, but to himself.

A recent instance of a "fine" happened in connection with a drapery establishment in Buckingham Palace Road. The tenant entered on a new lease, "which cost £4000 a year ground rent. It was very good of the landlord to have granted a lease at all, for he could have seized the whole business, goodwill, and everything. The landlord was not satisfied with this increased annual rent, but wanted something in advance, a 'sub,' but which he called a fine, amounting to £50,000." That is, as a man "may do what he will with his own," this landlord could, if it had suited him, have refused to renew the lease, and could have granted another lease to another man, who would have come into all the advantages gained by the draper who founded the business.[2] Here the tenant had made the land valuable, and the landlord demanded to benefit by his labour.

The process is usually this. A ground landlord grants a lease for ninety-nine years to a tenant who undertakes to build a house, or houses, on the land. As the houses will become the property of the ground landlord at the end of the lease, a clause is always inserted binding the lessee to build them in a suitable manner, and to hand them over at the end of the term in good repair. It very seldom happens that the original lessee and his representatives hold the lease for the whole ninety-nine years. Far more often, he or his heirs sell the remainder, of course with the landlord's consent, and under the same condition of handing over in good repair at the end.

The ground landlord is protected every way. He can distrain on the goods of a sub-tenant, although that tenant may have paid his rent to the tenant-in-chief. An exhibition of pictures was thus seized for ground rent, within the last year or two; and we all remember the disgraceful scene at the close of the dress exhibition, where the same thing happened. In that case, the property seized belonged to foreign exhibitors. What should we say if such a thing happened to English exhibitors in Berlin or Paris?

The ground landlord can force an outgoing tenant to put a house into repair, although it is intended to pull it down. In such a case, however, he sometimes accepts a sum of money for the repairs which are never to be made. Even should the house fall down, the leaseholder must put it up again. A very flagrant instance of this occurred some sixteen years ago, and owing to the tenant's resistance, is not yet settled. A lady took over the remainder of a lease of ninety-nine years. The ground landlord, a great nobleman who owns whole districts of the west end, in granting the original lease, inserted the usual clause stipulating that the house to be built upon the land should be constructed "in a suitable and workmanlike manner," and of course the further clause, that at the expiry of the ninety-nine years the house should be handed over "in good and habitable order." It must be obvious that this condition implies that the house is capable of standing at least till the expiration of the lease. The house in question, however, was a bad case of "jerry-building"—a fact which escaped the notice of the duke's surveyors. Only about twenty-seven of the ninety-nine years had expired when the original lessees sold the remainder of the lease to Miss J. M. Scott; and in three years more the house collapsed. The collapse was so serious that the Metropolitan Board of Works condemned the house as "a dangerous structure." The builder sent to examine the damage was astonished that it had stood upright so long, considering the manner in which it had been built—now fully revealed by the collapse. By every rule of equity, the cost of making the house safe and habitable ought to have been shared between the ground landlord and the original lessees; the surveyors of the former had passed the house as well built, and the original lessees had not fulfilled the condition of "workmanlike" building, contained in the Title Deeds. But it was Miss Scott who was ordered to make the house safe and habitable—in this case it must have been almost rebuilt. This she very excusably refused to do, alleging that she could not afford to pay twice over for the leasehold, and that the damage was caused by the negligence of the ground landlord's surveyors, and of his lessees. An action of eviction was then begun. And this was hardly the worst. Every legal device was employed, and many illegal ones, which need not be particularised here. One instance, however, of a distinct attempt on the part of the law to protect the stronger side must be given, because English law claims for itself not merely a supremacy, but something not far removed from a monopoly of justice. "In the course of my eviction from the 'Dangerous Structure,'" says Miss Scott in a statement published this year, "I was not permitted to say that I had received either loss or damage—or that the house was not built in the manner alleged in the Title Deeds, or that it had always been kept in good repair since it had come into my possession, nor that the ground landlord's agent had called upon them (the original lessees) to repair the house, according to the terms of their lease. Then I tried to state these simple and undeniable facts I was at once summoned to appear in Court, so that these statements on my part should be 'struck out,' as being 'embarrassing and vexatious' to the lessees, and moreover I was to pay for having dared to make the attempt of vexing 'and embarrassing them. … 'But,' I said, 'they did refuse to put the house in order, and conform to the terms of their lease, when requested to do so by the ground landlord's agent.' 'It may be so,' said the Master of the Court; 'but you cannot be allowed to remind them of that; it is vexatious to them, and embarrassing.'"

