Amalie Nominees Pty Ltd v Chief Executive, Department of Lands [1994] QLC 242

f , Re: Appeal against Annual Valuation Valuation of Land Act 1944 Shire of Whitsunday (AV93-408) Amalie Nominees Pty Ltd v. Chief Executive, De partment of Lands (Hearing at Proserpine) DECISION LAND COURT BRISBANE 8TH APRIL, 1994. Amalie Nominees Pty Ltd is the owner of land described as Lot 806 on Plan A 8595, Parish of Conway, County of Herbert, containing an area of 594 sq . metres. As at 31st March, 1992, the Valuer-General valued this land at $128,000. The owner objected against this valuation and by letter dated 28th June, 1993, this objection was disallowed. The owner then appealed to the Land Court against this decision on its objection. This is one of a number of appeals in the Shire of Whitsunday. I have made some general comments on these cases in the decision in respect of Appeal AV93-411, which it is unnecessary to repeat. The appeal was lodged through Valuers, Conroy & Associates, of Airlie Beach. Mr Bevan Conroy, registered valuer, appeared and gave evidence on behalf of the appellants. Mr Conroy tendered a report and valuation which stated that the subject property is located in Ocean View Avenue, approximately 500 metres north-west of the Airlie Beach Post Office. The land is zoned "Residential A" and used for single unit residential purposes. Access to the land is by Ocean View Avenue, a narrow dual-lane bitumen sealed road without kerbing and [1994] QLC 242 -- 1 of 7 -- 2 channelling. Telephone, electricity and all Council services are available to the property. Mr Conroy describes the land as a regular shaped allotment with a frontage of 18 metres to Ocean View Avenue and a depth of 33 metres. From Ocean View Avenue the land falls gently towards its northern boundary which fronts an esplanade to Pioneer Bay. The site has very good sea views. The only disability noted by Mr Conroy is that water from Ocean View Avenue drains onto the property during wet seasons. Mr Conroy valued the land at $100,000. In arriving at this valuation, he had regard to the sales of five properties situated in the Airlie Beach-Cannonvale area. These sales are for residential allotments which sold between May 1991 and April 1992 for prices ranging from $68,000 to $95,000. Mr Conroy goes on to say that this elevated site slopes fairly steeply from its road boundary towards its northern boundary and has very good sea views over Pioneer Bay out towards Whitsunday Passage and Islands. It is situated in what is considered to be the best residential area of Airlie Beach. Three of his sales, Nos. 1, 4 and 5 are situated at Airlie Beach, while his Sales 2 and 3 are at Cannonvale. He considered that Sale No. 5 is the most comparable, as it is of similar nature to the subject land and has very good sea views. However, it is considerably larger in area. This property is situated in Kara Crescent and is a sloping site, falling below road level. Mr Conroy comments that it would be difficult to develop, but has no gullies, drainage or access problems. He considers it to be inferior to the subject land. This property has an area of 1,543 sq. metres and sold in April 1992 for $68,000. Mr Conroy is of the opinion that -- 2 of 7 -- 3 this sale appears to be somewhat low. Sale No. 4 has similar attributes to the subject land, although it does not have the advantage of joining an esplanade leading to the waterfront. This property is also situated in Kara Crescent, has an area of 615 sq. metres and sold in August 1991 for $95,000. It is a steeply sloping site, falling below road level and would also be difficult to develop. It has very good sea views, but Mr Conroy considers it to be inferior to the subject land. However, with a sale price of $95,000, he considers it to be slightly high. In this case, the Department used sales situated at Shutehaven. Mr Conroy rejected the use of .these sales, saying that Shutehaven is the most exclusive area in the Town of Whitsunday and the sales are superior to the subject property. He went on to say that while the subject land had extremely good views, they were not as good as the views from the Shutehaven sales. The views from the subject land take in half of Hook Island and Hayman Island and then around to the west through Double Cone and Pioneer Bay and Bluff Point. However, the views are mostly directly north through to the western quarter, whereas the views from the Shutehaven properties take in numerous Whitsunday Islands. While it could be said that the subject land is in an exclusive area, it is not as exclusive as Shutehaven, but it is closer to amenities. Mr Conroy agreed that the most saleable feature of the subject land is its frontage to the esplanade leading to the sea front. The Department's Sale No. 1, with a sale price of $125,000 and an application of $119,000, has access by means of a walkway through Crown land and an esplanade to the waterfront at that area. It also has superior views. That, to him, suggests that people would -- 3 of 7 -- 4 not be prepared to pay $128,000 for the subject land. Under cross-examination, Mr Conroy said that he thought that his Sale No. 4 was slightly high because no other sales in Airlie Beach had taken place for $95,000. However, his Sale No. 3 at $85,000 was well situated