Burton v Chief Executive, Department of Natural Resources [1997] QLC 367

[1997] QLC 367 ILIBRARY CO P Y·1, ,. .. -- -- -........ .,.. . . ·.' . . ,._. ......-.,.. .._.__ •• ·-·.. 10·.-Jlj..... 41>~ --- -~ Re: Appeals against Annual Valuations - Valuation of Land Act 1944 - Shire of Pine Rivers. (AV96-785 and AV96-786). DA and CJ Burton V. LAND COURT, BRISBANE 27 March 1997 Chief Executive, Department of Natural Resources DECISION These are appeals against two separate parts of a parcel of land which the Chief Executive has declared should be valued separately. Mr and Mrs Burton are the owners of land described as Lot 48 on Registered Plan 92744, Parish of Warner, containing an area of 1.046 hectares. The land is situated in Bland Street, Strathpine, approximately 2 kilometres from the Strathpine Railway Station. Bland Street has a full length bitumen carriageway, with concrete kerb and channelling . Town water, sewerage, electricity and telephone services are available. Lot 48 is square shaped and slopes to a drainage easement which runs from the north-west corner at Bland Street diagonally across Lot 48 to near its south-east corner. An open drain, varying in depth from ½ metre to 2 metres, is situated within the easement. The land then rises gently towards the north-east corner. Situated on Lot 48 are six houses, five of them along the southern side of the land, one fronting Bland Street and the other four to the east of that, and one towards the north-west corner fronting Bland Street, between the street and the drain. An internal earth and gravel access road extends from Bland Street easterly to give access to four of the houses. In addition, as the Council only supplies water to the Bland Street frontage, an internal water reticulation system supplies water to each of the houses that do not front Bland Street. -- 1 of 7 -- 2 The reasons for this apparently non-conforming use of land zoned "Residential A" are explained in the decision of the Land Court in Raynbird v. The Valuer-General (1966) 33 CLLR 76. However, those reasons are not relevant for present purposes, except to say that each of the houses is situated on a separately fenced and surveyed area of 607 square metres, except for the one situated near the north-west corner, the area of which is approximately 550 square metres. The Raynbird decision makes clear that in accordance with what was then section 14 of the Act, the Valuer-General had directed that each of the surveyed parcels upon which the houses along the southern boundary of Lot 48 are situated, should be valued as a separate parcel. Accordingly, the unimproved values were determined for five parcels of 607 square metres. The balance land, of 7,424 square metres, comprising the north-west housesite of about 550 square metres, situated between the drain and Bland Street, together with the balance land cut by the drain, was also valued as a separate parcel. The abovementioned decision of the Land Court confirmed the validity of the Valuer-General's approach to valuing the land as six separate parcels, rather than as one parcel. In the present cases that was not in contention, although the appellants argued that none of the parcels could be sold separately. That is in fact true, but for valuation purposes each of the parcels declared by the respondent must be valued separately. It emerged ·in evidence that the respondent has given each of the separate parcels an alphabetical identifier, which I will adopt. As at 1 January 1996, the respondent determined the unimproved values of the various parcels as follows: Parcel A (fronting Bland Street) Parcel B (to the east of Block A) Parcel C (to the east of Block B) Parcel D (to the east of Block C) Parcel E (to the east of Block D) Parcel ZZ (the balance land, including the housesite in the north-west, between Bland Street and the drain) $ 37,500 $ 30,000 $ 30,000 $ 29,000 $ 27,000 $ 86,000 These appeals are against the unimproved values applied to Parcel D and to Parcel ZZ. -- 2 of 7 -- l Mr DA Burton appeared and gave evidence on behalf of the owners. He explained that, prior to his death in the early 1990s, the property had been owned by Mr AH Raynbird, the father of Mrs Burton. Upon instructions from the beneficiaries of Mr Raynbird's estate, Lot 48 was auctioned by agents, LJ Hooker and Company, the highest bid being $256,000, which the beneficiaries considered was not acceptable. Subsequently, Mr and Mrs Burton bought Lot 48 for a total consideration of $300,000. On a later occasion, Mr Burton said, the owners attempted to sell the property. However, the highest offer it attracted was $275,000 from a developer. The appellants did not challenge the level of unimproved values applied to Parcels A, 8, C or E. They accepted them as reasonable, having regard to the prices paid for residential allotments in the Strathpine area. Their challenge was to the $29,000 applied to Parcel D and the $86,000 applied to Parcel ZZ. Parcel D Mr Burton