Callcott v Chief Executive, Department of Natural Resources and Mines [2001] QLC 103

LAND COURT BRISBANE 28 SEPTEMBER 2001 Re: AV00-620 An Appeal against an Unimproved Valuation Valuation of Land Act 1944 Local Government: Dalrymple Albert J, Elton JV and Norma D Callcott v. Chief Executive, Department of Natural Resources and Mines D E C I S I O N [1] The Chief Executive valued the appellants' grazing property "Ellenvale" at an amount of $540,000 as at a relevant date of 1 October 1999. The appellants contended for a value of $500,000 in their Notice of Appeal, however, in evidence this figure was adjusted to $510,000. The subject property is used for the breeding and fattening of cattle. [2] Albert James Callcott, one of the co-owners, appeared and gave evidence on behalf of the appellants. Stephen Brooks Gilbert, registered valuer, provided a valuation in support of the Chief Executive's figure. Although Mr Callcott provided a 10-page statement in support of the appeal and Mr Gilbert provided a detailed expert valuation report, it transpired that the only point of disagreement between the parties, apart from the value, related to carrying capacity. Mr Callcott said that the carrying capacity ought to be one beast to 12 ha, whilst Mr Gilbert contended that the carrying capacity was one beast to 11.5 ha. The difference between the parties is that whereas Mr Gilbert says the property is capable of carrying 2,008 head, Mr Callcott's assessment is that it would carry 83 head fewer than that. [3] It will be useful before I descend into the details of the primary dispute between the parties if I provide a word picture of the subject property taken from Mr Gilbert's report. "Ellenvale" is situated about 179 km north-west of Charters Towers and is accessed by a 57 km length of the Lynd Highway, then 122 km of formed earth and gravel road. This unsealed road is frequently impassable during wet seasons. [4] Mr Gilbert described the nature of the land on "Ellenvale" as follows: "About 650 hectares (2.8%) comprises broken gorges and steep slopes at Bubbling Spring in the NW corner. About 625 hectares (2.7%) comprises rougher wattle and quinine in the SW corner. [2001] QLC 103 -- 1 of 7 -- 2 About 5530 hectares (24%) comprises generally sandy iron bark, ghost and poplar gum, with areas of box forest. Underground water is very difficult to find in this country. About 1655 hectares (7%) comprises open black soil country in 5 main patches, black soil varies considerably in quality from patch to patch. About 14640 hectares (63.5%) comprises generally gently undulating red basalt tableland, timbered with ironbark and coolibah. The red basalt is generally more friable and a deeper soil to the east of the property. The red basalt is broken by low walls and areas of surface stone." [5] Mr Callcott acknowledged the presence of black soil and coolibah country in his oral evidence, but said that these classes of country are in such small patches that it is really better to classify them as part of a wider classification. Nevertheless, in his written statement he acknowledged the quality of the black soil country at the "Ten Mile" and said that he turned his bullocks off that paddock. One disability with the black soil areas that he described is that they are open and therefore more subject to frost than timbered areas and are of little or no use until suitable rain falls on these areas. Mr Gilbert acknowledged that "Ellenvale", which has an elevation of between 700 and 780 metres above sea level, is commonly subject to frosts during winter and is one of the colder properties in the locality. [6] Permanent natural water is available from Bubbling Spring, however, stock prefer to water on a nearby bore. There are two permanent holes in the Basalt River, only one of which, however, is readily accessible to stock. There are also lasting supplies in the river at the eastern boundary and upstream from the house. Other holes and creeks are seasonally dependent and there are some springs/soaks which, though useful, can be a danger to weak cattle who readily become bogged in them. There is grader grass along all public road frontages and some isolated and scattered mimosa. Parthenium and rubbervine are found along the Basalt River and other waterways. [7] Mr Gilbert included three sales in his valuation: "Amelia Downs" (Sale 1), "Junction Creek" (Sale 2) and "Lava Plains" (Sale 3). "Amelia Downs" sold for an analysed unimproved price of $667,184 ($32.40 per ha) on 14 January 1998. The Chief Executive determined an unimproved value of that property of $650,000 or $31.56 per ha. The sale property has an area of 20,595 ha and is located 120 km north-west of Charters Towers, via a road of 77 km of bitumen with the balance being formed earth and gravel. The sale property has about 12% open black soil plain with the balance comprising good red basalt forest country intersected by areas of gorge -- 2 of 7 -- 3 along the Basalt River and W Creek. Mr Gilbert estimated the carrying capacity at