Department of Natural Resources and Mines v Spender [2003] QLAC 86 (2003) 24 QLCR 414

LAND APPEAL COURT OF QUEENSLAND CITATION: Department of Natural Resources and Mines v Spender [2003] QLAC 86 PARTIES: Chief Executive, Department of Natural Resources and Mines (appellant) v. Glenice E Spender and Jeffrey EJ Spender (respondents) FILE NO: LAC2003/0420 DIVISION: Land Appeal Court of Queensland PROCEEDING: Appeal against a determination of the Land Court ORIGINATING COURT: Land Court of Queensland DELIVERED ON: 19 December 2003 DELIVERED AT: Brisbane HEARD AT: Brisbane JUDGE: MEMBERS: Justice DA Mullins Mr JJ Trickett Mr RE Wenck ORDERS: 1. The appeal from the determination of the Land Court made on 19 June 2003 is allowed. 2. The orders made by the Land Court on 19 June 2003 are set aside. 3. In lieu, order that the appeal to the Land Court is dismissed. 4. Affirm the valuation of the Chief Executive that the unimproved value of Lots 3, 4 and 5 on RP 10977, Lot 2 on RP 10987 and Lot 3 on RP 43642 Parish of South Brisbane is Four Hundred and Sixty Thousand Dollars ($460,000) as at 1 October 2001. -- 1 of 27 -- 2 CATCHWORDS: Valuation - Valuation of Land Act 1944 (Q) - Improved land - Unimproved value - Method of valuation - Comparable sales - Scarcity of vacant land - Where Land Court member found that valuation made by Chief Executive flawed based on judgment in Maurici v Chief Commissioner of State Revenue - Error made in applying that judgment to the valuation evidence Valuation - Valuation of Land Act 1944 (Q) - Where Land Court member reduced the unimproved value of the subject land because of the presence of an historic dwelling on the land - Where property not listed on any Register as historic or heritage building - Where no evidence that any historic significance would attach to the land or have any adverse impact on the unimproved value of land - Member erred in taking presence of historic dwelling into account to reduce the unimproved value of the land Appeal - Nature of appeal to Land Appeal Court - Appeal by way of rehearing COUNSEL: Mr T Quinn and Mr R Paterson for the appellant Mr M Plunkett for the respondents [1] This is an appeal by the Chief Executive, Department of Natural Resources and Mines, against the decision of the Land Court reducing the unimproved value of land owned by GE and JEJ Spender from $460,000 to $350,000. Background [2] The landowners had appealed to the Land Court against the unimproved value applied to their land by the Chief Executive as at 1 October 2001, under the provisions of the Valuation of Land Act 1944 ("VLA (Qld")). The land is situated at Gray Road, Hill End and comprises five allotments with a total area of 1,621 m². Situated on the land is a large old house and in accordance with the concessional provisions of s.17 of the VLA (Qld), the Chief Executive had valued that land as the site for a single dwelling house, disregarding any enhancement in the value of that land because it comprised five individual allotments. The Chief Executive applied an unimproved value of $460,000, a significant increase on the $290,000 applied to the land 12 months earlier. [3] The landowners' appeal to the Land Court contained seven grounds of appeal. Grounds 4 and 5 are particularly relevant to the present matter. They were framed as follows: "4. The 'comparable' sales relied on were not comparable. They were of small parcels of land which were substantially unimproved and in respect of which an artificially high demand existed. They provide no reliable basis for deriving the unimproved value of a larger block of land on which a single family home of historical significance is located. -- 2 of 27 -- 3 The land was not valued on the basis of its highest and best use, but on the unreal basis that it was a large block of raw building land. The applied value is not supported by the market evidence. 5. The valuation process failed to have regard to the unique historical significance of the house on the subject property, and in particular the impact of that factor on the true unimproved value of the land." [4] To support his valuation in the Land Court, the Chief Executive's valuer, Mr AB Van Hees, relied upon three sales of vacant land in the general vicinity of the subject land, which sold between November 2000 and August 2001. Those three properties had areas of 405 m² (sale price $233,000 applied u/v $220,000), 422 m² (sale price $229,000 applied u/v $210,000) and 528 m² (sale price $300,000 applied u/v $285,000). According to Mr Van Hees, these were the only vacant land sales in the West End area. [5] Between the date of lodgment of the appeal on 6 August 2002 and the hearing of the appeal by the Land Court on 9 April 2003, on 13 February 2003 the High Court delivered its unanimous judgment in Maurici v Chief Commissioner of State Revenue (2003) 77 ALJR 727. That matter concerned an appeal by a landowner against the unimproved value applied to his improved property under the Land Tax Management Act 1956 (NSW) in accordance with s.6A of the Valuation of Land Act 1916 (NSW) ("VLA (NSW)"). In that case, the valuer for the Chief Commissioner had relied upon three sales of vacant land (one of which had been resold) to determine the value of the land and had disregarded sales of improved lands as he did not consider that they were relevant in determining the unimproved value. [6] In allowing the appeal, the High Court held that the method of valuation adopted by the respondent Chief Commissioner was unduly selective, as the valuer had considered four sales only and they were of vacant land; the sales were not representative of sales in the area because vacant land in that area was scarce; the sales evidence needed to be relevant and sufficient in volume. The High Court also held that the respondent's valuer had erred in ignoring reasonably contemporaneous sales of comparable improved land, particularly where there was a scarcity of vacant land, as such sales could not be disregarded. [7] The landowners in the present case placed particular reliance on para [18] of the judgment of the High Court which reads as follows: "In valuing the land, the respondent's valuer, to use the language of the Privy Council in Melwood [Melwood Units Pty Ltd v Commissioner of Main Roads [1979] AC 426], 'ignored a principle of assessment of [value]', the principle being, that sales to be treated as comparable sales need to be truly comparable; or, to put it another way, in valuing the land the respondent's valuer did not proceed rationally, in that he was unreasonably selective in ultimately confining himself to two sales of scarce vacant land for the purposes of the comparison. The respondent could not, and did not suggest that he would be performing his statutory duty if he made other than a fair estimate of the value of the subject land. A fair estimate could only be made here on the basis of a fair, that is to say, -- 3 of 27 -- 4 a reasonably representative group of comparable sales. A group of comparable sales cannot be representative if it does not go beyond sales of scarce vacant land." [8] In the Land Court hearing of the present matter, Mr Van Hees gave oral evidence that because of the scarcity of vacant land sales in the South Brisbane area, he had "relied predominantly on improved sales for most of my analysis through the area". (Transcript p.28, Record p.59). However, he conceded under cross-examination that his valuation report tendered in evidence stated that the valuation had been made having regard to vacant land sales and that in hindsight he should also have referred to improved sales. [9] To remedy this oversight, he had prepared a schedule of four sales of improved land in close proximity to the subject land which he had analysed in each case by deducting the value of improvements from the sale price. The resulting unimproved values substantially supported the sales of vacant land. Despite some argument about the admissibility of that schedule, it was ultimately admitted in evidence. [10] The schedule contained the details of four improved sales and showed the value of improvements in each case. Sale No. 1 of 951 m² sold in July 2001 for $595,000, with the analysed value of improvements $160,000, leaving a vacant land value of $435,000 ($420,000 applied u/v as at 1 October 2001). Sale 2 of 607 m² sold in May 2001 for $500,000, improvements $210,000, vacant land value $290,000 ($275,000 applied u/v). Sale No. 3 of 809 m² sold in June 2000 for $475,000, improvements $155,000, vacant land value $320,000 ($320,000 applied u/v). Sale 4 of 458 m² sold in September 2001 for $437,000, improvements $217,000, vacant land value $220,000 ($210,000 applied u/v). [11] On the basis of Maurici, the learned Member of the Land Court found that there was a "scarcity factor" in the sales of vacant land relied on by Mr Van Hees and concluded that he should reject those sales as "a flawed approach to the valuation in this instance". The learned Member was critical of Mr Van Hees for not providing detailed analyses of the value of improvements in respect of the four improved sales and considered