Cairns Shelfco No 16 Pty Ltd v State of Queensland (No 2)

[1996] QCA 517

IN THE COURT OF APPEAL	[1996] QCA 517
SUPREME COURT OF QUEENSLAND

Appeal No 3289 of 1996

Brisbane

[Cairns Shelfco No 16 Pty Ltd v. State of Qld]

BETWEEN:

CAIRNS SHELFCO NO 16 PTY LTD
ACN 010 327 312

Appellant

AND:

THE STATE OF QUEENSLAND

Respondent

Fitzgerald P
Pincus JA

Dowsett J

Judgment delivered 13 December 1996

Judgment of the Court

1.          APPLICATION REFUSED

2.          DECLARATION AS BETWEEN THE CAIRNS PORT AUTHORITY AND CAIRNS SHELFCO NO. 16 PTY LTD THAT CAIRNS SHELFCO NO. 16 PTY LTD WAS AT MATERIAL TIMES ENTITLED TO BE ISSUED WITH A NOTICE OF EACH OF THE VALUATIONS MENTIONED IN THE ORIGINATING SUMMONS.

3.          DECLARATION AS BETWEEN THE CAIRNS PORT AUTHORITY AND CAIRNS SHELFCO NO. 16 PTY LTD THAT CAIRNS SHELFCO NO. 16 PTY LTD COMPETENTLY LODGED EACH OF THE OBJECTIONS THEREIN MENTIONED.

4.          CAIRNS PORT AUTHORITY TO PAY CAIRNS SHELFCO NO. 16 PTY LTD'S COSTS OF THIS APPLICATION.

premises as assessed by the Valuer-General - certificates of valuation - right of objection to valuations made by the chief executive - joinder of parties.

ss. 28, 52 and 74 of the Valuation of Land Act.

Counsel:	Mr D.B. Fraser Q.C. for the applicant
Mr R.B. Bain Q.C. for the appellant/respondent
Mr D.G. Bancroft for the respondent
Solicitors:	Quinlan Miller & Treston as town agents for MacDonnells, Cairns for the appellant
Clayton Utz for the appellant/respondent
Crown Solicitor for the respondent
Hearing Date:	5 September 1996
IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No 3289 of 1996

Brisbane

Before Fitzgerald P

Pincus JA Dowsett J

[Cairns Shelfco No 16 Pty Ltd v. State of Qld]

BETWEEN:

CAIRNS SHELFCO NO 16 PTY LTD
ACN 010 327 312

Appellant

AND:

THE STATE OF QUEENSLAND

Respondent

JUDGMENT OF THE COURT

Judgment delivered 13 December 1996

On 5 March 1996 this Court gave judgment in an appeal from a decision of a Judge in

Chambers. The appellant was Shelfco No 16 Pty Ltd and the respondent was the State of

Queensland. We will continue to describe those parties by reference to their respective capacities in

those proceedings. Although the facts appear in the reasons for judgment previously delivered, we

will summarise them.

In 1988 Cairns Port Authority (the "applicant") leased certain land to the appellant for 75

years at an annual rental, for the first two years of the term, of $250,000. The lease provided for

rental increases at two yearly intervals, dependent upon variations in the unimproved valuation of the

demised premises as assessed by the Valuer-General (as that officer was then known) in

accordance with s.27 (now s.74) of the Valuation of Land Act. It is not necessary to describe the

exact process by which such valuations might affect the rent. In certain circumstances, other valuations made under the Act might also have that effect. The applicant as lessor requested

numerous valuations pursuant to s.27/74, which requests were met by the provision of certificates of

valuation as contemplated by the section. In each case, the appellant purported to object under the

Act to the valuation in question. The chief executive (previously the Valuer-General) disputed the

entitlement of the appellant to so object, asserting that the objection provisions of the Act do not

apply to a valuation performed pursuant to s. 27/74. The Chamber Judge upheld this assertion, but

this Court decided to the contrary. Little point will be served by repeating in full the reasons for the

decision, but a brief summary may be helpful. We will hereafter refer to relevant sections by their

current numbers.

