Capper v The valuer-General [1991] QLC 88

Re: Appeal against determination of Valuer-General - Glengallan Shire Council. AV91-525. Margot Capper V. The valuer-General DECISION (Hearing at Warwick) LAND COURT, BRISBANE 7th August, 1991 On 1st September, 1990, the appellant purchased Lot 8 on RP 15537, parish of Cunningham, containing an area of 91.44 hectares. The land was purchased for the purpose of establishing a business of primary production - namely cattle grazing. The land is situated about 24 kilometres from Warwick and is described by Mr D.B. Redgen, registered valuer in the employ of the Department of Lands who gave evidence on behalf of the Valuer-General, as consisting predominantly of easy sloping sandy forest country originally timbered with narrowleaf ironbark box and gum. He is of the opinion·that about 20% of the block is suitable for opportunity farming and fodder cultivation. There is an earth dam on the property which provides water for stock and there is a home which Mr Capper intends to extend. The plan behind the purchase lies in the desire of the appellant and her husband to settle on the block and for it to provide a nucleus for the purpose of establishing their son on the land on completion of his education through Gatton College. [1991] QLC 88 -- 1 of 5 -- 2 The appeal before the Court is against the decision of the Valuer- General to value the land for its highest and best use as a rural homesite. That valuation is in the sum of $40,200. The appellant has estimated the value of the lot at $30,000 but Mr Capper freely admits that he is not qualified to value land and that he is not familiar with values in the Shire. The essence of the appeal is whether the land for the purposes of this Annual Valuation made as at 31st March, 1990, should be valued as land exclusively used for purposes of the business of primary production (s.11 (1 )(vii)). Were this the case, Mr Redgen says that he would value the lot at $20,500. The relevant valuation issued on 29th January, 1991. The period between these dates (31st March, 1990 and 29th January, 1991) is the limit of the jurisdiction of the Court in determining whether for the purpose of this valuation the land should be valued under the provisions of s.11 (1)(vii) - II As it is relevant to my consideration of the evidence I should at this stage mention that my jurisdiction as to the use to which the subject lands are put is confined to the period commencing with the date as at which the value has to be found (31st March, 1975) and finishing on the date as at which the notice of valuation issued (28th October, 1976). If a business of primary production commenced later than 28th October, 1976, its effect, if any, on the unimproved value of the land is properly a matter for an application for revaluation in terms of Section 13 of the Valuation of Land Act. I have no power to give retrospective effect in valuation form to exclusive use for any such business of primary·production. " (G.A. and B.H. Walker v. The Valuer-General (1978) 5 Q.L.C.R. 347 at p. 349). There is no dispute that when the land was purchased it was in a run down state and was not being used for purposes of primary production - the sale was not one of the purchase of a going concern. On purchase the appellant immediately set about the task of putting the property together for the purpose of grazing breeder cattle on the block and ultimately lot feeding. Improvement -- 2 of 5 -- 3 commenced with repair of fences. Repairs were made at the water point and a small area (about 6 hectares) put to fodder by contract. Areas have been slashed and timber is being cleared. A sum of $80,000 has been expended on machinery, a four-wheel drive vehicle has been purchased and presently there are 20 head of breeder cattle on the block. These cattle were purchased in three lots and but for dry seasons this year preventing cultivation and the sowing of seed, the numbers would have increased. Mr Capper said that he spends about 3 days a week in Brisbane and intends to reside permanently on the property. He expects to achieve a herd size of about 80 head given favourable seasons and conditions. He concedes that the majority of the activity on the block has taken place between January and June this year. In fact he concedes that it would be reasonable to hold that the business was not established prior to June this year. On these admissions which are supported by fact, it would be impossible to hold that the business had been established by the end of the valuation period. Nor could I hold on the evidence that at that time ''the actions or operations in train at the relevant date of valuation must be such that given favourable seasons and conditions they are of such magnitude that they will, in the fullness of time, by maturity or further activity reasonably be expected to develop into a viable venture". (Walker case p. 354). An appreciation of what is intended in this part of the Walker test can be found in Young v. The Valuer-General 25th May, 1990 ~ V89-499. In that case, the appellants purchased land in March 1988 for the purpose of establishing an orchard. In the ensuing 12 months the land was prepared, irrigation systems were put in and trees were planted in March 1989. The appellants argued that the land should have been valued as primary production land from the date of purchase. The Valuer-General argued that the section should apply from March 1989 when -- 3 of 5 -- 4 the trees were put in place. The Court in finding t~at the Valuer-General was correct in his reasoning, quoted that part of the Walker case just quoted and also from the judgment of the Land Appeal Court in A. I. MacAdam and Another v, The Valuer-General 18th September, 1981 (VS0-298) which I repeat: • We stress that intentions, hopes and aspirations, however sincere, are not sufficient to constitute a business of primary production. They must be supported and affirmed by substantial and positive actions of a type and magnitude which are approaching or may be reasonably certain to reach commercial viability. • If these principles are applied to the circumstances of the subject case which are different from those of establishing an orchard, it seems clear that the time as at which the appellants should have the benefit of the section is at the point when the Valuer-General could say that the activity has reached a stage when there is no turning back notwithstanding that the number of stock then on the property may be less than a viable breeding herd. Such things to be considered include whether the land is being put to its best use, whether what is done by improvement is done with permanency in mind and for a commercial purpose, the volume of the operation and the amount of capital expended and such other matters as may be gleaned from the decision of the Land Appeal Court in Crawford v. The Valuer- General (27th August, 1990) (V89-460) (to be reported). On the evidence in this case, the activity to 29th January, 1991, falls short in my opinion of what is required under this part of the Walker test. Obviously with the capital outlayed by the appellant at the time of the hearing of the appeal, the point when she may qualify under the section may be fast approaching. When the appellant considers that the activity has reached this stage, she should make application for a revaluation in terms of s.13 of the Act and provide the Valuer-General, with the application, full details of all relevant material including a list of development works and outlays. -- 4 of 5 -- 5 In the circumstances, the appeal is dismissed and the determination of the Valuer-General affirmed. D. M. White Member of the Land Court -- 5 of 5 --