Bowers & Anor v Council of the Shire of Pine Rivers [2005] QLC 46 (2005) 26 QLCR 120

LAND COURT OF QUEENSLAND CITATION: Bowers & Anor v Council of the Shire of Pine Rivers [2005] QLC 46 PARTIES: Olive Louise Bowers and Lynette Ann Crane (as personal representatives) (claimants) v. Council of the Shire of Pine Rivers (respondent) FILE NO: A2004/0137 DIVISION: Land Court of Queensland PROCEEDING: Claim for compensation payable consequent upon the resumption of land for rubbish depot purposes under the Acquisition of Land Act 1967 DELIVERED ON: 15 September 2005 DELIVERED AT: Brisbane HEARD AT: Brisbane MEMBER: Mr RS Jones ORDERS: 1. Compensation is determined in the amount of $832,000 (Eight Hundred and Thirty Two Thousand Dollars). 2. The respondent to pay to the claimants interest at the rate of 5.50 per cent per annum on the sum of $812,000 from the date of resumption, 9 May 2003, to 28 November 2003, when the advance of $400,000 was received and, then on the balance of $412,000 to the date of payment. 3. The parties will have the opportunity to consider these reasons and make submissions in respect of interest on disturbance and/or costs including reserved costs if any. (See attached Variation Order made after Judgment published) -- 1 of 31 -- 2 CATCHWORDS: Resumption – scheme of resumption – Point Gourde principle – same or different scheme –criteria to be applied – extension of existing scheme, not part of original scheme Resumption – scheme of resumption – San Sebastian principle – relationship of town planning changes to scheme – need for direct relationship or a step in resumption process – whole planning scheme not to be ignored Town Planning – likelihood of development approval for subdivision but for resumption scheme – water services likely impediment – limit on bulk water supply – intensive subdivision approval not likely Valuation – sales evidence finally relied on – not fully analysed by valuers – 'best guess' estimate by Court using sales evidence APPEARANCES: Mr G Allan of Counsel for the claimants Mr C Hughes SC with him Mr A Skoien of Counsel for the respondent SOLICITORS: John K Harris for the claimants Shire Solicitor, Council of the Shire of Pine Rivers, for the respondent Details of Resumption [1] This is a claim for compensation by Olive L Bowers and Lynette A Crane, as personal representatives ("the claimants"), being the registered proprietors of Lot 1 on Registered Plan 13591, County of Stanley, Parish of Bunya, consequent upon the resumption of the whole of that land for rubbish depot purposes by the Council of the Shire of Pine Rivers ("the respondent"). [2] A Notice of Intention to Resume dated 30 August 2001 was served on the claimants giving notice that the respondent intended to take the whole of the land for "waste disposal facility purposes". On 9 May 2003 the land was resumed for "rubbish depot purposes" by a proclamation published in the Government Gazette on that date. Compensation is therefore to be assessed as at 9 May 2003. General Description of the Land [3] The subject land is located approximately 18 km by road from the Brisbane GPO, is adjacent to the eastern side of Bunya Road and contains an area of 16.187 hectares and is of irregular shape. The topography of the land consists of various slopes ranging from approximately one in eight to one in four which could be described as being a mix of moderate to steep slopes. -- 2 of 31 -- 3 [4] To the north and west the land is effectively bounded by the Bunyaville State Forest Park. To the immediate east and south are several parcels of land under the ownership of the respondent which have been acquired over a number of years commencing in 1979. The combined areas of land owned by the respondent (excluding the subject) consist of park and recreation (Lot 2 on RP 164889) and operating rubbish depot (Lot 2 on RP 156364) uses and one uncleared area of land referred to by the parties as the "Chinn" land (Lot 3 on RP 49298). South and west of the land and Bunya Road are established areas of Special Residential, Rural Residential and Residential A development. [5] Bunya Road is a sealed bitumen surface road which provides access to the land. Electricity and telephone services are connected and schools and shops lie within a 4 km radius. Improvements on the land consist of a highset timber and fibro dwelling, detached shed and carport. There is a dispute about the level of availability of sewerage and town water as at 9 May 2003. The Initial Position of the Parties [6] A Claim for Compensation pursuant to s.19 of the Acquisition of Land Act 1967, dated 7 November 2003 was served by the claimants on the respondent. The amount claimed was in the sum of $2,600,000 excluding interest. The claim was made up of two components, namely "land and improvements" - $2,500,000 and "disturbance", estimated at $100,000. The claimants commenced proceedings in this Court by filing on 10 November 2004 an Originating Application seeking compensation in the amount of $2,600,000. [7] On 28 November 2003 the claimants' solicitors received a cheque in the sum of $400,000 from the respondent by way of an advance against compensation. The Position of the Parties at the Hearing The Claimants' Position [8] The claimants initially relied on a valuation (Exhibit 5) prepared by Mr Walsh, a registered valuer employed by Taylor Byrne Valuers, assessing compensation in the sum of $3,185,000 excluding interest and disturbance. Critical to Mr Walsh's assessment of compensation was that the highest and best use of the land, disregarding what was referred to as the "… scheme of which the resumption forms a part …", was for Residential A subdivision. According to Mr Walsh, at the date of resumption, the land would have been "ripe" for such development. Reliance was placed on a hypothetical subdivision layout (Plan 12267-5A) prepared by Mr Goodwin, an experienced surveyor. Mr Goodwin's subdivision envisaged the land being developed into 91 residential allotments averaging about 830m² in area, the minimum lot area being 600m². About 6 -- 3 of 31 -- 4 hectares of land (approximately 37% of the total area) was to be set aside for park / open space purposes. [9] The valuation relied on by the claimants was largely dependent upon the advice of experts in other fields, to the effect that there were no engineering, ecological, traffic or other town planning impediments which would prevent the hypothetical development relied on from proceeding and that the development costs would be, on average, about $40,000 per lot including town water and sewerage. The Position of the Respondent [10] The valuation upon which the respondent relied was prepared by Mr Gillespie, a registered valuer employed by the valuation company Bloxsom Chippindall & Associates Pty Ltd. Mr Gillespie, like Mr Walsh, relied in part on the opinions and reports of experts in other fields to conclude that the highest and best use of the land was for a large rural homesite with potential for up to six Rural Residential allotments having a minimum area of 2 hectares. At page14 of his report (Exhibit 20) Mr Gillespie put forward an alternate highest and best use being for one large rural homesite. The first scenario yielded a valuation of $490,000; the second a value of $400,000. Mr Allan, counsel for the claimants, accepted that if I were to find that the highest and best use of the land was for a large rural homesite with potential for up to six Rural Residential allotments, Mr Gillespie's valuation of $490,000 was a reasonable assessment of compensation exclusive of any allowances for disturbance and interest. Final Position of the Parties [11] On the last day of the hearing of this matter, the claimants, without objection by the respondent and with the leave of the court, amended their claim to $2,821,000 exclusive of disturbance and interest. The claims under the heading of "disturbance" were able to be agreed in the amount of $20,000 on an "all up" basis. The final position of the parties was therefore: Claimants: $2,841,000 including disturbance but excluding interest. Respondent: $420,000 or $510,000 including disturbance but excluding interest. [12] Before turning to some of the more specific matters that need to be addressed, I should mention here that the respondent took the position that interest on compensation for land and improvements should run from the date of the taking of the land (9 May 2003) to the date of payment, with appropriate allowance for the payment of the advance on 28 November 2003. -- 4 of 31 -- 5 [13] On the second day of the hearing I, together with counsel, inspected the land, its environs and various land sales relied on by the valuers. The inspection was of assistance in my understanding of the evidence. [14] As mentioned above, the valuers for both parties relied heavily on the advice of experts in other fields. In particular both sides called evidence from qualified and experienced surveyors, civil engineers and town planners. In determining this matter I do not consider it necessary to make a final determination in respect of each and every issue raised by the experts relied on by parties. My role, as I see it, is to decide how the hypothetical purchaser and vendor, properly advised and acting reasonably and prudently would come together at a price for the land. By necessary implication, relevant to these proceedings, this requires me to determine how the prudent vendor and purchaser, acting on appropriate advice, would assess the development potential of the land.1 The Pointe Gourde and San Sebastian Issues [15] As is often the case in matters such as this, the value to be attributed to the land largely depends on the resolution of various factual disputes raised by the witnesses on each side of the record. However, in this case there is one particular issue which raises matters of fact and law. In addition to having to rely on advice from other experts in carrying out their valuations, the valuers were required to disregard certain factual matters in accordance with what were said to be the principles established in cases such as Pointe Gourde2 and San Sebastian3. [16] Mr Walsh, valuer for the claimant, at page 15 of his valuation report under the heading "Highest and Best Use" stated: "The highest and best use is defined as the most profitable, achievable legal use for a property. To assist in consideration of highest and best use I have had regard to the report of Buckley Vann Town Planners on the basis that the scheme of the resumption is disregarded… The scheme of which the resumption forms part is considered to be the scheme of the James Drysdale Waste Disposal Facility and is disregarded for the purposes of this valuation. When the scheme of the James Drysdale Waste Disposal Facility is disregarded, the subject land would have been included in the Residential A zone for further subdivision and residential development. ..." 