Dixon & Anor v Minister for Lands [1993] QLC 146

Re: Determination of Rent - Third Rental Period Special Lease No. 22/44895 Herberton District - LAND COURT BRISBANE 26TH NOVEMBER, 1993. Lessees: Walter Dixon and Deidre Petersen {Hearing at Atherton) DECISION For the third rental period of the lease of Special Lease No. 22/44895, Herberton District, which commenced on 3rd November, 1992, the Crown originally sought an annual rent of $1,100. However, at the hearing of this matter I was informed that the Minister had re-determined the annual rent at $990 and the Department led evidence to that rent. The lessees requested that this matter be referred to the Land Court for hearing and determination, advising that their estimate of the rent that should be charged is $660 per annum, which was the rent for the second rental period. Special Lease No. 22/44895 is in respect of the land described as Lot 296 on Plan CWL 3165, Parish of Ravenshoe, containing an area of 6.89 hectares. It was granted for a term of 30 years on 3rd November, 1982, for rural residential purposes. It is situated approximately 2.5 kilometres from the Ravenshoe Post Office and access is by means of the bitumen sealed Tumoulin Road. The Departmental report indicates that the land falls moderately to steeply from the eastern boundary through to easy sloping and undulating open forest country to the western boundary, with stony to gravelly red to grey soils. Tirr1bers [1993] QLC 146 -- 1 of 4 -- 2 include stringy bark and ironbark. There is no natural water supply on the property, domestic water being obtained by means of a pump and pipeline from the Millstream Creek on the opposite side of the road. Although the land has been zoned "Special Facilities" for caravan park purposes under the Herberton Shire Town Plan, it has been valued as a rural residential site. Ms Deidre Petersen gave evidence that the lessees do not understand how the rent keeps rising every five years. Ms Petersen thinks that the property market has been stable over this period. However, she was not able to give evidence of any sales during this period or refer to any market rents. She said that the land experiences some flooding and water lies in gullies and on the front of the land for up to a couple of months. At such times a four-wheel drive vehicle is necessary to obtain access to the house site. Mrs Isobel Dixon also gave evidence. Mrs Dixon said that the property is a dry block with no natural water and explained that water was obtained by pumping from the creek across the road. She said that the sale property in Cockram Road used by the Crown as a basis, had permanent natural water, was more level ground and would be a lot easier to clear. She considered it to be superior to the subject property. However, she did admit that it had limited access. Ms A L Mulcrone, registered valuer employed by the Department of Lands, gave evidence for the Crown. Ms Mulcrone said that she arrived at the later recommended rent by adopting 3 per cent of the unimproved value of the land which she assessed at $33,000. Ms Mulcrone arrived at this valuation by reference to two sales. The first sale consists of an area of 5.204 hectares situated in Cockram Road, about 6 kilometres south-east of the subject land. This property, -- 2 of 4 -- 3 although vacant, has a highest and best use as rural residential land. She described it as moderate to easy sloping originally heavily forested country. The majority is cleared and bounded by a small permanent creek. This land sold in August 1992 for $45,000 and was analysed to show an unimproved value of $40,100. Ms Mulcrone describes this land as being superior to the subject property in country type and water availability. However, it is slightly inferior in access and is smaller. Overall she considers it to be superior. The second sale is an area of 1.355 hectares situated in Kent Close, about 1 kilometre north-west of the subject land. This is also a vacant property with highest and best use as a rural residential site. It is described as broken moderately sloping to undulating gravelly timbered forest country rising immediately from the road frontage and then easing off to the rear. This land sold in January 1991 for $20,000 and was analysed to show an unimproved value of $19,000. Ms Mulcrone considers this property to be comparable to the subject land in access, country type and availability of water. However, it is smaller and therefore she considers it to be inferior to the subject land. Ms Mulcrone said that she has been responsible for the latest revaluation of Herberton Shire and has looked at up to 30 sales of rural homesites in the area. She selected these two sales as a basis for assessment of rent in this case because they were the most comparable to the subject land. While the first sale is superior country and has better availability of water, it is roughly the same size as the subject land. The second sale, although much smaller, is similar in both country type and the availability of water. In the absence of market rents in the area, Ms Mulcrone used the method of -- 3 of 4 -- 4 adopting 3 per cent of the unimproved value in order to arrive at the recommended rent of $660 per annum. She is aware that the Land Court has on occasions adopted 3 per cent of the unimproved value when evidence of market rents was not available and the circumstances warranted such a method. In the circumstances, I think that the adoption of 3 per cent of the unimproved value in this case is reasonable and the lessees have not been able to show that the rent recommended and determined by the Minister is not fair and reasonable. Accordingly, the rent for Special Lease No. 22/44895 for the third period of the lease is determined at $990 per annum. J J TRICKETT MEMBER OF THE LAND COURT -- 4 of 4 --