Cerutti and Anor v Department of Natural Resources and Mines [2003] QLC 71

LAND COURT OF QUEENSLAND CITATION: Cerutti and Anor v Department of Natural Resources and Mines [2003] QLC 0071 PARTIES: Steven Louie Cerutti as Trustee and John Spencer Henderson as Trustee (applicants) v. Chief Executive, Department of Natural Resources and Mines (respondent) FILE NO: AV2002/0392 and AV2002/0393 DIVISION: Land Court of Queensland PROCEEDING: Appeals against annual valuation under the Valuation of Land Act 1944 DELIVERED ON: 30 October 2003 DELIVERED AT: Brisbane HEARD AT: Coolangatta MEMBER Dr NG Divett ORDERS: (i) In respect of the notice of appeal against a valuation of Two Million Dollars ($2,000,000) at 1 October 2001 (AV2002/0392), on the evidence the Court has no jurisdiction to hear the matter, and the appeal is struck out for want of jurisdiction. (ii) In respect of the notice of appeal against a valuation of One Million Two Hundred Thousand Dollars ($1,200,000) at 1 October 2001 (AV2002/0393), considering the evidence, and allowing a reasonable cause for the circumstances of the appeal, the Court has jurisdiction to hear the merits of the matter, at a date to be fixed. CATCHWORDS: Practice and procedure – Satisfying jurisdiction – Failure to lodge an objection – Jurisdiction not found to exist. Practice and procedure – Satisfying jurisdiction – -- 1 of 10 -- Amendment to valuation under s.28(1)(f) – Lack of clear direction by appellant. Where a reasonable cause for incomplete notice of appeal – Jurisdiction found in view of circumstances. APPEARANCES: Dr SL Cerutti appeared for the appellants Mr GP Crowley appeared for the respondent Background: [1] This matter relates to land at 11 Teemangum Street, Tugun, Gold Coast, and described as Lots 1 and 2 on RP 216116, Parish of Tallebudgera. The matters before the Court relate to preliminary question of whether the court has jurisdiction to hear the merits of the matters in respect of appeals against annual valuations at 1 October 2000 (AV2002/0393, and 1 October 2001 (AV2002/0392) under the Valuation of Land Act 1944. Dr Steven Louie Cerutti appeared and gave evidence for the appellants. Gregory Patrick Crowley, the departmental registered senior valuer appeared and gave evidence for the respondent. The Facts: [2] The following chronology of events assists in understanding the circumstances of these appeals. Mr Crowley argues that neither of the annual valuations had been previously the subject of a decision on an objection from the appellants, and therefore both notices of appeal had failed to satisfy the requirements of s.45(1) of the Valuation of Land Act 1944. On that basis Mr Crowley requested that both matters be struck out as jurisdiction could not be found to lie in either matter. In order to understand those issues the appeals are dealt with individually, based upon court records, including copies of the departmental computer records. [3] On 26 February 2001 the Chief Executive issued a revaluation (code 21) of the subject land at 1 October 2000 for $420,000, with a date of effect of 30 June 2001. [4] On 25 February 2002 the Chief Executive issued a revaluation (code 21) of the subject land at 1 October 2001 for $1,200,000, with a date of effect of 30 June 2002. [5] On 25 June 2002 the Chief Executive issued a revised valuation (code 06) of the valuation at 1 October 2000 at $1,000,000, with a date of effect of 24 May 2002. [6] On the same day 25 June 2002, the Chief Executive issued a revised valuation (code 06) of the valuation at 1 October 2001 at $2,000,000, with a date of effect of 30 June 2002. [7] On the same day 25 June 2002, the Chief Executive issued a decision on objection against the valuation of $1,200,000 at 1 October 2001, confirming that figure, and noting that 2 -- 2 of 10 -- “further action will be taken by the valuer which will result in an amendment to your valuation”. [8] A copy of the letter from the Chief Executive of 25 June 2002 in respect of the unimproved value of $1,200,000 for 1 October 2001 is Exhibit 1. Copies of the other letters were not provided by either the appellant, or the respondent. Mr Crowley explains that current departmental policy in respect of notices of revaluations, or interim amendments of a valuation under s.28, is that those despatches are arranged through third party suppliers, and no copies of those correspondence are retained by the Chief Executive. The only departmental record that the letters were sent is a date stamp, and reasons explained in any text, which is retained on the computer. Copies of the computer file were supplied to the Court for verification. [9] In explaining the QVAS or computer codes maintained in this matter the