that he was left with an incomplete assessment of the analysed values of those sales. He found that the improved sales provided him with little assistance, "except for evidence of changes in the market". [12] In addition, the learned Member concluded that in determining the unimproved value of the land, regard should be had to the presence of the old historic dwelling and made a disability allowance of 7.5%. [13] Ultimately, the learned Member considered the only evidence which was not seriously disputed was that the property market had increased in value during the relevant period. On the basis of the evidence of the increases from the previous valuations applied by the Chief Executive to the land the subject of Sale 2 of Mr Van Hees' unimproved sales and -- 4 of 27 -- 5 the land the subject of Sale 3 of Mr Van Hees' improved sales, together with Mr Van Hees' evidence that there has been generally an increase in the value of land in the locality of between 20% and 30%, the learned Member accepted that there had been an increase in the value of the subject land of 30% as at 1 October 2001. Making allowance for the historical significance of the subject property of 7.5%, the learned Member determined the unimproved value of the subject land at $350,000. Nature of the Appeal [14] The jurisdiction of this court to hear the appeal from the decision of the learned Member is found in s 64 of the VLA (Qld) which provides: "64.(1) If aggrieved with the decision of the Land Court upon any appeal under section 55, the chief executive or the owner may appeal to the Land Appeal Court. (2) Such an appeal shall be by way of a rehearing. (3) The member of the Land Court who constituted such court in the first instance shall not sit upon the Land Appeal Court as constituted for such hearing." [15] Section 66 of the VLA (Qld) provides: "66. Upon an appeal under section 55 the Land Court or, upon the rehearing of any such appeal, the Land Appeal Court may- (a) affirm the valuation appealed against; or (b) reduce or increase the amount of that valuation to the extent necessary in its opinion to determine the same correctly under, subject to, and in accordance with this Act; and, subject to section 70, make such order as it deems fit with respect to the payment of costs." [16] In accordance with s 67 of the VLA (Qld), the provisions of the Land Court Act 2000 ("LCA") relating to the Land Appeal Court apply, subject to all necessary adaptations, for the purposes of an appeal under s 64 of the VLA (Qld). [17] The powers given to the Land Appeal Court under the LCA are found in Division 2 Part 3 of the LCA: "Land Appeal Court to be guided by equity and good conscience 55. In the exercise of its jurisdiction, the Land Appeal Court— (a) is not bound by the rules of evidence and may inform itself in the way it considers appropriate; and (b) must act according to equity, good conscience and the substantial merits of the case without regard to legal technicalities and forms or the practice of other courts. Evidence admissible on appeal 56. (1) An appeal in the Land Appeal Court must be decided on the evidence on the record of the proceeding in which the decision appealed against was made. (2) However, the court may admit new evidence if— -- 5 of 27 -- 6 (a) the court is satisfied admission of further evidence is necessary to avoid grave injustice; and (b) the party applying to have further evidence admitted gives the court an adequate reason for the evidence not previously being given; and (c) application to have further evidence admitted is made before the hearing of the appeal. Land Appeal Court may remit matter 57. The Land Appeal Court may remit a matter to the court or tribunal that made the decision appealed against— (a) because of an error or mistake in law; or (b) for the matter to be heard and decided again either with or without the hearing of further evidence." [18] Under s 65(3) of the LCA, the notice of appeal lodged with the Land Appeal Court against the decision of the Land Court must state the grounds on which the decision is appealed against. [19] The issue as to the nature of this appeal was initiated by the written submissions made on behalf of the landowners. [20] The landowners relied on the statements made by the High Court in Fox v Percy (2003) 197 ALR 201 at paras [20]-[31], [87]-[91] and [142]-[143], Warren v Coombes (1979) 142 CLR 531 at 551, Abalos v Australian Postal Commission (1990) 171 CLR 167 at 179 and Devries v Australian National Railway Commission (1993) 177 CLR 472 at 479-480 as to the nature of an appeal by way of rehearing and submitted that the proper approach to an appeal in this case is that which was described by Beaumont and Lee JJ in Minister for Immigration, Local Government and Ethnic Affairs v Hamsher (1992) 35 FCR 359, 369: "However, the hearing of an appeal in this Court is neither a trial de novo nor a trial of the case afresh on the record (Duralla Pty Ltd v Plant (1984) 2 FCR 342) and the court is not obliged to proceed to make new findings of fact on all relevant issues and discharge the judgment appealed from if those findings differ from those of the trial judge and do not support the judgment. The court must be satisfied that the judgment of the trial judge is erroneous and it may be so satisfied if it reaches the conclusion that the trial judge failed to draw inferences that should have been drawn from the facts established by the evidence. The court is unlikely to be so satisfied if all that is shown is that the trial judge made a choice between competing inferences, being a choice the court may not have been inclined to make but not a choice the trial judge should not have made. Where the majority judgment in Warren v Coombes (supra) (at 552-553) states that an appellate court must not shrink from giving effect to its own conclusion, it is speaking of a conclusion that the decision of the trial judge is wrong and that it should be corrected." [21] It was submitted that the Land Court is a specialist court possessing expertise which ought not to be lightly gainsaid: City of Enfield v Development Assessment Commission (2000) 199 CLR 135 at paras [41], [46] and [47]. -- 6 of 27 -- 7 [22] The culmination of the submissions on behalf of the landowners on the nature of the appeal was that, in order to interfere with the decision of the learned Member, this Court must come to the view that the learned Member was wrong. [23] The response of the Chief Executive to this submission was that this Court on the hearing of an appeal could form its opinion on a matter in issue, without the necessity to identify error on the part of the learned Member. The authorities on which the Chief Executive relied to support this submission were The Queen v Rigby (1956) 100 CLR 146, 150 and Brisbane City Council v Valuer-General (Q) (1978) 146 CLR 41, 46. [24] As an alternative argument, the Chief Executive submitted that, if it were necessary in order for the Chief Executive to succeed on the appeal that the Chief Executive show error on the part of the learned Member, there were two respects in which the Chief Executive disagreed with the landowners' submissions. Firstly, the approach of the High Court in decisions such as Abalos v Australian Postal Commission (1988) 171 CLR 167 where it was stated that an appeal court should be slow to interfere with the finding of a trial judge based on the demeanour or credibility of witnesses, has no application to this appeal, as the decision of the learned Member did not depend on any findings based on the demeanour or credibility of witnesses. Second, if the Land Court is treated as a specialist tribunal, the Land Appeal Court must be characterised in the same way and there is no justification for the submission that, as between the Land Court and the Land Appeal Court, the Land Court is a specialist tribunal. [25] Although s 66 of the VLA (Qld) specifies that the appeal from the learned Member to the Land Appeal Court is by way of rehearing, there are different meanings capable of being given to the description "rehearing": Fox v Percy (2003) 197 ALR 201 at [20] and Builders Licensing Board v Sperway Constructions (Syd) Pty Ltd (1976) 135 CLR 616 at 619-622. What is required of the Land Appeal Court in a rehearing of the decision of a member of the Land Court on an appeal against a valuation under s 55 of the VLA (Qld) depends on the construction of the relevant provisions of the VLA (Qld) and the LCA. [26] Before the commencement of the Land Act 1994, it was quite common for an appeal to the Land Appeal Court to be conducted on the basis of evidence that was unrelated to the evidence or the approach of the parties before the Land Court. That possibility of a completely fresh hearing in the Land Appeal Court was the subject of change, as a result of the amendments made to s 44(13) of the Land Act 1962 by the Land Act 1994. As a result, s 44(13)(a) of the Land Act 1962 provided, after amendment: -- 7 of 27 -- 8 "(a) The Land Appeal Court may admit further evidence only if- (i) it is satisfied that admission of the evidence is necessary to avoid grave