Dalla Costa & Anor v The Valuer-General [1991] QLC 148

Re: Determination of Unimproved Value - Shire of Atherton AV91-38 BF and AM Dalla Costa V. The Valuer-General DECISION LAND COURT, This is an appeal against the determination by the Valuer-General of an unimproved value of $60,000 for Lot 5 on RP 741266, Parish of Barron containing an area of 8.018 hectares. This is a URural B" zoned parcel situated some 8 kms south of Atherton. It is a rural site used as an angora goat stud and a beef cattle grazing proposition. The land has been valued as a rural site and not under the provisions of Section 11 (1) (vii) of the Valuation of Land Act as land used exclusively for the business of primary production. The relevant date for the valuation is 31st March, 1990. It is Benjamin Frederick Dalla Costa who claims that the land should have been valued as land used for the business of primary production and on that basis he estimates the unimproved value should be $40,000. Mr Dalla Costa told the Court that the land was purchased about 5 years ago and because of its quality and the climate, a decision was made to establish the angora goat stud. At [1991] QLC 148 -- 1 of 4 -- - Page 2 - the present time there are 38 pedigree angora does and 2 bucks. These have been bred up from an original number of 6 head of chosen stud does which cost $350 each at the commencement of the breeding venture. A buck was purchased at a cost of $2,500. In addition 12 head of beef cattle are grazed. Mr Dalla Costa told us that he has toiled long and hard to develop the enterprise and that unfortunately times are hard for the rural community at present with low prices for fleece and stock. He says that prices being paid three years ago were about $250 per head for a doe and $2,500 to $5,000 for a buck. Now pedigree does are only worth $25 and buck in the vicinity of $500. Mr Dalla Costa says the industry is now in a disastrous position with mohair suffering the same diminution in value as has wool. Mr Dalla Costa is a member of AMBER (Mohair Producer Organisation) and says he is accepted by the Australian Taxation Office as a Primary Producer. He has obtained work away from the property to support the appellants. Mr Dalla Costa told us of the development he has made on the property. The boundary has been fenced and the land cleared. Internal fencing subdivision has been erected. Pastures have been developed on the cleared land. There is a dam and an irrigation system installed. All this has cost considerable capital but Mr Dalla Costa was not able to tell us about these costs as he did not have his figures with him. He lodges taxation returns every year but as yet there are no taxable profits from the venture. However, Mr Dalla Costa believes that the operation is now in place and a profit will flow from the venture if fleece and livestock prices improve. Apparently Mr Dalla Costa did provide the respondent Valuer-General with some details of his profit ($532) and expenses ($5,600) tar the year ending 30th June, 1989. In 1988 it seems that his income was $172 and expenses -- 2 of 4 -- - Page 3 - $14,809. The valuation under appeal was made by registered valuer Robert Grant Moroney who sets out his description of the nature of the land and the sales basis for his valuation in a tendered valuation report. I do not see the need to detail this information here since the only real issue is whether the land should have been valued under the provisions of Section 11 (1) (vii) of the · Act. However, I should comment that a value of $60,000 for the subject land as a rural site appears well supported by the sales evidence tabulated by Mr Moroney, who offered the opinion that if the land falls to be valued as land used exclusively for the business of primary production then he would recommend a value of $24,000 ($3,000/ha). Now Mr Moroney told us that he inspected the subject land in 1987 and again in 1990. On both occasions he formed the opinion there was not a business of primary production carried out on the land, mainly on the basis that the scale of operations was not sufficient to bring the valuation within the test set out in the "Walker" Case. Mr Moroney says the operation lacks any degree of character and was not of sufficient magnitude. The Court was referred to a decision of the now learned President of this Court (Mr Barry) - Ref V83-188 wherein it was held that the grazing of 40 goats in a developing stud with 2 bucks at the relevant time of valuation did not constitute a business of primary production, but it was indicated in the decision that the grazing of 100 goats, (which were run at the time of hearing of that case) would constitute a business. It is without doubt that the primary production activities carried out on the subject land do lack viability due to the present state of the goat industry and -- 3 of 4 -- - Page 4 - . certainly the operations a·re small in scale. It is a pity that Mr Dalla Costa was not in a position to be more specific as to the trading figures of his operations since I feel that it is an integral part of the conduct of a business to be familiar with financial matters. To be regarded by the taxation office as a primary producer is not the essential test as to whether land is used for a business of primary production. This is a borderline case, but I feel on the evidence that the land did not at relevant date qualify to be valued otherwise than as a rural site. It well may be that with further development of the stud Section 11 (1) (vii) of the Act will apply in future valuations. But for the relevant date of valuation, I find that the respondent Valuer-General has not erred in valuing the land as a rural site. It follows that the appeal be dismissed, and that the unimproved value of Lot 5 on RP 741266, Parish of Barron as determined by the Valuer-General in the sum of $60,000 be affirmed. (C.H. Carter) Member of the Land Court. -- 4 of 4 --