Department of Natural Resources and Mines v ISPT Pty Ltd [2003] QLC 74 (2003) 24 QLCR 373

LAND COURT OF QUEENSLAND CITATION: Department of Natural Resources and Mines v ISPT Pty Ltd [2003] QLC 74 PARTIES: Chief Executive, Department of Natural Resources and Mines (applicant - respondent) v. ISPT Pty Ltd as Trustee (respondent - applicant) FILE NO: AV2002/0773 DIVISION: Land Court of Queensland PROCEEDING: Application for orders for further and better particulars and disclosure DELIVERED ON: 31 October 2003 DELIVERED AT: Brisbane HEARD AT: Brisbane MEMBER Mrs CAC MacDonald ORDERS: 1. The appellant, within forty-two days of the date of this order, file and serve further and better particulars of ground 3 of its grounds of appeal as follows: (a) An outline of further factors relevant to the development potential of the land and further conditions surrounding the present and future development of the site in addition to those previously outlined. (b) Particulars of the specific characteristics of the slope of the land in its unimproved state and details of the consequences of those characteristics. (c) Specific details, including details of quantities and rates, of the substantial bulk earthworks including excavation and filling which were necessary to create a suitable platform on which to construct the present improvements on the land. -- 1 of 19 -- 2 (d) Details of the location, dimensions, specifications, rates and quantities pertaining to the retaining walls on the land. (e) Details of the basis of the potential need for piling including sufficiently detailed plans, specifications, and details of the location of such piling and the quantities and rates pertaining to the said piling and details of the nature and location of the future construction that necessitates the potential need for piling. 2. The appellant, within forty-two days of the date of this order, deliver and produce to the respondent by way of disclosure any documents held in its possession or under its control which are directly relevant to the improved value of the subject property as at 1 October 2001 and the nature, extent, cost and value of the improvements to the subject property, including without limiting the generality of the foregoing, the following documents and classes of documents: (a) Valuation reports (b) Valuations of improvements for insurance purposes (c) Records, including historical cost records, relating to the nature, extent, cost and value of improvements (d) Records relating to depreciation of the improvements (e) Financial accounts or management reports relating to the operation of the property, the nett income of the property, the outgoings, capital expenditure allowances, vacancy rates, trade figures within retail categories and other information relevant to the trading performance of tenants and outgoings recoveries from tenants. CATCHWORDS: Practice and procedure – Further and better particulars application – Purpose of such – Precursor to efficient disclosure – Land Court Rules and Uniform Civil Procedure Rules – No pleadings in Land Court but Notice of Appeal sets appeal grounds – Application granted. Practice and procedure – Disclosure – Land Court Rules and Uniform Civil Procedure Rules – Test of direct relevance – When Court can order – No requirement by respondent to produce answers to Notice of Appeal – Lack of mutuality – Later mutual exchange of information. Practice and procedure – Disclosure – Sought for documents on value of improvements on subject property – Objections by landowner – Misconception of case by -- 2 of 19 -- 3 appellant – Respondent not confined to methodology used to arrive at valuation appealed against – Reasons for disallowing objection do not define issues before Court – Disclosure ordered. Evidence – Admissibility – Objection to admission of documents not formally proved – Admitted to establish existence of relevant documents not disclosed by appellant – Strict rules of evidence not applicable in Land Court. Practice and Procedure – Application for landowner appellant to disclose documents relevant to case but in possession of third party advisors – Application refused – May be able to obtain by non-party disclosure process. APPEARANCES: Mr AE Lyons of Counsel for the appellant Mr TW Quinn of Counsel for the respondent SOLICITORS: Holding Redlich for the appellant Mr G Smith of the Department of Natural Resources and Mines for the respondent [1] This is an application for orders that ISPT Pty Ltd (the appellant) file and serve further and better particulars of the grounds of Appeal stated in the Notice of Appeal filed on 5 September 2002, and that the appellant make disclosure by the delivery and production of documents and a list of the documents. The applicant is the respondent to an appeal under the Valuation of Land Act 1944 (the Act) against a determination by the respondent of the unimproved value of land owned by the appellant. The land is 5.406 hectares in area and is improved with a sub-regional shopping centre known as Kmart Arana Hills. The unimproved value was determined by the respondent at $3,700,000 as at 1 October 2001. [2] Following notification of the valuation and in accordance with the provisions of the Act, the appellant lodged an objection to the valuation and was advised, by letter from the respondent department dated 13 August 2002 that the objection had been disallowed because: “- The market evidence supports the applied value. - The value is considered appropriate compared to other similar properties.” [3] The appellant subsequently appealed to this Court. The grounds of appeal are: 1. The assessment of unimproved value is too high. 2. The assessment of unimproved value is not supported by comparable sales evidence of other similar properties. -- 3 of 19 -- 4 3. The assessment of unimproved value does not have sufficient regard to the development potential of the land and the conditions surrounding such development. 