1 De Ieso v Council of the Highways (1981) 27 SASR 248 at 252-254 per Wells J; Walker Corp Pty Ltd v Sydney Harbour Foreshore Authority (2004) 134 LGERA 195 at paras [121] - [123] per Talbot J. Spencer v. The Commonwealth (1907) 5 CLR 418 at 432 per Griffiths CJ and at 441 per Isaacs J. 2 Pointe Gourde Quarrying and Transport Co Ltd v Sub-Intendent of Crown Lands (1947) AC 565 at 572. 3 Housing Commissioner of New South Wales v San Sebastian (1978) 140 CLR 196. -- 5 of 31 -- 6 [17] The Buckley Vann town planning report referred to by Mr Walsh was prepared by Mr Ovenden, a qualified and experienced town planner. At page 1 of his report4 Mr Ovenden by way of introduction stated: " … The report has regard to the various planning instruments and associated planning scheme provisions affecting the subject site and surrounding land for the period January 1978 to May 2003. The report considers the highest and best use in the following context:  assuming the statutory planning provisions of this period did not apply, having regard to the suitability of the site for development and development trends in the locality; and  the zoning of the land which, in my opinion would have been applicable to the land had the scheme of resumption never taken place. These assumptions take into consideration not only the zonings of the subject site (over that period) but that of the surrounding land north of Bunya Road (referred to in this report as the 'Investigation Area') and the wider district which existed prior to the resumption … " At page 16 by way of conclusion Mr Ovenden went on to state: "A detailed review of the Council's planning instruments since 1971 has been undertaken in the preparation of this report. It has been established that since 1978 in one form or another there has been reference to the proposed or existing refuse disposal facility. In my opinion, this has influenced the planning for the Investigation Area to satisfy a specific objective ie to restrict the ordinary course of development in the Investigation Area in order to protect the operation and expansion opportunities for the refuse disposal facility. It has been established that the highest and best use (assuming that the statutory planning provisions from January 1978 to May 2003 do not apply) is for the subject site to be included in the Residential A zone and the majority of the land is suitable for subdivision into conventional residential lots. … " [18] At odds with the views of Mr Walsh are those of Mr Gillespie. In his report, under the heading "Highest and Best Use," Mr Gillespie stated at page 13: "As the current restrictions to the land associated with 'the scheme' are to be ignored we have investigated the other uses to which the land can be put. After considering reports provided to me by the Pine Rivers Shire Council we have concluded that the highest and best use for the land is as a large rural homesite with potential for Rural Residential subdivision. That subdivision potential could involve a subdivision to approximately six Rural Residential lots (2 hectare minimum) … " [19] The reports considered by Mr Gillespie in reaching his conclusions included those from a qualified and experienced surveyor, engineer(s) and town planner. Mr Rea, a town planner employed by and relied on by the respondent at page 1 of his report,5 by way of introduction stated: " … In formulating my response to such a development proposal for Lot 1 on RP 13591, I have been requested to assume that: 4 Ex 6. 5 Ex 11. -- 6 of 31 -- 7  The tip site and adjacent James Drysdale Reserve do not as a matter of fact exist and that the land is undeveloped and zoned Rural.  The relevant provisions of the Hills District DCP does not apply.  The strategic plan and all other related planning instruments do apply. This approach is significantly different from the approach usually taken in the assessment of proposals of this nature. … " [20] While the relevant experts say they have applied the principles established by precedent and, in carrying out their valuations, have ignored the "scheme" underlying the resumption, there are obvious differences of significance between them. The position of the claimants is articulated in the written submissions of Mr Allan where he argued the so-called Pointe Gourde point in the following terms: "32. It is submitted that the assessment of compensation in respect of the resumed land is to be made in accordance with the High Court's application of the Pointe Gourde principle in … San Sebastian. ... Namely, that in respect of the resumed land (and the 'Investigation Area'), the restrictive provisions contained in the existing 1998 scheme and all historical planning instruments dating back to 1978 (the date of commencement of the 'scheme of resumption') associated with the use or future use of the land for rubbish depot or waste disposal purposes are to be ignored since there is a direct relationship between the restrictions imposed by those provisions and the use of the land for rubbish depot purposes. … 42. It is submitted on the foregoing authorities … that it is clear the approach of Mr Ovenden in forming his opinion that but for the 'scheme of resumption' the subject land would have had a Residential A zoning conforms in all respects with the law. … " [21] This is to be contrasted with the position of the respondent where, on its behalf, it was contended that while the existing rubbish depot and James Drysdale Reserve had to be ignored, the "scheme" did not exclude from consideration in the valuation process the Rural zoning of the land nor the existing strategic plan and " … all other related planning instruments". Counsel for the respondent articulated in paragraph 6.7 of their written submissions, the following argument: "6.7 The respondent submits that the applicant's assumption is erroneous for the following reasons: (a) first, it is at least arguable that the 'Pointe Gourde' principle has no application in the present case because the respondent has never taken a deliberate step to impose a restriction upon the use of the subject land - rather it has merely maintained rural planning controls which have been in place for over 40 years; (b) second, it is, in this case, impossible to 'ignore' the rural zoning under the 1988 planning scheme (and, for that matter, the rural preferred dominant land use designation) based upon the so-called 'scheme' because, on the facts of this case, as a result of the physical characteristics of the subject land; the unavailability of appropriate services and the balance of provisions of the planning documents generally; the subject land would probably have been zoned rural and given a rural preferred dominant land use designation regardless of the existence of the rubbish tip or the 'scheme'; and -- 7 of 31 -- 8 (c) third, even on the applicant's case, the subject land could not conceivably have been given a zoning 'greater' than Future Urban, being the zoning which the residential land south of Bunya Road was given in 1988 … " Mr Hughes, Senior Counsel for the respondent, in his closing oral submissions argued that the claimants were not entitled to exclude from consideration in the valuation process "… planning documents … unless (they) can find within those planning documents that some deliberate decision was made(to further the purposes of the dump)". [22] The purpose of the principle stated in Pointe Gourde is to prevent the constructing authority having to pay more than the market value for land taken where its value at the date of acquisition has been increased and that increase is entirely due to the scheme underlying the resumption. The relevant passage of the judgment of Lord MacDermott is very brief and to the point: "(it is) well settled that compensation for the compulsory acquisition of land cannot include an increase in value which is entirely due to the scheme underlying the acquisition." This passage was referred to by Scott LJ in Waters & Ors v Welsh Development Agency6 in the following terms: "The dictum of Lord MacDermott's that I have cited has, in the subsequent case law, been examined, pored over and construed as though it had been a sentence in an Act of Parliament. This process, as may be seen from the judgments of the courts below in the present case, is still continuing. In my respectful opinion the process has been and is unwarranted. Lord MacDermott, in his two page ex tempore judgment, came to a conclusion which, if I may respectfully say so, was clearly correct. … " [23] While Pointe Gourde is concerned about the underlying scheme or project inflating the value of land, San Sebastian is concerned about circumstances which, if allowed to be brought into account in the valuation process, would deflate the value of the land. In San Sebastian it was held that where there was a direct relationship between a restriction on land use imposed by planning instruments and/or legislation and the scheme or project underlying the compulsory acquisition, the effect on value of the restriction should be ignored. This proposition was stated by Jacobs J at pp 206–207 in the following terms: " … Restrictions on land use, so that, explicitly or practically, use is restricted to a use for a public purpose for which the land might be resumed, are commonly imposed as a result of consultation with or direction by the public authority concerned with the carrying out of the particular public purpose. In such a case where there is a direct relationship between the restriction on land use and the proposed establishment of the public works the effect on value of the zoning or restriction ought to be ignored. … " … "If the zoning was done with the intent or in anticipation that the land should be resumed for