Part 4 of the Act deals with annual valuations and prescribes an objection process. (See ss.

42, 43 and 44.) These provisions are obviously not relevant for present purposes. Part 6 also

provides for objections. S.49 prescribes that:

"Except to the extent otherwise indicated in this Act, this part does not apply to or

with respect to a valuation of land made pursuant to part 4."

Section 52 provides:

An owner who is dissatisfied with the valuation made by the chief executive under this Act may, within 60 days after the date of issue of the notice of valuation (which date of issue shall be stated in such notice), post to or lodge with the chief executive an objection in writing against the valuation."

This Court held that the right of objection conferred by s. 52 applies to s. 74 valuations. It

followed that the appellant had a right of objection to each of the valuations made by the chief

executive.

The applicant was not a party to those proceedings. However material filed in this Court

suggests that by mid-June 1995, it was aware of the proceedings before the Chamber Judge and of

his Honour's decision. In February 1996 the applicant learned that "Cairns Shelfco and the Crown

currently have an appeal process before the Supreme Court concerning objections to Section 74

valuations." On 7 March 1996 the applicant was advised that the appeal had been successful.

As the decision at first instance was favourable to the applicant, it is not surprising that it
took no step to intervene when it first became aware of those proceedings. However from February

1996 it knew that the appeal was extant. It is difficult to understand why it took no step to intervene

at that time. The applicant was advised on 7 March 1996 that the appeal had been successful but

did not bring the present application until 16 April 1996. The applicant now asserts that it ought to

have been joined as a party before the Chamber Judge and on appeal and asks that the judgment of

this Court be set aside because it was not heard.

The applicant's interest is said to arise from its position as lessor and owner of the land in

question and as the party which requested the relevant valuations from the chief executive.

Obviously, it will be affected if a reduction in a valuation leads to a reduction in rental. Part 6 does

not, however, suggest an intention that the consideration of objections should be a quasi-judicial

process at which all affected parties are heard. The prescribed objection process rather appears to

be part of the valuation procedure. If that is so, it is difficult to see why a party should be heard on

the question of whether or not another party has a right to object. Even if the applicant ought to

have been heard on that question, the considerable delay in seeking to intervene may well offer a

further hindrance to the success of the present application. In any event, as the applicant concedes

that intervention will only be justified if its arguments on the merits lead us to a different view from

that previously expressed, it is appropriate that we first consider those arguments.

The applicant's submissions involved a detailed analysis of various sections of the Act,

apparently with the aim of identifying an integrated and consistent system of valuation emerging from

it. As suggested by Pincus JA in his earlier reasons for judgment, the Act may not lend itself to such

analysis. Primarily, it is concerned with the valuation of land for the purposes referred to in s.72,

namely land tax and rating. Section 74 is obviously designed to extend the function of the chief

executive to include the preparation of valuations for other purposes. As Pincus JA also

demonstrated, it is probable that initially, this function was intended to serve the needs of

government departments requiring valuations for purposes other than those connected with rates and

land tax.

The applicant summarised its arguments on the merits as follows:

(a)         The structure and purposes of the Act do not provide any reason for considering that a

"private" valuation under s. 74 should attract the processes of objection and appeal.

(b) The context in which s. 74(5) appears is quite inconsistent with the idea that such a valuation

is provisional only.

(c) S. 74(5) while not well drafted is directed to "enabling" the chief executive to do "private"

valuations and to the extent that it is ambiguous, it should be given a meaning designed to

effectuate the operation of the Act as a whole.

(d) S. 74(5) should not be interpreted in a way that does mischief to the utility of s. 78.

(e) The inconsistencies and anomalies resulting if s. 74(5) is given the meaning contended by

Shelfco are considerable.

Although the applicant put its case in a number of ways, the attack principally centred upon

the inter-relationship between s. 28(1) and s. 74. Section 28(1) provides:

"No alteration shall be made in the valuation of any parcel of land during the period during which any general valuation or annual valuation relating to the area in question is in force ...".