following are relevant: QVAS DESCRIPTION 06 section 28.1(f) – change use up 17 section 42 – objection for annual valuation 21 section 37 – annual revaluation issue [10] To the best of his recollection Dr Cerutti only recalls one objection to the Chief Executive in respect of the valuation of $1,200,000 at 1 October 2001. Mr Crowley agrees with that understanding, noting that the decision on objection of 25 June 2002 was in response to that objection. [11] Mr Crowley also confirms that a conference on the valuation at $1,200,000 was held with agents for the appellants (Mr Pearce and Mr Blenkins) on 13 June 2002. Following that conference about 20 June 2002, on their advice, Dr Cerutti spoke to Mr Crowley by telephone, following which he then quickly verbally placed the business of that appeal in the hands of his solicitors who reside in his home town of Ingham in North Queensland. Dr Cerutti is a very busy medical specialist practising since the late 1980s on the Gold Coast. He has continued to rely upon his legal advisers (Roati and Firth, Solicitors) for the processing of his appeal. [12] Roati and Firth, Solicitors, subsequently engaged professional valuers from Townsville (Collins and Eales) to advise in the matter. Dr Cerutti confirms that the official postal address on the departmental computer for despatch of official correspondence on the subject matter was his current correct address. (PO Box 14 Tugun, 4224). He also advises that any subsequent correspondence on this matter had been quickly referred to 3 -- 3 of 10 -- his legal advisers. He also confirms that it was always his intention to appeal any of the current valuation increases since 2001. [13] On 26 July 2002 a notice of appeal (Form 59) to this Court was forwarded by Collins and Eales, Valuers noting the Chief Executive’s valuations of $1,000,000 and $2,000,000. That notice was a typed copy which was received by the Court on 31 July 2002. The notice also specified among others that the appeal related to the dates of valuation of 1 October 2000 ($1,000,000) and 1 October 2001 ($2,000,000). The dates of effect were 24 May 2002 and 30 June 2002 respectively. [14] On 5 August 2002 a handwritten notice of appeal (Form 59) was received by the Court from Roati and Firth Solicitors, and was dated and signed by the solicitors for the owners on 2 August 2002. The Chief Executive’s valuation appealed on that notice was for $1,000,000 for 2 October 2000, effective at 24 May 2002. A copy of that notice was also faxed to the Court on 2 August 2002. [15] On 5 August 2002 a handwritten notice of appeal (Form 59) was received by the Court from Collins and Eales Valuers, also dated 2 August 2002, but against a valuation of $2,000,000 at the date of 1 October 2001, but effective at 30 June 2002. A copy of that notice was also faxed to the Court on 2 August 2002 by Roati and Firth Solicitors. [16] Mr Crowley argues that the valuation issued on 25 June 2002 for $2,000,000 was not an objection decision, but an amended valuation under s.28(1)(f) for a different land use classification for the subject land. The land was then assessed as a multi-unit site, and not afforded its previous concessional valuation under s.17 of the Act. [17] While the valuation matters in these appeals are not currently relevant in deciding whether jurisdiction can be found, an explanation of some of those details assists in understanding the confusion which appears to have occurred. The subject land has been used as a single residence for an elderly lady for many years prior to selling the land to Dr Cerutti in 1999. That elderly lady continued to reside in the premises while design and construction of a new single residence for Dr Cerutti was arranged. The land has subsequently been cleared and a new residence is now under construction. Apparently there was some delays due to design changes to accommodate obstructions to views by a new building on an adjoining parcel. [18] Dr Cerutti maintains that the use of the land always was, and continues to be, exclusively for a single dwelling for his family. He is at a loss to understand why the land use classification was changed during the construction phase, hence his intentions to appeal. Dr Cerutti is personally unfamiliar with the Valuation of Land Act or its implications. However he advises that he is currently anxious to finish the dwelling, and thus be able to 4 -- 4 of 10 -- claim “principal place of residence” status for land tax purposes. He has relied entirely upon his technical and legal advisers in this matter. Legislation – [19] Before considering the circumstances of this matter I refer to the directions of the legislation. It is noted then in respect of an annual valuation, an appeal to this Court against a decision of the Chief Executive is exercised under s.45, which states relevantly: “45.