a purpose such as a public reserve or if the zoning was proposed or dictated by the resuming authority then s.124 requires that the zoning be ignored. It is only a step in the process of subsequent resumption" … 6 (2004) 2 All ER 915 at para [93]. -- 8 of 31 -- 9 [24] Relevantly, in my view, there are two important matters that need to be kept in mind when applying the so-called "rule" in San Sebastian. First, it is not authority for the proposition that, where it does apply, it is then necessary to assign and apply a superior zoning or land use potential to the land. Second, there must be sufficient connection between the scheme underlying the resumption and the restrictions imposed. [25] As to the first of these matters, in San Sebastian, while it was held that the proposed residential zoning in the draft planning instrument was a step in the process which was to be ignored, Jacobs J at page 211 went on to say: "… If independently of the proposed resumption for the purpose of public housing the land was found likely in the varied scheme to have been zoned residential in terms of the interim development order that would have been a most important finding affecting the value of the land for purposes of a private hospital." And to a similar effect at pages 211-212: "… The fact that the land would probably have been zoned in a manner similar to its proposed zoning under the draft interim development order would only be of significance if, contrary to the facts, that zoning would have been regarded as likely to occur independently of the proposed purpose of public housing and consequent resumption. Nevertheless it must be made clear that in so far as there was a possibility or likelihood of such a zoning independently of the purpose of public housing that was a matter properly to be taken into account in accordance with the principle enunciated in the Stocks & Parkes Case … " Hope J.A. in the Court of Appeal, with whose reasons Reynolds J.A. expressed agreement, stated: 'A special problem arises in the present case because of the mixed history of planning proposals for the use of land in the Woolloomooloo Basin, and of other matters bearing on that use. This history included proposals and other matters indicating that development in the relevant part of Woolloomooloo would probably or possibly be limited to residential development in a general sense, but did not suggest any public housing works. In so far as any of these matters altered the value of the resumed land, s.124 would not require that alteration to be disregarded. If there were matters not related to any contemplated public housing scheme which established that the probable zoning of the resumed land when resubjected to a prescribed planning scheme would be residential, that probability would be a matter falling within this class.' With all of this I entirely agree." [26] The principles established in San Sebastian were later considered by the High Court in The Crown v Murphy7, where the claimant in that case intended to carry out residential development at Mon Repos Beach near Bundaberg. Mon Repos Beach is a turtle rookery of international repute. The application to rezone the land from rural to residential was refused by the local authority and the land was later resumed by the government for environmental park purposes. In considering whether or not the local authority could have (properly) refused the rezoning application, quite apart from the resumption and the scheme for the protection of turtles, the Court at 595 stated: 7 (1990) 64 ALJR 593. -- 9 of 31 -- 10 "The statement of principle by the majority in the Full Court and the statement of the necessary consequential enquiry are unexceptionable. One purpose of this principle is to ensure that a resuming authority does not employ planning restrictions to destroy the development potential of the land and then assess compensation for its resumption on the basis that the destroyed potential had never existed: Melwood Units Ltd. v. Main Roads Cmr [1979] AC 426, at p 434. The principle applies in cases where there is a direct relationship between the planning restriction and the scheme of which resumption is a feature and extends to cases where there is merely an indirect relationship, provided that the planning restriction can properly be regarded as a step in the process of resumption: Housing Commission of NSW v San Sebastian Pty Ltd, at pp 206-207. Of course, a characteristic or attribute of the land which affects its value must be taken into account in the assessment of compensation even if the planning restriction which is a step in the process of resumption is dependent upon or directed to that characteristic or attribute. … " [27] As to the second issue, the requisite degree of connection has been variously described as being or requiring a "direct relationship"8 or a "direct causal connection".9 In their submissions, counsel for both parties tended to merge and adopt both tests. Provided that the latter is understood to mean the same as the former, I have no difficulty with the approach adopted. However, in Murphy, the High Court at 595 citing San Sebastian stated that the principle applied in cases not only where there was a "direct" relationship but also to cases where there was merely an "indirect" relationship, provided that the planning restriction could properly be regarded as a step in the process of resumption. That is, the potential scope for the application of the San Sebastian principle is wider than actually contended for by the parties. [28] Leaving aside for the moment the question of whether the requisite relationship existed between the scheme underlying the resumption and the planning restrictions applicable to the land, there was little dispute about the background history which can be summarised as follows: (i) The subject land, together with four other freehold lots formed a precinct effectively bounded by the Bunyaville State Forest to the north, east and west and by Bunya Road to the south. This precinct was referred to by the parties as the "investigation area". (ii) The subject land had effectively been given a rural designation from the introduction of the 1965 town planning scheme through to the date of resumption. The balance of the land making up the investigation area was zoned Rural Land in 1965 but has been progressively rezoned during the evolution and development of the rubbish tip and public reserve area known as the James Drysdale Recreation Reserve. 8 San Sebastian at 206.5; Murphy at 595. 9 Haig v Minister Administering the National Parks and Wildlife Act (1994) 85 LGERA 143 at 149 per Kirby P. -- 10 of 31 -- 11 (iii) In 1978 the amended Arana Hills Development Plan came into operation. (iv) At or about 24 March 1979 the respondent resumed Lot 2 on RP 164889 for rubbish depot purposes. (v) On or about 24 April 1980 the respondent purchased Lot 1 on RP 164889 by private treaty. (vi) On or about 1 December 1980 the respondent adopted the Pine Rivers West Development Control Plan No. 3. (vii) In May 1983 the Pine Rivers West Development Control Plan No. 3 was amended. (viii) In 1985 town water and sewerage headworks areas were established. (ix) At or about May 1988 the respondent's planning scheme came into effect including its Strategic Plan and planning scheme schedules and maps. (x) At or about February 1989 the respondent, by private treaty acquired a two- third interest in Lot 2 on RP 156364 and, by resumption, acquired the remaining interest at or about December 1989. (xi) At or about June 1992 the Hills District Development Control Plan No. 1 (Hills District DCP) came into effect. (xii) In 1995 the town water and sewerage headworks boundaries of the respondent were reviewed. (xiii) At or about June 1997 a Notice of Intention to Resume for local government purposes was issued to the owners of Lot 3 on RP 49298 (the Chinn land). However, at or about December 1998 the respondent acquired the land by private treaty and the resumption process was discontinued. (xiv) In May 1998 the respondent's consolidated Strategic Plan was gazetted. (xv) On 9 May 2003 the subject land was resumed for rubbish depot purposes. The Scheme [29] As already identified, the proclamation resuming the land stated the purpose of the taking as being: "…for rubbish depot purposes ...". According to Mr Allan, the scheme underlying the resumption commenced in 1978, the date at which the first compulsory acquisition for rubbish depot purposes commenced within the investigation area. Counsel for the respondent did not contend for any specific date as being the commencement of the scheme underlying the subject resumption. However, as I understand their written submissions, the implication was that the relevant scheme did not commence until 1992 with the introduction of the Hills District DCP. -- 11 of 31 -- 12 [30] Notwithstanding lengthy testimony and volumes of documents being tendered by both sides in the furtherance of their respective cases, very little evidence was specifically directed at identifying what the relevant scheme was and when it commenced. In fact, the evidence on these matters was effectively limited to the contents of the various town planning instruments adopted by the respondent over time. My concern in this regard is this: Is the resumption in 2003 for rubbish depot purposes a part of the same scheme which commenced in 1978, or, is it in fact part of a new scheme, namely the expansion of the then existing waste disposal facility? To my mind, the fact that the resumption of the subject land was for the same purpose as that underlying the first resumption does not necessarily mean that both parcels of land were resumed as a part of the same scheme. If land was resumed in the 1970's for a road and, due to traffic growth in the area, more land is resumed in 2000 to increase the road from 2 to 4 lanes it could not, in my view, be necessarily said that both resumptions were part of the same scheme solely on the basis that the purpose stated in the notice of intention to resume and Proclamation in both cases was "road purposes". Conversely, the fact that the first resumption occurred in 1979 and the last in 2003 does not necessarily mean they were not taken as a part of the same scheme. [31] The difficultly I have with accepting that the scheme