The section then provides for a number of exceptions to this general prohibition, none of

which includes the making of a valuation pursuant to s. 74. The thrust of the applicant's argument

was that if the provisions of s. 74(5) be construed as applying all of the provisions of the Act to the

valuation process under s. 74, then s. 28(1) would operate to prohibit the provision of a valuation

differing from the latest general or annual valuation.

Section 28 appears in part 3 of the Act which is headed "Valuations". That part commences

with s. 13 which provides:

"The chief executive must decide the unimproved value of the land to be valued for

the Acts under which local authorities are established."

S. 15 authorises the use of unimproved valuations under the Act for fixing rent under the

Land Act. S. 72(1) provides that such valuations are to be used as the unimproved values for the purposes of the Land Tax Act, the Local Government Act and the City of Brisbane Act. The Acts

referred to in s. 13 are presumably the Local Government Act and the City of Brisbane Act. Whilst

it may not be absolutely clear, the better view is that part 3 (including s. 28) is concerned with

general and annual valuations for the purposes of those Acts (by virtue of ss. 13 and 72), the Land

Act (by virtue of s. 15) and the Land Tax Act (by virtue of s. 72). S. 28 should be construed as

referring only to general and annual valuations and to the uses to which they may be put. The

section cannot usefully be applied to a valuation obtained under s. 74 for a purpose which is, by

definition, unrelated to the purposes of the four Acts to which I have referred.

The other major problem identified by the applicant arises out of the difference between a

certificate of valuation provided pursuant to s. 74 and a notice of valuation which is a necessary

condition precedent to an objection for the purposes of part 6. Pincus JA has previously dealt with

this matter and we need not discuss it further.

We therefore respond to the above summary of the applicant's argument as follows:

(a) The applicability of part 6 to valuations under s.74 is a matter of construction of the Act. S.

49 expressly excludes the application of that part to part 4 valuations, strongly suggesting

that it is to apply to all other valuations under the Act. S. 74(5) would seem to support this

approach.

(b)        The reference in argument to a "provisional" valuation is, we understand, intended to convey

the proposition that the objection procedure renders any valuation to which it applies

"provisional" pending resolution of that objection. The "context in which s.74(5) appears" is

presumably the whole of the section, or perhaps, the Act. We have not identified any

provision of the Act which is so inconsistent with the application of part 6 to s.74 valuations

as to lead us to abandon the clear meaning of those provisions.

(c) We do not read s.74(5) as "enabling" "private" valuations. S. 74(1) performs that function.

S. 74(5) applies the empowering and regulating provisions of the Act to the process of

producing such valuations. Section 28(1), on its proper construction, is not intended to
apply to s.74 valuations.

(d) S. 78 permits certain named classes of fiduciary to "obtain and use" a certificate under s. 74

for the purposes of his or her duties. We see no reason why the application of part 6 to s.

74 valuations would undermine the efficacy of that provision. It may well be that a fiduciary

with notice of an objection could not rely upon such a certificate until the objection had been

resolved. Quite apart from the objection process, there will be circumstances in which a

fiduciary could not, in good faith, so act. Examples would be where the certificate was

obviously wrong or where, to the knowledge of the fiduciary, there had been an error in the

valuation process. Without deciding the matter, we expect that s. 78 would only protect

bona fide actions in reliance upon such a certificate.

(e)         We are unable to identify significant "inconsistencies and anomalies" resulting from the

application of part 6 to s. 74 valuations.

In the end, the applicant's argument was simply that the Chamber Judge was correct in

treating s. 74 valuations as distinct from other valuations under the Act and as not appropriately

subject to part 6 because of their "private" nature. For the reasons given in the previous

proceedings, there is no justification for so limiting the application of part 6.

The applicant by its notice of motion seeks to be made a party to the originating summons

and to the appeal and further directions as to the re-hearing of the appeal. There is a serious dispute

between the appellant and the applicant as to the proper construction of s.74 and part 6 of the Act.

Whether or not the applicant ought to have been joined in the original proceedings, it and the

appellant are parties to the current application and the matter has been argued on the merits. It is

appropriate that as between the applicant and the appellant, we declare in terms of the declaration

made in the earlier proceedings. It follows that the applicant should pay the appellant's costs of this

application.