Caligaris v The Valuer-General [1992] QLC 239

.. LAND COURT, BRISBANE. 19th June, 1992. Re: An appeal against a determination of the Valuer-General, Shire of Eacham. (AV91-111) Mrs J.J. Cali garis v. The Valuer-General (Hearing at Cairns) DECISION Mrs J.J. Caligaris is the registered lessee of land which, at the relevant date in this matter was described as Lease G being part of Lot 4 on R.P. 747291, Parish of East Barron, containing 835 square metres. The description has subsequently become Lot 17 on R.P. 808383. It is leased from the Eacham Shire Council and is located fronting Lakeside Drive Tinaburra, adjacent to Lake Tinaroo. As at 31st March, 1990, when the lessees were J.F. and F.M. Neven, the land was valued by the Valuer-General in the amount of $52,000. An objection against that valuation was disallowed. Mr and Mrs Neven appealed against that decision on several grounds, relating to the land being leasehold, the use of freehold sales evidence in determining value, lack of direct lake frontage and restricted water access during dry times. Subsequent to the relevant date, the property was sold to Mrs Caligaris who carries on the appeal as is permitted under Section 16K(2) of the Valuation of Land Act. Mr E.J. Caligaris appeared on behalf of the appellant and gave evidence in< \ support of the grounds of appeal. He says that only two sales have occurred in Tinaburra in th~ last three years, both of improved property, one of which was the purchase by Mrs Caligaris''of the subject property for $103,000. He says that as [1992] QLC 239 -- 1 of 5 -- 2 the present market value (at the relevant date) has to be established, it is also necessary to establish the market value of the improvements. Based on a quote he obtained from a Cairns builder, the replacement cost of the dwelling is accepted by him as being $64,750. He assesses the replacement value of other improvements as being $550. With the total replacement value of the improvements being $65,300 he says the land value indicated by the sale is $37,700 which supports the previous Valuer-General's valuation of $40,000. This amount then is the appellants estimate of value. Mr Caligaris says that as Tinaburra comprises all leasehold land, it cannot and should not be compared with land in Lakeside Estate which is 2 kilometres distant, freehold land and in his opinion far superior. Development in Lakeside includes executive style dwellings in the higher price range while in Tinaburra he says development is of lower to middle price range and mainly holiday co_ttages. Mr Caligaris confirms the claim of the previous owner that the waterfrontage of the subject property, being to Stewarts Gully and not the main body of Tinaroo lake, is not permanent, being known to have dried up in drought or high irrigation use periods. He says access to the water is steep with the land sloping away from the main house area. Because Tinaburra has public facilities including a caravan park, boat ramp and picnic area there is a heavy traffic flow in the locality. The immediate road frontage to the subject property is roughly sealed with a narrow bitumen strip surface, kerbed and channelled only on the immediate frontage with a pot-holed gravel shoulder opposite, causing dust pollution. Noise pollution is caused by " power-boat and ski racing activities permitted in the close proximity. The presence of the caravan park which accommodates both permanent and holiday occupancies ·,has in Mr Caligaris' opinion has deleterious effect on -- 2 of 5 -- 3 residential amenities of the area. Mr Caligaris says that while Lakeside and Tinaburra should be seen as "A" class and "C" class respectively in comparison, values applied by the Valuer- General are too close. In comparison with the subject land valued at $52,000 for 835 square metres or $623 per square metre with what he says is steep access to non permanent water, he gives an example of Lot 72 R.P. 738435 Oleander Drive Lakeside of 800 square metres being valued at $56,250. He says that Lot 72 has a very gentle slope to the lake edge with permanent water. A number of photographs were tendered, ·the primary thrust being to show the inferiority of Tinaburra in comparison with Lakeside. Mrs J.J. Caligaris was called to give evidence. She was firmly of the opinion that Lakeside was far superior to Tinaburra. It was put to her that the subject land enjoyed views not only to the lake _frontage at the rear but also to the front but in her opinion any views of the lake from the front of the property to the north and east