underlying this resumption is the same as that underlying the first resumption commencing in 1978 is that there is no convincing evidence to that effect. In the circumstances of this case I find the reasoning of the Land Appeal Court in Hutchins and Anor v The Council of the Shire of Woongarra and Steven v The Commissioner of Water Resources10 to be of some assistance. In Hutchins of pages 290-291 it was said: " … The question of whether the two resumptions of land are part of the same scheme is one of fact: Abbey Orchard Property Investments Pty Ltd v Sydney City Council (1978) 37 L.G.R.A. 230, Nuland Developments Pty Ltd v Parramatta City Council (1978) 37 L.G.R.A. 258. In deciding this question, however, the fact that the two resumptions are some 12 years apart is irrelevant. We do not think that the present resumption is part of the same scheme as the 1978 resumption. The former taking was for the purpose of constructing sewerage treatment works for the Thabeban area which could cater for a population of 2,000 persons. A claim for compensation for the resumed land was settled for the amount of $40,000. The sewerage treatment works was constructed on the resumed land. This, in our opinion, constituted the first scheme. There is no evidence to indicate that the Council considered it to be the first stage of an ongoing scheme. The report by engineers, G.C. Leddy and Associates, tendered in the Land Court, indicates that the existing sewerage treatment works was designed as a stand-alone scheme catering for a population of 2,000 persons, with the treated effluent being discharged into Yellow Waterholes Creek. Time and population pressure have rendered these works inadequate and the Council has now considered a scheme will which is quite different from the existing one. The new scheme will cater for a population of 5,000 persons, with land 10 14 QLCR 286; 13 QLCR 75 respectively. -- 12 of 31 -- 13 disposal of treated effluent instead of the present discharge into Yellow Waterholes Creek……." A similar approach or reasoning was adopted by the Land Appeal court in Steven at pages 80–82 to distinguish between an earlier scheme and a later scheme with some common elements. [32] Turning then to the various town planning instruments to which my attention was drawn, Mr Ovenden first referred to the Arana Hills District Development Plan adopted by the respondent in May 1978. As pointed out by Mr Ovenden only limited reference is made to a rubbish disposal site in this document. The next instrument referred to was the Pine Rivers West Development Control Plan No. 311 adopted by the respondent in December 1980. According to Mr Ovenden only Lots 1 and 2 on RP 164889 were identified as "garbage dump" in that document. Lot 1 was purchased by the respondent in April 1980 and Lot 2 was resumed by the respondent in March 1979. Other land (including the subject) within the investigation area was identified as "extensive grazing". At pages 57- 58 of this document it is stated: "Refuse Disposal" At present there are two rubbish tips within the Study Area. One is at the entrance to the disused railway tunnel under Mt Samson Road and is approaching the end of its viable life. The other is a newly opened site at the intersection of Bunya Road and Old North Road. ... Outside the Study Area, the closest useful refuse tip is located at Francis Road in Lawnton. … Council is investigating further the problems of refuse disposal within the Study Area… Once each tip site has reached its maximum capacity the surface contours will be adjusted to provide for a suitable ultimate use. Such uses are likely to be recreational or other appropriate land intensive activities in keeping with the uses proposed for adjacent areas on Policy Plan … " I was not referred to any specific part of this document as evidencing an ongoing rubbish disposal or depot scheme or an intention by the respondent to expand the existing facility at Bunya Road. [33] Sometime between 1980 and 1988 the respondent was obviously becoming more concerned about the availability of sufficient land for waste disposal and recreation purposes to accommodate population growth within the shire. After identifying this problem, the authors of the 1988 Strategic Plan went on to state:12 "James Drysdale Reserve. …. The existing area of land is not adequate to fulfil long term needs for playing fields…. To obtain additional land in the immediate vicinity of the existing facilities has considerable advantages in that the various sporting bodies will utilise the land more efficiently. The land immediately to the west of James Drysdale Reserve is suitable for use as a landfill reclamation site and after filling is completed for district playing field facilities. The land has been included in the Rural designation as this designation has been given to land which is constrained or where it is considered that a more appropriate use is possible in the future." 11 Ex. 59. 12 Ex. 70; Guidelines for Development Pine Rivers West District at page 46. -- 13 of 31 -- 14 [34] The timing of the 1988 Strategic Plan is of some significance. This Plan was adopted by the respondent in May 1988 and in February 1989 the respondent purchased a two third interest in Lot 2 on RP 156364. It seems unlikely to me that, at the time the 1988 Strategic Plan was being considered by the respondent, it was not also seriously contemplating the purchase and/or compulsory acquisition of at least Lot 2 for expansion of the rubbish depot and reserve areas. [35] By 1992 even more active steps were being taken to preserve other land within the investigation area for uses consistent with close proximity to the existing rubbish depot. In the respondents Hills District Development Control Plan13 the whole of the investigation area is located within precinct 15. In Part A at pages 38-39 the authors of this document state: "Precinct 15 – Special Purpose Area (a) Intent This precinct is intended to accommodate a land fill waste disposal site to serve the Hills District and Albany Creek areas for the foreseeable future. As the land is progressively filled, it is intended to be used for a wide range of sporting, recreational, community and local authority purposes. It is intended that privately owned land within this precinct shall not be used or developed for purposes which would be incompatible with Council's planning intentions for the land fill waste disposal site(s), such as Residential A, Park Residential, Rural Residential, or Special Residential sub-division. (b) Land Uses …. The preferred use of the privately owned land in this precinct is rural non-residential uses which, in the opinion of Council, are compatible with the uses to be established on the Council owned land." [36] The reference to "this precinct", which includes the subject land, as a "special purpose area" is, from the evidence that I have been referred to, the strongest language indicating that the whole of the investigation area was to be preserved only for land uses compatible with the respondent's rubbish depot use, including expansion. Between 1992 and 1998 the advantages of securing the adjoining land were being more precisely spelt out, though even then the prospect of further acquisitions was couched in vague terms as it was only identified that adjacent land "… may be suitable for future expansion"14. However, it would seem that in fact planning was more advanced as by June 1997 the respondent had issued a Notice of Intention to Resume in respect of the Chinn land which stated the intended use as being "local government purposes". This land was later purchased by 13 Ex. 22. 14 1998 Strategic Plan; Ex. 21 at pages 131-132. -- 14 of 31 -- 15 private treaty for what was described in some of the documents as being the future expansion of the James Drysdale reserve for future refuse purposes.15 [37] Doing the best that I can with the evidence before me I find; first, that the scheme underlying the resumption of the subject land did not commence in 1978. Second, the scheme underlying the subject resumption was for the extension or expansion of the then existing rubbish depot facility. Third, this scheme commenced at or about 1988, some time prior to the adoption of the 1988 Strategic Plan. The Hills District - Development Control Plan (No. 1) [38] As referred to above, counsel for the respondent, while advancing a primary argument for compensation in the sum of $490,000 excluding disturbance and interest, in their final address and written submissions left open what was said to be an "arguable" alternate case based upon the proposition that that section of the Hills District DCP relating to Precinct 15 was not a part of any scheme of resumption. And, if that section of the Hills District DCP was a valid consideration in the valuation process, the market value of the land was only $400,000 on the basis of its highest and best use being limited to only a large rural homesite. According to the respondent, the Hills District DCP arguably should not be seen as a deliberate step to impose a restriction on the use of the land as part of the resumption process but rather as a part of the ongoing policy of the respondent to maintain the rural zoning which had been in place for some 40 years. [39] I do not accept this argument for either of two reasons. First, it ignores or unreasonably reads down the actual wording used in the document concerning Precinct 15. Second, rural land in Precinct 15 is treated differently than other land designated Rural in the Plan. In Part A at pages 39-40 of the Plan, under the heading "Land Use" it is said in respect of Precinct 16: "… The preferred use of the Rural zoned land in the north-east of the precinct is as a buffer or transition area between the urban area and the Park Residential area to the north. Council shall not approve urban forms of residential development on the land. The Rural zoned land may be suitable for low density forms of Special Residential or Rural Residential development which, in the opinion of Council, is consistent with the objectives for Rural Areas described in Part A of the Strategic Plan, which will not detrimentally affect any area considered as environmentally sensitive by Council, which does not require the extension of Council's water supply system beyond the 120 metre contour (at the