Evans v Chief Executive, Department of Lands [1994] QLC 305

[1994] QLC 305 Re: Appeal against a valuation - Local Government: Toowoomba AV94-468. Peter F S Evans V. Chief Executive, De partment of Lands DECISION (Hearing at Toowoomba) LAND COURT, BRISBANE 14 October, 1994 This is an appeal against the determination of the Chief Executive, Department of Lands, of the unimproved value of Lot 6 and Lot 11 on RP 43851, parish Drayton, in the sum of $130,000 for the purposes of the annual valuation of the local government area of Toowoomba as at 30 June, 1993. The appellant is contending for an unimproved value of $90,000. The subject land contains an area of 1657m 2 and is situated at 34 Grenier Street on the corner of Logie Street, Toowoomba. Upon the land is an old colonial home which has been converted into six flats. The land is zoned "Residential A" under the town planning scheme for the city and is designated as RDA 1 (Residential Development Area 1) under the Development Control Plan No 2 Duplex and Accommodation Unit Development. The DCP for multi unit residential properties permits land within RDA 1 to be developed for a density of 1 x 2 bedroom units per 120m 2 to a maximum allowable site coverage of 40%. It follows that the maximum permissible density which may be made of the subject land would be of the order of 13 units. The valuation written on behalf of the Chief Executive by Mr BG Mahoney is derived by applying a density of 8 standard two bedroom units which he would value at $16,250 per unit area, hence the applied value of $130,000. The appellant in his notice of appeal and in evidence stated that the subject land was put to auction in 1990 and was passed in at $120,000. Reference was -- 1 of 3 -- 2 also made in the notice of appeal to land situated at 42 and 44 Raff Street which was unsold at August 1994. This land sold in the last month at auction for $185,000 and became the thrust of the appellant's case. The appellant was given an apportionment of the sale by an agent broken into $60,000 for land and the balance for improvements, including a double storey brick home of 22 squares. The sale land consists of two lots of 886m 2 and 898m 2 (1784m 2 ). One lot is vacant. The home on the land had been converted into two separate lettable tenancies but later on was used as one residence. The land is zoned "Residential A" - designated RDA 1. The appellant said that the land was purchased for purposes of establishing a child minding centre and was advertised as capable of housing 7 units. Under the Valuation of Land Act the Chief Executive is charged with deciding the unimproved value of land. For this purpose unimproved value in relation to improved land means a 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 the improvements did not exist. In answering this question, the courts have said on many occasions that the best evidence of value consists of sales of comparable unimproved (vacant) land at or about the relevant date for valuation purposes. Mr Mahoney has proceeded in accordance with these principles. He has compared the subject land with four sales of land situated in Burns Street, Phillip Street, Bruce Street and Lindsay Street. From the analyses of these sales, he derived unit values of $20,500, $17,750, $17,500 and $18,250 respectively. His research told him that few developers developed to the maximum allowable number of units permitted under the plan. He rationalised the evidence of development and applied a ratio in respect of RDA 1 into 1 x 2 bedroom units per 200m 2 rather than the maximum permitted under the Plan of 1 x 2 bedroom unit per 120m 2 • The sales have been analysed on the same method. The alternative of applying the maximum permissible development throughout would yield the same result in terms of overall value but would not, in his opinion, reflect the reality of the situation. The sale in Lindsay Street which is the closest geographically of the sales to the subject land and having an area of 911 m 2 reflects on analysis a land value of $73,000 or 4 unit -- 2 of 3 -- 3 areas at $18,250 each . In the opinion of Mr Mahoney the sale site has a superior location to the subject site. That superiority is a matter reflected in his application of a value of $16,250 per unit area to the subject land. Returning then to the evidence relied upon by the appellant it can be seen that nothing constructive can be made of the sale at 42/44 Raff Street. The crucial dilemma that arises (apart from the fact that the sale occurred well after the relevant date) is the added value which may have been given to the dwelling on the land. The evidence is that the building is substantial and will be used in some way in the proposed development of the site for child minding purposes. This latter aspect is another reason which throws doubt on any weight which can be given to the sale. Whilst potential unit developers may have been interested in the land and possibly pushed the price to the limit of its economic development for this purpose, it was not purchased for that purpose. I find the sale is of no assistance in displacing sales of land bought for the particular purpose for which the subject land is zoned and best suited in an unimproved state. Accordingly, the appeal is dismissed and the decision of the Chief Executive is affirmed. (OM White) President of the Land Court -- 3 of 3 --