Thus the law endorsed the dishonest cynicism of caveat emptor. It refused to take into account that Miss Scott had paid for an uninhabitable house—the finer feelings of those who sold it to her must be considered, to the extent of not even allowing them to be reminded of the loss caused to herself. It is as though a man who has hired a horse unable to work not merely found himself obliged to pay for the hire of a useless animal, but was compelled to furnish a good horse to the man who hired him the bad one. In no other transaction is there anything comparable. If Miss Scott's dressmaker had sent home an unwearable dress, Miss Scott could have refused to pay. When a "dangerous" house has been sold, the purchaser is required to rebuild it!

This case was thrown into Chancery, and if the Chancery acted up to its first professions, of being a Court of Equity, to "soften and mollify" the rigour of the Common Law, here was an excellent opportunity of doing so. By every rule of "equity," the expense of making good the damage ought to have been shared between the ground landlord and the original lessees. Both were undoubtedly to blame, and the only doubt could be whether the blame should be equally divided, or whether the original lessees, having actually built the house, ought to be considered more responsible than the duke, who by his agents had accepted the house as well built. The one person who had nothing to do with the erection was, however, the one person elected to make good the damage!

This is, of course, an extreme case ; but the system is the same in all cases—the ground landlord, who benefits most at least cost to himself, is the most protected by the law. which ensures that at every expiration and every transfer he shall find himself enriched by other men's labour, and the expenditure of other men's money, and the exercise of other men's abilities. Thirty years ago, Professor Thorold Rogers defined the position of the landlord: "Every permanent improvement of the soil, every railway and road, every bettering of the general condition of society, every facility given for production, every stimulus supplied to consumption, raises rent. The landowner sleeps, but thrives. He alone, among all the recipients in the distribution of products, owes everything to the labour of others, but contributes nothing of his own. He inherits part of the fruits of present industry, and has appropriated the lion's share of accumulated intelligence."

The following letter, signed "Englishwoman," appeared in the London Echo some six or seven years ago. It is an instance of the sort of extortion often practised on the renewal of a lease.

"Two years ago," says the writer, "I purchased a house on the Portman Estate (18 years' lease) at £10, 10s. per annum. I spent more than £300 to put it in tenantable repair, thinking that I should get a renewal at a fair ground rent. I applied, and the agent came to inspect the premises, and a few days afterwards sent me the terms as follows:—Lease for 34 years, ground rent to be £80 instead of £10; fine £1000 renewal, to be paid from the day of application, or £5 per cent, interest on the £1000 from that date, which would be principal and interest for eight years, £1400; improvements to be done, as stated in agreement, amounting to about £500, before a new lease is granted; all Viscount Portman's solicitor's fees to be paid by me. For the simple drawing of this agreement I paid £15. The last year of the 34 years' lease the house to be redecorated throughout; property to be insured by me in the Portman Fire Office. Upon remonstrating at the exorbitant terms, I received a letter from the agent that I could accept them or not, but in the event of my not accepting, I should not have any further opportuntity of applying.

"Now, sir, what right can the landlord have to take away my house? He has never spent a 1d. towards its improvement. Of course, the ground had increased in value, but that is through the tradespeople and not through the landlord. The ground rent is increased eight times; then what right has the landlord to demand £1400 for a house that I bought, and what right has he to dictate improvements that I have to pay for, so that after the expiration of a few years he may get larger premises, and another larger premium, without him spending a fraction, not even to pay the solicitor for getting the money."

