Copeland v Chief Executive, Department of Natural Resources [1999] QLC 118

LAND COURT BRISBANE 12 November 1999 Re: Appeals against annual valuations Valuation of Land Act 1944 Valuation Roll Nos 21746/50000 Local Government: Maroochy Shire (AV98-907/908/909) Kevin J and Rosemary A Copeland v. Chief Executive, Department of Natural Resources (Hearing at Maroochydore) DECISION Background: These matters deal with land at McKillop Road, Palmwoods, described as Lot 1 on RP 218704, Parish of Mooloolah, and known locally as “Birrawa”. The subject land has an area of 8,192 m², and is located about 7.4 kilometres by road south-west of the Palmwoods Post Office. The electricity and telephone are connected to the subject land, which had easy access to McKillop Road, which is gravel surface for 200 metres from the subject land, changing then to a bitumen surface to Palmwoods. The land is zoned as “Rural A” under the Maroochy Town Planning Scheme of 14 December 1985, and effective at the dates of valuation of 1 January 1996 (AV98-907), 1 October 1996 (AV98-908), and 1 October 1997 (AV98-909). By agreement with the parties, the three matters were heard concurrently, and a joint inspection of the site and sales was undertaken. The key issues are the nature of the land, the impact of a power easement, relativity and the comparison of sales. [1999] QLC 118 -- 1 of 20 -- 2 On 18 March 1996, the Chief Executive issued a valuation of the subject land at $60,000 (1 January 1996). Following an objection the Chief Executive revised the unimproved value, and on 26 October 1998 issued revised valuation at $58,000. On 1 April 1997 and 30 March 1998 the Chief Executive issued subsequent valuations at $61,500 (1 October 1996), and $61,500 (1 October 1997). Following further objections the Chief Executive amended both of these figures on 26 October 1998 to $60,000 (1 October 1996) and $60,000 (1 October 1997). The appellants have now appealed those figures claiming the unimproved value should more properly by:  1 January 1996 $42,000  1 October 1996 $45,000  1 October 1997 $45,000 Following a court supervised preliminary conference on 29 April 1999, it was decided to proceed to a hearing on 20 July 1999. Mr KJ Copeland, a valuer of considerable experience, although not currently practising, appeared and gave evidence for the appellants. Mr R Rose, the Departmental registered valuer responsible for the valuations, appeared and gave evidence for the respondent. (1) The history of the appeals - The appellants acquired the subject land in June 1993 as an improved property for $240,000. On the notification of change of ownership, Form 100, an apportionment of land ($60,000) and improvements ($180,000) was noted, although Mr Copeland does not concede that those figures represent a reliable detailed estimate of the values. At the annual valuation of 1 January 1995 the appellants sought directions of this court in respect of their appeal against the then valuation by the Chief Executive at $45,000. At the hearing the Chief Executive sought leave to amend his valuation to $54,000. The decision of the learned member in the matter of AV95-688 of 25 October 1996, determined the unimproved value to be $52,500. In that decision the nature of the subject land, and the impact of an overhead power easement were discussed in great detail and I will not repeat those matters further. However there were several matters then exposed which remain in dispute between the parties. These include the impact of distant views from the subject land, the diminution -- 2 of 20 -- 3 in the value of the land as a consequence of the power line, the nature of the subject land, relativity with adjoining parcels, and the relevance of the sales adopted. In the matter of relativity with adjoining parcels, I note that Mr Rose concedes that the parcel to the west of the subject land (Lot 3 on RP 135440 – Goh) was found to have been under-valued over a period of years, and steps are now in progress to bring that parcel into correct relativity. The under-value occurred because the Goh property had not been valued on the basis of the distant views that it is now found to enjoy. Another further impact on the lack of relativity consistency has been the location of a boundary of an administrative sub-market area classification (SMA), which lies between the Goh property and the subject land. The impact of that administrative arrangement has been that the two parcels were previously valued as if they lay within different land classification types, and therefore subjected to different market influences. The history of valuations of those two parcels, (Exhibit 11) reveals that between the 1 January 1995 and the 1 October 1997 valuations, the subject land has risen from $52,000 to $61,500, while the Goh property has increased from $45,000 to $85,000. Mr Rose argues that it is unwise to seek relativity between those parcels in the current matters, when it is known that the former unimproved value of the Goh property was known to be incorrectly determined. In an attempt to ensure relativity remains consistent in that area, Mr Rose has now shifted the Goh property and its near neighbouring lots, into the same SMA as the subject land. At this stage it is worth noting that the SMAs are defined by the Chief Executive to identify the area that is just off the edge of the Blackall Range Plateau. While not experiencing the full range of expansive views of the higher lands of Montville and Flaxton, the area of the subject land in that SMA is elevated, with good views to the east, and is much sought after. (2) The nature of the land - The detailed analysis of the nature of the subject land was examined in the former decision of AV95-688. The