one beast to 10 ha. The property is used for the breeding and fattening of beef cattle. [8] "Junction Creek" sold for an analysed unimproved price of $753,681 or $31.40 per ha on 1 July 1996. The Chief Executive placed an unimproved value on that property of $640,000 or $26.67 per ha as at 1 October 1999. This sale property is located about 203 km north-west of Charters Towers, via a road which has 57 km of bitumen and the balance of formed earth and gravel. The sale property comprises about 6.5% open to lightly timbered black soil; 74% good open red basalt forest; 9% good to fair ironbark and box forest with the balance 9.5% comprising generally fair to poor forest ridges of box and ironbark on gravelly forest soils. Mr Gilbert estimated the carrying capacity of the sale property at one beast to 10.5 ha. The property is used for the breeding and fattening of beef cattle. [9] "Lava Plains" sold for an analysed unimproved price of $587,278 ($14.32 per ha) on 19 September 1996. The Chief Executive applied an unimproved value of $570,000 or $13.90 per ha to the property as at 1 October 1999. The sale property has an area of 41,000 ha and is located 260 km north of Charters Towers and approximately 90 km south of Mt Garnet. "Lava Plains" comprises approximately 84% open red basalt and red sandy forest country, with the balance unavailable lava flow or areas inaccessible owing to the lava flow. Mr Gilbert estimated the carrying capacity on "Lava Plains" at 1 to 14 ha overall or 1 to 11.7 ha on the available country. [10] It may be convenient if I first discuss Mr Gilbert's approach to the matter of carrying capacity. There were two elements to his method. He referred to the work that CSIRO has done at "Hillgrove" and which I discuss in greater detail in my judgment in Adam J Allingham (AV00-478) and Adam J, Robert J & Sarah B Allingham (AV00-579) v. Chief Executive, Department of Natural Resources and Mines, handed down today. In summary, that CSIRO work points to red basalt country having a carrying capacity of one beast to 10 ha on a long-term basis. Mr Gilbert noted that "Hillgrove" has a lower altitude (285 metres ASL) than "Ellenvale" (700 to 780 metres)and is therefore warmer, particularly during the winter when frosts descend upon higher elevated lands, however, he said that altitude difference is compensated for by the fact that "Ellenvale" receives rainfall of about 25.4 inches per annum as against the 20.1 inches received at "Hillgrove". Frosts have the effect of both burning off pastures, as I understand it, and reducing protein levels, whilst a higher average rainfall would have the benefit of generating a greater pasture growth during summer. -- 3 of 7 -- 4 [11] Mr Callcott confirmed that "Ellenvale" experiences low temperatures. He maintains a thermometer, properly housed in a Stevenson Screen, and said that he frequently records temperatures of minus 6 degrees Celsius or minus 7 degrees Celsius during winter. I was not provided with evidence of the "Hillgrove" temperatures, but Mr Callcott did provide a rough guide. He said that mango trees grow at "Hillgrove" but that they will not survive at "Ellenvale". His statement records the history of a valiant but fatal attempt by a mango tree to grow on the subject land. A custard apple tree suffered a similar fate. Mr Callcott acknowledged the difference in rainfall between the two properties. He raised a question as to the distribution of rainfall on "Ellenvale", however, did not adduce any evidence which would lead me to conclude that the distribution of rainfall there offsets any advantage in the increased annual falls when compared with "Hillgrove". [12] Mr Gilbert gave evidence as to how he had calculated his carrying capacity of one beast to 11.5 ha. Description of Country Carrying Capacity Number of Cattle 650 ha broken gorges and steep slopes 1 to 25 ha 26 head 625 ha rough wattle and quinine 1 to 30 ha 20 head 5,530 ha ironbark, gum and box 1 to 18 ha 307 head 1,655 ha variable black soil country 1 to 8 ha 206 head 14,640 ha red basalt, ironbark and coolibah 1 to 10 ha 1,464 head [13] This calculates to 2,023 head, however, Mr Gilbert rounded the calculated carrying capacity of one beast to 11.41 ha down to one beast to 11.5 ha which calculates to a herd of 2,008 head. [14] Mr Callcott said that a State valuer who was at the time, as I understand it, in the employment of the Valuer-General's Department, had estimated a carrying capacity for "Ellenvale" of one beast to 13 ha. Mr Callcott thought that estimate to be "a bit lenient". At that time there were two valuing authorities and one of those, the Department of Lands, placed a carrying capacity of one beast to 12 ha on the subject property. Mr Callcott has been on "Ellenvale" since 1969 and has had life-long -- 4 of 7 -- 5 experience in the Charters Towers district. Based on that history, he said that "Ellenvale" would sustain 21 head per sq. mile year in, year out, though he noted that even at that stocking rate, cattle would die during