(1) An owner who has objected pursuant to section 42 against a valuation made by the chief executive may, if dissatisfied with the decision of the chief executive upon the objection, appeal to the Land Court against the valuation. (2) Except as hereinafter by this section provided, an appeal shall not lie unless it is instituted within 42 days after the date of issue to the owner concerned by the chief executive of notice of the chief executive’s decision upon the objection (which date of issue shall be stated in such notice). (3) An appeal shall be instituted by filing a notice of appeal in the Land Court registry. (4) Such notice shall state the grounds of appeal and the appeal shall be limited to the grounds so stated and the burden of proving any and every such ground shall be upon the owner. (5) Such notice shall also state the amount which in the opinion of the appellant should be the valuation of the subject land. (6) The appellant shall serve a copy of the notice of appeal on the chief executive not later than 7 days after the notice is lodged in the Land Court registry. (9) Sections 57 to 68 and section 70 apply, with any necessary changes, to an appeal under this section.” [20] Clearly under s.45(2) an appeal shall not lie unless there has been an objection to a valuation by the Chief Executive, and a decision issued in respect of that objection. In the matter of the valuation at 1 October 2001 for an amount of $2,000,000, it is agreed that a formal objection was not lodged against that valuation, which was issued on 25 June 2002. The right of an owner to object against a valuation is exercised under s.42(1) of the Act where the owner may object within 42 days of the issue of the valuation. [21] However where an owner may seek a late objection to a valuation under s.44(1), that late objection must be submitted in writing to the Chief Executive within one year of the date of the issue of the valuation. Discretion as to whether to accept that late objection is exercised under s.44(2), which directs: 5 -- 5 of 10 -- “44(2) If the chief executive is satisfied that the person’s failure to make a timely objection happened through no fault of the person, the chief executive must accept the late objection. [22] In respect of the valuation at $2,000,000 issued on 25 June 2002, and even had the appellants later decided to seek the indulgence of the Chief Executive in respect of a late objection under s.44(2), that period of grace has already expired, and provides no avenue for any consideration of the apparent confused circumstances of the valuation process under s.28(1)(f). As an inexperienced appellant under the Act, I accept that the appellant may have seen the advice of 25 June 2002 as a possible decision, or reconsideration, of the previous valuation at $1,200,000. But even that discretion has now expired, and I find I have no jurisdiction to hear the matter in respect of the new valuation at $2,000,000 for 1 October 2001 (AV2002/0392). [23] If I turn then to the matter of the valuation objection to at $1,200,000, I find that there is no specific mention of that figure in any of the notices of appeal lodged with the Court. However I note that the apparent issuing of three advices to the owners on the same day of 25 June 2002, has even caused confusion among the professional representatives of Dr Cerutti. For example Mr Eales (the valuer), who is a very experienced witness in this jurisdiction, has apparently confused the intentions of those three separate matters. The notice of appeal from his office (para [13]), specifies the date of the valuation at 1 October 2000, with the date of effect of 24 May 2002; and an unimproved value of $1,000,000. That is to be compared with the decision on objection issued the same day for a valuation of $1,200,000 at 1 October 2001, with a date of effect of 30 June 2002. (para [4]). Whether a reasonable Cause or Explanation – [24] Before considering precedents in this regard, I note that while the separate advices from the Chief Executive are apparently all correctly issued, their conclusions appear to lack a reasonable explanation, even for an experienced person such as the technical advisers of Dr Cerutti. For example the Chief Executive has in one period determined the following unimproved values of the subject land: Date of Valuation Date of Issue Date of Effect Unimproved Value 1 October 2000 26 February 2001 30 June 2001 $420,000 1 October 2000 25 June 2002 24 May 2002 $1,000,000 1 October 2001 25 February 2002 30 June 2002 $1,200,000 1 October 2001 25 June 2002 30 June 