with excellent views to the north. He said that if $90,000 was the appropriate figure for Sale No. 4, then people would be prepared to pay an extra $10,000 or $15,000 for an exclusive site like the subject land, but he did not think they would be prepared to pay an extra $38,000. He admitted that it all depended on the comparison with Shutehaven. Evidence on behalf of the respondent was given by Mr S J Whitfield, registered valuer employed by the Department of Lands. Mr Whitfield described the land as having a moderate cross-fall from west to east, but did not disagree with the description given by Mr Conroy. He said that in trying to establish a value for an exclusive area of Airlie Beach with very good ocean views, he had sought evidence from the exclusive Shutehaven area and had made allowance for the various factors of difference. Mr Whitfield's Sale No. 1 is situated in Passage Avenue, Shutehaven, and has an area of 529 sq. metres. This property sold in May 1992 for $125,000 and Mr Whitfield applied an unimproved value of $119,000 in the 1992 valuation. Mr Whitfield describes this land as a very good elevated site, although its steep nature would make development expensive. It has very good water views and is situated amongst exclusive development. It is about 10 kilometres from Airlie Beach and is considered to be slightly inferior to the subject land. Mr Whitfield's Sale No. 2 is situated in Shutehaven Close and has an area -- 4 of 7 -- 5 of 549 sq. metres. It sold in July 1991 for $160,000 and Mr Whitfield appfied an unimproved value of $144,500 in the 1992 valuation. This property is also a very good elevated site, having a moderate slope down to the road from the rear boundary. It has excellent water views to the north and east and is situated amongst exclusive development. It is also about 10 kilometres from Airlie Beach and is considered to be inferior to the subject land. In arriving at his valuation, Mr Whitfield said that there was no doubt that a prudent purchaser would have regard to the views, but he tended to think that location and access to services would probably weigh heavily in a purchaser's mind. Mr Whitfield said that the subject land was much superior to Mr Conroy's Sale No. 4 at $95,000. He said that the market would reflect the existence of the esplanade and sea views which could not be built out. With regard to Sale No. 5 for $68,000, Mr Whitfield said the subject land was superior, because this property would be difficult to develop and although situated in an attractive, modern area, it lacked the exclusivity of the subject area. Under cross-examination, Mr Whitfield said that his Sale No. 2, while being superior to the subject land, was not what he would call "considerably" superior. He considered his Sale No. 1 to be inferior to the subject land because the steep nature of the land would make development expensive. While the views were superior, it lacked proximity to shopping, medical services and other amenities. The issue in this case really boils down to the difference between the sales used by Mr Conroy, particularly his Sales 4 and 5 situated in Kara -- 5 of 7 -- 6 Crescent, and those used by Mr Whitfield situated in Shutehaven. Shutehaven is situated some 10 kilometres from Airlie Beach and although enjoying excellent views and a reputation for exclusivity that Kara Crescent does not have, it lacks the facilities available to Mr Conroy's sales. It also lacks sewerage, but this was not seen as an issue by either valuer. During the case Mr Whitfield explained that he had reduced the residential area of Whitsunday Shire by 15 per cent from the 1990 valuation and that he had maintained the relativity between Shutehaven and the subject land. He also said that a previous Court decision had confirmed the use of sales in Shutehaven to value the subject land. Although it is desirable to maintain relativity wherever possible, each revaluation must depend on the sales that are available at the time. If the sales indicate that there has been a change in relativity, it is the valuer's duty to follow the sales, rather than try to maintain the previous relativity. In this case it seems to me that Mr Whitfield has endeavoured to maintain the relativity in face of the sales used by Mr Conroy. While the subject land is undoubtedly superior to Mr Conroy's Sales 4 and 5, I have formed the opinion that it is inferior to the land in both Mr Whitfield's Sales 1 and 2 at Shutehaven. Indeed, there could be quite a different market for the Shutehaven properties than for those at Airlie Beach. They may well attract a different type of purchaser who would not mind being 10 kilometres from facilities, as long as he could enjoy the view. The subject land, in my opinion, has both attributes. It enjoys excellent views, although perhaps not quite as exclusive as Shutehaven, and it is also close to the facilities of Airlie Beach. -- 6 of 7 -- 7 After carefully weighing the evidence presented by both valuers, I have come to the conclusion that an appropriate unimproved value for the subject land is $115,000. Accordingly, the appeal is allowed, the valuation of the Chief Executive is set aside and the unimproved value of the subject land is determined at $115,000. J J TRICKETT MEMBER OF THE LAND COURT -- 7 of 7 --