Bell & Anor v The Valuer-General [1991] QLC 65

/. Re: An appeal against a determination of the Valuer-General, Shire of Barcaldine - V90-591. F.N. & R.F.N. Bell v. The Valuer-General (Hearing at Blackall) DE C ISI O N lANDCOURT, BRISBANE. 14th June, 1991. This appeal is against a determination by the Valuer-General of the unimproved value of the property known as "Blendon" in the Shire of Barcaldine. As at 31st March, 1989, the unimproved value has been assessed in the sum of $165,000, having been reduced on objection from $175,000. "Blendon" comprises a total area of 16,752 hectares, in two separate portions to the north and south of "Delta South", about 62 km south-east of Barcaldine by way of 27 km of sealed road and_35 km of formed earth road. The property description is GHFL 02/3734, Lot 12 on Plan EV41, Parish of Lochnagar and Lot 3 on Plan. EV55, Parish of Rostrevor and SL02/32031, LS, Parish of Rostrevor, County of Evora. The grounds of appeal are numerous and broad. Mr R.F.N. Bell attended the hearing and gave evidence related more specifically to his opinions as to the nature of the land, its disabilities and comparisons with other nearby properties. Particular reference was made to the considered inferiority and lesser productive potential of the gidyea country on "Blendon" as compared to the gidyea country on "Delta North" and "Kyneton" properties. This type of country on the comparison properties was described by Mr Bell as being softer and flatter with noticeably better grass coverage and recovery of pasture. He points to the larger original timber on these properties as indication of [1991] QLC 65 -- 1 of 7 -- 2 the better soil types in the gidyea areas and holds the opinion that the closer proximity of "Blendon" to the escarpment is a reason for its inferiority. It is his opinion that the valuations of "Delta North" ($172,500) and the "Kyneton" aggregation ($175,000) with both properties capable of carrying significantly greater total stock numbers, demonstrate the inaccuracy of the original and reduced valuations of - - "Blendon" ($175,000 down to $165,000). The valuation contended for in the Notice of Appeal is $134,016 or $8 per hectare, although after consideration, Mr Bell says that the valuation should not be greater than $7.50 per hectare. Other factors which he sees as affecting "Blendon" in comparison with others, are its inaccessibility in wet weather, the distance of 36 km to the school bus service which places the responsibility for the teaching of children on the owners, and the lack of local telephone call access, the service limited to STD charges. The locality has a dingo problem emanating from the country to the east and the separation of the two subject sections, precludes the use of the additional area block for sheep grazing due to the difficulo/ of management of the dingo and fly strike problems. There is a 42 km round trip between the blocks, such distance in itself being a disability. - The valuer responsible for the valuation appealed against was Mr D.P. Jones, AAIV, registered valuer. He classifies the land overall as follows: 480 hectares (3%) brown soil downs 7200 hectares (43%) gidyea scrub 7672 hectares (46%) soft desert and claypan 1400 hectares (8%) harder desert with poison His tendered report contains the following description: " The northern homestead portion consists of predominately gidyea scrub with areas of brigalow influence. There is an area of black soil downs around the homestead on the southern boundary, and approximately 840 hectares of open claypan country on the eastern bank of Gum Creek which rises through box forest into hard wattle poison desert. A further area of hard poison desert runs along the northern boundary above Little Gum Creek towards the western corner. An area of box desert ridge rises on the western boundary south of Little Gum Creek. -- 2 of 7 -- 3 The southern additional area is predominately poplar box and cabbage gum softer desert with scattered clumps and strips of gidyea. The best gidyea is in the south-west corner intersected by Evora Creek. The property is watered by 4 sub-artesian bores. 