2002 $2,000,000 1 October 2001 25 June 2002 30 June 2002 $1,200,000 6 -- 6 of 10 -- [25] I note that while the Chief Executive has the power to issue an alteration to a valuation under s.28(1)(f), where he determines that a use of the land may have occurred, such a process is virtually transparent to an appellant, who merely receives a notice that the valuation has been changed. In the current circumstances it was apparently because the Chief Executive had no evidence that the subject land was continuing to be “used” as a single residence site. [26] Now while the meaning of the word “used” could be argued to include the redevelopment of that land for a single family residence for Dr Cerutti, the effect of that uncertainty was that a previously determined value at $1,200,000, was objected at that figure, later determined to be correct at $1,200,000, and then increased to $2,000,000, all on the same day (25 June 2002). The confusion to the appellants is understandable. [27] Unfortunately there was no evidence of the actual wording of any of the notices of valuation on 25 June 2002, as copies were not maintained by the new departmental system, other than the decision on objection against the valuation at $1,200,000. (Exhibit 1). In that decision on objection the reason given for refusal of the objection stated: “Further action will be taken by the valuer which will result in an amendment to your valuation.” [28] The inference in that statement may well have been assessed by the appellant that the word “amendment” referred to a subsequent alteration of the previous unimproved value, rather than to the issuing of an entirely “new” valuation for that period. When the subsequent valuation for $2,000,000 was received on the same day as 25 June 2002, it was possible that that figure could have been interpreted as the “amendment” of the previous figure. [29] Now while such a process is not envisaged in the legislation, the fact that even an experienced technical expert in this jurisdiction such as Mr Eales, could misdirect himself on behalf of his client, tends to support the level of confusion which seems to have occurred. The question now to be addressed is whether there are sufficient grounds, in light of those circumstances, for acceptance of some reasonable cause for the lack of full compliance with s.45(2) of the Act. [30] Now the use of the words “reasonable excuse” relates only specifically to the lateness of the lodgement of a notice of appeal under s.57(1) of the Act. By comparison with that more flexible approach in dealing with the carriage of an appeal, the actual wording of s.45(2) is very specific. It is clear that an appeal “shall not lie” unless it follows an objection against a valuation. Now in the current matter the appellant had formally lodged an objection, and had waited some fifteen months for a response from the Chief 7 -- 7 of 10 -- Executive. When that response was received on 25 June 2002, it was nearly one year after the date upon which the objected unimproved value had taken effect. The advice to the objector was that the unimproved value was to be further “amended”. [31] The circumstances of the notice of appeal was that the appellant had entrusted his appeal to professional experts in both the law and valuations. The evidence is that those experts had lodged separate appeals in order to cover the ever changing nature of the matter at that time. The only problem for the appellant is that both experts overlooked the one appeal notice in respect of the valuation at $1,200,000 with effect from 30 June 2002. The question then to be asked is should the appellant be denied his right of appeal through such an oversight by his professional advisers? [32] The matter of a notice of appeal being lodged after the relevant date was considered in the matter of Director-General, Department of Transport v Congress Community Development and Education Unit Limited (A97-09) 25 June 1998, unreported. In that matter a solicitor for the appellant, because of pressures of work, had lodged an appeal three days after the prescribed period. In considering whether the words “reasonable excuse” should be afforded a broader meaning in its interpretation, Muir J in the Land Appeal Court said at 5: “In my view, the above authorities support the conclusion that for a reasonable excuse to exist it is not necessary that the conduct of the applicant (by itself) or its agents, be blameless. The expressions under consideration are broad in meaning and quite apt to cover a ‘slip’ of the nature of that made by the employee of the Crown Solicitor. One should not lose sight of the fact that the provision under consideration is remedial in nature, having been