only further issue relating to that subject in the current matter lies in the description of the subject land by Mr Rose as “an easy sloping knoll which falls sharply away to the north and west, and to a valley in the east”. It is Mr Copeland’s testimony that such a description under-values the extent of earthworks necessary in order to prepare the housesite and associated living areas, which he argues -- 3 of 20 -- 4 represented approximately 2,250 , and which represents more than half of the area of the subject land, exclusive of the area covered by the power easement. Because of that tendency to underestimate the difficulties of the site, Mr Copeland argues that the comparisons with sales of comparable lands are biased towards a higher compared value for the subject land. Mr Rose disagrees as he sees the subject land as primarily a rural homesite, and he argues that an area of 2,250 m² provides a good building and living area. He concedes the remaining areas of the subject land are steep to very steep, but he sees those additional areas as a bonus to the actual living area, and providing privacy for the owners. The nature of the lack of available water on the site was re-examined, and also the difficulties experienced by Mr Copeland in an unsuccessful attempt to pump water from an adjoining property, below the subject land. However those issues add nothing further to the previous evidence, and have no further practical impact upon the valuation. Mr Copeland concedes that he could construct a dam under the power easement, however, due to the porous nature of the soil, and the need for a permanent impervious layer to be provided to the dam, the cost would be quite high. Mr Copeland currently elects to buy in water in dry periods. Because of the current good rainfall, his five watertanks remain full, and he has no current water problems. Mr Rose concedes that the subject land is mainly a sandstone knoll with shallow soils, compared to the better agricultural soils on some of the sales discussed later. Mr Copeland agrees that he currently grows some fruit trees on the steeper slopes under the power easement, and below his swimming pool area. Mr Rose concedes that there is no town water connected to subject land, but notes that where town water is available, those lots tend to reflect a higher value for that reason, of the order of $5,000 to $10,000. Mr Rose believes that if a dam was available on the subject land, he would allow for something less than that figure as an improvement. (3) Relativity - While I have noted the history of the relativity between the Goh property and the subject land, the relativity of the surrounding parcels was further examined. Mr Copeland draws comparison with the Goh property which, he says, is better located to the bitumen access road, with better remnant softwood scrub and some rainforest country, double access to a semi-permanent watercourse, and the land is not impacted by the power easement. -- 4 of 20 -- 5 Mr Rose contests that comparison of relativity on a single lot basis proves conclusively that the unimproved value of the subject land is incorrect, particularly the Goh property, which was known to be formerly incorrect. Mr Rose further argues that a property to the north of the subject land (Lot 2 on RP 803644 – Cuddihy) had an unimproved value of $45,000 in 1996. That land is much lower than either the Goh or subject lands, it has good creek access, but has a long easement access from McKillop Road (an improvement of $8,000 to $10,000) immediately to the west of the subject land. While the power easement passes over that property also, the wires are 60 metres above the land, and virtually have no impact upon the parcel. Mr Rose sees the relativity between the Goh property, subject land, and Lot 2 on RP 803644 as appropriate. (4) The impact of the power easement - There was further discussion about whether there was an increased public awareness about the difference between the impact of various electro-magnetic fields, and visual impacts of different types of transmission towers. Mr Copeland argues that the high voltage of the 275 KV transmission across the subject land, would deter many potential buyers, and therefore impact the value of the land. Mr Rose argues that, while buyers would be impacted by the presence of the overhead wires, they do not tend to discriminate on the basis of voltage of transmission. Mr Rose argues that there would be minimal differentiation on the basis of the 275 KV line at the subject land, and other 110 KV lines at comparable sales. A general explanation of the impacts of transmission radiation was covered in AV95-688. However an important health factor would appear to be a guideline by the authorities that transmission radiation levels match background levels at a distance of some 150 metres from the wires. In the current matter all impacts considered are less than that distance. While neither Mr Copeland or Mr Rose were suitably qualified to provide evidence on the difference between 275 KV and 110 KV impacts, Mr Rose provided evidence of sales of vacant lands where overhead transmission lines appeared to impact the value of the sales. While he chose an area for comparison purposes at Cashmere, some 65 kilometres south of the subject land, he argues the reduction in price due to the presence of the transmission lines would be similar in the subject area. He bases that conclusion on the overall level of capital value of the Cashmere land, and the type of -- 5 of 20 -- 6 country and rural homesite occupation. Mr Rose also provides evidence of sales near single current lines and also double current lines (Exhibit 14), noting that the latter have about twice the number of electrical