4. The assessment of unimproved value has not been made in accordance with the Valuation of Land Act 1944 (as amended), is contrary to law and erroneous. [4] At a directions hearing conducted on 23 April 2003, I ordered, with the consent of the parties, that: 1. The appellant is to file and serve better particulars of the grounds of appeal as stated in the Notice of Appeal within 14 days. 2. Each party make disclosure of all relevant documents under its control within 21 days after filing and serving the better particulars, by serving a list of documents on the other party. [5] The appellant subsequently provided further and better particulars on 7 May 2003, and a list of documents dated 13 June 2003. The respondent has now brought this application contending, essentially, that the further and better particulars and the list of documents are incomplete. Further and Better Particulars [6] It is convenient to deal firstly with the application for an order that further better particulars be filed and served. This is because “[p]articulars fulfil an important function in the conduct of litigation. They define the issues to be tried and enable the parties to know what evidence it will be necessary to have available and to avoid taking up time with questions that are not in dispute. On the one hand they prevent the injustice that may occur when a party is taken by surprise; on the other they save expense by keeping the conduct of the case within due bounds. These considerations are no less important in revenue cases than in other cases” (Bailey v Federal Commissioner of Taxation (1977) 136 CLR 214 at 219). And, as Byrne J pointed out in NRNQ v MEQ Nickel Pty Ltd [1991] 2 QdR 592 at 595: “The openness afforded by adequate particulars facilitates effective resolution of the dispute. Discovery becomes more efficient. It need be directed only to the issues as they are refined by the particulars …” [7] The Land Court Rules 2000 are silent as to any obligation to deliver further and better particulars. However, r.4 provides: “(1) If these rules do not provide for a matter in relation to a proceeding in the court and the Uniform Civil Procedure Rules 1999 (the “uniform rules”) would provide for the matter, the uniform rules apply in relation to the matter with necessary changes. -- 4 of 19 -- 5 (2) For subrule (1), an originating application under these rules is to be treated as if it were a claim under the uniform rules.” [8] Rule 157 of the Uniform Civil Procedure Rules provides for particulars to be included in a pleading and r.161 provides that a party may apply to the court for further and better particulars of the other party’s pleading. Although there are no formal pleadings in this Court, the Notice of Appeal sets out the grounds of appeal on which the appellant relies. It is to be noted that s.56(2) of the Act provides that the appeal is to be limited to the grounds as stated in the Notice of Appeal, and that provision is mandatory so that no amendment or addition to those grounds can be made (Franklin v Valuer-General (1978) 5 QLCR 181 at 184, 185). Potentially, this is a complex matter, and it is considered that it is appropriate, in principle, to order that further and better particulars be provided, with a view to promoting efficient conduct of the litigation (see, for example, Kumali Holdings Pty Ltd v Chief Executive, Department of Natural Resources and Mines, unreported, Land Court, 27 April 2001 at [34]). [9] Prior to this application, the respondent had requested further and better particulars of the grounds of appeal on 18 February 2003. The appellant provided particulars on 7 May 2003 following the order made on 23 April 2003. This application, together with the requests and replies in respect of each ground of appeal are considered below. [10] Ground 1. The assessment of Unimproved Value is too high. Request 18/2/2003-What should be the unimproved value? Particulars provided 7/5/2003 – 1(a) The unimproved value is $1 680 000. Further Request 10/6/2003 - How has the unimproved value of $1 680 000 been arrived at by the appellant? Particulars provided 24 June 2003 - Details of the Appellant’s valuation of $1,680,000 will be tendered before the Court by way of expert evidence. [11] There is no application by the respondent for further and better particulars in respect of ground 1. [12] Ground 2. The assessment of Unimproved Value is not supported by comparable sales evidence of other similar properties. Request 18/2/2003 - What is the comparable sales evidence of other similar properties that supports the unimproved value given in (1) above? Particulars provided 7/5/2003: -- 5 of 19 -- 6 2(a) Relevant sales include: (i) the sale by Lensworth North Lakes Pty Ltd to Westfield Management Ltd in or about July 2001 of the North Lakes Shopping Centre, corner Bruce Highway and Anzac