Evans v The Chief Executive, Department of Lands [1993] QLC 110

Re: Determination of Unimproved Value - City of Bundaberg - AV93-178 NJ Evans V. LAND COURT, BRISBANE. 3rd September, 1993. The Chief Executive, De partment of Lands (Hearing at Bundaberg) DECISION This appeal is against the determination by the Chief Executive, Department of Lands of an unimproved value of $31,000 for a "Residential A" zoned site situated at 28 Stevenson Street, Bundaberg and which is more particularly described as Lot 64 on RP 115364 parish of Kalkie containing an area of 794 m 2 . The appellant contends within the notice of appeal for an unimproved value of $26,000. The relevant date for the determination of the unimproved value is 31st March, 1992. Noel John Evans, who is a practicing registered valuer, furnished evidence on his own hehalf. Mr Evans describes the site as being low in elevation with a [1993] QLC 110 -- 1 of 6 -- 2 slight south west to north west fall. In times of excessive rain, Mr Evans says there is frequently a strong flow of surface water on the western boundary of the site. There is a 10 cm drainpipe in place and this is not sufficient to handle the waterflow which has caused damage over time to the front western corner of the dwelling on the site. Mr Evans told us that about 1.35 metre width of land on the western side has been abandoned as unsuitable for garden landscaping due to drainage problems. Mr Evans tendered schedules of 67 sales of vacant lots which he contends support his valuation of $26,000 for the subject land. From this volume of sales Mr Evans assesses the value of the site to be $1 ,350/m frontage to a standard depth of 40.23 metres, adjusted by 4.5% for the drainage disability as follows:- 20 . 12 m x $1350 to standard depth Less 4.5 % disability allowance Value of land Unimproved value adopted $26,000. $27,162 $ 1 , 222 $25,940 == ===== As a check against this valuation Mr Evans applies a value of $34.50/m 2 and makes the same disability allowance of 4.5%. Now most of the sales scheduled by Mr Evans, while on the same side of a fall in the topography in the area to a low lying swamp called Baldwin Swamp, are located some distance from the subject land in a newly developing suburb called Kepnock. Most of these sales are in the 668 m2 to 712 m2 area range and have sales prices ranging from about $24,000 to about $27,500. It is to be noted however, that five of the sales scheduled are in the $40,000 price range and these blocks are much closer to the subject land than are the remainder of the sales. -- 2 of 6 -- 3 They are:- 8 Rankin Court - containing 924 m 2 on 22nd April, 1991 for $40,000 A site in Melcer Court containing 1797 m 2 on 1st October, 1991 for $40,000. Another site in Melcer Court containing 1835 m 2 also 1st October, 1991 for $40,000. A site in Hargreaves Street containing 745 m 2 on 19th November, 1991 for $_40,000 and, A site at 55 Stevenson Street containing 1244 m2 on 18th August, 1992 for $43,500. Mr Evans informed the Court that the first three of these sales are located in Glenforest Estate which is the first estate in Bundaberg to have underground power. Mainly for this reason he sees these sale sites as being superior to the subject land. Mr Evans' primary sales for his valuation are those in the Kepnoch area. Now Mr Evans says that his land is grossly overvalued in comparison with an unimproved value of $32,000 placed upon a neighbouring block on the east. He is of the opinion that an allowance of $1,000 for the drainage disability as against the value of the adjoining lot is inadequate. Mr Evans claims that a method of valuation based on a rate per metre frontage to standard depth is a better method than valuing on a site to site basis. With this contention I cannot agree, since it has often been held that valuing on a site to site basis is the best method when the task at hand is to value residential sites. The same can be said of Mr Evans' check method of valuing on a per square metre basis - vide the decision of the Land Appeal Court in Re: H. and E. Grahn v. The Valuer-General (AV89~246 and 247) - not reported. The rate per -- 3 of 6 -- 4 metre frontage method of valuation has its place in valuing retail or business sites. The valuation under appeal was made by Departmental registered valuer Michael David Denlay. Mr Denlay describes the subject land as being regular in shape with a slight fall from the rear to the front boundary. Mr Denlay supported his valuation of $31,000 for the site on the basis of three of the four sales scheduled by Mr Evans mentioned earlier in this decision. Lot 155 on RP14 7894 containing 924 m 2 sold from King to King on 22nd April, 1991 for $40,000 - analysed unimproved value $39,000 - applied unimproved value - $36,500 - situation Rankin Court. Mr Denlay sees this sale site to be in a superior location than is the subject land and for that reason he says the sale is overall a superior parcel. Although the parties to the sale are related, Mr Denlay's investigations reveal that no discount or reduction in the sale price was involved and he sees the sale as a bona fide transaction. Lot 3 on RP 811752 containing 745 m 2 sold from Wide Bay Burnett Insurance Services Pty Ltd to Hallam on 19th November, 1991 for $40,000 - analysed unimproved value after allowing for filling $36,500 - applied unimproved value $33,000 - Situation Hargreaves Street. Mr Denlay considers this sale site to be slightly superior to the subject land, it is smaller but the sale lot is superior in location. Lot 33 on RP 137556 containing 1244 m 2 sold from Martin to Harriman on 18th August, 1992 for $43,500 - analysed unimproved value after allowing for filling - $40,000 - applied unimproved value $33,500 - situation Stevenson Street. Mr Denlay regards this sale site to be slightly superior to the subject land. It -- 4 of 6 -- 5 is larger, is on the opposite side of Stevenson Street and backs onto Baldwin Swamp. Mr Denlay says the sales site is in a superior location but he points out that it is subject to flooding over about 2/3rds of its area. Mr Denlay considers that the sales relied upon by him are to be preferred as a basis of valuation to the big volume of sales in the Kepnock area as they are closer to the subject land. With this contention I agree. Mr Evans suggests the sale in Stevenson Street should not be used as a basis of valuation since it took place after the date of valuation. There is no principle in valuation which automatically excludes from evidence sales which take place after a relevant date of valuation. Subsequent sales can be taken into account to determine the proper weight to attach to circumstances applying at the relevant date - vide Samios v. The Commissioner of Land Tax ATC 4063 - also vide McCathie v. Federal Commissioner of Tax (1944/5) 16 CLR 1 at p. 16. In any event Mr Evans is of the opinion that residential values within the city of Bundaberg have been rising at a rate of 10% or more per annum of recent times, and it is interesting to note that Mr Denlay has valued the Stevenson Street sale site at $33,500 or 20% below its analysed unimproved value of $40,000 - a strong indication that his valuation of that site is supported by the sale of it some six months after the relevant date. Mr Denlay informed us as to the level of unimproved value applied by him to sites in Stevenson Street and in Wilson Street (to the south) . I am satisfied that the unimproved value applied to the subject land, after the allowance for drainage problems, is not anomalous with other valuations applied in the area. Nor is it excessive when related to the nearest sales evidence sites upon which higher -- 5 of 6 -- 6 unimproved values have been applied even though an allowance has be made for filling placed on those sale lots. It follows then that the onus resting upon the appellant under the provisions of Section 16J(3) of the Valuation of Land Act has not been discharged. The appeal fails, and the unimproved value of Lot 64 on RP 115364, Parish of Kalkie as determined by the respondent Chief Executive in the sum of $31,000 is affirmed. (C.H. Carter) Member of the Land Court. -- 6 of 6 --