Elliott v Department of Natural Resources and Water [2008] QLC 108

LAND COURT OF QUEENSLAND CITATION: Elliott v Department of Natural Resources and Water [2008] QLC 108 PARTIES: Ian R Elliott (appellant) v Chief Executive, Department of Natural Resources and Water (respondent) FILE NOS: AV2006/0192 and RV2006/0193 DIVISION: Land Court of Queensland – General Division PROCEEDING: Appeals against a rating valuation and a rental valuation DELIVERED ON: 30 May 2008 DELIVERED AT: Brisbane HEARD AT: Winton MEMBER: Mr JJ Trickett, President ORDERS: 1. In appeal AV2006/0192, the appeal is allowed, the valuation of the Chief Executive is set aside and the unimproved value of “Eskdale” for rating purposes as at 1 October 2005 is determined at One Million, Five Hundred and Twenty-seven Thousand Dollars ($1,527,000). 2. In appeal RV2006/0193, the appeal is allowed, the valuation of the Chief Executive is set aside and the unimproved value of “Eskdale” for rental purposes as at 1 October 2005 is determined at One Million, Five Hundred and Twenty-seven Thousand Dollars ($1,527,000). CATCHWORDS: Unimproved value – grazing property at Winton – comparison with determinations of test cases – sales relied upon in the test cases – classification of country – carrying capacity – sheep are values – disabilities – Valuation of Land Act 1944 -- 1 of 6 -- 2 APPEARANCES: Mr A Boyd, agent, for the appellant Mr W Isdale, Executive Legal Consultant, Crown Law, for the respondent [1] These are appeals by a landowner in the Shire of Winton against the unimproved values applied to his land for rating and rental purposes by the Chief Executive, Department of Natural Resources and Water (the Department) under the provisions of the Valuation of Land Act 1944 (the Act). Background [2] Mr IR Elliott (the appellant) is the owner of a grazing property known as “Eskdale”, containing an area of 13,000 ha, situated about 110 km north-east of Winton. As at 1 October 2005, the Department applied an unimproved value of $1,700,000, or $130.77/ha, to that property for rating purposes. “Eskdale” is held under grazing homestead perpetual lease tenure and the Act requires that a separate valuation is made by the Department for rental purposes. A rental valuation also for the amount of $1,700,000 issued as at 1 October 2005. Mr Elliott appealed against both valuations, stating that his estimate of the unimproved value was $570,000 in each case. [3] The appeals were lodged on his behalf by his agent, Mr A Boyd. The grounds of appeal are wide-ranging but general nature, essentially contending that the unimproved value is excessive because of the failure by the Department to take into account and make proper allowance for various matters, or to apply the correct principles of valuation. These two appeals were among a number of cases tried by the fast-track process, following the determination of selected cases of “Bonnie Downs”1 and “Belmont”2 in the Shire of Winton. The parties agreed that the remaining appeals be determined by confining the evidence to comparisons with the decisions in those cases and to the sales relied upon in arriving at those determinations. However, evidence of the differences between individual properties was also heard. 1 Fawckner v Department of Natural Resources and Water [2008] QLC 0036. 2 Elliott v Department of Natural Resources and Water [2008] QLC 0040. -- 2 of 6 -- 3 Mr Elliott’s evidence [4] Mr Elliott gave evidence that in November 2004 the Land Court determined the unimproved value of “Eskdale” at $21.90/ha, compared with the determination of the unimproved value of the “Bonnie Downs” aggregation at $21.50/ha. The Court also determined the rental valuations of “Bonnie Downs” and “Corunna” at $21.90/ha. Mr Elliott considers that “Eskdale” is similar to “Bonnie Downs” and “Corunna” and he was satisfied with the relativity of the valuations at that time. However, the unimproved value of “Eskdale” has been increased to $130.77/ha as at 1 October 2005 for both rating and rental purposes. The valuation of the “Bonnie Downs” aggregation has been determined at $110/ha by the Land Court. Mr Elliott contends that the valuation of “Eskdale” should now be $112.50/ha, compared with the determined value of the “Bonnie Downs” aggregation, making a slight adjustment for the difference in areas. [5] Mr Elliott was aware that the determination of the unimproved value of “Bonnie Downs” was based on the sale of “Dahlia”, to which the Department had applied an unimproved value of $112.55/ha. In Mr Elliott’s opinion, “Dahlia” is similar to “Eskdale” and has a similar carrying capacity. The Department’s evidence [6] Evidence for the Department was given by registered valuer, Mr DA Routh, who explained that he had undertaken the valuation using the Department’s historical record, which he reviewed with the assistance of the WARLUS land system mapping, regional eco-system mapping and satellite imagery. The various areas were measured using a computer based measuring system. [7] Mr Routh’s description of “Eskdale” is as follows: 10,500 ha (81%) downs (1-1.6 ha) 2,500 ha (19%) channels (1-1.6 ha) Mr Routh then goes on to state that: “ ‘Eskdale’ is described [I assume in the Department’s historical record] as generally open to lightly shaded brown to black soil downs. Generally well grassed with patches tending loose. Shaded Whitewood and Vinetree with Coolibah on limited gullies and flooded flats of Kennedy and Eskdale Creeks with claypan influence. Some lighter areas include Bull Mitchell.” -- 3 of 6 -- 4 [8] According to Mr Routh, “Eskdale” is typical of the Corfield downs country and has no major working problems. However, this part of the Shire has formed earth roads which cause problems after any rain. [9] Mr Routh adopted the historical carrying capacity for “Eskdale” of 1 sheep to 1.6 ha. He referred to the sales of “Dahlia”, to which the Department had applied a valuation of $112.55/ha and to the sale of “Ashfield”, to which the Department had applied a value of $117.65/ha. The Department’s carrying capacities on both those sale properties was 1 sheep to 1.8 ha. [10] In Mr Routh’s opinion, “Eskdale” is in the similar run of country to the two test cases, “Bonnie Downs” and “Belmont”, both of which have loose patches and claypans with lighter areas of Bull Mitchell country. He was of the opinion that “Eskdale” was a better property because it had a greater percentage of channels than “Corunna” and “Dahlia”, but he conceded that the channel areas had both advantages and disadvantages. Furthermore, Mr Routh contended that the run of country generally improves from the west towards the east and that is reflected in the Department’s applied unimproved values. The issues [11] There is little difference between Mr Elliott and Mr Routh concerning the general description of the country. However, Mr Elliott contends that the valuation of “Eskdale” should be the same as that of “Bonnie Downs” and “Corunna”. Those valuations were based on the sale of “Dahlia”, to which the Department had applied an unimproved value of $112.55/ha. On the other hand, Mr Routh contends that “Eskdale” is generally better country and should be valued somewhat higher than those properties. [12] The issue of carrying capacity arose in this case as it did in the hearing of the “Bonnie Downs” aggregation valuation appeal. In determining the valuation of “Bonnie Downs”, I discussed the evidence concerning the Department arbitrarily -- 4 of 6 -- 5 revising its traditional carrying capacities in an ad hoc manner.3 In that case, there was evidence that the Department had “let out” the carrying capacity of “Dahlia” from 1 sheep to 1.6 ha to 1 sheep to 1.8 ha. Furthermore, the Department had “let out” the carrying capacity of “Bonnie Downs” from 1 sheep to 1.6 ha to 1 sheep to 1.7 ha. However, it appears that the Department maintained the traditional carrying capacity of 1 sheep to 1.6 ha for the other surrounding properties. [13] That ad hoc revision of carrying capacities has resulted in a distortion of the sheep area values which have been used as a traditional check on the valuations of grazing country. However, as I pointed out in the “Bonnie Downs” case, those sheep area values should be put to one side and comparisons made on a direct comparison basis.4 I propose to adopt the same course in this case. Conclusion [14] On the evidence, I accept that “Eskdale” is in the same run of country as the two test cases and the sale of “Dahlia”. In my opinion, “Dahlia” provides the best comparison. It is of a similar size and consists generally of the same type of country. Although the Department has extended the carrying capacity on “Dahlia” and on “Bonnie Downs”, the weight of the evidence is that all these predominantly downs properties would have much the same carrying capacity. [15] Mr Routh has valued “Eskdale” at $130.77/ha because he considers it to be somewhat better country than the properties to the west. It seems to be generally accepted from the evidence in this and other cases that the quality of the country generally improves from west to east towards Aramac. That seems to have been the traditional view of the Department, although there is little between each individual property in terms of country and carrying capacity. [16] Having regard to the whole of the evidence, I have come to the conclusion that “Eskdale” should be valued slightly higher per hectare than the sale property “Dahlia” and the selected case “Bonnie Downs”. Therefore, on a direct comparison 3 [2008] QLC 0036, at [85] and [86]. 4 [2008] QLC 0036 at [87]. -- 5 of 6 -- 6 basis I intend to apply an unimproved value of $117.50 to “Eskdale” for both rating and rental purposes. When rounded that amounts to an unimproved value of $1,527,000. Orders 1. In appeal AV2006/0192, the appeal is allowed, the valuation of the Chief Executive is set aside and the unimproved value of “Eskdale” for rating purposes as at 1 October 2005 is determined at One Million, Five Hundred and Twenty-seven Thousand Dollars ($1,527,000). 2. In appeal RV2006/0193, the appeal is allowed, the valuation of the Chief Executive is set aside and the unimproved value of “Eskdale” for rental purposes as at 1 October 2005 is determined at One Million, Five Hundred and Twenty-seven Thousand Dollars ($1,527,000). JJ TRICKETT PRESIDENT OF THE LAND COURT -- 6 of 6 --