"Englishwoman," adds: "It seems incredible that people endure such extortion without seeking redress." She hopes the law will be altered—it "beggars tradespeople to enrich the aristocracy."

The meanness of this transaction would do credit to the lowest Jew money-lender. Not only is Englishwoman" to pay Lord Portman £1000 "fine" for taking his house for a longer term, but she is to pay him interest on the fine for the eight years already expired! This antedating of interest proves that the Hebrew race has no monopoly of sharp practice.

This is the private side of leasehold. The public side is no better. The law which gives to the ground landlord all the unearned increment created by the community injures the community as much, if less ruinously, as it injures a private person. It is only less ruinous, because a whole community is better able to bear extortion than is any one member of that community. But the same principle is at work, with similar results.[3]

Leasehold property is sometimes let, not for a term of years, but for a term of "lives." [4] Leases for lives are very common in Cornwall. The lessee names three persons of whom he himself may be one—and the lease is to last until the death of the last survivor of the three. The evils of such a custom are obvious, especially in a district which, like West Cornwall, is almost wholly mining, and where, therefore, there are greater risks to life. But even without mining accidents, such leases can fall in at any moment. Mr Dawson, in his "Unearned Increment," gives instances. On an estate in West Cornwall, "five farm leases on sets of lives" fell "in hand" within ten years. An epidemic of typhoid carried off the whole fifteen lives. In another case, "a leaseholder in a Cornish village had spent £260 in building a house on land held for three lives. All the lives expired in fifteen years, and the landlord became the absolute possesser of the building." The system has been well described as "a flesh and blood lottery." Yet it is said that four-fifths of the house property in West Cornwall is held on life leases. The most extraordinary feature of the business is, that raining is the chief industry of West Cornwall, and it inevitably happens that miners are selected for "lives." A miner will put in his own life. A very cruel change in law has transferred the burden of proof of survival from the landowner to the leaseholder; and Mr Broadhurst was informed some years ago that there was then an old lady in Devonport Workhouse, who would have had enough to keep her in comfort, if she could have traced the last "life" on the property, but the person had emigrated, the old lady could not produce evidence of his existence, and under the change of law, the landlord was able to resume possession without proving the death.

At the Royal Commission of 1886, Mr John Vivian, a tradesman of Camborne, was examined. After testifying to overcrowding, caused by pulling down houses, he was asked concerning leases for lives. The usual term is for 3 lives, or for 50, 60, or 80 years. Mr Jesse Collings said: "I was born upon an estate where the life tenure was the custom, and I found that in many cases men put their children's lives on a house, and some day or other they found themselves deprived of both children and property. In other cases the lives of sailors were on, and after a time there was great doubt whether the lives were in existence or not, and generally a great deal of misery was the result of this life tenure. Is that the state of things in Cornwall?" Mr Vivian replied: "There are several instances given in this little pamphlet ('The Bitter Cry of Cornish Leaseholders'), all of which I think I can vouch for." Asked how long 3 lives would give, witness replied: "I should say from 30 to 40 years would be the average; just over 30 years, perhaps, because the lives that are put up are frequently miners, and they are proverbially a short-lived class." "Would you say that the 3 lives system is not popular in that part of England?" Answer: "It has been popular because they have no chance of getting other terms."

Leases for terms of years can contain the most unjust provisions. In a certain village of Carmarthenshire all the land belonged to one or other of two proprietors, and all the houses had therefore necessarily been built by the occupiers on land belonging to one of them. The leases are mostly for ninety-nine years, but the ground rents had been almost doubled in the last eight or nine, and the leases contain a clause that if any part of this rent is twenty-eight days in arrear, "the lessor may re-enter upon any part of the said premises in the name of the whole, and thereupon the said term of ninety -nine years shall absolutely determine." The gentleman who told this story to Mr Broadhurst added: "A fortnight ago I heard of nine houses of which the ground landlords had entered into possession under this clause owing to the great fall in wages"; and though himself a landlord, he expressed himself as heartily deprecating "the gross injustice of legalised landlordism." "By the leasehold system, the landlord is not content with taking the houses that he did not build ; he also takes the goodwill of the trade attached to the house, and, on renewing a lease, extorts a heavy payment for allowing the tenant to continue to enjoy his own business which he has brought to the house. It is all cant to talk about freedom of contract where a tenant would be ruined if he did not submit to his landlord's terms."[5]