time of preparation of this DCP Council was reviewing its Water Supply and Sewerage Headworks Policy and may reconsider this requirement pending the outcome of that review), and which does not, in the opinion of Council, detrimentally affect the amenity of the adjoining Park Residential estate to the north. To my mind, the respondent clearly saw the potential for some form of more intense development of the rural land in Precinct 16 when compared to land with the same designation in Precinct 15. The most apparent difference between the two precincts being 15 Eg, Ex. 57; Part of Council minute dated 17 August 1999. -- 15 of 31 -- 16 proximity to the respondent's rubbish depot and reserve. By that I mean to say, but for the "scheme", there appears to be no other sound town planning or engineering reasons why the subject land should have been treated differently to that of other land designated rural in such close proximity. [40] For the reasons canvassed above I find that the restrictions imposed on the use of the land by virtue of the operation of that part of the Hills District DCP dealing with Precinct 15 is to be ignored. In my view, there is a direct relationship between the planning restrictions imposed by this section of the Plan and the scheme of which the resumption is a part. In this context I note that senior counsel for the respondent did concede in final submissions that it was, on the evidence, open for me to conclude that there was a sufficient relationship between this part of the plan and the scheme to offend the principles established in San Sebastian. [41] Accordingly, I reject Mr Gillespie's alternate valuation approach which assessed the value of the land and improvements in the sum of $400,000. Zoning and Services [42] Upon the introduction of the Integrated Planning Act 1997 (IPA), the actual zoning of a parcel of land arguably became less critical when assessing the development potential of that land. Under IPA, residential development would not be a prohibited use because of the historical rural zoning. However, in my view the rural zoning would, in the eyes of the prudent purchaser, tend to be seen as a negative introducing more risk into any analysis of the potential of the land for development. In the circumstances of this case, according to Mr Rea, the respondent's town planner, intensive residential development depended on the developer being able to demonstrate:16 (i) that essential services could be made available without compromising the entire water supply network or the rights of other property owners within the existing headworks area (and that other similarly placed Rural zoned properties could also be developed) without compromising the provision of essential services. (ii) the development of the subject property and the other properties within the "enclave", could occur without creating an unacceptable burden on surrounding land use or the future residents by way of traffic and general amenity issues; and (iii) development of the property could occur in an acceptable manner with due regard to issues related to slope, orientation, vegetation retention, bushfire management etc. (emphasis added). In respect of the availability of "essential services" the critical issues were whether or not at the date of resumption town water and sewerage would have been reasonably available for connection. Mr Rea, in his response report17 considered the availability of these 16 Ex 11, P 4 "Conclusion". 17 Ex 12, P 5 "Service Availability". -- 16 of 31 -- 17 services to be the most important issue in assessing the development potential of the land. The theoretical pre-lodgement meeting form18, while clearly identifying a wide range of matters that would need to be addressed in any development approval process, specifically noted: "… NB Water supply and sewerage are not available. Therefore, Residential A development not supported." [43] In my view, the other issues identified by Mr Rea, as set out in paragraph [42] above do not on their own or collectively necessarily rule out Residential A development. That is, provided that essential services (i.e. town water and sewerage) were available for connection and the other issues identified by Mr Rea and Mr Vanderent19 could be satisfactorily addressed in the design and construction stages of development, there was no reason to suppose that favourable consideration would not have been given for some form of Residential A type development. That of course does not mean that, even if town water and sewerage were reasonably available, such development would occur. The commercial viability of any such development would be critical to the prudent purchaser and vendor. Sewerage and Town Water Connection. [44] The prudent purchaser, particularly since the introduction of IPA, would no doubt find the zoning of the land to be a matter to consider, however, he or she would be far more interested to know how likely it was that, as a matter of fact, approval would be given for his or her development by the relevant local authority. In this context, to an extent, the rural zoning of the land seemed to me on more than one occasion to be more a matter of only historical interest to Messrs Rea and Vanderent. Mr Rea, in addition to the opinions stated in his written reports, emphasised on more than one occasion in the witness-box that for him the major impediment to Residential A development on the land was the availability of town water and sewerage, particularly town water.20 The oral evidence of Mr Vanderent, as far as it went, was of similar effect. For him the "turning point" for the respondent in considering development applications was the knowledge of the bulk water supply problems in 1995.21 [45] To my mind, a zoning or designation which would facilitate Residential A development and the reasonable availability of town water and sewerage are so inter-related that it is difficult to imagine one without the other, provided sufficient demand for such development existed. Accordingly, in my view, a critical issue to be resolved is whether, 18 Ex 13, App D at P9. 19 Professional engineer employed by the respondent and author of reports Ex 13 and Ex 14. 20 T 584, L 40-45; T 585; T 593, L 45-50; T 594, L 1-10. 21 T 630, L 40-45; T653, L 20-40. -- 17 of 31 -- 18 but for the scheme underlying the resumption of the land, town water and sewerage would have been reasonably available for connection on or before the date of resumption. [46] On behalf of the respondent it was contended that the major obstacles in the path of town water and sewerage were that the land was and always had been outside of the respondent's headworks catchment areas. Second, and related to the first obstacle, that on and from 1995 the limited availability of bulk water effectively meant that the reasonable opportunity for any meaningful extension of the town water headworks boundary to include the subject land was gone (if in fact it ever really existed). Third, there was at all relevant times other land available for residential development within the shire that was generally superior to the subject because of various attributes including; more appropriate zoning, topography, area and location, being either within or proximate to the existing town water and sewerage catchment areas. Of course availability of services, location and area would be issues likely to occupy the minds of the relevant officers of the respondent when determining the appropriate land use designation for any parcel of land. [47] Also, in my view, particular care needs to be taken to ensure that each of the matters raised by the respondent against the development potential of the land, are considered in a historical context. One illustration of this is the bulk water issue. Prior to 1995, as I understand the evidence, the respondent was not aware that the availability of bulk water was an issue militating against extension of the water headworks areas set in 1985. However, from 1995 to the present, the availability of bulk water has been seen as a genuine impediment to the extension of the water headworks areas and a limitation on the location and approval of more intense residential development generally. If, but for the scheme underlying the resumption, it would have been a reasonable expectation that the water headworks area would or could reasonably have been extended to include the subject land before the 1995 bulk water problems became known of by the respondent, the later knowledge of that problem by the respondent would be largely irrelevant. [48] In so far as the availability of town water and sewerage is concerned, the case for the claimants is concisely stated by Mr Ovenden at page 3 of his response report (Exhibit 30) in the following terms: "The Rea report (Section 5.2, Stage 1) considers a theoretical development application and highlights the importance of first analysing the availability of water supply and sewerage to the subject site and the Investigation Area. It fails to recognise what is a reasonable proposition that but for the Scheme of Resumption the sewer and water supply headworks boundary would have been extended to include the subject site. The reason why it was not extended as part of the 1985 or 1995 review of headworks boundaries is that the waste disposal facility was in existence. In undertaking any review of water supply and sewerage capacity the process would involve a consideration of the planning scheme (in particular the Strategic Plan and DCP) and liaison with Council officers in relation to development opportunities and constraints." -- 18 of 31 -- 19 Sewerage Connection [49] The evidence makes it quite clear in my view that, as between the availability of sewerage and town water connection, it was the latter which would have caused more concern to the respondent in the consideration of any Residential A development proposal. This conclusion is consistent with the evidence of engineers called by both parties. Dr. Johnson, in his initial report22 relevantly concluded: "It has been determined that suitable water supply and sewerage infrastructure can reasonably be supplied to this site, without excessive cost. While it is noted that the site is outside of Council's headworks area, it is not considered that this would be an impediment to development, because Council