a drought if they were not fed a supplement. This carrying capacity estimate calculates to about one beast to 12 ha. Whilst Mr Gilbert's valuation and carrying capacity calculate to a beast area value of $268.92, Mr Callcott's figure would be $264.93. However he provided no reasoning in support of that figure except to say that the carrying capacity ought to be adjusted. Mr Gilbert said that using his beast area value of $268.92 and Mr Callcott's carrying capacity, the value of the subject property would be reduced by a figure of $22,320. [15] The Chief Executive did not challenge Mr Callcott's evidence as to what his experience had told him concerning the carrying capacity of "Ellenvale". Nevertheless, it maintained the view that the Chief Executive's carrying capacity should be adopted. Mr Gilbert had analysed a number of sales of basalt country properties and, based on the previous State-applied carrying capacities of one beast to 13 ha or one beast to 12 ha, concluded that beast area values in the basalt country were at an incorrect relationship with beast area values shown on lighter country. He concluded, with the support of the "Hillgrove" work and Mr Allingham's opinion as expressed before me in the case of his appeals, that red basalt country could sustainably carry one beast to 10 ha. Based on this evidence and on the beast area values shown on lighter country, Mr Gilbert concluded that the carrying capacity of red basalt country which the Chief Executive had previously applied ought to be tightened in order that the beast area values calculated revealed more acceptable figures. He said that some indirect support for his conclusions is found in his observation that many graziers in the basalt country stock at a higher rate than he has applied. [16] It is important to note that Mr Gilbert has assessed the carrying capacities of the three sales, "Amelia Downs", "Junction Creek" and "Lava Plains", in the same manner as that employed with respect to "Ellenvale" and as set out above. His valuation method is to compare the subject property with those sales. If he were to adjust the carrying capacity of "Ellenvale" to accord with Mr Callcott's figures, then he would also have to adjust the carrying capacity on the sales to maintain consistency. The result would be that the value he placed on the subject property would not alter. [17] Whilst the contest between the parties was limited to one issue, that is the issue of carrying capacity, the broader issue is concerned with of the valuation which -- 5 of 7 -- 6 should apply as at 1 October 1999 under the provisions of the Valuation of Land Act. In that respect the appellant needs to show that the value applied by the Chief Executive is wrong. It may be both useful and of interest to Mr Callcott for me to refer to two provisions of the Valuation of Land Act which apply. The first of these is s.33: "33. Any and every valuation, or alteration of the valuation, of any land made, or purporting to be made, under this Act by the chief executive shall be deemed to be correct until proved otherwise upon objection or appeal or until altered or further altered." [18] What this statutory provision clearly says is that unless there is clear evidence or a legal basis which demonstrates that the valuation of the Chief Executive is wrong, then it is deemed to be right. That is, there may be evidence that could be led to demonstrate that it is wrong, but unless that evidence is led and the argument advanced to that conclusion, the valuation remains as being presumed to be correct. The next provisions which I will refer to are s.45(3) and (4): "(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." [19] Even if I were to accept that the carrying capacity of "Ellenvale" is one beast to 12 ha, the result would not be that the value of the Chief Executive would be shown to be wrong. The burden of proof would not be discharged. Apart from that, I should say that it is my view in a matter such as the present one that in considering an issue such as carrying capacity this Court should be less concerned with absolute numbers than with the use of carrying capacity as an expression of the class of country. Absolute numbers will vary according to such matters as the style of management, the type of enterprise being conducted (including whether it is breeding and growing and/or fattening), the age of turning off stock and a range of similar matters. The Chief Executive, through Mr Gilbert, has approached the matter of valuing lands in the basalt country of the Charters Towers district on a consistent basis. Whilst consistency is not a virtue if the outcome is consistently wrong, I cannot conclude on the evidence provided that in the approach to the assessment of carrying capacity both on "Ellenvale" and on the sales employed by Mr Gilbert that he has been shown to be wrong. -- 6 of 7 -- 7 [20] Accordingly, this appeal is dismissed and the valuation of the Chief Executive is affirmed. RP SCOTT MEMBER OF THE LAND COURT -- 7 of 7 --