transmission wires, and larger towers. In the previous decision (A95-688) the learned member had concluded that a reduction in the unimproved value of 32.5% should be allowed for the presence of the overhead transmission wires. The member did not reject that the market might distinguish between powerlines of different dimension and capacity, but concluded on the evidence that the similarities in dimensions of the powerlines compared to sales and the subject land, suggested no differentiation was needed in that case. However the new evidence now provided by Mr Rose would indicate that any diminution in value as a consequence of the proximity of the overhead powerlines, would vary more relative to the percentage of area covered by the easement, rather than as a consequence of the voltage of the powerlines. In the comparisons on Table 1, the reduction in sale price of lots affected by the power easement over about half of the area of the lot, varied for a single current line from 17% to 19.5%. In the comparisons on Table 2 the reduction in the sale price of lots affected by a double current overhead power easement varied from 11.5% (about 30%), to 14.7% (about 50% coverage), to 29.5% (majority covered), and up to 44% (80% covered, but with two large pilons on site at the intersection of two major powerlines). Clearly each case depended upon the particular circumstances and presence of the towers at each parcel. However the overall conclusion is that the greater the percentage area covered, the greater the impact upon the value. Where there was also large transmission towers involved, the impact is even greater. Based upon those comparisons Mr Rose argues that comparisons for the subject land would indicate a reduction in the unimproved value of 20% to 25%, to allow for the powerlines, would be appropriate. Mr Copeland argues for a diminution of 40% for that purpose. Mr Copeland also argues that it is inappropriate to compare the park residential lands at Cashmere, as those are a quite different market segment, due to the availability of town water supplied to those parcels by the Pine Rivers Shire Council. Mr Rose argues that the transmission lines involved are similar as they are part of the Brisbane to Gladstone powerline system. It was agreed by the parties that the areas covered by the powerline easements at the Mossy Bank Road sale (Sale 1) represented between 50% and 60%, and there was a -- 6 of 20 -- 7 further small sliver of unaffected land on the eastern side of Sale 1. The area impacted by overhead powerline easements on the subject land represented about 48%. Mr Copeland relied on the former process applied in AV95-688 , adopting 40% for the subject land, and 30% for the Mossy Bank Road sale (Sale 1). Mr Rose applied 32% at the subject land, but feels that is a very conservative figure. However it is agreed that the use of the lands within the easement areas is restricted only to construction under the actual overhead wires, and in fact the rest of the easement land is used for the cultivation of bananas and pineapples at the Mossy Bank Road sale, and the appellants’ swimming pool in the subject land. Therefore the extent of the blot on title does not entirely prevent any use of the land, for purposes other than habitation. Mr Copeland notes that, in his opinion, the differences between the Mossy Bank Road easement and the subject easement may be summarised as:  the difference in powerline capacity  the difference in the size of the transmission towers  the different visual impacts of the towers  the difference in the height of the overhead wires  the tower near Sale 1 can not be seen from the sale, while the tower near the subject land is in clear view. On the basis of those differences Mr Copeland determines his impacts at 40% (subject) and 30% (Sale 1). He notes also that the visible tower to the north of the subject land is different, as it also provides a link as a service tower to the Palmwoods sub-station. (5) Comparison of sales - In support of his estimates of the unimproved value of the subject land, Mr Rose provides the following comparisons of vacant land sales:  Sale 1 – (Mossy Bank Road, Eudlo – Lot 5 on RP 226378) This is a parcel of area 7,293 m², zoned Rural B, located about 4.2 kilometres by road south-west of Eudlo, and about 3.6 kilometres south-east of the subject. Access is by bitumen from Eudlo, then by 3.2 kilometres of gravel road to the sale. The land is moderately sloping over the building area, and about 60% of the sale is covered by an -- 7 of 20 -- 8 overhead power easement for 110 KV power transmission line. The soil is basaltic forest type. There is an existing inferior dwelling erected on perhaps the best building site on the sale, and excellent rural views are available to the north-east and east, with ocean views to the east and further to the south of Buderim Mountain in the south-east sector. Services are similar, but the locality of the sale is seen as inferior, as is also the access to the sale. The views are superior to the subject land, but the sale is seen as more severely impacted by the overhead power easement. The sale is seen as overall comparable by Mr Rose, and slightly superior by Mr Copeland, on an unaffected basis. The sale sold in July 1995 for $70,000, which after allowing for improvements and the impact of the powerline, Mr Copeland analysed at $58,950, and he proposes an applied rate of $53,000. Mr Rose analysed the sale at $66,000, and applied it at 1 January 1996 at $60,000. The difference between the parties lies in their estimate of the added value of the existing inferior dwelling and the allowance for the impact of the powerline. Mr Rose found an unencumbered site value of $100,000, from which he deducted 32.5%, concluding the sale value of $75,000. Mr Copeland valued the sale at an unencumbered value of $75,000, from which he deducted 30%, giving an unencumbered, unimproved value of $53,000.  