injustice and there is adequate reason that the evidence was not previously given; or (ii) the appellant and respondent agree to its admission." [27] The provisions in the Land Act 1962 that dealt with the Land Court, Land Appeal Court and appeals from the Land Appeal Court were finally repealed upon the commencement of the LCA. Under s 4 of the LCA, the Land Court was established as a specialist judicial tribunal and a court of record, but s 79 of the LCA deemed the Land Court, so established, to be a continuance of the Land Court established under the Land Act 1962. The Land Appeal Court, established under s 53 of the LCA as a court of record, was deemed by s 80 of the LCA to be a continuance of the Land Appeal Court established under the Land Act 1962. [28] It is apparent from the wording of s 56 of the LCA that there are greater restrictions in respect of fresh evidence being introduced on an appeal before the Land Appeal Court than existed, even after the amendment made by the Land Act 1994. If it were necessary to confirm the intent of s 56 of the LCA, reference can be made to the Explanatory Notes for the Land Court Bill 1999. One of the features of the Bill was described in the Explanatory Notes as: " A hearing by the Land Appeal Court to be essentially a re-hearing of the evidence already presented in the Land Court with very limited scope for additional evidence. Rather than have the Land Appeal Court hearing as a fresh hearing (as was the case prior to 1994) or allow additional evidence with the consent of both sides, strict limitations are now to apply to any appeal. The Land Appeal Court will have the discretion to allow new evidence only if its admission is necessary to avoid grave injustice and there is adequate reason as to why the evidence was not previously given. Such conditions will ensure that the initial land court hearing is not merely a 'trial run' and will preserve valuable judicial time at the Land Appeal Court level." [29] The commentary on clause 56 of the Bill in the Explanatory Notes was: "Clause 56 provides the general rule that an appeal to the Land Appeal Court is to be decided on the evidence already presented to the Land Court in the case appealed against. The appeal case is not a re-hearing as was the case prior to 1994. However, new evidence can be admitted in a fairly limited range of cases. The Court is given a discretion to admit such evidence if the nominated conditions are met. These conditions are stricter then those applying under the previous provisions." [30] In the light of these legislative changes the observations relied on by the Chief Executive that were made in The Queen v Rigby (1956) 100 CLR 146 and Brisbane City Council v Valuer-General (Q) (1978) 146 CLR 41 can no longer be considered as pertinent to the role exercised by the Land Appeal Court under the LCA. -- 8 of 27 -- 9 [31] Although the Land Appeal Court is required by s 55 of the LCA to be guided by equity and good conscience and is not bound by the rules of evidence, that provision (which mirrors s.7 of the LAC which applies to the Land Court) must be given its operation in the context of the limited opportunity for further evidence to be admitted on an appeal in the Land Appeal Court. [32] In determining the nature of the rehearing, it is relevant that the Land Court exercised judicial power in hearing the appeal against the valuation made by the Chief Executive under the VLA (Qld): s 4 of the LCA. The appeal is constrained by the grounds of appeal which an appellant must specify in the notice of appeal: s 65(3) of the LCA. The express requirement of s 56(1) of the LCA together with the restriction on the introduction of fresh evidence clearly indicate that the rehearing by the LAC is intended to be a rehearing on the evidence that was before the learned Member. [33] Effect must also be given to s 66 of the VLA (Qld). The Land Appeal Court is required to reach its opinion as to the correctness of the valuation which is the subject of the appeal. In practical terms, however, the Land Appeal Court is not likely to reach an opinion that is different from the learned Member, unless the appellant establishes an error on the part of the learned Member of law or fact. [34] As the Land Court and the Land Appeal Court are in the same hierarchy of courts, established by the same Act of Parliament and the majority of the membership of the Land Appeal Court is drawn from the members of the Land Court, it is not necessary for the Land Appeal Court to proceed on the basis that greater weight should be given to the opinion of the learned Member by virtue of the learned Member’s expertise for appointment as a member of the Land Court than the weight which would ordinarily attach to the opinion of the court at first instance. [35] The hearing before the learned Member took less than a day. It involved oral evidence with cross-examination of the male landowner and the valuer called for the Chief Executive. The exhibits which had evidentiary effect were the statement of the male landowner (Ex 2), the valuation report of the valuer (Ex 3) and the bundle of documents and plan tendered by the Chief Executive relating to the four sales of improved land (Ex 4). Ultimately, there were no issues of credibility involved in respect of the evidence given by the witnesses. It was therefore not a case to which the approach of appellate restraint provided for in decisions such as Abalos v Australian Postal Commission (1988) 171 CLR 167 has any application. [36] Were it necessary to choose between the submissions of the Chief Executive and the landowners as to the nature of the hearing on the appeal, we consider that the above -- 9 of 27 -- 10 analysis of the relevant statutory provisions and the intent of a rehearing on the evidence that was before the Land Court (with power in exceptional circumstances only for the Land Appeal Court to admit new evidence) is consistent with a rehearing that should not result in a different decision from the learned Member, unless there is error that can be identified on the part of the learned Member, whether in a finding of fact or in the application of the law. It is, however, unnecessary to resolve definitively the nature of an appeal to the Land Appeal Court in this matter, because of the decision we have reached on the substantive issues raised by the appeal. The Appeal to this Court [37] The Chief Executive appealed to the Land Appeal Court on the basis that the learned Member had erred in concluding that the findings of the High Court in Maurici justified the setting aside of the valuation appealed against and in determining the unimproved value of the subject land at $350,000. The 21 grounds of appeal are comprehensive and detailed, but most are directed at the alleged failure of the learned Member to distinguish between the circumstances in Maurici and the circumstances of this matter. In particular, the grounds assert that this failure led the learned Member to conclude that the Chief Executive's valuer had adopted a flawed method by basing the valuation of the subject land on vacant land sales which included a scarcity factor and in rejecting the improved sales because of what he considered to be an incomplete assessment of the analysed values. [38] Before us, Mr Quinn on behalf of the Chief Executive, argued that in the Maurici case the Chief Commissioner's valuer had relied upon vacant land sales which he admitted included a premium for scarcity value; in addition, because he believed he was bound to disregard them, the valuer gave no consideration to sales of improved land which were less scarce and more comparable. The High Court concluded that the valuation method was flawed. [39] Mr Quinn argued that in the present case the evidence did not go so far as to establish that the prices paid for vacant land included a premium for scarcity. Furthermore, the valuer did not restrict consideration to vacant sales but gave evidence that he specifically had regard to improved sales. However, the learned Member rejected those improved sales as providing little assistance because the valuer did not provide an in-depth analysis of the improvements on each of those lands. Mr Quinn argued that it is not extraordinary for a valuer to give his opinion of the added value of improvements without further explanation. The valuer was not cross-examined as to the added value of improvements and his was the only expert evidence in that regard. -- 10 of 27 -- 11 [40] Mr Quinn submitted that it was unfair to the Chief Executive to reject his valuer's opinion as to the added value of improvements stated in the schedule of improved sales; as no question of credit arose, there was no proper basis for the learned Member to reject that evidence. [41] On the other hand, Mr Plunkett for the landowners, argued that the Maurici case could not be distinguished; in the present matter the valuation by the Chief Executive's valuer was based solely on three sales of vacant land in an area where vacant land is scarce. Therefore, Mr Plunkett submitted, the valuer adopted a flawed method of valuation which