Carija and Main Roads Western Australia - [2012] WASAT 78

JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL

STREAM: DEVELOPMENT & RESOURCES

ACT: LAND ADMINISTRATION ACT 1997 (WA)

CITATION: CARIJA and MAIN ROADS WESTERN AUSTRALIA [2012] WASAT 78

MEMBER: JUDGE D R PARRY (DEPUTY PRESIDENT)

HEARD: 1 AND 2 FEBRUARY 2012

DELIVERED : 24 APRIL 2012

FILE NO/S: DR 278 of 2010
DR 279 of 2010
DR 280 of 2010
DR 281 of 2010

BETWEEN: ISAVEL AND LAURA CARIJA (DR 278 of 2010)
JOHN DINKO NUICH (DR 279 of 2010)
BLAZ RUDEZ (DR 280 of 2010)
ANTHONY RUDEZ AND BLAZ RUDEZ (DR 281 of 2010)
Applicants
AND
MAIN ROADS WESTERN AUSTRALIA
Respondent

Catchwords:

Compensation for compulsory acquisition of land Reduction of value ('injurious affection') of claimant's retained land adjoining land taken for a public work Land Administration Act 1997 (WA) s 241(7)(b) Widening and upgrading of Great Northern Highway including overtaking lanes Rural lifestyle use Identification of cause of reduction of value for which compensation is payable Identification of public work for which land of claimant was resumed by reason of which claimant's adjoining land is reduced in value Whether public work for which land of claimant was resumed is purpose of public work stated in Taking Order Whether public work for which land of claimant was resumed includes hypothetical work which may potentially be accommodated within the resumed land but was not planned or contemplated by the resuming authority when the land was taken

Legislation:

Acquisition of Land Act 1967 (Qld), s 20(1)
Land Acquisition and Public Works Act 1902 (WA), s 63(b)
Land Administration Act 1997 (WA), s 177, s 178, s 178(1)(d), s 220(c), s 241(1), s 241(7)(b)
State Administrative Tribunal Act 2004 (WA), s 51(1)

Result:

The applicants have not suffered any damage due to a reduction of the value of their retained adjoining land (other than the land comprising houses and their curtilages, the winery and the restaurant/reception centre) for the purposes of s 241(7)(b) of the Land Administration Act 1997 (WA)

Category: B

Representation:

Counsel:

Applicants: Mr JCW Skinner with Ms LM Helman
Respondent: Ms LA Eddy with Dr S Willey

Solicitors:

Applicants: Jackson McDonald
Respondent: State Solicitor's Office

Case(s) referred to in decision(s):

Cerini v The Minister for Transport [2001] WASC 309
Kettering Pty Ltd v Noosa Shire Council [2004] HCA 33; (2004) 207 ALR 1
Konowalow and Felber v Minister for Works [1961] WAR 40
Lenz Nominees Pty Ltd v The Commissioner of Main Roads [2012] WASC 6
Marshall v DirectorGeneral, Department of Transport [2001] HCA 37; (2001) 205 CLR 603
Spencer v The Commonwealth of Australia (1907) 5 CLR 418

REASONS FOR DECISION OF THE TRIBUNAL:

Summary of Tribunal's decision

Main Roads Western Australia resumed land from each of the applicants and from other landowners in order to expand the road reserve of Great Northern Highway and enable the highway to be widened and upgraded. In particular, the public work for which the applicants' and other landowners' land was resumed involved the replacement of a two lane highway with a course bitumen surface with a two lane highway with a smooth bitumen surface, a 2 metre wide hard shoulder/bicycle path on each side, a central median strip, turning lanes and slipways, and a 1 kilometre overtaking lane in each direction.
The applicants claimed compensation from Main Roads Western Australia for the compulsory acquisition of their land and ultimately commenced these proceedings for the determination of compensation. Through mediation conducted by the Tribunal (and further discussions in relation to a discrete issue), the parties resolved all aspects of the claims for compensation, with the exception of one element of claims under s 241(7)(b) of the Land Administration Act 1997 (WA). That provision enables compensation in respect of 'the amount of any damage suffered by the claimant … due to a reduction of the value of [the claimant's] adjoining land'. This head of compensation is often referred to as 'injurious affection' because of the use of that expression in former legislation. Section 241(7)(b) of the Land Administration Act 1997 allows compensation where retained adjoining land of a claimant is reduced in value by reason of the public work for which land of the claimant was resumed.
The parties agreed that the applicants' retained adjoining land comprising houses and their curtilages, and a winery and restaurant/reception centre on one of the properties, was reduced in value by reason of the public work. However, they disagreed in relation to whether the remainder of the applicants' land, which is used for rural lifestyle purposes, was reduced in value.
The Tribunal determined that there is no reduction of the value of the remainder of the applicants land by reason of the public work for which the land was resumed. Contrary to the applicants' submission, the Tribunal found that the public work for which the applicants' land was resumed is a two lane or single carriageway road, not a four lane or dual carriageway road. The public work was therefore not a larger road with a greater vehicular capacity than the road prior to the work.
The Tribunal also determined that, although the 'purpose' or 'designated purpose' of the public work stated in the Taking Order is relevant to ascertaining the public work for which land is resumed, as the public work must fall within that purpose, the purpose of the public work involves a broader concept and is not synonymous with the public work itself. In this case, the Tribunal had direct evidence, which it accepted, as to the scope of the public work for which the applicants' land was resumed. On the evidence, the public work for which the applicants' land was resumed is the road construction that has taken place and, contrary to the applicants' submission, does not include any other road widening, or road widening and upgrading, to Great Northern Highway within the expanded road reserve of the highway.
Finally, the Tribunal held that the public work by reason of which the value of retained adjoining land of a claimant may be reduced, for the purposes of s 241(7)(b) of the Land Administration Act 1997, and for which compensation is, therefore, payable by the resuming authority, is work that was planned, or at least in contemplation, by the resuming authority, at the time of the compulsory acquisition. The public work by reason of which retained adjoining land of a claimant may be reduced in value does not extend under the legislation to a hypothetical work which may potentially be accommodated within the resumed land, but which was not at least in contemplation by the resuming authority when the land was taken.