has resolved that it will seek to facilitate such external developments by the provision of relevant Infrastructure Agreements. …" Mr Nigel Cartwright (Engineer) was the author of three reports tendered in the case for the respondent. In one of his reports (Exhibit 16), after identifying that the land was zoned Rural and located outside of the existing sewerage headworks area, he relevantly concluded at page 4: " Impact on Existing Trunk Sewerage The capacity of the existing sewerage up to PS260 is adequate for ultimate flows that include flow from the bunya Rd development. The flow from the development will have only a limited impact on the size and/or staging of augmentation works proposed downstream of PS260. Pump station capacity would have to be increased by 3.67 L/s at PS260 and PS203, which have ultimate peak wet weather flows of 180 L/s and 467 L/s respectively (refer to attached system curves). However, it is not recommended that the development proceed until the new rising main from PS260 has been constructed and pump upgrades completed at PS203 where the existing capacity has been exceeded." After having had the opportunity to review the reports of Mr Cartwright, Dr Johnson authored a response report (Exhibit 23) which relevantly concluded at page 5: "2.3 Technical Memoranda of Nigel Cartwright Mr Cartwright has provided advice on the provision of water supply and sewerage to the site. No response is required to the information provided, since the findings are essentially identical to those outlined in my original report, namely that both water supply and sewerage can reasonably be provided to the site." This evidence of Dr Johnson was not challenged in cross-examination and Mr Cartwright was not called as a witness. [50] Having regard to the evidence I have reached the conclusion that, leaving questions of commercial viability aside for the moment, there were no sound engineering or town planning reasons for refusing Residential A development of the land solely because it lay outside of the sewerage catchment area. This service would have probably been achieved by the developer bearing the capital cost of installing the necessary pumping station and 22 Ex 8. -- 19 of 31 -- 20 associated works and then entering into an appropriate infrastructure agreement with the respondent. The evidence of Mr Vanderent together with that of Dr Johnson left me with the clear impression that such an arrangement was feasible. Town Water Connection [51] It seemed quite clear that, like Mr Rea, Mr Vanderent was of the view that post 1995 there was no reasonable prospect of town water being made available to service Residential A development on the subject land. At page 653, lines 20-40, when being questioned by Mr Allan about infrastructure agreements the following exchange took place: "Q. And you'd raise such a matter at your pre-lodgement meeting with the relevant expert who may come to you with the type of concept plan and engineering evidence which have been produced by the claimant in this case? A. If someone had come along to a pre- lodgement meeting on this land, 9th May, with this report we would have said, 'It doesn't matter whether or not you can provide the service. We're not expanding outside our headworks area because we have a limited bulk water supply, we have sufficient development of the land in our headworks area and I wouldn't be recommending council expand into this area.' Q. So the limit on bulk water supply, as I understand it, is the largest constraint to, at least in your opinion, making a recommendation to council again - in the hypothetical situation we're dealing with-----? A. Exactly. And under the 1985 plan council did approve - that's 1985 headwords plan - it did accept developments outside the headworks area in a period when it didn't know there was a bulk water supply issue. 1995 was the turning point when we discovered a bulk water issue and we were regularly reporting proposals to council saying, 'They're outside your headworks area. You don't have enough water for your headworks area. If you approve this you'll be compromising people who have had development potential inside your area and you shouldn't be doing that'." [52] Exhibit 74 shows the boundary of the water catchment area at the date of resumption generally following the location of Bunya Road to the south of the land. There is also no dispute that the whole of the investigation area, including the subject land, lies in a different physical catchment area to the Cabbage Tree Creek catchment. As was the case concerning sewering the land, the evidence of Dr Johnson and Mr Cartwright left me with the strong impression that there were no insurmountable engineering impediments to connecting town water to the land. However, neither of these witnesses had regard to the "bulk water" issue raised by Messrs Rea and Vanderent. [53] The availability of town water is no doubt complicated by the events of 1995. The evidence of Messrs Rea and Vanderent, which I accept, points quite clearly to the respondent having to rethink its water strategies and policies, after learning in 1995 of the constraints on development within the shire imposed by the bulk water allocation to which the respondent was subject. As I understand it, the respondent and other local authorities have a bulk water allocation sourced from various dams including those at -- 20 of 31 -- 21 North Pine and Wivenhoe. According to Mr Vanderent the respondent is required to ensure that the future planning demands for the shire would not exceed the bulk water supply allocated to it by the relevant authority. [54] To return then to the opinions expressed by Mr Ovenden as set out in paragraph [48] above, what needs to be tested are his clearly inter-related propositions. The evidence leads me to the conclusion that it would be fair to say that, once the decision had been made by the respondent to progressively acquire and utilise the land within the investigation area, it was not going to readily make available the sorts of services likely to attract intensive residential development. Mr Rea candidly conceded that there was a deliberate intention by the authors of the Strategic Plan to ensure the privately owned land within the investigation area was kept in the rural zoning. Notwithstanding this, it need not necessarily follow that, but for the scheme, the subject land would have been given a Residential A or Future Urban designation by the respondent and that the water catchment boundary would have been extended to include the land. [55] The evidence, particularly that of Messrs Rea and Vanderent, leads me to the conclusion that from 1995 up to the present the respondent, regardless of the scheme, would have been opposed to extending the water headworks to include the land which lies in a different and unserviced catchment. Things might have been different if there was a shortage of developable land within the shire but that was not the case according to Messrs Rea and Vanderent, whose evidence on that topic was not seriously challenged. [56] In support of his opinions to the contrary Mr Ovenden drew attention to instances where the respondent had approved more intense forms of development reasonably proximate to the subject land and outside of the water catchment areas set in 1985 and 1995. Some emphasis was placed on what had occurred on land located to the east and south-west of the subject land. [57] As to the development to the east, it is located on land immediately to the north of Collins Road, a road constructed by the developer of that land. The evidence revealed that the land referred to and developed for Residential A purposes was part of a large residential development over some 65 hectares which, prior to the construction of Collins Road, was a contiguous holding. Further, the respondent's initial approval for residential development over the entire site dated back to 1984 when the land was rezoned. As I understand it, the conditions attaching to the 1984 rezoning were not met and it effectively lapsed. The project was reactivated in February 1993 when the same land was taken from the Future Urban zone and placed in the Residential A zone as a consequence of a successful combined rezoning and subdivision application being lodged on behalf of -- 21 of 31 -- 22 the new developers. Mr Rea saw the 1984 rezoning as an important element in the respondent's consideration of the 1993 application. On balance, I do not consider that a prudent purchaser or vendor would draw much comfort from what occurred on this land as representing some form of precedent or giving insight as to how the respondent might react to a Residential A proposal over the subject land in 2003. There are too many differences of both a physical and historical character. [58] The second development to the south-west was described by Mr Ovenden as an example of where the respondent "… allowed for an extension of the urban footprint into the rural designated land …". This development was referred to as being part of the Fernlands Estate. The evidence concerning this development is that it involved an area of land which made up part of the western section of the Fernlands estate and, notwithstanding that the land was within the Cabbage Tree Creek catchment it was not included in the respondent's 1985 water headworks area because, at that time, water supply was not provided for above 120 m AHD. As Mr Hughes SC put it, the land was suitable for sewerage but not for reticulated water. As a part of an infrastructure agreement entered into in the "early" 1990's between the developer of the retirement village to be built on part of this land, the developer was required to put another water supply reservoir in place. This in turn allowed for the expansion of the water supply area beyond 120 m AHD and up to the natural elevation of the Cabbage Tree Creek catchment. Taking these matters into account I have come to the same conclusion in respect of this example as that reached concerning the Collins Road development. The third example referred to was the supply of town water to the rubbish depot and public reserve which now exist on land acquired by the respondent within the investigation area. I agree with Mr Ovenden that no sensible comparison can be made between those works and what would be