The story of this Welsh village recalls the accusations brought by the Reformers against the new landlords of the Church lands—that they deliberately tried to cause the forfeiture or relinquishment of leases, that they might renew on better terms for themselves. And the poorer classes suffer more than even the enhancement of rent; for the system gives an additional motive for lowering wages. A landlord who is also an employer of labour has much to gain from his tenants' "difficulties." If they cannot pay their rent, he can take from them all they have. Those nine houses in the Carmarthenshire village represented to the landlords nine houses to be let on fresh leases. Instead of the suffering of "one member" entailing the suffering of the others, it positively benefits them. The depraving moral effect on the characters of the rich may account for much in the state of political opinion which shocks those who believe that "justice" is something more than a name. What must be the moral condition of the landlords who took possession of those houses? What are we to say of laws which allow the validity of such a contract? The Jew money-lender who exacts 60 per cent, from the spendthrift heir is an honourable man compared with a landlord who takes a house because a month's rent is owing to him. This trumpery debt gives him the right to cancel a lease, and take possession for himself of a house built with his debtor's money. "Unearned increment" is the increase in the value of a site from external circumstances, and not from the exertions of the ground-owner of that site. Such external circumstances may be said to be almost invariably connected with increase of population, and this increase of population is always due to the exertions, not of the ground-owner, but of the occupier of the site.

Reckoning the "unearned increment" of London as, on an average of 20 years, £304,634,[6] it amounted during the 17 years from 1870 to 1886 (both years included), to £6,092,680. This increase, created by the industry and enterprise of the community, ought to benefit the community. At present it benefits the ground landlord. It takes place in all large towns. We can see what the industry and enterprise of a community means, if we read the evidence of Captain Richard O'Sullivan before the Select Committee on Town Holdings, in 1886.[7] He said: "Queenstown in the course of a century has grown by the sheer industry and enterprise of its inhabitants from a barren rock into a property valued at £21,000 a year, a value for a lump sum equivalent to half-a-million pounds. None of it has been created by the landlord, yet he tries to confiscate it. Nearly eight miles of roads and streets, with their flagged footways, main sewers, private drainage, crossings, channels, etc., costing at least £30,000, have been paid for out of the pockets of the people, and on the expiration of the leases the landlord confiscates them also. The public quays have been built at the public expense, and even the foreshore upon which they are erected had after great and expensive litigation to be paid for to the uttermost farthing to the landlords, who refused to contribute in the smallest degree to the erection of the quays. The town as it stands has been paid for many times over by the occupiers, and yet the landlords claim it as their own, and except the occupiers are prepared to purchase it over again at a fabulous amount they must clear out and leave the labour of their lives to the landlords, if the Government fails to give them protection."

These words exactly describe the fact—leasehold property, under our present laws, means property which the occupiers must purchase over again at a higher price each time, or "clear out" and leave the labour of their lives to the landlords.[8]

The whole area of London is about 75,000 acres, and the value is about £16,000,000 a year, which gives an average of £200 an acre, but in some parts a square foot is worth from 30s. to 40s. a year, equal to a capital value of from £65,000 to £87,000 the acre. As farmland, it would be worth £4.[9] And this gigantic increase in value is due to the increase of population, and to the industry of that population. No one has yet attempted to show that the ground landlord has by his exertions or abilities caused this increase. The population of London has increased the value of London, and the population pays for that increase. By an ingenious arrangement of rates, the poorer districts pay more in proportion than the richer. Thus Rotherhithe pays 7s. 11d. in the pound, Bow, 8s. 1d., but the district round the Savoy only 4s. 6d. This is the reason why there are proposals for the equalisation of rates. Throughout, the occupiers pay more than the ground landlords.