Sale 2 – Thompson’s Road – (Lot 5 on RP 881308) This is a 4,003 m² Rural B parcel located about 8 kilometres north of the subject land. Access is by bitumen road from Nambour, and then by 1.1 kilometres of gravel track to the sale. Electricity and telephone are available, and the owner has a “casual agreement” of an adjoining owner to pump water from a neighbouring dam. However the agreement apparently rests only at the goodwill of the owner. The soil is basaltic forest type. A building pad would need to be benched, somewhat similar to the adjoining parcel to the south; and there are moderate cross falls south to north, and it falls from the road slightly towards the building pad, and then falling steeply towards the rear. Views from the building pad site are excellent to the ocean to the east and south-east. The views to the ocean towards the north-east are partly obscured by trees on the side of Thompson Road. The sale has the benefit of a height restriction easement on the parcel directly east of the sale (easement D on sale 3), thus protecting the views to the eastern -- 8 of 20 -- 9 ocean. Overall, though smaller in area, it is agreed the sale is superior to the subject, and is not affected by any power constraint. The sale sold in July 1995 for $125,000, which after allowing for improvements was analysed by Mr Rose at $123,800, and applied at $110,000 (1 January 1996), and $115,000 (1 October 1996). Mr Copeland has analysed the sale at $118,800 and adopted the applied rate of $110,000 by the respondent. The difference between the parties is that Mr Copeland allowed for a further added value of improvement of $5,000 for the agreement to pump water to the site. There is also some difference between the parties in respect of what a prudent buyer would have allowed in respect of the difference in cost of site development works at the subject land, which would be more expensive. However Mr Rose argues that should not affect the site value paid by a prudent purchaser, but should be considered as part of the development costs of the lands. Mr Copeland also argues that Sale 2 has rural views to the west, not available on the subject land, which would affect any comparison of the properties. Mr Copeland concludes an unencumbered value of $70,000 for the subject land, by comparison with Sale 2, from which he then deducts 40% for the power easement, giving his estimate of $42,000 for the subject land.  Sale 3 – (Thompson’s Road – Lot 1 on RP 886265) This is a 2.384 hectare rural site opposite Sale 2, on the eastern side of Thompson Road, with virtually unobstructed views to the ocean. Similar access and services are available as for Sale 2. The sale land is virtually a single building site, with the balance of the sale being covered by height restriction easement (Easement D) to the southern part, and an access easement for cattle (Easement C) to the northern part. Because of likely subsequent land slip in that area, the owner of Sale 3 (Lucie- Smith) has sought Council agreement to a relaxation of the 15 metre set-back from Thompson Road, now having an approval for a set-back of 6 metres. The area available for building on Sale 3 is about 2,000 m² to 3,000 m², the rest is escarpment, or covered by easements. The sale is seen as vastly superior to the subject land, and was compared merely to set the upper limit for land with some views in that locality, showing the premium that people will pay for unobstructed views that cannot be built out. The sale sold in October 1995 for $170,000, which was analysed at $169,000, and applied at $150,000 (1 January 1996). -- 9 of 20 -- 10  Sale 4 - Roys Road, Palmwoods – (Lot 1 on RP 883843) This is a 1 hectare Rural site located 4.3 kilometres from Palmwoods and 2.4 kilometres east of the subject land. Similar services are available, and access is similar. The sale has an easier building site, superior topography and water supply, is closer to Palmwoods, but at an inferior elevation. The sale is opposite the Palmwoods Power Station, and is overall seen as an inferior to the subject land. The sale sold in November 1995 for $81,000, which after allowing for improvements, was analysed at $74,500, an applied at $73,000 (1 January 1996). The sale was analysed in the previous decision of AV95-688, and the better agricultural quality of the soils on Sale 4 were noted compared to the subject land. Sale 4 had previously been cultivated for custard apples, and was part of a family transfer arrangements. Sale 4 also has access to a bore and irrigation mains, and Mr Rose made allowance for access to a dam, although the dam wall was located on an adjoining property. Mr Rose concedes that the land at Sale 4 was superior to the subject, but argues that the views and elevation of the subject land outweigh any agricultural advantage at Sale 4 as a rural homesite.  