Introduction

The applicants in these proceedings, Isavel and Laura Carija (DR 278 of 2010), John Dinko Nuich (DR 279 of 2010), Blaz Rudez (DR 280 of 2010), and Anthony Rudez and Blaz Rudez (DR 281 of 2010), are the respective owners of No 884 Great Northern Highway, Herne Hill (Carija property), No 1020 Great Northern Highway, Millendon (Nuich property), No 1001 Great Northern Highway, Millendon (B Rudez property), and No 32 Beryl Avenue (cnr Great Northern Highway), Millendon (A and B Rudez property). Each of the applicants' properties contains a house. The Carija property also contains a winery and restaurant/reception centre. Other than the portion of the Carija property comprising the winery and restaurant/reception centre, the applicants' properties are used for rural lifestyle purposes.
By Taking Orders made pursuant to s 177 and s 178 of the Land Administration Act 1997 (WA) (LA Act) dated 29 March 2008 and 23 June 2008, a strip of land generally 10.1 metres in width adjoining the former road reserve of Great Northern Highway was compulsorily acquired from each of the applicants and the other landowners along a 5 kilometre stretch of Great Northern Highway. The effect of the taking of these strips of land was to increase the width of the road reserve of Great Northern Highway to generally 40 metres, including adjoining the Nuich, B Rudez and A and B Rudez properties, and 40 47 metres adjoining the Carija property.
The Taking Orders stated that the resumed land was taken 'for use for the designated purpose(s) of the public work specified below', namely, 'Road widening and upgrading to Great Northern Highway' (in the case of the Carija property) and 'Road widening to Great Northern Highway' (in the case of the other three applicants' properties). The evidence of Mr Domenic Palumbo, a civil engineer employed as Manager Project Delivery by Main Roads Western Australia (Main Roads WA), who has been the senior manager for the Great Northern Highway Widening Project since February 2006, shows that the public work for which the applicants' and other landowners' land was resumed involved the widening and upgrading of the 5 kilometre stretch of Great Northern Highway from a two lane highway with a course bitumen surface to a two lane highway with a smooth bitumen surface, a 2 metre wide hard shoulder/bicycle path on each side, a central median strip, turning lanes and slipways, and a 1 kilometre overtaking lane in each direction. The length of the overtaking lanes was determined on the basis that the speed limit in this section of Great Northern Highway is 80 kph. The overtaking lanes adjoin each the Nuich, B Rudez and A and B Rudez properties.
The road work was carried out between March 2009 and December 2010 and formed the southernmost and final portion of an approximately 18 kilometre long widening and upgrading of Great Northern Highway comprising essentially the same elements. The earlier widened and upgraded sections included one overtaking lane in each direction. The length of these overtaking lanes is 1.2 kilometres, reflecting the increased speed limit of 110 kph in that section. The total length of the overtaking lanes in the part of Great Northern Highway which has been widened and upgraded is, therefore, 2.2 kilometres out of approximately 18 kilometres, or approximately 12.2% of the length of the widened and upgraded part of the highway. Approximately 87.8% of the length of this stretch of Great Northern Highway remains single carriageway in each direction.
The applicants claimed compensation from Main Roads WA under the LA Act for the compulsory acquisition of their land and ultimately commenced these proceedings for the determination of the compensation payable to them pursuant to s 220(c) of the LA Act. Through mediation conducted by the Tribunal (and discussions between the parties suggested by the Tribunal during the hearing in relation to a discrete issue of flooding/ponding on the B Rudez and A and B Rudez properties), the parties resolved all aspects of the claims for compensation, with the exception of one element of the claims made under s 241(7)(b) of the LA Act.
Pursuant to s 51(1) of the State Administrative Tribunal Act 2004 (WA), the Tribunal ordered that the proceedings are to remain separate, but are to be heard and determined together, with evidence in one proceeding being evidence in the other proceedings.