All our public improvements are paid for by the public. It is really singular how little the great landowners of London do for London. In most other countries, a noble, man with the enormous rental of the Duke of Bedford, would have presented to London Co vent Garden Market—the state of which at present is a disgrace to the greatest city in the world.

The Thames Embankment was made at a cost to the public of nearly two and a half millions—paid partly out of the now abolished London Coal Duties, and partly out of the inhabited house duty—a duty paid, not by the ground landlord, but by the occupier. In this case, too, the ground landlords received the full price of the land, compensation for "severance," 10 per cent, for "compulsion," and found the value of the unsold half of the land enormously increased by the substitution of a magnificent frontage on the river, for the former unwholesome mudbanks.[10]

The Tower Bridge, which cost the Corporation over three quarters of a million, was also partly paid out of the Coal Dues.

London ground landlords are paid heavily for permitting improvements to be made, and they benefit enormously by those improvements after they are made. But not content with this, they denounce as "robbery" and "confiscation" any proposal to tax them in any sort of proportion to their gains. The ground landlord is the only man whose property increases in value without effort or expenditure on his part, and he is the only man who is protected from bearing his share of the public burdens. As this continual rise in value is solely due to the public, the public and not the ground landlord ought in common justice to reap the chief part of the benefit. The expenditure caused by growth of population ought to be borne by the growing land values. But as it is, "The people of London pay, directly or indirectly, £11,000,000 a year to make and keep the land valuable; and then pay £16,000,000 a year to the landlords because it is valuable."

The story of the making of Charing Cross Road, besides being an excellent example of the way in which ground landlords take the lion's share of profits from improvements for which the public pay, has at this moment an additional interest in connection with another burning question of the moment. The story was told by Mr Chamberlain at Birmingham on the 2oth October 1885. After describing what the Board of Works proposed to do, Mr Chamberlain continued: "But when the Bill came before the Committee of the Commons, one great landowner along the line of route, by his agents opposed the Bill, and claimed the insertion of a clause for his special protection, which provided that the Board of Works should not take one inch more of his land than was necessary for the formation of the street, and that he should have the frontage along the whole line of his property. Just consider what that meant. It meant that this landowner was to have the fullest possible price for his land—it was to be bought from him at its prospective value; he was to have compensation for severance; then he was to have 10 per cent, for compulsory sale; and heaped up on all this he was to have the enormous advantage and profit which the turning of his property into the front land of a great thoroughfare would add to its value. Well, the Committee of the House of Commons, finding out that this proposal was altogether exceptional, that there was only one single precedent for it, and that in the case of a Tory peer. Lord Cadogan, rejected the clause. But when the Bill got up into the House of Lords, this great landowner was one of their number, a peer of great influence in the Upper Chamber, and the Committee of the Lords inserted this clause … Mr Fawcett moved that the House of Commons disagree with the Lords' amendment, and so strong was the feeling in the Commons that the resolution was carried without a division. … Who do you think was the landowner? … It was the Marquis of Salisbury, the Prime Minister of England."