Sale 5 – Shurvells Road, Palmwoods – (Lot 61 on RP 865555) This is a 1.008 hectare Rural B parcel located about 4 kilometres west of Palmwoods, and 2.4 kilometres north of the subject land. Services are comparable, the sale has good rural views, and there is a domestic powerline across the sale. The sale has an inferior building site, access, and views, but better agricultural soils. Overall the sale is superior, but there is no impact of a power easement. The sale is seen as typical for an average small rural homesite without ocean views. The sale sold in July 1994 for $75,000, and after allowing for improvements was analysed at $69,500, and applied at $63,000 (1 January 1995) and $67,000 (1 January 1996). In addition, Mr Rose provides five further sales in the general Palmwoods rural locality, none of which have substantial elevation, or have any ocean views, however some of those sales have a rural outlook. The five sales are all of vacant land, except for Sale 4 in Eudlo School Road, which has a weekender colorbond shed constructed; but on a site off to the side, and not interfering with later development of the best building site. -- 10 of 20 -- 11 The extra sales varied in area from 4,000 m² to 8,660 m², and were bought for prices in the range of $67,000 to $82,500. Mr Rose saw those sales as demonstrating a base level of value for rural homesites in the area, with lesser views, elevation and locality. Mr Rose also notes that those five sales occurred between March 1995 ($69,000) and August 1998 ($82,500), and the later sales demonstrate, in his opinion, that there has been an increase in the market over that period. Mr Rose also notes that Sale 4 sold in August 1995 for $67,000, and resold later for $75,000. In support of his assumption that his Sale 3 demonstrates what the market would pay for sites east of Thompson Road with uninterrupted views, Mr Rose notes that there were two parcels about 0.5 kilometres south of Sales 2 and 3, both with good ocean views. One sale (Lot 1 on RP 26988 – 1.886 hectares) sold in 1990 for $157,500, and the other (Lot 1 on RP 181224) also sold in 1990 for $165,000. Mr Rose argues that those older sales support his view that the buyers pay high prices in that locality for excellent views. Mr Copeland queries a sale to the north of Sales 2 and 3 in Thompson’s Road at Lot 1 on RP 26467, which has an area of 3.19 hectares, and sold in 1996 for $85,000. However inspection revealed that sale to have virtually no building area upon the edge of the plateau, and the land was mainly steeply sloping below the road level. Mr Copeland also argues that Mr Lucie-Smith had purchased Sale 3 as a not fully informed buyer, as he had formerly lived in Cairns and relied on comparisons in that locality. It was confirmed that Mr Lucie-Smith had subsequently objected to his valuation on the land at Sale 3, in view of the potential slippage problems, of which he is now aware. However that objection was not allowed, and the owner did not appeal. (6) The added value of the dwelling upon Sale 1 - The difference between the valuers in assessing the added value of the existing inferior building upon Sale 1, lies in their estimate of the ongoing use of that building. Mr Copeland argues that the owner has undertaken further improvements to the structure, and has used the building since the sale as a weekender, and for casual renting purposes while the owner is overseas. As such he believes the building had value at the date of sale, and he has assessed that added value on the basis of replacement costs, less depreciation. Mr Copeland assessed the building at $8,750, including 113 m² at $136 per m² (being about one third the cost of a basic dwelling), and allowed his estimate of 40% value considering the condition of the building. -- 11 of 20 -- 12 Mr Rose disagrees with that estimate arguing that the dwelling is hardly more than a shed, with no permanent toilet, only a bath, and with doors missing. Because of the limitations of the power easement Mr Copeland concedes that the existing inferior building does occupy the best site for any further building, and would need to be removed for that to occur. As a temporary weekender, Mr Rose draws comparison with a colorbond shed, which he argues could be installed, including power and a tank, for about $8,000 to $9,000. Allowing half of the figure for the inferior nature of the existing dwelling, Mr Rose concedes that the added value could be concluded to be worth $4,000 to $5,000 to the owner. However he discounts that figure, arguing that his estimate of the added value of $2,000 would be more than reasonable. Mr Rose notes that the property was originally listed for $92,000. From hearsay it is argued that the bank saw no value in the building when it considered its involvement as the financing agency. Mr Rose also notes that if he capitalised the property for rental purposes for one year, that would represent $70 per week or $3,500, less rates and outgoings, giving a net return of about $2,000, supporting his estimate of the added value. He concludes that if the building was in another location where it did not need to be demolished to fully develop the sale, then he could accept about $8,000 as a reasonable added value. However in the circumstances of comparisons with sales in the general locality, he believes that the building has only a nominal value, and he has allowed $2,000. Mr Rose believes that the process should be seen as similar to where a site is being redeveloped, and a good solid wooden building has to be removed. In those cases a nominal value only is allowed for the added value of the old building. Decision: (i) The nature of the land - I turn first to the nature of the land, and note that the description of the subject land differs only in respect of the understanding of the two valuers in what might be seen as the nature of a rural residential homesite. From the evidence it is clear that the development of the building area of the subject land, including the access road, has been reasonably extensive. Mr Copeland’s conclusion that it would considerably exceed building areas upon the sales supplied, is reasonable. However the actual existing developed building area is not a matter for consideration in this matter, where the comparison of sales is being undertaken on an unimproved vacant site basis. -- 12 of 20 -- 13 The selection of rural homesites