Dowrie v Chief Executive, Department of Lands [1993] QLC 139

, :, I LIBRARY COPY I LAND COURT BRISBANE 29TH OCTOBER 1993 Re: Appeal against Annual Valuation - Valuation of Land Act 1944 - Shire of Redland (AV93-424) Kathleen Dowrie V. Chief Executive , De partment of Lands DECISION Mrs Dowrie is the owner of land described as Lot 17 on Registered Plan 95330, Parish of Cleveland, containing an area of 597 sq. metres. In accordance with the provisions of Section 16B of the Valuation of Land Act 1944, the Valuer- General assessed the unimproved value of the subject land as at 31st March, 1992 at $125,000. Mrs Dowrie objected to this valuation and by letter dated 28th June, 1993, she was advised that her objection had been disallowed and the valuation remained unaltered at $125,000. Mrs Dowrie then lodged an appeal to the Land Court against the decision on her objection, advising that her estimate of the unimproved value is $108,000. Mrs Dowrie's appeal is confined to one ground, namely: "Allotments each side of me and directly behind have increased 30 per cent. Mine has been increased over 50 per cent." Although the valuation issued in the name of the Valuer-General, the Lands Legislation Amendment Act 1992 substituted the Chief Executive of the Department of Lands for the statutory office of Valuer-General. For present purposes, [1993] QLC 139 -- 1 of 7 -- 2 therefore, it is appropriate that the Chief Executive be the Respondent in these proceedings in place of the former Valuer-General. The subject property is situated on the corner of Wilson Esplanade and Hatchman Street, Victoria Point, approximately 800 metres north of the Victoria Point Post Office. Good access is provided from Hatchman Street. The land is irregular in shape, being nearly triangular, and has a very slight rise from Hatchman Street and a slight cross-fall to the north. It enjoys uninterrupted views of Victoria Point, Coochiemudlo Island and Moreton Bay. Electricity, telephone, reticulated town water and sewerage are connected to the property. The land is zoned "Residential A" under the Redland Shire town planning scheme and is used for residential purposes. Mrs Dowrie gave evidence that she could not understand why the unimproved value of the subject land had increased by 50 per cent when that of the neighbouring property had increased by only about 30 per cent. She said that her property was the smallest in the area, being only 597 sq. metres and that its triangular shape makes the Hatchman Street frontage longer than most of the blocks in this area, making mowing and maintenance more difficult. Mrs Dowrie said that the allotment did not face the sea and although the views were good, she considered that the allotments in Wilson Esplanade would be more valuable. Mrs Dowrie feels that her property has been unfairly treated by the Department of Lands and has been subjected to a much greater increase than any of the neighbouring properties. She feels very strongly that relativity should have been maintained. -- 2 of 7 -- 3 Mr G W Knight, registered valuer employed by the Department of Lands, gave evidence on behalf of the Chief Executive. Mr Knight said that in valuing the lands in this area he did not have regard to the percentage increase from the previous valuation, but valued each allotment on its own merits. He said that the subject land enjoyed the same uninterrupted views of the bay and Coochiemudlo Island as did the much larger neighbouring properties fronting Wilson Esplanade. However, these properties were valued much higher, as the size and shape of the subject property had been taken into account. With regard to the unimproved valuations of the neighbouring allotments fronting Hatchman Street, Mr Knight said that none of them enjoyed the same views as did the subject land, therefore they were valued at lower figures. Mr Knight said that the subject land is situated in an older area where there are very few unimproved properties, let alone sales of unimproved land. The closest sales of unimproved esplanade land were at Point Halloran, a new estate with underground electricity. Although these sales are situated some distance to the north of the subject land, Mr Knight considered that they provided a more reliable basis of valuation than sales which are not situated on the esplanade. Both basic sales are situated in Orana Esplanade, with areas of 716 sq. metres and 797 sq. metres and which sold in August 1991 for $150,000 and November 1991 for $155,000 respectively. These sales analysed to show unimproved values of $141,000 and $147,200 and unimproved valuations of $137,000 and $146,000 respectively, were applied to them in the 1992 valuation. These properties have esplanade frontages, with similar views to the subject land but towards the east/south-east. Both sites were filled, and the second site has an -- 3 of 7 -- 4 unsightly sewerage pumping station at its south-western corner. Mr Knight said that these allotments were larger than the subject land, of better shape, with superior services such as the underground power, and overall he considered that they were superior to the subject land. He commented that the first of these sites was resold in February 1992 for $165,000. Although he had no sales of unimproved land in the vicinity, Lot 18 on Registered Plan 95330, containing an area of 655 sq. metres and situated directly opposite