The weight of evidence taken by the Commission of 1886 and following years (which sat to inquire into the general housing of the poor) went to disprove the assertion that large freeholders necessarily keep property in better condition than small ones. Thus, Mr Dixon, medical officer for Bermondsey, said: "The worst houses are those which are the fag end of a lease." Lord William Compton, a son of the Marquis of Northampton (who owns Clerkenwell), said that when a lease is nearly run out, the lessee gets rid of it by letting it rather low to a man unable to lay out money on it, but who, as he has nothing, is not afraid of being called on for dilapidations. Mr Boodle, agent of the Duke of Westminster and the Marquis of Northamption, admitted that on the Northampton estate repairs and sanitary improvements required by the leases were not always insisted on, when the lease was renewed. If it was a short lease, on a higher rent, the improvements might be dropped to secure the higher rent. As Mr Boodle frankly put it, "ventilating the soil pipes, and disconnecting all the waste pipes is found to be a very expensive business." This explains the insanitary condition of so many houses in the "slums." Mr Boodle, it should be mentioned, was a hostile witness, and finding that the Supplementary Report stated that his evidence condemned the leasehold system, he sent a public protest to the papers. It should also be said that he asserted that "no well-disposed landlord would attempt such a thing," as resuming possession on any breach of contract whatever, as allowed by the lease. He laid on the middlemen the blame of everything that went amiss; they it was who broke up houses into tenements, and Lord Northampton intended in future to collect the rents directly through a lady visitor. Mr Hunt, surveyor to Lord Portman's London estate, declared that it was easy for a working man to buy a leasehold house, and he would be quite as well off as if it were a freehold. Asked whether an applicant could purchase a freehold, he replied that he had never been applied to for one, and when pressed harder admitted that the reason "probably" was that it was known the application would have been useless. Again asked why, he replied that it would not be to Lord Portman's advantage: "It would be a loss to Lord Portman probably, and no sufficient gain to the purchaser." "But if it is good for Lord Portman to hold freeholds, why is it not good for the tenant of a house?" To this awkward question, Mr Hunt replied: "I am travelling rather outside what I came here to answer."

The evidence is most instructive reading. Not only do many facts come out, illustrating the working of the system, but the opinions of witnesses who represented the great ground landlords show how they understand what they are always calling "the prosperity of the country." Mr Ryde, past-President of the Surveyors' Institute, began by naively confessing that the Institute was "greatly alarmed" on hearing there was to be legislation. They "all agreed" with him that "the prosperity of the country "required no more legislation in connection with land. Reminded that he had once written a pamphlet advocating the simplifying of land transfer, he admitted that such a simplification would be an advantage. But this did not make him less clear that a ground landlord has "a perfect right" to raise the rent when he sees that the tenant is succeeding in business. If he knows that a certain piece of land has become of increased value to the tenant, he has the perfect right to take the full advantage of this circumstance—as much right as the owner of a Derby winner has to ask a higher price for his horse after he has won the Derby than he would have asked before. Asked whether he thought the cases analogous, Ryde first confessed there was a difference, and then repeated the comparison of "rights." He admitted that in the course of ninety-nine years, properties generally increased in value "three, four, or five times." "You may take it that they do. But that is part of the bargain; it is seen beforehand, and it is known that it is so: there is nothing else like it; it is nothing like the old copyhold or feudal system, there is nothing to be compared to it. … The freeholder says, I will grant you a lease of this land for ninety-nine years, if at the expiration of the time you will leave me the house upon it." There must be "freedom of contract." "We must be allowed to bring our abilities to bear and work it out unfettered." Here, of course, freedom of contract means the freedom of the freeholder to drive the hardest bargain he possibly can; and the "abilities to be brought to bear" are the abilities which enable one man to exploit the labour of another man. The one-sidedness of the "freedom" never seems to have struck Mr Ryde at all. Where is the tenant's freedom? The landlord is truly "free." He can make a more or less hard bargain with the lessee, but the lessee must submit to the terms, or give up business altogether. It is true that he sees it beforehand, and knows that it is so; he also knows, not that he can take it or leave it, but that he must take it. He agrees, not because he willingly accepts the terms, but because they are the only terms on which he can obtain something for which there is no substitute. There is certainly "nothing like it," and it is certainly" nothing like the old feudal system, there is nothing to be compared to it"—not even the right of asking what price you please for a horse that has won the Derby, a right also "seen beforehand." In no market but the English land-market is any commodity paid for over and over again; and in no other market is an improvement acknowledged by a "fine."