Avenue, Mango Hill for a consideration of $15.85 m;and (ii) the sale by Ellen Haven Pty Ltd to Indigo Projects in or about November 1998 of the Great Western Super Centre, corner Settlement and Samford Roads for a consideration of $2 000 000. Further Request 10/6/2003 Does the use of the word include suggest the existence of further sales evidence? If so please provide particulars of the further sales evidence. Particulars provided 25 June 2003 - The use of the word “include” does indicate the existence of additional sales. Those sales are not sufficiently similar to the property in question as to warrant inclusion in the Appellant’s sales comparison. [13] Application for order: The appellant file and serve seven days after the date of order, particulars of the “sales” referred to in ground 2 of the grounds of appeal. [14] Counsel for the appellant submitted that the answer given on 25 June 2003 is complete, in that the appellant’s solicitor has stated that the additional sales are not sufficiently similar to the subject property to warrant comparison. The respondent says that he is entitled to have those sales identified and the fact that they are not comparable is not relevant. [15] In general terms, in a matter of this nature, details of the sales on which a party intends to rely are the proper subject of a request for further and better particulars. The appellant’s answer on 7 May 2003 to the original request appeared to indicate that the two sales identified were only some of the relevant sales. I have accepted the submission of Counsel for the appellant that the subsequent reply on 25 June 2003 must be taken to modify the original response and to limit the relevant sales to two. Counsel for the appellant did suggest that further relevant sales may come to light, in the future. If that is so, details should be provided, and any consequences as to costs will need to be considered at that point. In my opinion, the appellant should not be ordered to provide details of sales that are not comparable with the subject. [16] However, Counsel for the respondent submitted that in view of the appellant’s characterisation of the matters in issue between the parties, (as to which, see [32] below), an inference might be drawn that the appellant has confined its consideration of relevant sales to sales of unimproved land. It appears, from the description of the sales particularised by the appellant, that they are sales of improved properties. Further, there -- 6 of 19 -- 7 is nothing to indicate that the appellant has confined itself to a consideration of sales of unimproved land, in determining what sales are relevant. That being so, I will not make any order for the delivery of further particulars of ground 2 of the grounds of appeal. [17] Ground 3 The assessment of Unimproved Value does not have sufficient regard to the development potential of the land and the conditions surrounding such development. Request 18/2/2003 What is the development potential referred to ? How does the development potential affect the unimproved value of the land ? How should the development potential be treated ? What are the conditions surrounding the development potential ? How do those conditions affect the unimproved value of the land ? How should those conditions be treated ? Particulars provided 7/5/2003: The factors relevant to the development potential of the land and the conditions surrounding the present and future development of the site include: 4. (a) the slope upon the land in its unimproved state; (b) for the purpose of constructing the present improvements on the land: (i) the need to perform substantial bulk earthworks including excavation and filling to create a suitable platform upon which to construct the said improvements; and (ii) the need to construct retaining walls: (c) the potential need for piling for future construction upon the site. Further Request 10/6/2003 Does the use of the word include suggest the existence of further factors relevant to the development potential of the land and further conditions surrounding the present and future development of the site in addition to the matters outlined? If so please outline those factors and conditions. Further please provide further and better particulars in respect of the designated paragraphs set out below: 4(a) the specific characteristics of the slope of the land in its unimproved state and details of the consequences of those characteristics. 4(b)(i) please provide specific details of the substantial bulk earthworks including details of quantities and rates. -- 7 of 19 -- 8 4(b)(ii) please provide details of the location, dimensions, specifications, rates and quantities pertaining to the said retaining walls. 