had been condemned by the High Court in Maurici. He contended that Maurici did not change the law; it simply but emphatically restated the fundamental principle of valuation that like must be compared with like. [42] In relation to the improved sales, Mr Plunkett argued that there was no full analysis of those sales in the documents tendered. Mr Van Hees had admitted that the unimproved value applied to each of those parcels of land was derived from the same sales of vacant land to which he had regard for the purposes of the subject valuation. Mr Plunkett submitted that it was plainly open to the Land Court to reject the use of those improved sales as of little assistance because of the incomplete analyses of those sales. Therefore, he submitted that the Court's finding in that regard should not be disturbed. [43] Finally on this point, Mr Plunkett submitted that in the light of the High Court judgment in Maurici, the Chief Executive did not follow the correct principle. [44] Because of the argument concerning the Maurici case, we now turn to consider the judgment of the High Court and its relevance to the present case. The Maurici Case [45] This was a judgment by the High Court in an appeal by an owner of land in Hunters Hill, Sydney, a "desirable" residential address, from a judgment by the Court of Appeal of the Supreme Court of New South Wales. The Court of Appeal had approved the approach to the "land value of land" by the Commissioner of State Revenue. The Commissioner's valuation had been made pursuant to s.6A of the VLA (NSW) and had been based on sales of vacant land which was a scarce commodity not only in Hunters Hill but in the built-up suburbs of Sydney generally. [46] The Commissioner's valuer had agreed in his evidence at first instance in the appeal process that a scarcity factor was reflected in the vacant land sales which had formed the sole basis of his valuation. That sales evidence related to three parcels of vacant land. One of the parcels had been sold then resold, but the primary valuation basis had come from the other two sales. It had been the valuer's evidence that, as he interpreted the VLA -- 11 of 27 -- 12 (NSW) the subject land was to be valued at the relevant date not only as if it had been notionally vacant, but in the built-up environment in which it existed. The scarcity factor existed in that environment. In his view it had not been appropriate to attempt to analyse improved sales to establish the value of unimproved land. [47] It had been the owner's consistent argument, which had been successful in the Land and Environment Court of New South Wales, but rejected by the Court of Appeal, that it was inappropriate to value, for statutory purposes, the subject land together with each other parcel of land in the district at a level of value which included the scarcity factor, based on vacant land sales, when there was no scarcity of sales of improved parcels. [48] The High Court in reversing the decision of the Court of Appeal, accepted the thrust of the owner's argument although not the owner's assumptions as to the correct basis for valuation of the added value of improvements in the sale prices of improved properties. The Court did not attempt to quantify the value of the relevant land, ordering that the matter be remitted back to the Commissioner "for determination according to law". [49] In its reasons, the High Court had observed that the Commissioner had made no attempt "to resolve the inherent paradox that as every improved parcel would be required to be treated in an equivalent way the consequence would be that all parcels were notionally vacant and that there would no longer be any scarcity of vacant land". [50] The Maurici judgment was pivotal to the rejection of the Chief Executive's valuer's basis of valuation by the learned Member in the Land Court decision subject of this appeal. [51] The question which the High Court was required to answer in Maurici was identified at para [1] of the judgment: "[1] The question in this appeal is whether, in fixing the unimproved value of an improved parcel of land under the Land Tax Management Act 1956 (NSW) in accordance with s6A of the Valuation of Land Act 1916 (NSW) as the former requires, it is right to have regard exclusively or virtually exclusively to sales of scarce unimproved parcels of land in the same locality as the relevant land." [52] The Court found that such valuation methodology was not right. The reasoning was not that sales of scarce vacant land were necessarily irrelevant, but that such sales were "likely to be to a special and different class of buyer from buyers of improved land" and a fair estimate of value "could only be made here on the basis of a fair, that is to say, a reasonably representative group of comparable sales. A group of comparable sales cannot be representative if it does not go beyond sales of scarce vacant land. That is not to say that sales of comparable vacant land may not provide useful evidence of value". (emphasis added). [53] The Maurici land was improved land and there was, it seems, a representative group of sales of comparable improved land. In the statutory land valuation process, the -- 12 of 27 -- 13 assumption was required that the improvements, other than land improvements as defined, had not been made, not only on the Maurici land but on each other parcel of land in the district when subjected to the valuation process. [54] Probably the most controversially interpreted aspect of the Maurici judgment in terms of well-established precedent was the finding that the statutory requirement for the valuation of all parcels of land in an area, on the assumption that improvements had not been made on each of the improved parcels, was a factor that could not be ignored, to the effect that "a scarcity of vacant sites not be the determinant factor in valuations made under the Act" (emphasis added). We do not interpret that finding, as some have done, as suggesting that there is "a notional clearing of the whole area". The absurdity of such an interpretation would have the converse "likely" effect of scarcity, being a likelihood of an over-supply of vacant land in each locality. The High Court reasoning, as we interpret it, was a recognition that the market for land in a predominantly built-up area was not exclusively of scarce vacant land but inclusive of land with improvements thereon. As each parcel of land in that environment, vacant or improved, was required to be valued in the statutory process, on the basis of relative value at the same date, albeit notionally as unimproved, it was wrong to adopt a basis of valuation selected exclusively from one segment of the market which in itself was not proved to be representative of the overall market for land. [55] It is seen as an observation of reality that a buyer of a scarce vacant parcel of land at a desirable location could be categorised as a special and different class of buyer to one not wishing to build and seeking an established dwelling. It might be a popular conception, particularly among those challenging a statutory land valuation, that a buyer of scarce land would be prepared to pay a premium over and above "fair market value" because of that scarcity factor. However for that to be proved, or disproved, for the purposes of the statutory valuation process, analysis of the overall relevant market evidence is necessary. For example, just as a sale to an adjoining owner might be shown not to have included a premium, by reference to the overall market, a sale of a scarce vacant parcel needs to be considered in light of the overall market which includes sales of improved parcels. [56] While a purchaser of a scarce vacant residential parcel may realistically fall into a different category to the purchaser of an existing dwelling, it does not follow that the price such a purchaser will pay does include a premium over fair market value. It would be expected that the prudent purchaser of vacant land will not have confined considerations relevant to purchase price to that narrow market segment. Such a purchaser would hardly be seen as prudent in purchasing a vacant lot, developing it to its highest and best use through the construction of a dwelling if the certain outcome was an -- 13 of 27 -- 14 overall loss in capital value, through the land component, once improved, reducing in value to the extent of the vacant land value scarcity "premium". It is also seen as unlikely that a prudent purchaser of an existing dwelling would not become informed of the overall local market, including that for any scarce vacant land. [57] Consequently, while purchasers of either improved or vacant land may be categorised as belonging to different segments of the marketplace, it does not necessarily follow that those segments are not strongly interlinked. The Maurici judgment recognises the error in a valuation basis being established from an overly selective segment of the market. [58] The High Court indicated that it was aware that analyses of improved sales are used daily for the purposes of statutory valuations similar to s.6A(1) of