were limited by tree plantings and would eventually be screened as planted trees on public areas became established. Mr R.G. Moroney, registered valuer with the Department of Lands had carried out the Valuer-General's valuation. He described the land as being easy sloping from the level road frontage to the rear boundary where there is a ponded area of Lake Tinaroo. He said there were : no sales of vacant or lightly improved sites in Tinaburra and he chose not to ·analyse sales of the improved leasehold properties including,. . " that of the subject property, because, in the first place, any such analyses would provide a leasehold land value when he was required to find the equivalent and logically higher, freehold value. -- 3 of 5 -- 4 Mr Moroney agreed that land in Lakeside possessed superior location to the subject land at Tinaburra but held the opinion that it was possible as a valuation exercise, to make comparisons between the two areas. His valuation was based on three sales at Lakeside as follows: (1) Lot 74 R.P. 738435, 1543 square metres, Oleander Drive, sold January 1990 for $60,000 analysed to show an unimproved value of $59,000 but with an application of $53,000 at the relevant date. He says while this site is larger in area it is steeper in topography with inferior lake water access, but then overall comparable to the subject land. (2) Lot 127 R.P. 738436, 1167 square metres, Coolibah Close, sold March 1990 for $36,000 analysed to show an unimproved value of $35,200 with an application of $32,000. This site is larger in area, has similar topography and superior lake overview compared to the subject land but because it does not have lake water access is inferior in value. (3) Lot 63 R.P. 738434, 1244 square metres, Oleander Drive, sold March 1990 for $101,500 analysed to show an unimproved value of $100,500 with an application of $91,000. Whi le it is described as having a steady, easy fall from the road to the rear· boundary, Mr Moroney says it has inferior topography to the subject lahd, but then larger area, superior lake outlook and access and is overall superior in value. There is somewhat conflicting evidence as to the comparability of the Lakeside location compared to Tinaburra. Mr Caligaris informed the Court during his evidence that while he was an accountant by profession he was also a registered valuer. He describes a comparison of Lakeside and Tinaburra as being like chalk and cheese and not consequently comparable. Mr Moroney agrees that Lakeside is superior but still capable of comparison. I have formed the opin}on that in the absence of sales of vacant freehold land at Tinaburra the evidenc,e at Lakeside should not be ignored and the "chalk' . . and cheese" comparison as suggested by Mr Caligaris is far too extreme from a professional valuation point of view. While in the context of comparisons it may have been a useful exe!cise for the Valuer-General to have analysed the improved -- 4 of 5 -- 5 sale of the subject property, even if as Mr Moroney says the result would have shown the leasehold value. The exercise of Mr Caligaris in analysing the sale is clearly defective in that he allows, if I understand his evidence correctly, a new replacement cost of an improvement said to be 13 years old in establishing its present market value. The added depreciated value should logically be something less than its replacement cost new, which would effectively increase the analysed leasehold value. Logically then the freehold value should be greater again. Nevertheless, even if Lakeside and Tinaburra were directly comparable as localities (which they obviously are not) the available sales evidence is not directly comparable in terms of size, water access and topography. Some doubt has been created as to whether sufficient allowance has been made for the disabilities of Tinaburra in comparison with Lakeside, particularly as a result of the public orientated intrusion and its overall effect on residential usage at Tinaburra, then the somewhat restricted water orientated use of Stewarts Gully Inlet which on the evidence can be effected at reduced water levels. Resolving doubts in favour of the appellants I will allow the appeal, but I do not find that significant disturbance to the Valuer-General's valuation is warranted on the evidence before me. The appeal is allowed, the Valuation of the Valuer-General is set aside and the unimproved value of the land is determined in the amount of $48,000 as at 31st March, 1990. (signed) R.E. Wenck. Member of the Land Court. -- 5 of 5 --