explained that Parcels 8, C, D and E have no formal access, their access being the private internal earth and gravel road constructed on the balance land, which runs easterly from Bland Street. The internal road required constant maintenance by the owners in order to provide trafficable access to the four houses. While Parcels A, B and C are reasonable housesites and not greatly affected by seepage and drainage, Mr Burton said that Parcel E is quite badly affected and Parcel D is nearly as bad. He felt that the unimproved value of Parcel D should be closer to that of Parcel E than to that of Parcel C. He contended for an unimproved value of $27,500 for Parcel D, rather than the $29,000 applied by the respondent. Evidence for the respondent was given by Mr TS Alexander, a registered valuer employed by the Department of Main Roads, but who was at the relevant time employed by the Department of Lands and who was responsible for the valuations. Mr Alexander described Parcel D as being slightly below the level of Bland Street, with an even crossfall from the west. He saw Parcel D as being somewhat superior to Parcel E, as it was not subject to the same extent of poor -- 3 of 7 -- 4 drainage and seepage. He said it was wet in the front, but not wet towards the rear. However, it was not as good as Parcel C which was not affected to any great extent by poor drainage or seepage. Parcel ZZ It was with respect to the unimproved value of Parcel ZZ that Mr Burton presented his most forceful argument. He contended that its unimproved value should be $37,500 and not $86,000 as applied by the respondent. Apart from the area of about 550 square metres occupied by the sixth house, Mr Burton felt that the balance land had very little value. He agreed that the value of the housesite (which he described for identification purposes as Parcel F), was nowhere near as good as Parcel A and was the next worst to Parcel D, placing its unimproved value at about $27,500. He described it as a low block, affected by some flooding from water runoff. The balance of the land was partially used for purposes of the internal access road, which is apparently wide enough for two cars to pass, which ran from Bland Street easterly between Parcel A and Parcel F. As none of the blocks B to E had any access apart from that internal road, Mr Burton contended that they could have no separate value without it. He was of the opinion that the value of each of the Parcels B to E already incorporates the value of the area used for the internal road. In other words, its value was already apportioned to each of the blocks to which it provides access. The rest of the balance land, Mr Burton saw as useless. The area affected by the drainage easement was subject to flooding which also affected the lower parts of the land outside the easement. The area to the east of the easement was low-lying but rose gently to the north-east. As the land was zoned "Residential A" the grazing of animals was not permitted. It was, according to Mr Burton, more a detriment than an advantage, as the land had to be slashed several times a year at an annual cost of about $700 to $800. In order to get a tractor and slasher to the area across the drain, a culvert with a 2 feet 6 inch concrete pipe had been constructed. Apparently the culvert also assisted access to Parcel E which is the closest to the drain. -- 4 of 7 -- 5 Mr Burton said that the Council would prohibit the building of further houses on the land and, in any case, it was too wet and swampy. He could suggest no real use for the balance land. His estimate of $37,500 was not based on sales, but appeared to be based on the unimproved values which the respondent had applied to other lands. On the other hand, Mr Alexander had valued Parcel ZZ as a large homesite of 7,424 square metres, handily situated to Strathpine. Blocks of that size were, he said, rare indeed in such locations. He explained that under the provisions of the Act, the land must be considered as if it was unimproved. Therefore, he felt that the best homesite was not where the present house was situated on Parcel F, but on the other side of the drain. Access was already available by means of the culvert, although Mr Alexander admitted this would have to be upgraded and the road built up in parts. Mr Burton conceded that it would be possible to build a house on the north-east side of the drain, but felt it would need to be a high-set house, adding that it would have a wet driveway. In any case, he said, the environment of poorer, older houses would preclude a prudent owner from spending much on constructing a house in that area. Mr Alexander disagreed. In his opinion the situation of the land so close to the Strathpine Railway Station and Shopping Centre would off-set its disabilities. He felt that there was a demand for large homesites which would provide privacy and that the neighbouring houses could be, as he put it, "treed out". In defending his