4(c) please provide details of the basis of the potential need for piling including sufficiently detailed plans, specifications, details of the location of such piling and the quantities and rates pertaining to the said piling and details of the nature and location of the future construction that necessitates the potential need for piling. Particulars provided 25 June 2003: The use of the word “include” acknowledges that there may be additional development considerations. For the purpose of particularising the development potential of the property in question, the factors previously outlined by the Appellant are considered adequate. Details of the: (a) specific characteristics of the property in question; (b) the required bulk earthworks; (c) construction of retaining walls; (d) excavation and filling; and (e) piling upon the property, will be tendered before the Court by way of expert evidence. Application for order: The appellant within seven days of the date of order, file and serve further and better particulars of ground 3 of its grounds of appeal as requested in the further request of 10 June 2003 enclosed with the letter from the Chief Executive’s solicitor to the appellant’s solicitor dated 10 June 2003. [18] Counsel for the appellant submitted that the particulars given are sufficient to indicate the substance of this ground of appeal and that the substance will be fleshed out with evidence. He submitted that the most appropriate way to proceed is for expert reports to be exchanged. [19] Counsel for the appellant has not objected to the further request on the grounds of irrelevance. The particulars sought in respect of Ground 3 are directly relevant to the assessment of the unimproved value of the land. The basis of the refusal appears to be that the details sought are matters of evidence which will be provided, in due course, in the expert reports. [20] Although the information sought may become available in experts’ reports at some later stage of the proceeding, that is not a reason why the particulars should not be provided at this stage, to facilitate the progress of the matter. Byrne J said in NRNQ v MEQ Nickel, at 595: -- 8 of 19 -- 9 “These days particulars may require the disclosure of information in such detail as to indicate the mode by which a case may be proved. … And that particulars will disclose the evidence to be adduced at trial is not of itself a sufficient justification for refusing them.” Bearing in mind that the purpose of particulars is to facilitate the conduct of litigation and the effective resolution of the dispute (see NRNQ v MEQ Nickel Pty Ltd at 595), I consider that an order should be made that the particulars sought in relation to this ground be provided. [21] Ground 4. The assessment of the Unimproved Value has not been made in accordance with the Valuation of Land Act 1944 (as amended), is contrary to law and erroneous. Request 18/2/2003: (i) how is the assessment of unimproved value by the Chief Executive contrary to law ? (ii) how is the assessment of unimproved value by the Chief Executive erroneous ? Further Request 10/6/2003: No particulars have been provided please provide the particulars as requested. Particulars provided 25 June 2003: (i) The Chief Executive misapplied the method of valuation in s.3(1)(b) of the Valuation of Land Act 1944 by failing to have sufficient regard to sales evidence of properties comparable to the property in question. (ii) The Chief Executive erred in the application of the method of valuation in s.3(1)(b) of the Valuation of Land Act 1944 by failing to have sufficient regard to sales evidence of properties comparable to the property in question. [22] Application for Order: The appellant, within seven days of the date of order, provide further and better particulars of the sales referred to in its particulars of ground 4 of the notice of appeal, dated 25 June 2003. [23] As both Counsel acknowledged, it now appears, as a result of the particulars delivered on 25 June 2003, that grounds 2 and 4 in the Notice of Appeal are related in that each refers to a failure to take full and proper account of relevant sales evidence. Counsel for the appellant has indicated that there is no further relevant sales evidence on which his client relies, other than the two sales identified in the particulars delivered on 7 May 2003. In -- 9 of 19 -- 10 the circumstances, I will not make an order in respect of the delivery of particulars of sale in relation to ground 4. Disclosure [24] In response to the order for disclosure of 23 April 2003, the appellant provided a list of documents dated 13 June 2003 which disclosed the existence of six documents in part 1 of the schedule, and no documents in part 2. [25] In this application, the respondent seeks an order that the appellant deliver and produce to the respondent documents held by or on behalf of the appellant directly relevant to the improved value of the subject property and the nature, extent, cost and value of the improvements, and a list of such documents, including the documents and classes of documents referred to in the affidavit of Graham Joseph Smith sworn on 7 July 2003. [26] Mr Smith is a solicitor employed in the legal section of the Department of Natural Resources and Mines and he is also a registered valuer. Mr Smith has deposed that he is aware that there are two valuation reports of the subject property on an improved basis, as at June 1999 and June 2000, which were made on the instructions of the appellant and which were not disclosed by the appellant. He also says that he considers that it is likely that there are a number of other particular types of documents in the possession of and available to the appellant which would be relevant to assessing the improved value of the land. [27] Counsel for the appellant objected to the tender of these two valuation reports into evidence, submitting that a proper foundation had not been made for the tender of the documents. He also objected to the content of specified parts of Mr Smith’s affidavit in that those parts of the