the VLA (NSW), by "subtracting the added value of the improvements to them from their sale prices to derive unimproved value". However, the Court also observed the difficulties which may arise in precise assessment of the "added value" of improvements. Certainly it found that it would be wrong to assume that replacement cost of residential improvements necessarily equals their added value. Use of Sales Evidence [59] While it has long been held that sales of vacant or lightly improved land provide the best evidence of unimproved value (see for example WM & TJ Fischer v The Valuer-General (1983) 9 QLCR 44 at p.46; R & MM Barnwell v The Valuer-General (1989) 13 QLCR 13 at p.17), it is also a basic valuation principle that for sales to be treated as comparable they should not be unreasonably selective. There can be no hard and fast rules as to the extent of sales evidence which will be deemed to provide either a reasonably representative group of sales or to be overly selective. That is a question of fact based on the circumstances of a particular case and the relevant evidence. [60] However where unimproved valuations are being made pursuant to the VLA (Qld) the question of whether the available sales evidence would be overly selective if restricted to, for example, sales of scarce vacant or lightly improved parcels, will be a relevant consideration. If it is found that sales evidence is overly selective and consideration has not been given to an available group of reasonably representative comparable sales, including sales of improved land, then the valuation would be, on the Maurici test, flawed. [61] It is clear that various difficulties will present themselves to valuers in the investigation and analyses of sales of private dwellings and in establishing the added value of improvements to residential land at the precise date of sale. It is reasonable to assume that in many instances, but certainly not all, added value may well be found to equal -- 14 of 27 -- 15 depreciated replacement cost. However in cases such as, for example, over or under capitalisation, lack of aesthetic appeal and the like, no precise assessment of the added value of improvements could reasonably be expected. It would be only in predictably controversial circumstances or where deviations from market expectations are obvious, where detailed professional analyses might be a reasonable expectation. However it is that type of sale which might arguably fall outside "a reasonably representative group of comparable sales". [62] In the end result the methodology adopted in the assessment of the added value of improvements in the analysis of an improved residential sale will be a matter of professional judgment, tempered where necessary by the relevant legislation. Ideally added value of improvements would be obtained by subtracting the land value from the improved sale price rather than the reverse process which is necessary when it is the land value which requires proof. [63] It is to be observed that in s.5 of the VLA (Qld) the meaning of value of improvements is relevantly as follows, with the proviso in sub-s.(2) to be particularly noted: "(1) The 'value of improvements' means, in relation to land, the added value which the improvements give to the land at the time as at which the value is required to be ascertained for the purposes of this Act, irrespective of the cost of the improvements … (2) However, the added value shall in no case exceed the amount that should reasonably be involved in effecting, at the time as at which the value is required to be ascertained for the purposes of this Act, improvements of a nature and efficiency equivalent to the existing improvements." Application of the Maurici Judgment [64] In the present case the date of valuation was 1 October 2001.The Maurici appeal was heard by the High Court on 4 October 2002 and the judgment delivered on 13 February 2003. The appeal against the unimproved valuation of the subject land was heard on 9 April 2003. In the Land Court, the landowners relied heavily on Maurici as legal support for, in particular, much of the content of the fourth ground of appeal as set out in para [3] above. [65] There are many similarities between the facts in each case, for example:  The Chief Executive's valuer, Mr Van Hees, stated in his valuation report that the relevant valuation had been made, having regard to the sales of three vacant parcels in the subject case, of land much smaller in area than the subject.  Mr Van Hees agreed that a fair estimate of unimproved value could only be made on a reasonably representative group of comparable sales.  Mr Van Hees did not agree, under the pressure of cross-examination, that in the circumstances of the subject matter, a group of comparable sales could not be representative if the group did not go beyond sales of scarce vacant land. -- 15 of 27 -- 16  The vacant land sales on which the valuation was said to have been based were the only such sales in the locality and Mr Van Hees agreed they were scarce, and indeed "real scarce". [66] Under cross-examination as to what would constitute a reasonably representative group of comparable sales, Mr Van Hees was, it appears to us, attempting to give evidence that there were no sales of land, improved or vacant, which he had regarded as directly comparable to the large subject site. The following passage appears in the transcript (p.31 - p.62 of the record): "Q. Do you agree that a group of comparable sales cannot be representative if it doesn't go beyond sales of scarce vacant land? A. Unfortunately we are not privileged to have any blocks of the large size of yours which in the South Brisbane area are very rare. I mean you could ... Q. The proposition - I'm sorry? A. I understand your scenario. It would be a great indicator if there were sales of large blocks of land of 1,600 m² on the market. Unfortunately they come very rarely. Q. Do you agree that a group of comparable sales cannot be representative if the group does not go beyond sales of scarce vacant land? A. Well, the best indicator, like I said, were the sales we have on the date of valuation. Q. Do you agree with the proposition? A group can't be representative if the group doesn't go beyond the sales .....? A. I find it very difficult in the sense that how would you value a large block of land with what - if there are none available? Q. Yes, well it may be, you see, that they're not comparable? A. Would you leave the block on its own and wait for 10 years for a sale to pop up somewhere in the marketplace? Q. A group of comparable sales cannot be representative if the group does not go beyond sales of scarce vacant land. Now that is the proposition that I put to you. Do you agree with it? A. I don't agree with it, I don't agree with it. Q. You don't agree with it? A. No." [67] However, (at p.32 of the transcript - p.63 of the record) after Mr Van Hees agreed that sales of vacant land were scarce: "Q. So we have scarce vacant blocks, a small number, used as the basis of your valuation? A. That's right plus the - may I put to you that we do look at improved property sales within the whole area to indicate the level for what people would pay for a larger block. In other words, we look - I don't get sales of your property very often, very rarely." Then (at p.34 of the transcript - p.65 of the record): "Q. ... the new valuations were arrived at by applying some technique from the three vacant sites? A. No, like I said, we looked at your - we looked at the improved sale. That's why with my area - looking at the improved sales is very important and it's been done over the last three or four years. Okay? Q. I know that you're trying to shift ground, but what I'm putting to you --- ? A. I'm just trying to explain my technique or my procedures in doing the valuations in these areas. Improved sales are important to us in these inner city suburbs due --- Q. Well, if that's the case why didn't you in fact say that in reaching this value of $460,000 you relied on sales other than the three sales that you say you relied on? A. In hindsight, yes, I should have put that statement in this report. -- 16 of 27 -- 17 Q. Well the statement in your report which appears at p.3: 'The valuation has been made having regard to vacant land sales as to the attached schedule'? Now is that statement true or not? A. That's true." [68] It is observed that at p.3 of Mr Van Hees' report, the statement under "Basis of Valuation" commences as follows: "My general knowledge and valuation experience and assistance from the following sales as per schedule of sales attached. The valuation has been made having regard to vacant land sales as to the attached schedule." [69] Now it is clear from the evidence and submissions in the Land Court that, at least before understanding the implications of the findings in Maurici, the Chief Executive's valuers in general did not provide analyses of individual improved sales of residential land in making unimproved valuations of such land pursuant to s.3 of the VLA (Qld), when sales of, albeit scarce, vacant land were available. After the