Anthony v Chief Executive, Department of Lands [1997] QLC 365

[1997] QLC 365 Re: Appeal against a valuation Valuation Roll No: 2647 Local Authority: BCC-Brisbane (AV95-507) MJ and D Anthony v. Chief Executive, De partment of Lands DECISION LAND COURT, BRISBANE 14 February 1997 Michael John Anthony and Demetra Anthony are the owners of land described as Lot 1 on Registered Plan No 9748 in the County of Stanley, Parish of North Brisbane, and having an area of 445 square metres. The land is situated at 190 Brunswick Street, Fortitude Valley, and is approximately 40 metres south-east from the intersection of Brunswick Street and St Paul's Terrace. Pursuant to the provisions of the Valuation of Land Act 1944, the Chief Executive, Department of Lands, determined the unimproved value of the land as at 1 January 1995, to be $142,000. The owners of the land objected to that valuation, but their objection was disallowed and they have now appealed to this Court. They contend in their notice of appeal that the unimproved value of the land as at the relevant date is $75,000. Michael John Anthony, a solicitor, who -is one of the appellants, appeared on behalf of the appellants at the hearing of this appeal and also gave evidence on their behalf. Mr John Mauchline, a registered valuer employed in the Department of Natural Resources, carried out the valuation under appeal and gave evidence on behalf of the respondent. At the outset it might be noted that Mr Anthony sought, on the hearing of the appeal, to appeal also against the valuation of the land as at 1 January 1996, because he had overlooked objecting to the 1996 valuation since the -- 1 of 6 -- 2 proceedings relating to the 1995 valuation were still in train. Because the notice of appeal relates only to the 1995 valuation, I directed at the hearing that the appeal should be confined to that valuation and the hearif)g proceeded on that basis. The grounds of appeal set out in the appellants' notice of appeal were as follows: II The maximum rental achievable after deduction of all expenditure gives a net return of $6,000. All sales have been effected on the basis of a 10% return in the last two years so that the true value of the land is somewhere between $40,000 and $75,000. Comparable properties have a lettable area of 100% to 200% of the size of the land and the subject property has a lettable area of only 60% of the size of the land." Section 13 of the Valuation of Land Act 1944 provides that the Chief Executive must decide the unimproved value of the land to be valued for the Act under which local authorities are established. Section 3(1) of the Act provides that for the purposes of the Act - "unimproved value of land" means - II in relation to improved land - the capital sum which the fee simple of the land might be expected to realise if offered for sale on such reasonable terms and conditions as a bona fide seller would require, assuming that, at the time as at which the value is required to be ascertained for the purposes of this Act, the improvements did not exist. " It has been held on numerous occasions that where the land the subject of the valuation is in fact improved land, the improvements are to be ignored in determining the unimproved value of the land. For example, in Clough v. The Valuer-General (1981/82) 8 QLCR 70 at 75, the Land Appeal Court said: " We think it beyond doubt that what has to be valued is the subject parcel of land viewed as if the improvements thereon, visible or invisible, never existed but that otherwise the parcel was situated in the community (and environment) with the amenities and facilities that had grown up around it as at date of valuation. " -- 2 of 6 -- 3 It has also been held on many previous occasions that in determining the unimproved value of land for the purposes of the Valuation of Land Act, the best basis for assessment of unimproved value is the use of sal~s of vacant or lightly improved parcels of land (citations omitted), Grahn v. Valuer-General (1992) 14 QLCR 327 at 328. While it may be necessary in cases where there are no sales of comparable unimproved land on which to base a valuation, to resort to other methods of valuation, in this case, the valuation relied on is supported by sales of four parcels of unimproved land in the locality of the subject land. Unless therefore there is some reason for challenging the validity of reliance on those sales, the appeal cannot succeed by reference simply to the low rental returns and lettable area of the subject property. The respondent relied on four sales in support of the valuation. Sale No. 1 is Lot 3 on Registered Plan 9717 located at 147 Constance Street, Fortitude Valley, and having an area of 392 square metres. The property is zoned "Commercial". The property was sold in August 1994, for $155,000. It has an analysed value of $154,000 ($392 per square metre) and an applied value of $110,000 ($280 per square metre). Mr Mauchline considered the sale property to be inferior to the subject property. He said in his evidence that the property had been sold to the Brisbane City Council which owned an adjoining property but the Council had a current market valuation carried out on the property and believed that it had paid market price for the property. Mr Mauchline said he had not relied on the sale specifically but used it as an indication of what was happening in the street. Sale No. 2 is Lots 13 and 14 on Registered Plan 9718 located at 134 Constance Street and having an area of 52~ square metres. The property is zoned "Commercial". It was sold on 25 August 1994, for $220,000, has an analysed sale price of $219,000 ($419 per square metre) and