affidavit referred to or relied on material contained in the valuation reports. [28] Although these documents have not been formally proved, the Land Court is not bound by the rules of evidence (s.7(1), Land Court Act 2000) and I consider that they are admissible at least for the limited purpose of establishing that there are documents in existence which appear to be relevant to the determination of the improved value of the land and which have not been disclosed. It follows that the objections to the parts of Mr Smith’s affidavit are not sustainable. [29] Rule 13 of the Land Court Rules provides that Chapter 7 of the Uniform Civil Procedure Rules applies, with necessary changes, to the disclosure of documents in relation to a proceeding in the court. Rule 211 of the Uniform Civil Procedure Rules provides that: “(1) A party to a proceeding has a duty to disclose to each other party each document - -- 10 of 19 -- 11 (a) in the possession or under the control of the first party; and (b) directly relevant to an allegation in issue in the pleadings; and (c) if there are no pleadings – directly relevant to a matter in issue in the proceeding. …” [30] Rule 223 provides that “(1) The court may order a party to a proceeding to disclose to another party a document or class of documents by – (a) delivering to the other party in accordance with this part a copy of the document, or of each document in the class; or (b) producing for the inspection of the other party in accordance with this part the document, or each document in the class. … (4) An order mentioned in subrule (1) or (2) may be made only if - (a) there are special circumstances and the interests of justice require it; or (b) it appears there is an objective likelihood - (i) the duty to disclose has not been complied with; or …” [31] As there are no pleadings in this matter, it is necessary, firstly, to determine whether the documents which the respondent seeks to be disclosed are ‘directly relevant to a matter in issue in the proceeding’ (r.211(1)(c)). [32] Initially, the difference between the parties lies in their characterisation of the matter in issue in this proceeding. Counsel for the appellant noted that the respondent had not identified its case, but submitted, relying on the Chief Executive’s decision in response to the objection (which is set out at [2] above), that the valuation appealed against is founded on the comparable sales approach to valuing the land, that is by comparison with sales of similar properties. He contended that it is not open to the respondent to alter its valuation methodology, and that, therefore, information as to the nature and extent of improvements on the subject land was not relevant to the matter in issue. [33] Counsel for the respondent submitted that the matter in issue is the unimproved value of the subject land as at the relevant date and that it is the duty of the Court, under s.66 of the Valuation of Land Act, to determine the value in accordance with the Act. To -- 11 of 19 -- 12 determine the unimproved value of improved land, Counsel submitted, the Court should consider not only the notional sale price referred to in s.3(1)(b) of the Act but as well, for the purposes of s.3(2), both the improved value of the land and the value of the improvements. Counsel therefore submitted that proper disclosure in the case of an improved property should include documents directly relevant to the issue of improved value and the value of improvements as at the relevant date. [34] The unimproved value of the subject is to be determined as at 1 October 2001. At that time, sections 3, 4 and 5 of the Act provided, so far as is relevant: “Meaning of ‘unimproved value’ 3.(1) For the purposes of this Act – ‘unimproved value’ of land means – … (b) in relation to improved land – the capital sum which the fee simple of the land might be expected to realise if offered for sale on such reasonable terms and conditions as a bona fide seller would require, assuming that, at the time as at which the value is required to be ascertained for the purposes of this Act, the improvements did not exist. (2) However, the unimproved value shall in no case be less than the sum that would be obtained by deducting the value of improvements from the improved value at the time as at which the value is required to be ascertained for the purposes of this Act.” … “‘Meaning of ‘improved value’ 4. For the purposes of this Act - ‘improved value’ means, in relation to land, the capital sum which the fee simple of the land might be expected to realise if offered for sale on such reasonable terms and conditions as a bona fide seller would require.” “Meaning of ‘value of improvements’ 5.