Body Corporate for ‘Nautilus Gold Coast’ v Valuer-General [2018] QLC 22

LAND COURT OF QUEENSLAND CITATION: Body Corporate for ‘Nautilus Gold Coast’ CTS 5710 v Valuer-General [2018] QLC 22 PARTIES: Body Corporate for ‘Nautilus Gold Coast’ Community Titles Scheme 5710 (applicant) v Valuer-General (respondent) FILE NO: LVA737-17 DIVISION: General Division PROCEEDING: General application DELIVERED ON: 20 August 2018 DELIVERED AT: Brisbane HEARD ON: 12 June 2018 HEARD AT: Brisbane MEMBER: WL Cochrane ORDER: The application is dismissed. CATCHWORDS: REAL PROPERTY – Valuation of land – Land Valuation Act PRACTICE AND PROCEDURE – Disclosure – Whether the Valuer-General has a duty to disclose material relevant to objection decision – Application of Uniform Civil Procedure Rules Land Court Act 2000 Land Court Rules 2000 Land Valuation Act 2010 Uniform Civil Procedure Rules 1999 APPEARANCES: A Stolar (solicitor), Stolar Law, for the applicant JP Hastie (instructed by In-House Legal, Department of Natural Resources, Mines and Energy) for the respondent -- 1 of 5 -- 2 Background [1] On 11 December 2017 pursuant to s 157 of the Land Valuation Act 2010 (LVA), the appellant filed an appeal in relation to the valuation of land located at 39 Garfield Terrace at Surfers Paradise in the State of Queensland. [2] The valuation was as at 1 October 2016 with an effective date from 30 June 2017. [3] Originally, the valuation advised by the Valuer-General was $12,500,000 but, consequent upon an objection filed by the applicant, the Valuer-General amended that valuation to $11,500,000 on the basis that: (a) When compared to similar properties, the delegate decided a change in the valuation should be made; and (b) An error or omission in the valuation was made and therefore it has been amended. [4] An appeal to this Court was lodged on 11 December 2017 and then, pursuant to an order made on 2 February 2018 an amended notice of appeal was filed. The original valuation was the outcome of the mass appraisal methodology utilised by the respondent which applies a market based movement factor to properties in an area which have similar characteristics. [5] In the present case it appears that the market factor applied was a figure of 1.44. [6] In its correspondence notifying the decision to amend the valuation to $11,500,000, as indicated above, the respondent appears to have abandoned the 1.44 factor and used a comparison with similar properties to fix the valuation of $11,500,000. [7] There has been, as is apparent from the affidavit of Mr Graeme McIlwain, the chairman of the Body Corporate of the appellant, extensive dialogue between the parties as to the disclosure of relevant documents. Mr McIlwain, until the present application, has been acting as the agent for the appellant. [8] Mr McIlwain has pursued access to all of the documents which either underlie or evidence the utilisation of the 1.44 factor. In his pursuit of those documents he has been rebuffed by the respondent, who has maintained that the disclosure provided by it has been complete. -- 2 of 5 -- 3 [9] Mr McIlwain exhibits to his affidavit the document from the respondent of 20 April 2018.1 [10] Mr McIlwain quotes from that correspondence wherein it says: “The respondent has provided disclosure of documents that are directly relevant to the assessment and determination of the site value for the subject property as at 1 October 2016, namely, documents which relate to the subject property and comparable sales properties. What the respondent will rely upon at the hearing of the appeal is the analysis of the comparable sales and other evidence from its expert valuation witness to support the site valuation of $11,500,000 as at 1 October 2016.” [11] This decision deals with a general application filed by the appellant on 31 May 2018 in which the appellant contends that the respondent has failed to make full disclosure of all documents relevant to the 1 October 2016 decision. [12] The application in respect of further and better disclosure seeks the following orders for relief: “On or before 4.00pm, Friday 15 June 2018, the Respondent must provide copies of all documents directly relevant to the 1.44 market based movement factor, including but not limited to: a. Details of the valuation of the benchmark properties used as representative valuations within the sub market area. b. Details of the number and description of the sub market area which is recorded and maintained in QVAS. c. Details of the validation of the derived value to ensure that it is consistent with market