an applied value of $160,000 ($306 per square metre). In his report Mr Mauchline stated that he considered the sale property to be inferior to the subject property; in his oral evidence he said it was a very nice site and comparable to the subject property in the way of location. -- 3 of 6 -- 4 Sale No. 3 is Lot 1 on RP 150851 situated at 585 St Paul's Terrace and having an area of 400 square metres. The property is zoned "Warehouse Transport". The property was sold on 26 June 1995, for $194,500, has an analysed sale price of $193,500 ($483 per square metre) and an applied value of $100,000 ($250 per square metre). In his report Mr Mauchline commented that he considered the sale property to be considerably inferior to the subject property as it was in a very quiet inactive area. He said in his oral evidence that he had included Sale No. 3 because it had a zoning which was not as desirable as the subject property. The sale property is a "fair way" from the subject property, is similar in nature regarding the frontage and the capability of developing the site. The sale property has subsequently been successfully developed and a two- storey commercial premises is erected on the site. Sale No. 4 consists of Lots 6, 7 and 8 on Registered Plan 9633 situated at Alden Lane, Fortitude Valley, and having an area of 834 square metres. The property sold on 20 March 1994, for $415,000. It has an analysed price of $414,000 ($496 per square metre) and an applied value of $381,500 ($493 per square metre based on 723 square metres). Mr Mauchline described the property as being superior to the subject property because it is very much in the heart of the Valley area being located close to McWhirters. In his report he said that the lot was a basically level corner lot with high exposure. Mr Anthony adduced no valuation evidence nor did he challenge the details concerning these sales. However, he raised some general points concerning their comparability. One matter raised by him concerned vehicular access to the sale properties and the ability to park cars on them. The implication appeared to be that the subject property was at a disadvantage in these matters as compared with the sale properties. However, the evidence was extremely sparse in this regard with the result that it is impossible to draw any conclusions from it. Mr Anthony also suggested that the subject property could be distinguished from the comparative sales on the basis that the Fortitude Valley Development Control Plan controls dealings with the building on the appellants' land whereas the comparable sales are unimproved sites. There may be merit in -- 4 of 6 -- 5 this argument but there is not sufficient evidence before the Court as to the effect of the Fortitude Valley Development Control Plan. The Court is unable to say how the Plan affects the subject land, whether it affects the, sale lands differently from the subject land and whether it has any effect on the unimproved value of the subject land. As noted above, two matters were specified by the appellants in their notice of appeal - the low rental returns and the comparatively small lettable areas of the subject property. In addition Mr Anthony submitted, both in his oral evidence and in his written submission to the Court, that the value of the appellants' property had been adversely affected by the controls imposed on it by virtue of the Fortitude Valley Development Control Plan. The effect of the Plan is, he said, that the appellants are unable to demolish the building on the subject land which has become uneconomical to repair, without the consent of the Brisbane City Council. Since they are unable to demolish the building they cannot redevelop the property to its full economic potential and consequently the value of the land is diminished. The appellants did not rely on the constraints imposed on their property by the Fortitude Valley Development Control Plan in their notice of appeal. Again there may be some merit in the argument that the effect of the Plan is to decrease the unimproved value of the land. However, it cannot succeed in this particular appeal because section 45(4) of the Valuation of Land Act 1944 provides that the appeal shall be limited to the grounds of appeal stated in the notice of appeal. It has been held in a number of cases that this provision is mandatory and the Court has no power to allow an appellant to add to the grounds of appeal stated in the notice of appeal (see, for example, Gibson Investments Pty Ltd v. Valuer-General (1978) 5 QLCR 223 and Pratt v. Valuer- General (1982) 8 QLCR 145). The evidence concerning the effect of the Fortitude Valley Development Control Plan was relevant (but insufficient) to the appellants' challenge to the comparability of the sales properties with the subject property. However the argument cannot stand alone as a separate ground of appeal because it was not raised in the notice of appeal. The Court does not have jurisdiction to consider -- 5 of 6 -- 6 the merits of this aspect of the appellants' argument. In the absence then of any compelling reason to reject the sales evidence or the valuation process relied on by the respondent, sectiol) 33 of the Valuation of Land Act creates a presumption that the valuation of the chief executive as shown in the notice of valuation is correct in money terms. (Brisbane City Council v. The Valuer-General (1978) 140 CLR 41 at 56.) Neither the evidence nor the arguments raised by the appellants are sufficient to rebut that presumption. In the circumstances, the appeal is dismissed and the valuation of the Chief Executive is affirmed. (CA McDonald) Member of the Land Court -- 6 of 6 --