initial overview of the market ultimate reliance on sales of vacant or lightly improved residential land, rather than of sales of improved residential land, was in keeping with Mr Van Hees' understanding of correct valuation practice. [70] Mr Paterson, who appeared as advocate for the Chief Executive in the Land Court, sought leave, pursuant to sub-rule (4) of rule 23 of the Land Court Rules 2000 for Mr Van Hees to expand on matters contained in his statement, through the tendering of evidence relating to sales of improved land. That application was made "having regard to the grounds of appeal and to the raising by the appellants in their grounds of appeal of the principle established by the High Court in Maurici, being that in circumstances where sales of vacant land are scarce, then one should cast one's net wider and look to sales of improved properties ..." [71] The landowners objected to the application and submitted that the introduction of such fresh evidence was tantamount to the Chief Executive presenting a wholly different case to that on which he had relied in defence of the grounds of appeal. [72] In answer to that objection, Mr Paterson submitted that no fresh case was being made out because the purpose of the application to adduce evidence of improved sales was for Mr Van Hees to show that "whether one has regard to the sales of vacant land or has regard to wider sales evidence ... the answer is the same." He suggested that in order to give the landowners time to examine and consider the improved sales evidence sought to be adduced, the hearing might be adjourned. [73] The landowners specifically declined seeking an adjournment and at that early stage in the hearing the learned Member refused the application. However, later in the proceedings, after an objection by the Chief Executive to the landowners giving evidence -- 17 of 27 -- 18 in regard to the market for improved land, unless Mr Van Hees was given a similar opportunity, the learned Member decided to allow the tendering of the improved sales evidence, but for the limited purpose of providing support to the primary basis of valuation. [74] In the end result while he was concerned that Mr Van Hees had provided "an incomplete assessment of the analysed values of the additional improved sales" and that "the appellants had not been afforded adequate prior notice to prepare their case on such a basis", the learned Member found "that the additional improved sales provide little assistance in this matter, except for evidence of changes in the market". [75] If Maurici was not distinguishable, because of the similarities involved, and if there was a reasonably representative group of comparable sales going beyond sales of scarce vacant land, and Mr Van Hees had disregarded those comparable sales, then clearly his valuation would have been flawed, as the learned Member found. [76] However the facts, while largely similar, may be distinguished on the evidence. First, Mr Van Hees did give consideration to the overall evidence, including sales of improved land. Second, in his professional opinion, there was no directly comparable sales evidence either of vacant or improved land. However, it was his evidence that in his professional opinion, analyses of the sales of improved land as well as the vacant land sales supported the applied level of unimproved value [77] The learned Member was critical of the lack of detail provided by Mr Van Hees in his analyses of the improved sales evidence, and commented, "It could be observed that the included added value of improvements may well be the result of a subtraction of the analysed value of the land from the sale price." We do not interpret Mr Van Hees' oral evidence as support for such an observation. His oral evidence was that the vacant sales evidence supported the unimproved values applied to the parcels subject of the improved sales, as did his analyses of the improved sales. [78] As we see it, it was the landowners' case in the Land Court that the valuation appealed against was flawed primarily for the same reasons as was the Maurici valuation. Pursuant to s.45(4) of the VLA (Qld) "the burden of proving any and every such ground" of appeal "shall be upon the owner". If the valuation was flawed because it had been made having regard exclusively or virtually exclusively to sales of scarce unimproved parcels, then the landowners should have adduced evidence to show:  that a group of comparable sales existed;  that group of sales went beyond sales of scarce vacant land;  that on analysis the improved sales evidence proved that the level of unimproved value reflected by those sales did not support the level of unimproved value reflected by sales of the scarce vacant land. -- 18 of 27 -- 19 [79] That level of proof of the relevant ground of appeal may have been a difficult task for lay persons. However the landowners chose to argue this case, as it happened successfully, and primarily on their interpretation of the Maurici judgment, in the absence of exposed professional valuation advice. [80] Improved sales evidence and the manner in which the overall market had been interpreted by Mr Van Hees eventually became evidence before the Land Court and is available for this Court to consider. There was no cross-appeal by the landowners against the learned Member's admission of Exhibit 4 into evidence. On the basis of the valuation evidence before the learned Member, we are not persuaded that the valuation appealed against was flawed or that the overall valuation methodology was in conflict with the making of a statutory valuation under similar legislation as had been interpreted by the High Court in Maurici. [81] It is true that for the reasons already given, Mr Van Hees' valuation report was not prepared or presented in a manner which spoke to the overall valuation methodology which had been followed. [82] Mr Van Hees did not provide a "speaking report" as to the basis of his valuation of the improvements in his improved sales analyses. Nevertheless, his was the only professional valuation evidence before the Land Court. It might be expected, because of the subjective nature of this type of assessment, that differing professional opinions would often result. However, if the question of an improved sale analysis is contested, the success of a particular opinion will depend on the extent of cogent forensic research which has formed the basis of such opinion. [83] It is our finding that the learned Member misapplied the Maurici judgment to the valuation evidence before him. [84] As was submitted by Mr Plunkett for the landowners, although it was an important consideration, defence of this appeal did not stand or fall on the Maurici judgment. We now consider the remaining valuation issues. Increase from the Previous Valuation [85] In the Land Court, the landowners contended that a valuation process which resulted in an increase in the unimproved value from $290,000 to $460,000 in 12 months must be flawed. However, apart from some hearsay evidence which they obtained from a real estate agent that median house prices in West End had increased by no more than 12%, the landowners produced no evidence in this regard. [86] Having rejected both the vacant land sales and the improved sales relied on by the valuer for the Chief Executive as a basis for the valuation, the learned Member concluded that he -- 19 of 27 -- 20 was left only with the fact that both parties had agreed that the property market had increased during that 12-month period. He reasoned that Sale 2 of the unimproved sales had increased by 23.9%, Sale 3 of the improved sales by 33% and the valuer had given evidence that the general increase in the area might have been between 20% and 30%. He came to the conclusion that there had been an increase in the value of the subject land of 30%. [87] In this Court, the Chief Executive challenged that reasoning. On his behalf Mr Quinn submitted that it was incongruous that the learned Member rejected the sales for purposes of direct comparison with the subject land and then proceeded to refer to the sales to apply a percentage increase to the previous unimproved value. He contended that the method of valuation adopted by the learned Member was unsound, because it adopted as a starting point the previous unimproved value, which Mr Van Hees had considered to have been too low. Mr Quinn submitted that the Land Appeal Court had rejected the method of valuing land by applying some general market increase over the previous valuation: Scougall v Chief Executive, Department of Natural Resources (1996) 16 QLCR 536; also criticised as unsatisfactory by the High Court in Deputy Federal Commissioner of Taxation v Gold Estates of Australia (1903) Ltd (1934) 51 CLR 509. [88] In this case we have found that there is no reason for the sales relied on by Mr Van Hees to be rejected. It is therefore not necessary to resort to any method of valuation other than direct comparison between the sales and the subject land, making allowances for the differences between them. Nature of Land [89] There was a question as to the comparability