evidence. d. Details of which typical properties were identified as benchmark properties within the sub market area. e. Details of the inspection and valuation against bona fide sales evidence to test the proposed market changes for the area. f. Details of the departmental system where the benchmark properties are established and maintained for reference in the statutory valuation process. g. Details of the schedule prepared forming part of the support data for the mass appraisal process after inspection and valuation of each benchmark property. h. Details confirming the benchmark schedule which is an auditable document within the final basis documentation which was provided to the approving officer and subsequently approved. i. Costs in the application.”2 [13] The valuation as at 18 October 2017 was on an objection which resulted in the original valuation of $12,500,000 being amended down to $11,500,000. Accordingly, this is an appeal against a decision on objection. 1 Affidavit of Graeme McIlwain, Ex NGC5, paragraph 8. 2 General Application, Attachment B. -- 3 of 5 -- 4 [14] For the current application, however, the Body Corporate has seen fit to engage the services of Mr Stolar, a solicitor. [15] The respondent has filed an affidavit of Mr Philip Christopher Smith, the valuer who will be giving evidence at the hearing of this appeal. [16] In his affidavit, Mr Smith says: “In this appeal and at the hearing of the matter, I will be applying the direct comparison methodology through the analysis and application of comparable sales’ [sic] properties to assess the correct site value of the subject.”3 [17] In his affidavit Mr Smith goes on to refer to the sales that are set out in Exhibit NGC- 4 to the affidavit of Mr McIlwain. [18] Within the LVA, s 169 provides as follows: (1) The hearing must be limited to the grounds stated in the valuation appeal notice. (2) The appeal must be by way of a rehearing. Note— See also section 256 (Particular evidentiary provisions for valuation appeals). (3) However, the appellant has the onus of proof for each of the grounds of appeal. [19] Once it is accepted that the respondent does not rely upon the market based movement factor of 1.44 then any documentation evidencing how that factor may have been derived becomes irrelevant or, more importantly in the context of the present application, not directly relevant to any matter in issue in the appeal. [20] Within its grounds of appeal, the appellant, articulated the following grounds: “1. The market based movement factor applied to the existing valuations of the 24 beachfront properties between 3 Garfield Terrace and 1 The Esplanade, Surfers Paradise which are in a similar sub market area is not supported by the valuation of the subject property. 2. The adjusted site valuation is not supported by comparison with other applied values. 3. The adjusted site valuation is not supported by recent property sales.”4 [21] There is also a reference to “Attachment A” which deals with the market based factor. 3 Affidavit of Philip Christopher Smith, paragraph 9. 4 Notice of Appeal dated 20 February 2018. -- 4 of 5 -- 5 [22] It is clear from the correspondence and, particularly from the affidavit of Mr Smith, that this appeal is going forward on some basis other than reliance upon the market based movement factor. [23] Accordingly, it would appear that the appellant succeeds on its first ground of appeal but still carries the onus of satisfying the Court that the valuation for which it contends is the appropriate one. [24] The application filed by the appellant and the supporting affidavit material does not satisfy me that the respondent has failed to provide proper disclosure of all documents directly relevant to the matters in issue in this appeal. [25] It has long been established in Australia that disclosure is confined to what is in issue on the pleadings.5 As I have indicated above, it seems clear that the 1.44 factor is no longer in issue and accordingly, I can see no proper reason why further disclosure in respect of that concept ought be ordered. [26] Moreover, the application by the appellant does not point, with any particularity, towards any specified documents which might otherwise be shown to be relevant to matters in issue. [27] In all of the circumstances, I do not believe there is any basis upon which I could uphold this application and accordingly the application is dismissed. ORDERS: The application is dismissed. WL COCHRANE MEMBER OF THE LAND COURT 5 See Mulley v Manifold [1959] 103 CLR 341, 345 (Menzies J). -- 5 of 5 --