(1) The ‘value of improvements’ means, in relation to land, the added value which the improvements give to the land at the time as at which the value is required to be ascertained for the purposes of this Act, irrespective of the cost of the improvements, including in such added value the value of any hotel licence the value of which has been included in the improved value. (2) However, the added value shall in no case exceed the amount that should reasonably be involved in effecting, at the time as at which the -- 12 of 19 -- 13 value is required to be ascertained for the purposes of this Act, improvements of a nature and efficiency equivalent to the existing improvements.” [35] There is very little information before the Court as to the way in which the Chief Executive’s valuation was made. The appellant’s submission is based primarily on the reasons given by the Chief Executive in disallowing the objection, which are set out at [2] above. In my opinion, those reasons were advanced as justification for the valuation and as reasons for disallowing the objection. They do not purport to state or explain the basis or methodology of the valuation. In any event, I have considerable doubt as to whether the reasons given for disallowing an objection can be used to define the matters in issue before the Court. [36] However, even if it were assumed that the valuation appealed against had been made by comparison with appropriate sales of comparable land, there does not seem to be any reason why the Chief Executive should be restricted to that valuation methodology in responding to the appeal. In Franklin v Valuer-General, the Land Appeal Court said at 184-185: “On the other hand, the Valuer-General is not limited to the nature of the reply he makes to an appellant’s appeal. He may decide to restrict his case to the specified grounds of appeal, or as more often happens, he places before the court the whole basis of the valuation appealed against and in so doing endeavours to answer the specific grounds of appeal.” [37] Although this statement was made in the context of a discussion of whether an appellant was entitled to amend a Notice of Appeal, it indicates that the Land Appeal Court considered that the Chief Executive is entitled to place the whole basis of the valuation before the Court. [38] AMP Life Ltd v Chief Executive, Department of Natural Resources and Mines [2002] QLC 099, was concerned with the question of whether it was permissible for the Chief Executive to lead evidence to a higher amount than the value appealed against. The Chief Executive had not altered the valuation pursuant to ss.28, 28A or 29 of the Act. In the course of his judgment, the learned Member considered a number of submissions by Counsel for the landowner in support of the argument that the Chief Executive was bound by the valuation as issued which is deemed by s.33 of the Act to be correct, and that the valuation cannot be changed except in accordance with the Statute. It was held that the Chief Executive is not restricted to adducing evidence in support of the original valuation figure. The learned Member said (at [60]): “Now apart from the fact that an appellant would not usually know at the time of lodgment of the Notice of Appeal (which includes the grounds of -- 13 of 19 -- 14 appeal) the valuation evidence relied on by the Chief Executive, there is no prohibition in the Act that I can find that limits either party to any particular valuation evidence or method. Such limitations, if they arise at all, would arise as a consequence, of the management of a particular case by the Court.” (Emphasis added) [39] The learned Member in the AMP case also pointed out (at [49]) that annual valuations are struck by the use of mass appraisal techniques and the refinement of the valuation amount will often be justified once a complete valuation report is prepared. In the same way, the valuation methodology adopted may be refined or altered when a detailed valuation is undertaken. I have come to the conclusion, therefore, that the Chief Executive is not confined to the same method of valuation as that adopted when the valuation originally issued. [40] Underlying the appellant’s objections to the orders sought is a submission that no details of the respondent’s valuation have been provided to the appellant, and that the application for discovery is premature until the respondent has stated his case. As was noted in Kumali Holdings (at [25]) there is no requirement in the Valuation of Land Act that the respondent provide an answer to the Notice of Appeal filed by the appellant, and the procedure governing an appeal against a valuation lacks mutuality at this stage. It is difficult therefore to draw a close analogy with other civil litigation or to apply all the authorities developed in relation to such litigation. While r.214(2)(e) of the Uniform Civil Procedure Rules contemplates that disclosure would normally take place within 28 days of the close of pleadings, that rule cannot be applied to these proceedings, where there are no pleadings, and in particular where there is no obligation on the respondent to provide an answer to the Notice of Appeal. In these circumstances, there is no reason why the appellant should not make disclosure of relevant documents at this stage of the proceedings. The Land Court Rules now have provision for pre-trial procedures to be implemented, and those procedures can ensure that there is a mutual exchange of information in due course. [41] I do not consider it necessary to deal with the respondent’s submission that it is obligatory for the respondent to carry out a valuation under s.3(2) of the Act in determining the unimproved value of improved land, because I consider that, in any event, in supporting the valuation appealed against, the respondent is entitled to undertake the exercise contemplated by s.3(2) of the Act. Such a valuation requires the improved value of the land to be determined in accordance with the definition of “improved value” in s.4. Similarly the value of the improvements is to be determined. It is noted that