introduced in order to ameliorate the harsh consequences of a failure to comply with the requirements of subsections 44(11)(a) and (b). cf Bull v Attorney-General (NSW) 1913 17 CLR 370.” [33] In that matter s.44(11)(a) of the Land Act 1962 (as it then was) dealt with a matter where a notice of appeal had been correctly completed, but failed to be exchanged, or lodged in time with the Court, or the prescribed fee duly paid to the registrar of the court. (Now s.428 of the Land Act 1994). However such an appeal to this Court must be followed by a decision under s.421 of the Land Act 1994, similar to the notice on objection exercised under s.45(2) of the Valuation of Land Act 1944. [34] While the other members of the Land Appeal Court agreed with Muir J in approving that the matter should proceed, they went on to say in a separate judgement at p.1: “That does not imply however that, in our opinion, there was a reasonable excuse for the conduct of the solicitor to whom the applicant had entrusted the institution of the appeal. The reasonable cause and explanation of the lateness of the service and lodgment of the notice and payment of the 8 -- 8 of 10 -- prescribed fee, is, in our opinion, the fact that the solicitor failed in the duty entrusted to her. The applicant had done everything that should have been expected of him.” [35] Guidance from that decision, in my opinion, in the current matter is that the appellant (Dr Cerutti) has done everything that he could be expected to do to ensure his appeal was appropriate, but that the confusing nature of the various changes in the process have led to this current circumstances. However, as noted in paragraph [27], there was no evidence supplied by the respondent of copies of the actual notices of valuation issued to the appellant on 25 June 2002. There is no confirmation of the actual wording of those valuation notices; and their message to the appellant. That such a process could be allowed to occur, where evidence of proof of the actual figures issued, or the meaning of the words used, or the actual date of issuing, cannot be demonstrated, is a reflection on the Chief Executive’s understanding of the need for proof under the Act. That such an administrative process should occur, where copies of notices are not maintained, or even that a demonstrable electronic trail is provided, leaves something to be desired, even in the modern electronic era. In the current matter it lends support to the appellant’s case for consideration. [36] However in seeking to understand the meaning of a “valuation” under the Valuation of Land Act 1944, (s.2), as noted previously, the Chief Executive has the power to alter a valuation under s.28(1)(f); and each such alteration under s.29(3) is to be seen as a “valuation” against which the rights and obligations of an appeal are executed under s.55. (Similar to s.45 for annual valuations). In interpreting that legislation I am reminded by Bull (supra), where Isaacs J said at 384: “In the first place, this is a remedial act, and therefore, if any ambiguity existed, like all such acts, should be construed beneficially (per Lord Loreburn LC in Bist v London and South Western Railway Co (1907) AC, 209, at page 211. This means, of course, not that the true signification of the provision should be strained or exceeded, but that it should be construed so as to give the fullest relief which the fair meaning of its language will allow.” [37] Now had there been documented evidence of the actual notices of valuation issued on 25 June 2002, and the Chief Executive’s intentions of those notices, then a fair reading of those notices in the light of the legislation, may have led to the conclusion that the appellant, or his professional advisers, should have known that an appeal, at that time, only lay open to an amount of $1,200,000 with effect from 30 June 2002. In the absence of that documented evidence, and following guidance from Bull, I believe the “fullest relief” can be exercised in the appellant’s favour in this matter. 9 -- 9 of 10 -- 10 Conclusion: [38] In respect of the notice of appeal against a valuation of Two Million Dollars ($2,000,000) at 1 October 2001 (AV2002/0392), on the evidence I find the Court has no jurisdiction to hear the matter, and the appeal is struck out for want of jurisdiction. [39] In respect of the notice of appeal against a valuation of One Million Two Hundred Thousand Dollars ($1,200,000) at 1 October 2001 (AV2002/0393), considering the evidence, and allowing a reasonable cause for the circumstances of the appeal, I find that the Court has jurisdiction to hear the merits of the matter, at a date to be fixed. NG DIVETT MEMBER OF THE LAND COURT -- 10 of 10 --