The plea for "freedom of contract" assumes a still more ironical aspect when we remember that the persons whose interests are to be thus protected are not taxed on these ever-increasing land values. Those to whom the ground landlord lets his land—and in letting it his contribution to the "prosperity of the country" begins and ends — those to whose exertions and sacrifices that increasing value is due, are taxed, but the landlord escapes. If those who are improving the land make more money as the years go on, they pay more and more into the public treasury. A careful inquiry is made into their "profits," but the value of the land itself is not inquired into. The value of the land may have increased three, four, or five times in the course of a century, but the owner of the soil still pays the original rate, and grows rich while he sleeps.

In England, property in land is protected far more effectually than property in money. Yet, of the two, property in money needs more protection, for whereas we are always being reminded that land "cannot run away," we all know that money cannot only "take to itself wings" by our own folly, but that when we are robbed of money it is seldom that we recover it. The worst that can happen to the ground landlord is to lose his rent for a time—his land remains where it was, and possession can be recovered, if his title is clear. But though there may not be the smallest doubt in the world that our money was our lawful property, the law seldom recovers it for us, even when it punishes the robber. This is usually the case even in the more vulgar branches of theft, such as burglary and pocket-picking, but when it comes to the more complicated devices of the swindler, our chances are poor indeed. An English judge said publicly not long since that the law respecting companies seemed framed to protect fraud. The same has been said of the law of bankruptcy. Sometimes, indeed, the law appears to connive at the escape of the dishonest. In an action to recover money, the jury may find for the plaintiff, and the Court may order the money to be paid at once into court; but the defendant has only to give notice of appeal, to be allowed to leave the court with the money in his pocket. He can then withdraw his appeal, and the successful but unfortunate plaintiff has no redress. How different is the protection which the law affords to the landowner!


  1. In the Poor Rate Returns, presented to the House of Commons in 1818, and reprinted by order of the House in 1826, the rental of real property in England and Wales is given from the Returns to the "Tax Office," for the year ending April 1804, as £38,000,000. The disproportion of rates is mentioned. Nine counties are taxed above 4s., twelve from 3s. to 4s., and eighteen under 3s.
  2. This case was mentioned by Mr Hyder in a speech at Hendon, reported in Land and Labour, December 1906.
  3. "The more numerous the community becomes and the more it thrives, the higher the tribute it must pay to the owners of the soil upon which its dwellings have been placed. In lending or selling land the owner renders now no greater service to the community than he did years ago—when land was cheaper—but he requires far greater remuneration for the service. Where the landlord, by his own labour or expenditure, increases the value of his property this growing tribute is, to some extent, justifiable; but it will generally be found that it is not the owner but society which makes the land more valuable. Nevertheless the law says that society may be rack-rented on its own improvements."—Dawson, "The Unearned Increment," p. 15.
  4. Sometimes also for "years and lives"—that is, for so many years, usually twenty-one, after the death of the last "life."
  5. Broadhurst and Reid's "Handbook on Leasehold Enfranchisement," to which this gentleman contributed an anonymous chapter, "The Remedy for Landlordism."
  6. Mr Webb's calculation, based on the returns. The £6,092,680 is the "spontaneous increate" of the rental of London between the valuations of 1870 and 1886, £22,142,706 and £37,027,516.
  7. This was part of a larger Commission on the Housing of the Poor. The Commission sat from 1886 to 1889. Captain O'Sullivan had been Chairman of the Queenstown Commissioners for twenty years. He was sent to give evidence before the Select Committee, by the whole town, "without any distinction of class or creed."—See Reports, 1886, xii. 367 (213, Session 1).
  8. "As a matter of fact, the owner contributes nothing to local taxation. Everything is heaped on the occupier. The land would be worthless without roads, and the occupier has to construct, widen, and repair them. It could not be inhabited without proper drainage, and the occupier is constrained to construct and pay for the works which give an initial value to the ground rent, and, after the outlay, enhance it. It could not be occupied without a proper supply of water, and the cost of this supply is levied on the occupier also. In return for this enormous expenditure, he has his rent raised on his improvements, and his taxes increased by them."—Rogers, "Six Centuries of Work and Wages."
  9. Mr Bilson, M.P., on Land Values.
  10. "The Great Problem of our Great Towns."