5 earth tanks and 2 troughs from neighbours. " Mr Jones estimates a carrying capacity of 1 sheep to 2.2 hectares overall or alternatively for cattle grazing one beast to 15 hectares. His--valuation is $10 per-- hectare, but he rounds the total to an overall $165,000. In establishing this level of value he has accepted as a basis, the analysed unimproved values from the sales of three properties "Jaccondall" which showed $13.10 per hectare in December 1988, with a relevant date application of $12.00 per hectare, "Minnamoora", $7.19 per hectare in October 1988 with an application of $6.50 per hectare; and "Bellview" $2.02 per hectare in April 1988, with an application of $1.75 per hectare. Mr Jones sees "Jaccondall" as being overall superior to the subject property with a good mix of well located and well watered country although the comparison is close in country type with a larger percentage of good country on the subject. He says "the sale only shades the subject because of location and water." The sale also has some internal access restrictions caused by the Alice River and Patrick Creek. He provides the following break-down of values as applied to the "Jaccondall" sale: 2100 ha Downs (1:1.5 sheep or 1:11 cattle) @ $28 per ha 3600 ha Gidyea (1:1.4 or 1:10) @ $15.25 per ha 9205 ha Desert (1:2.8 or 1:20) @ $7.25 per ha 14905 ha Adopt 14905 hectares @ $12 per hectare say $178,000 = $58,800 = $54,900 = $66 ,736 $180,436 Overall carrying capacity 1 sheep to 2 hectares or 1 beast to 14 hectares Equivalent to $25 per sheep or $176 per beast. "Minnamoora" is described by Mr Jones as being overall inferior to the subject property mainly due to the mix of country type with the sale having no downs, much less gidyea scrub, a much greater proportion of heartleaf poison desert and a similar -- 3 of 7 -- 4 proportion of average desert. The location of the sale is superior although its access is slightly inferior. His classification and applied values to "Minnamoora" are as follows: 2600 ha Gidyea (1:10) @ $16.00 per ha = $41,600 700 ha Coolibah (1:12) @ $12.50 per ha = 8,750 9081 ha Desert (1:20) @ $7.25 per ha = 65,837 6000 ha Poison Desert (1:100) @ $0.75 per ha = 4,500 18381 ha $120,687 Adopt 18381 hectares @ $6.50 per hectare say $119,000 Overall carrying capacity 1 beast to 22 hectares Equivalent to $142 per beast or $20 per sheep. The third sale property "Bellview" while better situated than the subject property has no formed legal access, with an informal access through a neighbouring property. Mr Jones describes "Bellview" as being far inferior in both quality of country and access. His applied valuation is: 15410 hectares poison desert (1:50) @ $1.75 ha say $27,000 Equivalent to $88 per beast In comparison, the valuation of the subject "Blendon" would be apportioned as follows: 7680 ha Gidyea (1:1.6 or 1:11) @ $14 per ha = $107,520 9072 ha Desert. (1:3 or 1:22) @ $7 per ha = 63,504 Total $171,024 Adopt 16752 hectares @ $10 = $167,520 say $165,000 Carrying Capacity 1 beast to 15 ha or 1 sheep to 2.2 ha Equivalent to $148 per beast or $21 per sheep The following relativity comparisons were provided: "Kyneton" part part 9680 ha @ $10.75 per ha - adopt $104,000 Carrying Capacity 1 beast to 14 ha or 1 sheep to 2 ha Equivalent to $151 per beast or $22 per sheep 7893 ha @ $9.00 per ha - adopt $71,000 Carrying Capacity 1 beast to 17 ha or 1 sheep to 2.4 ha Equivalent to 4153 per beast or $22 per sheep -- 4 of 7 -- "Delta North" "Delta South" 5 31260 ha@ $5.50 per ha - adopt $172,500 Carrying Capacity 1 beast to 22 ha or 1 sheep to 3.2 ha Equivalent to $121 per beast or $17 per sheep 15311 ha @ $9.00 per ha adopt $138,000 Carrying Capacity 1 beast to 18 ha or 1 sheep to 2.6 ha Equivalent to $162 per beast or $23 per sheep Further information supplied in Mr Jones' report indicated the history and relativities of valuations per hectare of various sale and comparison properties as follows:- 1989 1981 1971 Kyneton (part 9680 ha) $10.75 $2.15 $0.53 (part 7893 ha) $9.00 $1.80 $0.46 Delta North $5.50 $1.10 $0.37 Delta South $9.00 $1.80 $0.44 Jaccondall $12.00 $2.30 $0.85 Bellview $1.75 $0.30 $0.074 Blendon $10.00 $2.10 $0.55 (rounded to $9.85) It can be seen that the valuation on "Blendon", subject of this appeal has, because of the reduction on objection, fallen a little below previous relativities. Mr Bell says that the question of valuation has not been contested in the past and it is his opinion that the Valuer-General's estimate of carrying