Claims for compensation under s 241(7)(b) of the LA Act

Section 241(1) of the LA Act states as follows:
In determining the amount of compensation (if any) to be offered, paid, or awarded for an interest in land taken under Part 9, regard is to be had solely to the matters referred to in this section.
Section 241(7) of the LA Act states as follows:
If the fee simple in land is taken from a person who is also the holder in fee simple of adjoining land, regard is to be had to the amount of any damage suffered by the claimant
(a)due to the severing of the land taken from that adjoining land; or
(b)due to a reduction of the value of that adjoining land,
however, if the value of any land held in fee simple by the person is increased by the carrying out of, or the proposal to carry out, the public work for which the land was taken, the increase is to be set off against the amount of compensation that would otherwise be payable under paragraph (b).
As Parker J observed in Cerini v The Minister for Transport [2001] WASC 309 (Cerini) at [224]:
Although s 241(7) does not contain any reference to the term 'injurious affection', it is common for [s 241(7)(b)] still to be referred to as the injurious affection provision.
As his Honour said, '[t]his is a habit born, no doubt, out of past experience, but which may be misleading for the purposes of the LA Act'. The 'past experience' to which his Honour referred was derived from the terms of s 63(b) of the Land Acquisition and Public Works Act 1902 (WA) (LAPW Act), which provided that, in determining the amount of compensation to be offered, paid or awarded for land taken or resumed, regard was to be had to:
The damage, if any, sustained by the claimant by reason of the severance of such land from the other adjoining land of the claimant or by reason of such other lands being injuriously affected by the taking;
As Edelman J recently observed in Lenz Nominees Pty Ltd v The Commissioner of Main Roads [2012] WASC 6 (Lenz) at [302], with reference to the decision of McHugh, Gummow, Hayne, Callinan and Heydon JJ in the High Court of Australia in Kettering Pty Ltd v Noosa Shire Council [2004] HCA 33; (2004) 207 ALR 1 at [24]:
The origin of [the] term ['injurious affection'] is the Land Clauses Consolidation Act 1845 (UK) which used the term in relation to physical injury or disturbance of enjoyment caused by the construction of works on resumed land.
In Lenz at [303], Edelman J referred to the description by Gleeson CJ and Gummow, Kirby and Callinan JJ in Marshall v DirectorGeneral, Department of Transport [2001] HCA 37; (2001) 205 CLR 603 (Marshall) at [32] of the label 'injurious affection' as 'a neat, expressive way of describing the adverse effect of the activities of a resuming authority upon a dispossessed owner's land'. However, as Edelman J said in Lenz at [304]:
Although it is convenient to use this label, it should be used only as a shorthand description for the reference to '[a] reduction [of the] value of that adjoining land'. The governing principle is the words of the statute: Boland v Yates Property Corporation Pty Ltd [[1999] HCA 64; (1999) 167 ALR 575] [174] (Hayne J); Leichhardt Council v Roads & Traffic Authority of New South Wales [2006] NSWCA 353; (2006) 149 LGERA 439 [35] (Spigelman CJ).
The parties agreed in mediation to the payment by Main Roads WA of compensation to the applicants pursuant to s 241(7)(b) of the LA Act for the impact of the public work on the value of the houses and related improvements within their curtilages and, in the case of the Carija property, on the winery and restaurant/reception centre business. The only issue remaining between the parties and requiring resolution by the Tribunal is whether, and if so, in what amount, compensation is payable by Main Roads WA to the applicants due to a reduction of the value of the remainder of the applicants' properties, used for rural lifestyle purposes, under s 241(7)(b) of the LA Act.
The applicants contended that there are substantial reductions of value and, hence, compensation payable to them, in relation to the remainder of their properties. Based on the evidence of their consultant expert land valuer, Mr Robert Ferguson, the applicants claimed compensation under s 241(7)(b) of the LA Act in relation to the remainder of their properties of $133,463 in respect of the Carija property, $123,312 in respect of the Nuich property, $46,398 in respect of the B Rudez property and $94,723 in respect of the A and B Rudez property. In contrast, Main Roads WA contended that there is no reduction of value and, hence, no compensation payable by it, in relation to the remaining parts of the applicants' properties.

Identification of the cause of a reduction of the value of retained adjoining land for which compensation is payable under s 241(7)(b) of the LA Act