valuation of $86,000, Mr Alexander had regard to three sales. One property of 7,313 square metres, situated in Dohles Rock Road, Murrumba Downs, sold in May 1994, for $110,000; another of 1,749 square metres in Mclllwraith Road, Joyner, sold in April 1995, for $88,000; while the third, of 6,000 square metres, in Oxford Street, Joyner, sold in April 1995, for $99,000. Mr Alexander was of the opinion that those sales indicated the prices that purchasers were prepared to pay for large homesites. He said that the valuation made allowance for the flooding and drainage problems, the internal access road and the fact that the road would be shared by the occupants of Parcels B, C, D and E. -- 5 of 7 -- 6 Consideration of the Evidence In the case of Parcel D, Mr Burton's argument is based simply on the relativity of values applied to other blocks, namely Parcels E and C. On the other hand, Mr Alexander was well aware of the disabilities suffered by Parcel D and said that he had taken them into account. His valuation was based on sales in the area. After considering the evidence, I prefer the valuation of $29,000 assessed by Mr Alexander. Mr Burton has not convinced me that Parcel D is only $500 superior to Parcel E. Parcel E is acknowledged to be the lowest and wettest of the blocks, it is at the end of the line as far as the reticulated water supply is concerned, it is furtherest from Bland Street along the internal access road which needs constant maintenance, and it joins the open drain. There is also evidence that the access to Parcel E is assisted by the construction of the culvert in the drain. All these matters seem to me to indicate that the unimproved value of Parcel D should exceed that of Parcel E by more than $500. As for Parcel ZZ, on the evidence there is no doubt that it is not the most attractive large homesite. However, Mr Alexander was aware of all its problems and said that they had all been considered and taken into account in arriving at the valuation. He felt that they were offset, at least to some extent, by the favourable situation of the land and that the weighing of all the factors was reflected in the value of $86,000 which had been applied. He said that if Parcel ZZ did not suffer· from the drainage, flooding and access problems, he would have applied an unimproved value of approximately $120,000. The valuation of Parcel ZZ had previously been considered by the Land Court in an appeal by the then owner against the valuation made by the Valuer- General as at 31 March 1988. (AH Raynbird v. Valuer-General V89-327, decision 21 March 1990). Under section 33 of the Act, the valuation made by the Chief Executive is deemed to be correct until proved otherwise. In Brisbane City Council v. The Valuer-General (1978) 140 CLR 41 at pp.56-57, the High Court of Australia considered the predecessor to section 33. The High Court found that the statutory presumption of correctness could be rebutted if it could be shown that the Valuer-General (in that case) acted upon a wrong principle, or made a -- 6 of 7 -- 7 serious error or fact or that the valuation was made by a method fundamentally erroneous. In the present cases it is clear that the respondent had not acted upon any wrong principle. Mr Alexander, on behalf of the respondent, based his valuations on sales of comparable land. Although it may be argued that the sales were not ideal, such method of valuation is to be preferred to valuations based on opinion or even on relativity; Grahn v. Valuer-General (1992-93) 14 QLCR 327. The principle of valuation was correct. Nor can it be said that the respondent made a serious error of fact. Mr Alexander was well aware of all the problems suffered by the subject lands and said that they had been taken into account in making the valuations. Although he said that he had maintained the previous relativity of values as determined by the Land Appeal Court, he had considered the sales and said that he could see no reason to alter the relativity. I am not persuaded that the respondent made a serious error of fact. It follows that I cannot find the respondent made either valuation by a method which was fundamentally erroneous. The method in each case was by direct comparison with sales, an approved and accepted method of valuation. Although I was told that the valuations represent a 10 percent reduction from the previous valuation and are therefore the result of a blanket reduction, the correctness of the relativity of these valuations was at least considered by the valuer. He could find no reason for altering it. On the evidence, it seems to me that the detriments suffered by the subject lands were known and were given due regard by the valuer in the making of the valuations. Therefore, I cannot find that the statutory presumption of correctness has been rebutted. Accordingly, the appeals are dismissed and the unimproved values of the respondent are affirmed. (JJ Trickett) President of the Land Court -- 7 of 7 --