while s.5(1) provides that “value of the improvements” means the added value which the -- 14 of 19 -- 15 improvements give to the land, irrespective of their cost, s.5(1) is qualified by s.5(2) which provides that the added value shall in no case exceed the amount that should reasonably be involved in effecting such improvements as at the relevant date. I therefore consider that in so far as the order for disclosure sought by the respondent relates to those matters, any such documents that are within the possession or control of the appellant are relevant to the determination by the Court of the unimproved value of the land. [42] Having determined that the value of the improvements is directly relevant to the matter in issue in the proceedings, the question remains whether I should make an order for disclosure of the documents as sought in the respondent’s application. Rule 223(4)(b)(i) provides that the court may order disclosure if it appears that there is an objective likelihood that the duty to disclose has not been complied with. [43] In Mercantile Mutual Custodians Pty Ltd v Village/Nine Network Restaurants & Bars Pty Ltd [2001] 1 QdR 276 at 283, Pincus JA said: “If it appeared, for example, that an order for further disclosure would be likely to “facilitate the just and expeditious resolution of the real issues”, [see r5(1) of the Uniform Civil Procedure Rules], that would enable and perhaps require the making of such an order. But there must, at least in the ordinary case, be something more than mere suspicion, to justify granting relief to a party complaining of incomplete disclosure.” [44] It seems to me that this is a case where, even under the less flexible former Rules of the Supreme Court, a Court would have made an order for further disclosure. This is because it appears that the appellant has excluded documents under a misconception of the case (see Mulley v Manifold (1959) 103 CLR 341 at 343) in that the appellant took the view that the respondent is confined to the valuation methodology used to arrive at the valuation appealed against. On the basis that the valuation may be carried out by reference to s.3(2) of the Act, documents relevant to ascertaining the nature, extent, value and cost of the improvements on the subject land as at the relevant date are directly relevant to the matter in issue. It appears from the material before me that it is likely that there are such documents in existence and therefore they should be disclosed. [45] One other general matter may be noted. The appellant has objected to the production of a number of documents on the basis that they are not relevant to establishing the value of the subject property as at the relevant date. For example, the valuation reports do not assess the value of the property precisely at the relevant date. [46] It is not, I consider, sufficient reason for non-disclosure to say that the reports etc. were not made precisely as at the relevant date. Each of the specific requests will be considered shortly, but as a general principle, I consider that the appellant should disclose those documents which are relevant to the determination of the value of the property -- 15 of 19 -- 16 either at the relevant date, or at some other date from which the value as at the relevant date can be assessed. [47] I turn then to consider the specific classes of documents referred to in Mr Smith’s affidavit. Valuation reports [48] The appellant objected to disclosure of the valuation reports as at June 1999 and June 2000 on the grounds that they are not directly relevant to the matter in issue, because they are (a) the expression of an opinion by a third party to the proceedings; and (b) valuations at dates other than the material date. The reports value the subject as at 15 June 1999 and 15 June 2000. [49] Mr Smith noted that the subject property is held by the appellant on trust and said that it is not uncommon for trust property to be valued annually. He considered that the appellant would be likely to have obtained improved valuations as at June 2001 and June 2002. In his opinion, any such valuations, being on either side of October 2001 would be of great assistance in determining the improved value of the property as at October 2001. [50] The probative value of these reports remains to be established, but prima facie, they are directly relevant to the matter in issue. From what has been said above, I consider that the appellant should disclose any valuation reports which are in its possession or control which are relevant to the improved value of the subject land as at the relevant date or from which the improved value of the subject land can be assessed as at the relevant date. Valuation of improvements for insurance purposes [51] Mr Smith says in his affidavit that it is his expectation that, in the ordinary course, the appellant will have obtained assessments of the value of improvements on an annual basis, in order to carry out its duty as a prudent trustee to insure the improvements, and that the appellant will have available to it records relating to assessments of value and insurance in relation thereto. [52] The appellant relied on the same objections as that made to the valuations of the entire property. [53] For the same reasons as those set out above, I consider that disclosure should be made of any such documents that are directly relevant to the value of