Brosnan v Department of Natural Resources and Mines [2005] QLC 5

LAND COURT OF QUEENSLAND CITATION: Brosnan v Department of Natural Resources and Mines [2005] QLC 5 PARTIES: Cornelius JG and Clare C Brosnan (appellants) v. Chief Executive. Department of Natural Resources and Mines (respondent) FILE NOS: AV2003/0617 and 0618 DIVISION: Land Court of Queensland PROCEEDING: Appeals against Unimproved Valuations - Valuation of Land Act 1944 - Shire of Warwick DELIVERED ON: 31 January 2005 DELIVERED AT: Brisbane HEARD AT: Warwick MEMBER: Mr RE Wenck ORDER: Each appeal is dismissed and the unimproved valuations of the chief executive as at 1 October 2002 affirmed. CATCHWORDS: Statutory Valuation - Unimproved value - Valuation of Land Act 1944 Sales Evidence - Not directly comparable - Preferred to relativity approach - Unproved relativity basis - Existing relativity unaltered other than for Vegetation Management issues Vegetation Management Areas - Allowance for restrictions on use Disabilities - Unique to gorge environment - Allowances made historically -- 1 of 6 -- 2 APPEARANCES: Mr KG Flehr, Solicitor, for the appellants Mr K Fisher, Barrister, Crown Law, for the respondent Background [1] These appeals are against the unimproved valuations made by the chief executive ("the Department") of two adjoining blocks, in differing family ownership, located in the Condamine River Gorge north-easterly of Killarney. [2] The owners are members of a group of landowners most of whom own farm properties with rainforest components in the Spring Creek Mountain locality above the gorge. The group was formed to contest valuations made by the Department as at 1 October 2002. There are significant differences between the "gorge" and "mountain" locations and the nature of country involved. Consequently although the general history and much of the background leading to the hearing of the appeals and some valuation evidence was common to each of the appeals, the decisions in the subject matters are delivered separately from the others. The overall history of the objection and appeal process as it related to the group of landowners is discussed in the decision delivered today under the citation Dagg & Ors v Department of Natural Resources and Mines [2005] QLC 0006. [3] As was common to all appeals in the group, valuation evidence was given by Mr Allan J Matson for the appellants and Mr Danny B Redgen for the Department. [4] Appeal AV2003/0617 Registered Proprietor: Cornelius JG Brosnan Real Property Description: Lot 1 RP 53054 and Lot 1 RP 83019, Parish of Cunningham Area: 108.3 ha [5] Appeal AV2003/0618 Registered Proprietors: Cornelius JG and Clare C Brosnan Real Property Description: Lot 22 on M341090, Lot 25 on M341127, Lot 417 on M34263, Lot 574 on M34417, Lot 2151 on M34846 and Lot 101 on ML321, Parish of Killarney and Lot 1 on RP 52191 and Lot 2 on RP 53054, Parish of Cunningham. Area: 516.3 ha Nature of Land: [6] As a consequence of the pre-hearing conferences and his inspection of both properties, Mr Matson was able to agree with the general classification of the country on each valuation parcel as provided by Mr Redgen and contained within his reports as follows: -- 2 of 6 -- 3 AV2003/0617 14 ha arable river flats 5 ha contoured arable forest uplands 42 ha moderate to steep basalt forest ridges 47.3 ha Vegetation Management Area AV2003/0618 13 ha arable river flats 16 ha sloping arable forest 90 ha hilly mixed bastard scrub and forest grazing 135 ha easy, moderate to steep forest grazing 262.3 ha Vegetation Management Area [7] Valuations Appealed Against AV2003/0617 - $30,500 rounded from $280/ha overall. As in each of the appeals by the various landowners, Mr Redgen's primary method of valuation had been by "direct comparison" with sales evidence, on an overall unit of area basis, with a check valuation conducted on a classification of country as follows: 14 ha arable river flats (level friable soils to gentle black soil rises subject to ridge run-off water. 4 ha puggy and difficult to work) @ $1,150/ha $16,100 5 ha contoured arable forest uplands @ $525/ha $2,625 42 ha moderate to steep basalt forest ridge @ $240/ha $10,080 47.3 ha Vegetation Management Areas (includes 41 ha regional ecosystem 11.8.8 and 6.3 ha regional ecosystem 11.9.4 and 11.9.13) @ $110/ha $5,203 $34,008 Less allowance for access 10% $3,401 Adopt $30,500 Mr Redgen explained that the legal access to this parcel was obtained by way of a surveyed easement over adjoining land in private ownership. AV2003/0618 - $100,000 rounded from $195/ha overall. Mr Redgen's check classification approach was as follows: 13 ha arable river flats (4 ha (1%) irrigated Condamine River flats; 9 ha (2%) arable Condamine River flats) @ $1,175/ha $15,275 16 ha sloping arable forest @ $1,050/ha $16,800 90 ha hilly mixed bastard scrub and forest grazing @ $400/ha $ 36,000 135 ha easy, moderate to steep forest grazing @ $182.50/ha $24,638 262.3 ha Vegetation Management Areas (49 ha of regional ecosystem 11.3.23, 11.8.8, 12.8.14, and 12.8.16; 88 ha of regional ecosystem 11.9.4, 12.10.15, 12.12.9; and 125.3 ha of regional ecosystem 11.9.13 and 12.8.14) @ $36/ha $9,443 $102,961 (sic) Less access allowance 2% $2,030 Adopt $100,000 -- 3 of 6 -- 4 The access allowance was said to be in recognition of the access to Killarney not being all weather, due to the effect of low level Condamine River crossings. [8] Owners' Estimate of Value AV2003/0617 - Notice of Appeal - $29,000. Mr Matson's valuation of $29,000 was rounded from $270/ha. He adopted the apportioned values of Mr Redgen for all classifications except the 14 ha of arable river flats to which he apportioned $800/ha rather than Mr Redgen's $1,150/ha. Mr Matson made no allowance for the easement access. AV2003/0518 - Notice of appeal - $86,000. Mr Matson's valuation was $72,000, rounded from $140/ha overall. In his oral evidence he said that his apportioned values would vary from those of Mr Redgen in the following classifications: 4 ha arable river flats @ $800/ha (compared to Mr Redgen's $1,175/ha overall) 9 ha arable river flats @ $700/ha (Redgen - $1,175) 16 ha sloping arable forest @ $525/ha (Redgen $1,050) 90 ha hilly mixed bastard scrub and forest grazing @ $250/ha (Redgen $400). Mr Matson's Basis of Valuation [9] Mr Matson had used a relativity basis, comparing levels of value which he had assessed for various classifications of country on the mountain, with levels which he believed were more realistic, primarily on a productivity basis, for those classifications on the subject properties where he believed Mr Redgen's figures were too high. [10] I will not repeat the discussion on the relativity basis for the mountain blocks in Dagg (supra). However, rather than make a "direct comparison" with the basic examples used for the mountain blocks, which came from "off the mountain" in any event, he valued the arable river flats in this instance in comparison with the unproved level of value which he had adopted for the best of the rainforest lands. For the 90 ha of bastard scrub country on AV2003/0618, his level of value came from a comparison with the level of value applied by the Department to the "forest" country on the Watts' sale land on the mountain. That level of value with which he had agreed, had come from the Department's comparison with forest sales "off the mountain". In the case of the arable forest on AV2003/0618, Mr Matson felt it was of equivalent value to the forest arable on AV2003/0617 in which case he had agreed with Mr Redgen's classified value. [11] Factors which influenced Mr Matson's opinions included:  The arable flats on the subject lands were small, in severed locations and in his opinion relatively insignificant in comparison with the overall size of the parcels being valued. -- 4 of 6 -- 5  The arable flats suffered flooding disabilities peculiar to the gorge environment where fast flowing run-off water from steep adjacent slopes caused erosion, crop and topsoil losses in addition to disabilities from the river flooding.  The gorge environment caused a rain shadow effect with much lower rainfall and production potential than was experienced on the mountain.  The gorge environment caused sun shading and souring of pasture lands.  The difficulty involved in comparing sales of "open" lands outside the gorge with the subject lands. [12] In response Mr Redgen agreed that the disabilities raised by Mr Matson were factual and indeed added a further disability related to the damage to grain crops in the gorge due to the feeding habits of birds from their adjacent vegetated habitats. Mr Redgen said that the disabilities associated with the subject lands and the opinion of the owners were well documented on departmental files through the history of objections to previous valuations. Mr Redgen's Basis of Valuation [13] Mr Redgen provided a schedule of eight "basic rural sales" some of which formed part of the forest country basis for the mountain country. The sales will not be repeated here as Mr Matson had no specific knowledge of the various properties involved and had not conducted any sales analyses. [14] The main criticism by Mr Matson of the sales evidence was that none of the sale properties were located in the gorge environment and none, in his opinion, were of assistance in assessing the value of, in particular, the small areas of arable lands on the subject large properties with a predominant grazing use. [15] While Mr Redgen agreed that the only available sales evidence came from country not in the gorge environment, he held the opinion that it was necessary to seek a basis from actual sales of land capable of subjective comparison even if not directly comparable. [16] In his opinion the levels of value applied to the river flats arable land were supported by the basic sales evidence on which he relied, both of properties with predominantly creek or river flat arable land or properties with mixed land classifications. [17] The existing relativity between valuations applied to the sale lands was supported by the sales evidence and apart from the reductions made for Vegetation Management Area restrictions, the previously existing relativity between the valuations of relevant classifications of the sale lands and of the subject lands had not been altered. [18] With specific regard to the arable forest, Mr Redgen's evidence was that the classification on AV2003/0618 was significantly superior to that on AV2003/0617 which had required the construction of contour banks because of the steeper and less suitable slope. He also -- 5 of 6 -- 6 pointed out that in his opinion, the arable river flats on AV2003/0618 were of generally comparable quality overall. While 4 hectares were capable of irrigation under licence, as I understood it, those 4 ha were ambulatory within and not specific to any particular part of the 13 ha. He saw no reason to differentiate between any part of the 13 ha as Mr Matson had done. Findings [19] I have not found Mr Matson's relativity approach in establishing levels of value for rainforest country on the mountain to have been substantiated from a market perspective. It follows that I can place no weight on a valuation basis for the river flat arable lands on the subject properties which relies on relativity with an unproved level of value for rainforest land in a significantly different physical and market environment. [20] Mr Redgen's approach, in my opinion, has followed correct valuation principles. He is satisfied that the analysed market evidence even if not directly comparable, supports the levels of value applied and checked by the classification approach. [21] No weight of substance can be given to criticism of that evidence or its analysis and application, when no alternative market related basis supports the criticism. [22] While the disabilities associated with the subject lands are accepted as being real I am satisfied that consideration has been given to them all, both individually and collectively in Mr Redgen's approach. There is no evidence of substance to show that the levels of value applied are wrong or unreasonable and the appeals must fail accordingly. Order Each appeal is dismissed and the unimproved valuations of the chief executive as at 1 October 2002 affirmed. RE WENCK MEMBER OF THE LAND COURT -- 6 of 6 --