required for Residential A development on the subject land. [59] Some reference was also made during the course of the evidence to extensive residential development occurring in the north-east of the shire involving areas of land lying outside of the 1995 water headworks boundaries. These areas are said to include the Mango Hill/North Lakes Estate development areas. These areas have been designated "Special Development" in the respondent's Town Planning Zone Map. According to Mr Rea, the Mango Hill/North Lakes development also has its own development control plan and the developers have entered into significant infrastructure agreements which include certain guarantees that the shire's ratepayers will not have to contribute to the cost of servicing the development. -- 22 of 31 -- 23 [60] Finally, reference was also made to residential development of land outside the 1995 water catchment area at Ira Buckby Road, West Cashmere. In this case the headworks area was not extended to include the land but arrangements were made to provide town water through infrastructure agreements. This development also involved rather special circumstances. First, the land was previously designated for extractive industry purposes but contained significant areas of environmentally sensitive vegetation. Second, the development on the land was subject to the developer handing over to the respondent about 50% of the entire holding for environmental purposes and the balance being developed less intensively. Overall, the development yielded only about 1.2 lots per hectare compared to the more typical Residential A yield of 8 or 9 lots per hectare. [61] After consideration of the facts and circumstances surrounding each of these two developments I have concluded that they offer no support for the proposition or conclusion that, but for the scheme, town water have been reasonably available to service the land for Residential A development. [62] When the headworks catchment areas within the shire were reviewed in 1995 they would have accommodated sufficient development to provide for a shire population of 180,000. However, as at 1995 the existing shire population was no more than about 90,00023 and, as Mr Vanderent pointed out, there was a significant surplus of developable land within the existing headworks areas and therefore little need to extend them further. The evidence also revealed that between the setting of the catchment boundaries in 1985 and 1995 these circumstances had not changed dramatically. That is, a surplus of developable land within the 1985 catchment areas meant that significant expansion in the 1995 review was not required.24 There was also evidence to the effect that much of the undeveloped land within the 1985 and 1995 catchment areas would have been easier to develop than the subject. In this context, the surveyor and engineer called on behalf of the claimants agreed that the subject land would not have been an easy site to develop for Residential A purposes. [63] After reviewing all of the evidence on this topic I am not at all convinced that, ignoring the scheme underlying the resumption, town water would have been available or reasonably available to facilitate Residential A development on the subject land any time prior to 1995, whether by extension of the water catchment boundary or by way of infrastructure agreement. The land is physically separated from the urban land to the south and the headworks area, not only by Bunya Road but also by a ridge line which puts 23 T 627 L 40-50; T 628, L 1-5. (Note: The figure of 180,000 was reviewed downward to 160,000 because of bulk water supply concerns. 24 T 630, L 10-32. -- 23 of 31 -- 24 the land (together with the balance of the investigation area) in its own small catchment. The latter physical characteristic was an issue which particularly concerned Mr Vanderent and the 1985 review of the town water and sewerage headworks areas extended the boundary of those areas only to the northern natural boundary of the Cabbage Tree Creek catchment area. [64] As already identified, the evidence left me with the clear impression that from 1995, when the bulk water issue became known, there was no reasonable prospect of the water catchment area being extended to include the subject land. [65] Before leaving this topic I consider it necessary to deal with one further aspect of Mr Vanderent's evidence. At page 669 of the transcript, Mr Vanderent was asked to make two assumptions: First, that the investigation area was a "priority infrastructure area" and second, that the investigation area had a "Future Urban" or "Urban" designation. He was then asked, making those assumptions, would the respondent then have been prepared to enter into appropriate infrastructure agreements to service the land. Mr Vanderent's response was that, if the land " … was zoned Future Urban" there was every likelihood that such a course of action would have been recommended. Presumably the recommendations would have come from council officers such as Mr Rea and himself. [66] Given the assumptions underlying the response, the concession was not a surprising one. When giving his response, Mr Vanderent clearly saw land with a 'Future Urban' zoning or designation as being land " ... always intended one day to have water and sewerage". To that extent, Mr Vanderent tends to confirm what I attempted to articulate in paragraph [45] above when touching on the almost circular relationship between the urban designation of land and the availability of services, particularly town water and sewerage. For reasons already addressed I do not accept that, but for the scheme, it would have been reasonable to expect or act on the basis that the investigation area, including the subject land, would have had town water available or reasonably available for connection. In the circumstances the concession made by Mr Vanderent does little to advance the claimants' case in my view. [67] It should be clear from what I have already said that I do not accept that, as at the date of resumption, the land would have had a Residential A or similar zoning or designation due to the unavailability of town water. Notwithstanding this conclusion I consider it appropriate to address some of the other matters raised by the parties concerning the zoning of the land. [68] As counsel for both parties acknowledged, I am not required to disregard all of the respondent's town planning instruments, it is only those about which it could be fairly -- 24 of 31 -- 25 said there was a direct relationship between the town planning restrictions those instruments imposed and the scheme, or where the restrictions could be properly regarded as a step in the process of resumption, that are required to be ignored. [69] The evidence was that the topography of the land did not easily lend itself to Residential A development. Further, the location of the land is such that it is rather uniquely placed having regard to other land within the shire designated for more intensive urban development. First, the investigation area of which the subject land is a part, is a discrete area separated from Residential A development to the south by Bunya Road and effectively surrounded on three sides by State forest. Second, as the land lies in a small and discrete water catchment area it could not be said, in my view with any degree of confidence that Residential A development would have involved a logical extension of the existing water supply and sewerage infrastructure. To my mind, the physical characteristics of the land and its environs are such that a land use designation not compatible with intensive urban development could not be said to be illogical or incongruous. In this context, to the near west and south west lie significant areas of land zoned Future Rural Living, Park Residential and Special Residential requiring less intensive urban development. [70] Having regard to all of these matters I am left in the position that I am not satisfied that, but for the scheme, the land would have had a Residential A or even a future urban designation or zoning. Nor am I convinced that, regardless of zoning and if the scheme was ignored, there were reasonable prospects of a Residential A development gaining the necessary approvals under IPA. Accordingly, I reject the valuation of Mr Walsh based on a Residential A subdivision of the land. [71] This conclusion does not necessarily lead to the consequence that, as at the date of resumption, the highest and best use of the land, with its rural zoning, was for only a large rural homesite. Mr Gillespie, relying on advice from officers of the respondent, expressed the opinion that if the restrictions imposed by the Hills District DCP were ignored, the highest and best use of the land would include potential for Rural Residential subdivision into 2 hectare lots. Further, as already identified, following the introduction of IPA, the existing zoning of land does not mean that any particular form of development is prohibited. Each application for development is to be looked at and have its merits assessed in accordance with the provisions of that legislation. Highest and Best Use and Value [72] In his report (Exhibit 12) at pages 4-5, Mr Rea expressed the view that, as at the date of resumption, Rural Residential or Park Residential development was more likely to be -- 25 of 31 -- 26 approved than more intensive residential development. Rural Residential development allows for lot sizes down to 2 hectares in area and requires neither sewerage nor town water. Park Residential development allows for sub-division down to 6000 square metres and requires town water but not sewerage. Another form of residential development is envisaged within the respondent's town planning framework and it is that which Mr Rea referred to as being "Special Residential". Not surprisingly, this form of development is permitted in what Mr Rea described as "special circumstances" including topography and limited availability of services. An example of this form of development is that referred to in paragraph [60] above at Ira Buckby Road.25 [73] Topography would not be a basis for refusing Park Residential or Special Residential type development on the evidence before me. The proximity of the land to the forest is also unlikely to be a bar to such