capacity on the "Kyneton" and "Delta North" properties is too conservative in comparison with that on "Blendon". With regard to the sales evidence, Mr Bell said that the price paid for "Jaccondall" was locally considered to be grossly excessive. He said that the property had been pulled and grassed up, prior to the sale, which took place in a relatively dry time, and that it had been on the market at the sale price for a long time, with the -- 5 of 7 -- 6 situation of the vendors not allowing negotiation of the price. He said the availability of a school bus service was a very important consideration to the purchaser. He felt that the country on "J accondall" was generally superior to "Blendon" and that Mr Jones' comparison of it being "slightly superior" understated the true comparison. Mr Bell did not have any real knowledge of the sale property "Minnamoora'\ but knew "Bellview" - - and agreed it was inferior although as the purchaser was not a grazier by occupation and was, in his opinion, seeking the life-style offered, the price paid for that property should not be seen to reflect its true grazing value. Mr Jones' response to Mr Bell's criticism of the use of the "Jaccondall" sale, was that he and other officers of the Department had interviewed the purchaser and when the price was compared to other sales in the district it was considered to represent fair market value. The remaining matter to be considered is the severance of the home block of "Blendon" from its additional area and the associated management difficulties. Although separated by a considerable distance, Section 14(b) of the Valuation of Land Act provides for the inclusion of t~e two parcels in one valuation, and not, unless directed by the Valuer-General to be valued in isolation. When considered as an aggregation, there is a severance disability. Mr Jones says that this is largely offset because the larger area of the aggregated holding, by normal market criteria, would command a lesser value on a pro rata per hectare basis. He said that if the separated parcels were valued separately the home block would have been valued at $128,000 and the southern severance at $48,000 totalling $176,000. The evidence is that before the reduction on objection (and the reasons for that reduction were not said to be because of the size factor) there would have been no discount in real terms for the severed parcels being valued together. -- 6 of 7 -- 7 On past relativities with the properties used for comparison by the appellants, the Valuer-General's basis for the valuation of the subject property would be difficult to fault, although Mr Jones did say that the much larger "Delta North" property might be slightly low in comparison. There has been no serious challenge as to the Valuer- .. General's estimate of carrying capacity on the subject property overall, the criticism -· being that it is too high in comparison with the estimates for "Delta North" and "Kyneton". With no sales evidence to assist the Court and with the argument relating largely to criticism of the Valuer-General's basis and incorrect relativity, the appellants have taken on a difficult task as the onus is on them to prove the Valuer-General's valuation to be wrong. Mr Bell's practical knowledge of the property and his evidence and reasoning as to the somewhat lesser qualities and productive capacities of particularly the gidyea country on "Blendon", when compared to other properties including "J accondall", then some of the circumstances surrounding that sale, together with his evidence as to specific location disabilities and the severance, leaves room for some doubt as to whether the Valuer-General's disturbance to previously existing relativity has gone far enough.-· While I see merit in providing the benefit of this doubt to the appellants, I am far from convinced that the extent of reduction they seek could be supported in any way by the evidence overall. On the evidence put before me I determine the unimproved value at the relevant date at $9.25 per hectare, rounded to a total valuation of $155,000. · The appeal is allowed, the Valuer-General's determination set aside and the unimproved value of the "Blendon" aggregation determined in the sum of $155,000 as at 31st March, 1989. (R.E. Wenck)_ Member of the Land Court -- 7 of 7 --