the improvements as at the relevant date, or from which the value of the improvements can be assessed as at the relevant date. -- 16 of 19 -- 17 Records, including any historical cost records, relating to the nature, extent, cost and value of improvements [54] The appellant has conceded that if the respondent is entitled to disclosure on a wider basis, then these records are discoverable, with the exception of those records as to value where they are not assessments made at the relevant date. [55] The objection to producing documents that assess the value of the improvements at a date other than the relevant date is answered by the general principle set out above, namely that if the information in the documents can be used to calculate the value at the relevant date, the documents should be disclosed. Records relating to depreciation of the improvements [56] The appellant has not expressly objected to disclosing these documents. They should be disclosed on the same basis as the other documents. Financial accounts or management reports relating to the operation of the property, the nett income of the property, and the outgoings, capital expenditure allowances, vacancy rates, trade figures within retail categories and other information relevant to the trading performance of tenants and outgoings recoveries from tenants [57] The appellant accepts that if wider disclosure is appropriate then any documents disclosing the rental income and management operating expenses as at the date of valuation are relevant. The appellant says however that the request is framed too widely in that it may cover many things not relevant to the income and expenses of the property. I consider that the financial accounts or management reports relating to those matters set out above are relevant to the matter in issue and should be disclosed in so far as they relate to the value of the property as at the relevant date. Other Matter [58] Although not included in the application for disclosure filed in this Court, Counsel for the respondent sought a declaration that the obligation of the appellant to make disclosure extends to documents held in its interest in relation to the subject property and appeal by Rider Hunt Queensland Pty Ltd, M3 Property (Vic) Pty Ltd and Grant Jackson. [59] It is not appropriate for me to make this declaration. Neither the companies nor the individual named are parties to this action. I have no information as to their connection, if any, with the appellant. The order for disclosure that I will make adopts the wording of -- 17 of 19 -- 18 r.211(1)(a) of the Uniform Civil Procedure Rules, that is that the appellant make disclosure of relevant documents in the possession or under the control of the appellant. In so far as any relevant documents which these entities may hold are not covered by the order, it would seem that it will be necessary for the respondent to consider whether to follow the procedures set out in the Uniform Civil Procedure Rules for non-party disclosure, if he wishes to obtain disclosure of such documents. Orders 1. The appellant, within forty-two days of the date of this order, file and serve further and better particulars of ground 3 of its grounds of appeal as follows: (a) An outline of further factors relevant to the development potential of the land and further conditions surrounding the present and future development of the site in addition to those previously outlined. (b) Particulars of the specific characteristics of the slope of the land in its unimproved state and details of the consequences of those characteristics. (c) Specific details, including details of quantities and rates, of the substantial bulk earthworks including excavation and filling which were necessary to create a suitable platform on which to construct the present improvements on the land. (d) Details of the location, dimensions, specifications, rates and quantities pertaining to the retaining walls on the land. (e) Details of the basis of the potential need for piling including sufficiently detailed plans, specifications, and details of the location of such piling and the quantities and rates pertaining to the said piling and details of the nature and location of the future construction that necessitates the potential need for piling. 2. The appellant, within forty-two days of the date of this order, deliver and produce to the respondent by way of disclosure any documents held in its possession or under its control which are directly relevant to the improved value of the subject property as at 1 October 2001 and the nature, extent, cost and value of the improvements to the subject property, including without limiting the generality of the foregoing, the following documents and classes of documents: (a) Valuation reports (b) Valuations of improvements for insurance purposes -- 18 of 19 -- 19 (c) Records, including historical cost records, relating to the nature, extent, cost and value of improvements (d) Records relating to depreciation of the improvements (e) Financial accounts or management reports relating to the operation of the property, the nett income of the property, the outgoings, capital expenditure allowances, vacancy rates, trade figures within retail categories and other information relevant to the trading performance of tenants and outgoings recoveries from tenants. CAC MacDONALD MEMBER OF THE LAND COURT -- 19 of 19 --