of the vacant sale parcels and the subject land in several respects, including the availability of views. It was also alleged that there were inaccuracies in relativity between various valuations of nearby lands. [90] It is accepted that Mr Van Hees' written descriptions of comparability and available views from the various sites may have been deficient. However his oral evidence in the Land Court indicated that while the available sales of vacant land were not directly comparable, his valuation of the subject land was the result of his professional opinion as to its unimproved site value having regard to size, location, physical qualities and after consideration of the overall market evidence. The further sales evidence which was adduced was of improved land in close proximity to the subject land and the analysed unimproved values gave added support to the valuation appealed against. -- 20 of 27 -- 21 [91] We are not persuaded that the valuation of the notionally unimproved site if its potential was limited to that of a single dwelling house, has been proved wrong for reasons associated with its location, size or physical nature relative to views. The Significance of the Old Historical Dwelling [92] Grounds 13 to 16 of the appeal to this Court are to the effect that the learned Member of the Land Court erred in concluding that the unimproved value of the subject land should be reduced because of the presence of an old historical dwelling on the land. [93] In a statement to the Land Court on behalf of the landowners, the historic significance of the house was explained: "This house was the first built in the Hill End area in the 1880's. It is 54 squares in size, of lath and plaster construction internally, with cedar joinery for doors, architraves, etc throughout; etched glass with Australian flora motifs, four marble fireplaces, two of which, at least, are of Gympie marble; originally gas-lit, with a functioning well at the rear of the detached kitchen wing. Its historic value cannot be disputed, with the implication that the owner of it can do nothing with it. The significance of a home of this distinction and heritage value on the unimproved value is totally ignored as an irrelevant matter by the valuer." [94] Although the property is not listed on any Register as a historic or heritage building, the landowners contend that because of the presence of the historic home they would be prevented from interfering with it in any way. This restriction, they argue, would have an adverse impact upon the unimproved value of the land and should be reflected in the Chief Executive's valuation of the property. [95] The learned Member accepted that argument. He considered what difference there would be between a historically significant property and a heritage listed property and how that difference would be reflected in the marketplace. He found that the subject land could be considered as a "character building" under the current provisions of the Brisbane City Plan 2000. As such, the dwelling would be subject to the control of the Brisbane City Council in respect of any redevelopment of that site. He concluded that in the case of a registered heritage property, the value of the land was likely to be impacted negatively by between 5% and 10%, in the absence of sales to demonstrate otherwise; in the case of the subject land he reasoned that "because it has still to receive formal public recognition of its heritage implications", he made a disability allowance of 7.5%. [96] Before us, Mr Quinn on behalf of the Chief Executive, argued that unimproved value under the Act is arrived at on the assumption that the improvements did not exist. It is therefore necessary, if any account is to be taken of the historical or heritage significance of improvements, for there to be an impact of a restrictive kind on the land as well as upon the improvements: Valuer-General v The Queensland Club (1991) 13 QLCR 207; -- 21 of 27 -- 22 Ballow Chambers Ltd v The Valuer-General (1993) 14 QLCR 422; and Roberts v Chief Executive, Department of Natural Resources (1998) 19 QLCR 186. [97] In each of those cases the land as well as the improvements was affected by the restrictive provisions of the Town Plan (Queensland Club), or listed under the Heritage Buildings Protection Act 1990 (Ballow Chambers), or the Queensland Heritage Act 1992 (Roberts). [98] Mr Quinn submitted that there is no basis in the evidence in the present case to support a conclusion that the historical significance of the dwelling on the subject property had any adverse impact on the unimproved value of the land. On the contrary, the evidence demonstrated the absence of any such listing and therefore the basis for any such restriction; it also indicated the likely increase in the improved value of the property because of the demand for historical dwellings. [99] Mr Quinn further submitted that while the precise restriction referred to by the learned Member was not entirely clear when he referred to the property as one that might be considered as a "character building", it was clear that the property was not "listed" by the Brisbane City Council. Mr Quinn suggested that the learned Member may have been referring to the provisions of the Demolition Code contained in the Brisbane City Plan 2000. [100] Mr Quinn submitted that even if the "heritage" issues are relevant to unimproved value, there was no evidence in this case to support a reduction in value on that account. On the contrary, the only valuation evidence was to the effect that historic dwellings attracted premium prices and the landowners in the present case recognised that the subject property would command a premium on account of its historic significance. [101] The landowners argued for a reduction in the unimproved value on the basis of the decision of the Land Court in O'Sullivan v Department of Natural Resources and Mines [2002] QLC 70. However, Mr Quinn pointed out that the Department's valuer in the Court below explained that in O'Sullivan's case the property was actually listed as a commercial character building, which imposed a limitation on the achievement of the highest and best use of the land and therefore the circumstances were quite different. [102] Finally, Mr Quinn submitted that the landowners had failed to discharge the onus of proof as their evidence did not justify any reduction in the unimproved value because of the "historical significance of the home". [103] On the other hand, Mr Plunkett on behalf of the landowners, argued that it was not necessary for the property to be "listed" for its historic significance to affect the unimproved value of the land. Although in the Queensland Club, Ballow Chambers and Roberts' cases the properties were listed under some statutory scheme, none of those -- 22 of 27 -- 23 authorities say that it is only a "listed" property which would be subject to potential bureaucratic constraints, which would have an effect on its unimproved value. Indeed, he continued, the learned Member below referred to Robt Nettleford Pty Ltd v Hobart City Council (2001) 117 LGERA 342, and pointed out that the Supreme Court of Tasmania found that it does not need to be a "listed" property for a constraint to be placed upon it. [104] In para [80], the learned Member referred to the power for a local council to consider wider issues when determining whether demolition of an old building of historic or aesthetic nature can occur. Although the subject land as he put it, "has still to receive formal public recognition of the heritage implications", he made a disability allowance of 7.5% to the unimproved value. [105] Mr Plunkett submitted that it was a question of whether as a matter of practical reality the historic significance of the dwelling would impact on the price a prudent purchaser would pay for the property, bearing in mind the Brisbane City Council policy concerning character buildings in respect of any redevelopment of the site. [106] In considering the competing arguments in relation to this issue, we have had regard to the highly artificial manner in which the Chief Executive was required to determine the unimproved value of the subject land as at 1 October 2001. The VLA (Qld) requires the appellant to decide the unimproved value of the land (s.13), which pursuant to s.3(1)(b) is to be the market value of that land, but assuming that the improvements did not exist. As the land comprises five surveyed lots but is used as the site for a single dwelling house (a dwelling used solely for habitation by a single household), it must be valued disregarding any enhancement in that value because the land has been subdivided by survey (s.17(1)). In other words, it must be valued as a large single, vacant, dwelling house site. [107] Under the artificial construct of the Act, it might seem that if a restriction or prohibition (statutory or otherwise) applied to the improvements on the land and such improvements were to be assumed not to exist, then those restrictions or prohibitions would have no effect on the unimproved value of that land. However, the authorities indicate