the subject land, sold in October 1991 for $178,000. This land was improved with a standard high-set dwelling and Mr Knight analysed this sale to show an unimproved value of $110,000. Although occurring some five months prior to the date of valuation, Mr Knight considers that this sale supports the valuation applied to the subject land. Although Mrs Dowrie feels very strongly that there should be no change in relativity, there is no doubt that Mr Knight has adopted the correct approach to this valuation. Mrs Dowrie's case is based entirely on the relativity of the unimproved value of her property compared with those of other properties in the area. With regard to the matter of relativity of valuations, the Land Appeal Court has recently encapsulated a number of principles which must be kept in mind. In Grahn v. The Valuer-General, in its decision dated 20th June, 1992 (not yet reported), the Land Appeal Court said at page 9: "The decision of the High Court of Australia in Brisbane City Council v The Valuer-General ((1978) 140 CLR 41, 5 QLCR 283) and the decisions of the Land Appeal Court in cases such as WM and TJ Fischer v The Valuer- General ((1983) 9 QLCR 44) and R and MM Barnwell v The Valuer-General ((1989) 13 QLCR 13) are authority for the following propositions: -- 4 of 7 -- 5 a) It is desirable that valuations made for the purposes of the Valuation of Land Act 1944 of comparable lands should bear proper relativity, one to the other, so long as the valuations are soundly based. It is, however, untenable to adopt a value for one parcel on relativity with another which has no sound basis. (R and MM Barnwell v The Valuer-General (1989) 13 QLCR 13, at p. 16 and cases cited in it). b) The best basis for assessment of unimproved value is the use of sales of vacant or lightly improved parcels of land (WM and TJ Fischer v The Valuer-General (1983) 9 QLCR 44, at p. 46; R and MM Barnwell v The Valuer-General (1989) 13 QLCR 13, at p. 17). c) Section 13(7) of the Valuation of Land Act 1944 creates a presumption that the value in money terms shown by the Valuer-General in his notice of valuation is correct (Brisbane Ci ty Council v The Valuer-General (1978) 140 CLR 41, at p. 56). d) Once it is shown that: 1) in making the valuation the Valuer-General acted upon a wrong principle, or made a serious error of fact; or 2) the valuation was made by a method fundamentally erroneous, the presumption created by section 13(7) is rebutted (Brisbane Ci ty Council v The Valuer-General (1978) 140 CLR 41, at pp. 56-7). (e) Whilst maintenance of correct relativity is of considerable importance for rating valuations, the use of the principle of relativity should not be preferred to the exclusion of relevant (even if not ideal) sales evidence (WM and TJ Fischer v The Valuer-General (1983) 9 QLCR 44, at p. 46). (f) If possible, the Valuer-General should obtain uniformity between different blocks in the same land category or type, but should do so (preferably by reference to sales of comparable land) by correcting inaccuracies rather than by making an inaccurate assessment in order to secure uniform error (R and MM Barnwell v The Valuer-General (1989) 13 QLCR 13, at pp. 16- 17 and cases cited in it)." While it is true that the majority of allotments in the neighbourhood both in Wilson Esplanade and Hatchman Street have increased by about 30 per cent from -- 5 of 7 -- 6 the previous valuation, this is not universally true. For example, Lot 18, the allotment subject of the sale, increased from $78,000 to $110,000, an increase of about 41 per cent, while Lot 19, on the opposite side of Hatchman Street to the subject land, increased from $72,000 to $100,000, an increase of approximately 39 per cent. Mr Knight, understandably, prefers to rely on the unimproved sales at Point Halloran rather than the sale of the improved Lot 18 as his basis of valuation. However, Mr Knight has applied the analysed figure of $110,000 to Lot 18 and in the circumstances I feel that this sale should not be treated lightly. While it is true that the best evidence of value are sales of vacant or lightly improved land, the sale of an improved property in the near vicinity of the subject land, although not an ideal basis, if properly analysed, does afford some evidence of unimproved value. The fact that Mr Knight has chosen to apply the analysed figure indicates that he has more than a passing regard to the analysis of this sale. As it is only across the road from the subject land, I consider that it is a better indicator of the relationship of values than the sales some distance away at Point Halloran. Mr Knight says that the subject land is superior to both Lots 18 and 19 valued respectively at $110,000 and $100,000. This is largely due to the fact that the subject land has views to the north which are unobstructed while the views from Lots 18 and 19 are partially obstructed. It is always a matter of judgment just how much extra the market would recognise for better views. In the circumstances, having regard to the sale of lot 18, I think that a valuation of $117,000 would more appropriately reflect the advantages enjoyed by the subject land over that allotment. -- 6 of 7 -- 7 Accordingly, the appeal is allowed and the valuation of the Director-General is set aside and the unimproved value is determined at $117,000. J J TRICKETT MEMBER OF THE LAND COURT -- 7 of 7 --