development. Further, the totality of the evidence of Mr Rea left me with the clear impression that, while after 1995 town water would not have been made available for Residential A development, it was not ruled out for less intensive residential development involving significantly fewer lots. At page 5 of Exhibit 12 Mr Rea states in part: "The issue of whether one designated the land for either a "Park Residential" or "Rural Residential" land use, would in my opinion have been decided upon the results of a close examination, as to the feasibility and economic practicality of providing a town water supply." To my mind, when Mr Rea was discussing the possibility of Park Residential or Rural Residential development the bulk water issue dealt with above was not in itself determinative. That is, for such development the availability of town water was more to do with practicability of supply rather than the availability of bulk water. Mr Rea's oral testimony on this topic was, in my view, consistent with this conclusion. [74] The engineering evidence, to which I have already referred, makes it quite clear to me that there were no technical or engineering issues which would prevent town water and, for that matter, sewerage being made available to service development on the land, probably by way of infrastructure agreements similar to those put in place to facilitate the Special Residential development on Ira Buckby Road. It also seems to me to be tolerably clear that the main reason, if not the only reason, Mr Gillespie rejected Park Residential as being the highest and best use of the land, was his conclusion that town water would not have been reasonably available as at the date of resumption. And, further, if Park Residential was the highest and best use of the land he would have relied on those sales 25 Refer also to Report of Mr Vanderent; Ex 14 at P6. -- 26 of 31 -- 27 set out at page 16 of his report described as being sales of land with "Park Residential Development Potential". [75] In the circumstances of this case I have reached the conclusion that the prudent purchaser and vendor, properly advised, would have been reasonably confident of gaining the necessary approvals from the respondent at the date of resumption to facilitate at least Park Residential development of the land. [76] In light of my findings concerning the highest and best use of the land it is Mr Gillespie's sales 1 to 4 which are likely to provide the best guide to value. Unfortunately, no doubt influenced by their assumptions and advices concerning the Point Gourde/San Sebastian issues raised , neither valuer gave much attention to these sales. Leaving aside sale 1 for the moment, sales 2, 3 and 4 are generally described as being superior to the subject due to "land type" and aspect. I understand "Land type" to refer mainly to topography. However, each of these sales is located some distance further from the Brisbane CBD than the subject land. Sales 3 and 4 occurred at a date relatively close to the date of resumption whereas sale 2 occurred some 8 months earlier on what appeared to be a generally rising market. These sales range in area from 10.02 hectares to 24.53 hectares and in rates per hectare from $22,418 to $54,890. [77] Turning to the sales in more detail, I reject Sale 1 as reliable evidence of value. This sale occurred some seven months prior to the date of resumption in what appears to have been a generally rising market. Further, the topography, presence of high voltage transmission lines and low lot yield indicate to me that this sale involves land significantly inferior to the subject. It seems to me that this must be so given that the sale price reflects a rate of $8,348 per hectare, almost three times lower than the rate adopted by Mr Gillespie on the basis of a highest and best use for only Rural Residential development. [78] I find Mr Gillespie's Sale 4 a very difficult sale to rationalise. While it is described as being "Superior to the subject due to (its) superior dwelling and aspect", once allowance has been made for improvements, this sale reflects a rate per hectare less than that attributed to the subject land which has inferior development potential. No doubt the "very steep" nature of the timbered western section of the land, its location and size (about 50% larger than the subject) were all mattes which had an influence on price but to what extent? In these circumstances, particularly where a higher rate per hectare has been attributed to the subject notwithstanding a lower order of development potential, I do not accept this sale as reliable evidence of value. [79] Sales 2 and 3 are smaller in area to the subject and of superior topography. However, both of these sales are further removed from the Brisbane CBD, although Mr Gillespie -- 27 of 31 -- 28 did not consider distance to be a major issue for larger lot subdivisions. On the other hand, the topography of the subject land is such that it would have been likely to cause design and construction difficulties for any developer, particularly in respect of that land to the south-east which is effectively isolated by the large gully traversing the block. Sale 2 reflects a rate $33,275 per hectare and Sale 3 $54,890 per hectare. Sale 2 has the additional difficulty of being some eight months prior to the date of resumption in a generally rising market. Sale 3 is closest in time to the date of resumption, however, while it had the advantage of a golf course adjacent to its northern boundary, as identified by Mr Gillespie, the development of this land was hindered by topography and the presence of power line easements. [80] Doing the best I can with the evidence before me and endeavouring to resolve doubts in the assessment of compensation in a way more generous to the claimants,26 I will adopt a rate of $45,000 per hectare for the subject land. I will also include Mr Gillespie's value of improvements in the amount of $83,000. This value was unchallenged for Rural Residential purposes and I can see no reason why it would not have the same level of value for Park Residential purposes. [81] I immediately acknowledge that the adoption of $45,000 per hectare involves an element of "best guess" when comparing the subject land to the sales I have had regard to. However, as identified by Hope JA in Leichhardt Municipal Council v Seatainer Terminals Pty Ltd,27 sometimes that may be the only option open on the available evidence. [82] Accordingly, I determine compensation payable by the respondent to the claimants under all heads at $832,000 made up as follows: Value of Land (16.2 hectares x $45,000 per hectare) $729,000 Improvements (per Mr Gillespie) $83,000 Disturbance (agreed) $20,000 $832,000 I also order that the respondent to pay to the claimants interest at the rate of 5.50 per cent per annum on the sum of $812,000 from the date of resumption, 9 May 2003, to 28 November 2003, when the advance of $400,000 was received and, then on the balance of $412,000 to the date of payment. 26 Commissioner of Succession Duties (SA) v Executor Trustee and Agency Co of South Australia Ltd (1947) 74 CLR 358 at 373–374 per Dixon J; cited with approval by Callinan J in Boland & Anor v Yates Property Corp Ltd (1999) 167 ALR 575 at para [356]; Merivale Motel Investments Pty Ltd v The Brisbane Exposition and South Bank Redevelopment Authorities 10 QLCR 268 at 286. 27 (1981) 48 LGRA409 at 434; AMP Henderson v Valuer-General (2004) 134 LGERA 426 at 440. -- 28 of 31 -- 29 [83] As referred to above I was advised during closing argument that disturbance had been settled in the sum of $20,000 on an "all up" basis. Unfortunately I did not enquire and was not told whether or not the term "all up" was meant to include interest and no evidence was led as to whether or not, and if so when, payment of the disturbance items occurred. In these circumstances, although there is only a relatively small amount of money involved, I will allow the parties to make submissions, (if they wish to), as to interest on compensation for disturbance. Orders 1. Compensation is determined in the amount of $832,000 (Eight Hundred and Thirty Two Thousand Dollars). 2. The respondent to pay to the claimants interest at the rate of 5.50 per cent per annum on the sum of $812,000 from the date of resumption, 9 May 2003, to 28 November 2003, when the advance of $400,000 was received and, then on the balance of $412,000 to the date of payment. 3. The parties will have the opportunity to consider these reasons and make submissions in respect of interest on disturbance and/or costs including reserved costs if any. R S JONES MEMBER OF THE LAND COURT -- 29 of 31 -- 30 IN THE LAND COURT OF QUEENSLAND AV2004/0137 Acquisition of Land Act 1967 BETWEEN: Olive Louise Bowers and Lynette Ann Crane (as personal representatives) Claimants and Council of the Shire of Pine Rivers Respondent Before Mr RS Jones BRISBANE This matter having, on the Fifteenth day of September 2005, come on for judgment, and upon hearing from Counsel for both parties, the Court ORDERED THAT: 1. Compensation is determined in the amount of $832,000 (Eight Hundred and Thirty Two Thousand Dollars); It is FURTHER ORDERED BY CONSENT THAT: 2. Orders 2 and 3 of the published reasons for judgment dated 15 September 2005 be vacated and in lieu thereof the following orders 3 to 6 be substituted; 3. The respondent to pay interest at the rate of 5.50 per cent per annum: (a) on the sum of $812,000 from the date of resumption, 9 May 2003 to 1 December 2003, when the advance of $400,000 was received; and (b) then on the balance of $412,000 from 1 December 2003 to 24 June 2005 when a further advance of $110,000 was received; and (c) then on $302,000 from 24 June 2005 to the date of payment; 4. The respondent pay to the claimants interest at the rate of 5.50 per cent per annum on the agreed disturbance figure of $20,000 from 1 January 2004 to the date of payment 24 June 2005; -- 30 of 31 -- 31 5. Any application for costs by the respondent is to be in writing and filed and served on or before 4.00 pm Friday 30 September 2005, with written submissions in response by the claimants to be filed and served on or before 4.00pm Friday 14 October 2005; 6. The further hearing of the matter be adjourned to a date to be fixed. By the Court Deputy Registrar -- 31 of 31 --