demonstrates in the market place that people acquire them for a variety of reasons. Some select parcels for their views, isolation and privacy, while others seek an area to run a horse or other animals. But whatever purchasers particular expectations, all potential purchasers compete in a single market in a locality for a rural homesite. The outcome of that market is that people often pay as much for only a single land use capability, if that is their prime objective. In seeking guidance on that matter, I note the findings of the Land Appeal Court in AT Dewer v Valuer General (1980-81) 7 QLCR 112, where the Land Appeal Court noted at page 114: “The term “rural homesite” is a widely accepted and commonly used expression in the real estate profession. The term recognises the trend in more recent times where people are seeking to escape the confinement, bustle, noise, pollution, etc, of smaller allotments within the high density residential areas of cities and towns and are buying lands in a rural setting on the outskirts of towns and cities whereon to build their homes and either live in a pleasant rural setting or engage, part-time or full-time, (and to varying degrees as they choose) in some form or forms of rural hobby or pursuit.” The Land Appeal Court further noted at page 115: “The market for rural homesites demonstrates that they are purchased on a site basis and not on a pro rata per hectare basis.” That was also held by the Land Appeal Court in DF and M Ward v The Valuer- General (1983) 9 QLCR 48 at page 50. The subsidiary or secondary use of any rural homesite was, however, noted by Wells J in Crouch v Minister of Works (1976) 36 LGRA 254, at page 256: “The owner of a farmlet does not, however, see his land as simply part of the assets of a professional farming venture; he sees it as a rural living block; farming is undertaken by him as a subsidiary activity – in some cases, almost as a pretext.” In the current matter the sales evidence would appear to support that there are several localities in the Palmwoods-Eudlo-Nambour area, where people select rural homesites for different reasons. Those with a desire for privacy and the enjoyment of views, tend to locate along the edge of the Blackall Plateau, where elevation would appear to influence the quantum paid for the rural homesite. People who desire a rural homesite, with some further land use capability, such as running of livestock or, -- 13 of 20 -- 14 restricted agricultural pursuits, tend to locate on the lower lands nearer to Palmwoods. However they all compete in the one market, and make their decisions based upon the characteristics of the land suited to their needs, and the price required to acquire the land. On the sales supplied there is clearly a premium paid for those sites with extended views, particularly where those views cannot be built out. (ii) Relativity - In seeking relativity with the adjoining Goh lands, Mr Copeland seeks support in the thrust of the Valuation of Land Act 1944, which seeks to provide an equitable valuation process for rating and taxation purposes. That principle was perhaps most clearly enunciated in the decision of Barton and Elliott Pastoral Company v Valuer- General (1957) 15 The Valuer 176, where Sheehy J noted at page 186: “It is the requirements of the Acts, that the real value should be ascertained and this entails the necessary and equitable consequence that all values in Queensland should bear the correct relationship one to another in view of the objects of the Act, ie to discover the basis of taxation for rates, land tax and the like.” While the directions of Sheehy J in respect of the correct relationship of each parcel in Queensland is fundamentally correct, how the Chief Executive affects that objective is now made more complex by the requirement to achieve that purpose for each parcel in the State on an annual basis. As part of his methodology, the Chief Executive has determined administrative boundaries which reflect common market differentiation, or sub-market areas, (SMAs). By analysis of relevant sales in those SMAs, and assuming that relativities between parcels in those SMAs have been established reliably, the Chief Executive now uses a computerised mass appraisal technique to generate likely unimproved values within initially each SMA, and then within the wider administrative areas, or districts of the city area. However, the computer process is merely a highly sophisticated tool for each valuer to undertake the increasingly demanding task of assessing the ever growing number of parcels. Should the Chief Executive become aware that certain unimproved values may be inaccurate, he is empowered by the Act (section 28(1)(g) and section 29) to seek to correct any error in the valuation. Mr Rose has elected to do that in respect of the Goh property. -- 14 of 20 -- 15 Mr Rose concedes that the unimproved value of the Goh property had been found to be in error, due mainly to Mr Copeland’s advice that there was distant ocean views from that property. In an attempt to facilitate a more correct level of relativity Mr Rose has now included the Goh land in the same SMA as the subject land. Any comparison of relativity between the Goh land and the subject land, during the period when the Goh land is being incrementally increased to bring it into line with surrounding parcels, should be treated with some caution. I am aware of the decision of TF and SA Shepherdson v The Valuer General (1992-93) 14 QLCR 83, where the learned member found at page 87: “The appellants are entitled to rely on the valuations of properties in the vicinity of the subject land as being correct.” However I am also reminded of the findings of the Land Appeal Court in WM and