that this is not always the case. [108] The Queensland Club case concerned the unimproved value of an area of land of 3,990 m² upon which was situated the Queensland Club, a building which the Town Plan of the City of Brisbane aimed to conserve in its entirety. It was one of some 77 buildings included in the Table of Heritage Buildings in the Plan. The relevant provision of the Town Plan restricted the gross floor area available on a redevelopment of the site to twice the gross floor area of the heritage building. The Land Appeal Court found that although the existence of the Queensland Club was the motivating factor for the imposition of the -- 23 of 27 -- 24 restrictions on the use of the land for redevelopment, the fact that the valuation was carried out on an unimproved basis did not lead to the conclusion that those restrictions could be disregarded. Those restrictive provisions would continue to apply even if the heritage improvements were removed or destroyed. The Court held that the restriction in the Town Plan runs with the land and not with the improvements. [109] In the Ballow Chambers case the land in question had an area of 1,272 m² upon which was situated a building known as "Ballow Chambers", which was listed under the Heritage Buildings Protection Act 1990 as a heritage building. The provisions of that Act imposed constraints upon the use and development of land upon which was situated a listed heritage building. The Land Appeal Court found at 434: "There can be little doubt however that the Heritage Buildings Protection Act 1990 gives to the heritage committee and, ultimately to the Minister, statutory powers designed to significantly constrain the rights of owners to land, with or without improvements, with a heritage building listing." [110] The Land Appeal Court held that those potential constraints must be taken into account when valuing that land for its highest and best use, even though its improvements must be assumed not to exist at the valuation date. [111] In Roberts the Land Appeal Court was considering the unimproved value of land in Townsville upon which was situated a historical residential dwelling which had been included in the Heritage Register under the Queensland Heritage Act 1992. In that case the respondent conceded that a heritage listing attached to the land and the Court found that the effects of the heritage listing have to be considered in any determination of the unimproved value of the land. [112] It is significant that in each of those cases the property was a "listed" property and that the provisions of the relevant legislation was such that the restriction imposed on that property by the "listing" attached to the land as well as the improvements. That is not the situation in the present case. [113] The learned Member below was of the view that the property might be considered a "character building" under the provisions of the Brisbane City Plan 2000 and that the dwelling would be subject to the control of the Brisbane City Council in respect of any redevelopment of that site. Counsel for the appellant has suggested that the learned Member may have been referring to the provisions of the Demolition Code in the Brisbane City Plan 2000, Chapter 5 Part II of which applies in relation to the demolition, removal or relocation of a building which was constructed in or prior to 1946. [114] However, whatever the learned Member had in mind, those restrictive provisions apply to the building, not to the land. It is well settled from the authorities referred to above, that -- 24 of 27 -- 25 it is only when the restrictions or limitations affect the land as well as the improvements that they can be considered to adversely affect the unimproved value of that land. [115] In the present case, the provisions of the VLA (Qld) require that the unimproved value be determined at the market value of the land, assuming that the improvements did not exist. If the dwelling house on the subject land is notionally removed, then there is no evidence that any "historical significance" would attach to that land or have any adverse impact on the unimproved value of that land. [116] In the Court below the landowners referred to a decision of the Land Court in O'Sullivan v Department of Natural Resources and Mines [2002] QLC 70. That case concerned the unimproved value of land with an area of 233 m² upon which was constructed a two- storey commercial building dating from 1891 which was listed as either a commercial character building, or a heritage place, under the Heritage Register Planning Scheme Policy of the Brisbane City Plan 2000. In that case the learned Member found the restrictions that might be imposed on a heritage place for any particular development comprised a risk factor or a burden that runs with the land and which would adversely affect the unimproved value of that land. [117] O'Sullivan is simply another case where a property had been listed under the planning provisions. It is a commercial property with the restrictions or limitations imposed by those provisions affecting the use which can be made of the land. There is clearly a distinction between such a limitation or restriction and the present case where, if the historic home did not exist, there would be no impact on the use or development of the vacant land. [118] The landowners placed some reliance on the reference by the learned Member below to the Robt Nettleford case. That case concerned an appeal against the decision of the Hobart City Council to refuse permission to demolish a building built over 100 years ago in order to construct on the site a private car park. The property was not "listed" under the heritage provisions of the planning scheme or the relevant heritage legislation. However, the Council had refused permission on a number of grounds, one of which was that the application was contrary to the objectives of the Tasmanian planning legislation because it did not conserve a building and site which was of historical and aesthetic interest. In dismissing the appeal, the Full Court of the Supreme Court of Tasmania held that the Council was permitted to take into account general statements of objectives and have recourse to principles stated by Parliament in consideration of the application, and that this was not confined to a "listed" building. -- 25 of 27 -- 26 [119] Mr Plunkett submitted that similarly the subject land does not need to be "listed" for there to be a constraint placed upon it which has such an impact as to affect the unimproved value of the land. [120] However, in the present case s.17 of the VLA (Qld) requires that the land be valued as if its highest and best use is the site for a single dwelling house. While the constraints against demolition of the old building in the Robt Nettleford case may well have impacted on the highest and best use of that land, there was no town planning or statutory restriction on the use of the subject land as a single dwelling house. If some risk had attached to "demolition, removal or relocation" of the existing dwelling to allow redevelopment of the land for single dwelling house use (and such risk was not proved), in any event, it was common ground that the existence of the historical dwelling enhanced the improved value of the property. [121] In cases where the highest and best use of land is not affected by town planning or statutory restrictions, and the improvements on the land are assumed not to exist as part of the statutory valuation process, we are unable to accept that the nature of an improvement should be a consideration, in the making of an unimproved valuation. [122] It follows that we find that the learned Member also erred in concluding that the unimproved value of the subject land should be reduced because of the presence of the dwelling of historical significance. Conclusions [123] We conclude that the facts in this matter are distinguishable from those in Maurici and the learned Member misapplied that judgment to the valuation evidence before him. The valuation made by the Chief Executive was not flawed on that basis. [124] For the reasons given we also conclude that the learned Member erred in finding that the unimproved valuation of the land should be reduced because of the existence of the dwelling with historical significance. [125] In addition we conclude that because of the sales evidence before him, it was unnecessary for the learned Member to resort to applying a percentage increase over the previous valuation. Orders 1. The appeal from the determination of the Land Court made on 19 June 2003 is allowed. 2. The orders made by the Land Court on 19 June 2003 are set aside. 3. In lieu, order that the appeal to the Land Court is dismissed. -- 26 of 27 -- 27 4. Affirm the valuation of the Chief Executive that the unimproved value of Lots 3, 4 and 5 on RP 10977, Lot 2 on RP 10987 and Lot 3 on RP 43642 Parish of South Brisbane is Four Hundred and Sixty Thousand Dollars ($460,000) as at 1 October 2001. MULLINS J JUSTICE OF THE SUPREME COURT JJ TRICKETT PRESIDENT OF THE LAND COURT RE WENCK MEMBER OF THE LAND COURT -- 27 of 27 --