TJ Fischer v Valuer-General (1983) 9 QLCR 44, where the Land Appeal Court said page 46: “Whilst maintenance of correct relativity is also of considerable importance for rating or revenue type valuations, we cannot prefer in the circumstances of this case, the use of the principle of relativity to the exclusion of the sales evidence.” In seeking guidance upon the weighting to be placed upon the maintenance of the relativity, I am also directed to the general directions to be found in R and MM Barnwell v Valuer General (1989) 13 QLCR 13 at 16; and H and E Grahn v The Valuer General (1992-93) 14 QLCR 327. On the basis of those guidelines I will rely more upon the comparison of sales provided. (iii) The impact of the power easement - In considering the potential impact in the mind of a purchaser of lands affected by the presence of overhead powerlines, I note the conclusions reached by the learned member in the former decision (AV95-688), and his adoption of a diminution of some 32.5% for the subject land. I note also the evidence of the appellant in Dr JW and AC Cox v Chief Executive, Department of Natural Resources (AV97-166) 11 February 1998, unreported. In that matter Dr Cox, a very experienced paediatrician in Toowoomba, argued that, while there is no conclusive proof that electro-magnetic radiation causes childhood cancer, the “fear that it might” has a major impact upon parents. -- 15 of 20 -- 16 As a paediatrician, Dr Cox is required to deal with the fear of uncertainty, which pervades emotive matters, and he successfully argued that such fears may have a significant impact upon the price that people will pay for lands suffering transmission line impacts. However the impacts are not only related to health matters, but are also associated with the visual intrusion of the structures. I believe that the only reliable evidence of any impact of the powerlines, lies in the interpretation placed upon them in the marketplace. Mr Rose has therefore correctly sought to demonstrate that principle. In his selection of affected and unaffected sales at Cashmere, I agree that those properties are well removed from the Palmwoods area, however I believe they adequately demonstrate the principle. As rural residential homesites at Cashmere, the lots have been chosen to provide a rural living environment, not completely dissimilar to the subject land. As with any comparison of lands, the valuer is charged with doing the best he can in the absence of more direct comparisons. That was perhaps best described in the majority decision of the Land Appeal Court in King Ranch Pastoral Company Pty Ltd v The Valuer General 35 CLLR 255, at 259, where the Land Appeal Court found: “In not attempting to do this, Mr Walker adopted a method of valuing based on knowledge and experience rather than one lacking precedent and authority.” That was further clarified in the wording of the minority decision of that case, where the learned member noted at page 262: In Bingham v Cumberland County Council (1954) 20 LGR 1, at pp. 18 and 19, Sugerman J says: “ In the absence of sufficient guidance to be had from sales, the valuer may find himself in a position resembling that to which Lord Romer referred in the Raja case (1939) AC at pp. 312 and 313, in which he will have no market value to guide him, and he will have to ascertain as best he may from the material before him what a willing vendor might reasonably expect to obtain from a willing purchaser of the land.” The valuer in arriving at his opinion in these difficult matters may have to draw upon his general knowledge and experience, including perhaps experience in other situations which, although lacking in complete comparability, may yet provide an experienced valuer with guidance and suggestions as to the general approach which may be made and as to considerations which may become relevant.” -- 16 of 20 -- 17 In the end I believe that the larger area covered by the power easement at Sale 1, (60%) would represent a more significant impact upon the value than covered at the subject land area (48%). On the evidence of the sales at Cashmere I believe that where about half of a lot is covered by an overhead power easement, then a disability say 20% would provide a conservative conclusion. For a parcel which is covered by about 60%, I believe a disability of say about 25% would be reasonable. However the visual impact of the actual transmission towers should also be considered, which is more significant at the subject land than at Sale 1. On balance I believe a disability at the subject land of 25% also would balance those differences. When comparing Sale 1 and the subject, I believe they should be compared as “affected sites”, and no double dipping should be further applied to that comparison to allow for any impact of the powerline. (iv) Comparison of sales - It is agreed by both parties that the preferred method of determining unimproved value is the comparison of vacant or lightly improved sales, where they are available. (PH Clough v Valuer General (1981-82) 8 QLCR 70 at 76; NR & PG Tow v Valuer General (1978) 5 QLCR 378 at 381; and WM and TJ Fischer v Valuer-General (supra) at 46.) However Mr Copeland queries the comparison of sales of lots with panoramic views, with lots with no views. That principle was followed in the findings of the Land Appeal Court in H and E Grahn v The Valuer General (supra). By comparison, Mr Copeland seeks guidance for an appropriate method of comparing sales in the words of Wells J in Brewarrana Pty Ltd v Commissioner of Highways (No. 1) (1973-76) 32 LGRA 170, at page 179: “It is general valuation practice for sales characterized as comparable sales to be used as bases for the valuation of lands said to be similar. But allowances must always be made before such sales can be so used. No two parcels of land are identical in all respects: ---- For example, in relation to the land itself and the circumstances appertaining to it, it may be necessary to consider such matters as topography, location, size, shape, slope, view, land use (actual and potential), scope for, and difficulties of, development, services and amenities; and in relation to the transaction of sale, the valuer must weigh such things as the character, business and relationship of the parties, their motives, the terms and conditions in their contract of sale, and any other special considerations.” -- 17 of 20 -- 18 However the use of comparable sales depends upon the skills of the valuer, and involves certain judgments and adjustments. In that regard Wells J went on to say at page 180: “ --- there is no hard and fast rule by the application of which a valuer may, whatever the circumstances, draw the line that clearly separates the sales that are comparable from those that are not. It is, in my view, all a matter of degree: some adjustment is always necessary; too much adjustment will render it unsafe to use a sale, subject to such a degree of adjustment, for the purpose of the reasoning process in the comparable sales method. Just where the line is to be drawn is, it seems to me, the very sort of question that is fit for the expert valuer to determine; the assessment of the risks of adjustment is peculiarly within his sphere of skill.” In the current matter Mr Rose has sought to develop a continuum of values within which, using his skills as a valuer, he seeks to position the subject land as an unaffected parcel. Mr Rose concedes that at 1 January 1996 his Sale 3 (applied at $150,000) is vastly superior; Sale 2 (applied at $110,000) is superior; Sale 1 ($100,000) is comparable; and Sale 4 (applied at $73,000) is inferior. Sale 5 (applied at $67,000) is seen as superior, but only in as much as it is not affected by any power easements. On that basis, as an unaffected parcel, the subject land could reasonably be concluded to have an applied unimproved value between $100,000 and $73,000. By comparison Mr Copeland sees the subject land, as an unaffected parcel, as inferior to both Sales 2 and 3, and slightly inferior to Sale 1. He draws no real comparison with Sales 4 and 5, because of their different characteristics. The use of the additional five sales of Mr Rose, were supplied only to provide a base level or rural homesite sales in that area, all of which are seen as inferior to the subject land. The key therefore to the analysis lies in the different approaches by Mr Copeland and Mr Rose to Sale 1 (the Mossy Bank Road sale). The difference between the parties on Sale 1, as an unaffected parcel, lies in the added values allowed for the inferior dwelling upon the sale. The key to that difference lies in the added value that a prudent purchaser would see in the inferior building in its current location on the best building site on Sale 1. In assessing Mr Copeland’s estimate of $8,750, I believe he has been more than generous for a building which, on inspection, appeared in need of substantial renovation, -- 18 of 20 -- 19 and has continued to generally remain vacant. Its current use would appear to be only as a “weekender”, and the lack of any permanent toilet facility confirms that minor use. On the other hand, Mr Rose would be prepared to concede an added value of about $8,000, if the building occupied other than the best building site, and clearly it currently has limited existence once a decision to permanently occupy the site is made. As a temporary “weekender” Mr Rose could see a suitable replacement value to the owner of perhaps $4,000 to $5,000. While I accept that generally his valuation of $2,000 for removal purposes would be generous for that purpose, I accept that the ongoing temporary use as a “weekender” by the owner, over the period of 4 years since the sale, would support that the dwelling has some inherent value to her. On that basis I will allow $4,000 for the added value of the building. I then analyse Sale 1 as follows:  Sale price as an affected site = $70,000  Less improvements – clearing and dam = $2,500  Dwelling = $4,000  Analysed affected unimproved value = $63,500  Analysed unaffected unimproved value (100% over 75%) = $84,666 Say $84,000 Mr Copeland sees Sale 1 as superior, while Mr Rose sees it as comparable. On the basis of the better views at Sale 1 I will accept that sale as superior to the subject land in an unaffected state. On that basis I will allow an unaffected unimproved value of the subject land at $80,000. If I then allow a 25% reduction for the impact of the powerlines at the subject, I arrive at an affected unimproved value of $60,000 for 1 January 1996. On that basis I will accept the Chief Executive’s valuations of $58,000 for 1 January 1996 and $60,000 for both the 1 October 1996 and the 1 October 1997 valuations. Summary: Under section 33 of the Act the unimproved value as determined by the Chief Executive is taken to be correct, unless it is proved that there has been an error made, or a wrong principle applied (Brisbane City Council v Valuer General (1977-78) 140 CLR 41 at 56). I note also that the onus to prove their cases rests upon the appellants under section 45(4) of the Act. -- 19 of 20 -- 20 Conclusion: Having considered the whole of the evidence I am not persuaded that the appellants have proved their case. The appeals are dismissed, and the unimproved values as determined by the Chief Executive in the matters of AV98-907, AV98-908 and AV98-909 in the sums of $58,000, $60,000 and $60,000 respectively are affirmed. N G DIVETT MEMBER -- 20 of 20 --