As Parker J lamented in Cerini at [225], and as unfortunately remains the case, s 241(7)(b) of the LA Act does not contain 'any express statutory identification of the cause or causes of a reduction of value of adjoining land for which compensation is payable'. In Cerini, Parker J referred, at [225], to the identification of the cause of a reduction of the value of retained adjoining land of a claimant in decisions of the Supreme Court in relation to injurious affection under s 63(b) of the LAPW Act, and cited, as an example, Konowalow and Felber v Minister for Works [1961] WAR 40 (Konowalow). In Konowalow, Virtue J held, at 43, that s 63(b) of the LAPW Act (then simply the Public Works Act 1902):
… refers to damage resulting or likely to result to activities … being carried on by the plaintiff on the land as a result of the use to which [the resumed land] is to be put for the public work.
In Cerini, Parker J observed, at [225], that although Konowalow and other decisions 'relied much on the similarity of language between section 63 of the [LAPW] Act and the equivalent provisions of the Land Clauses Consolidation Act 1845 (UK), each of which referred to "injurious affection"':
… the legislative history of s 241(7) [of the LA Act] and the reasoning in that line of authorities provides some indication that what was intended by the legislature in s 241(7)(b) was a reduction in value attributable to the use of the land taken for the purpose for which it was resumed.
In Cerini at [229], Parker J addressed and rejected a submission that 'the words of section 241(7) which follow par (b) might be read to indicate [the] legislative intention [of s 241(7)(b) of the LA Act]'. As his Honour observed, the words following para (b) of s 241(7) focus on 'any increase in value of any land of the claimant, not just the retained land, "by the carrying out of … the public work for which the land was taken"'. The portion of s 241(7) of the LA Act following para (b) involves the concept referred to as 'betterment', under which an increase in the value of a claimant's retained land due to the carrying out of, or the proposal to carry out, the public work for which the land was taken, is to be set off against any compensation that would otherwise be payable under para (b). Parker J rejected the submission that the terms of the betterment provision indicate the cause of a reduction of value of adjoining land for which compensation is payable, because '[t]his provision appears distinct in object and subject from par (b)'.
His Honour then concluded his analysis as to the cause of a reduction of value of adjoining land for which compensation is payable under s 241(7)(b) of the LA Act at [230] in Cerini as follows:
While section 241(7) is regrettably unclear, in particular because of the incompleteness of par (b), I am inclined to the view that par (b) is intended to allow compensation where retained adjoining land of a claimant is reduced in value by reason of the public work for which land of the claimant was resumed. I prefer to see the justification for that interpretation, however, in the context and the opening words of the subsection and by adopting reasoning akin to that adopted in Konowalow in respect of the former section 63(b).
Both parties accepted the correctness of this interpretation of s 241(7)(b) of the LA Act. With respect, and for the reasons stated by his Honour in Cerini at [230], I agree with this interpretation.
The applicants also referred to the adoption by Edelman J, at [307] in Lenz, of the following identification of the cause of a reduction of value of adjoining land for which compensation is payable under s 241(7)(b) of the LA Act, stated by Gleeson CJ and Gummow, Kirby and Callinan JJ in Marshall at [20] in relation to what Edelman J said in Lenz is 'a similar provision in Queensland', namely:
Once the constructing authority acquires land for a statutory purpose … it must … compensate the dispossessed owner for the injurious effect upon the residual land resulting from the undertaking and the implementation of that purpose, actual and prospective.

However, as Parker J observed in Cerini at [227], the statutory provision considered by the High Court in Marshall, namely, s 20(1)(b) of the Acquisition of Land Act 1967 (Qld), is 'materially different' to s 241(7)(b) of the LA Act. Indeed, Parker J said at [228] in Cerini that 'the two statutory provisions bear little or no similarity'. Significantly, the provision of the Queensland statute requires regard to be given to the damage, if any, caused by 'the exercise of any statutory powers of the constructing authority otherwise injuriously affecting such other land'. In Marshall at [20], Gleeson CJ and Gummow, Kirby and Callinan JJ emphasised the words 'any statutory powers' and observed that 'the language of section 20(1)(b) of the Act could hardly be plainer'. As the language of the Queensland provision is materially different to s 241(7)(b) of the LA Act, I do not adopt the statement in Marshall in relation to the interpretation and application of s 241(7)(b) of the LA Act.

Issues

The following three principal issues were debated between the parties:
(1)Whether there is a reduction of the value of the applicants' retained land (other than the land comprising houses and their curtilages, and the winery and restaurant/reception centre) by reason of the public work for which their land was resumed.
(2)If the answer to (1) is 'yes', what is the reduction of the value of the applicants' retained land?
(3)If the answer to (1) is 'yes', whether the value of the applicants' land has been increased by the carrying out of the public work for which the land was taken under the betterment provision of s 241(7) of the LA Act, with the consequence that any such increase is to be set off against any amount of compensation that would otherwise be payable under para (b) of that subsection.
However, in light of the Tribunal's decision in relation to issue 1, issues 2 and 3 do not arise for determination.

Is there a reduction of the value of the applicants' retained land by reason of the public work for which their land was resumed?

Mr JCW Skinner, who appeared with Ms LM Helman on behalf of the applicants, advanced essentially three submissions in support of the contention that there is a reduction of the value of the applicants' retained land, in the areas outside the houses and their curtilages, and the winery and restaurant/reception centre on the Carija property, by reason of the public work for which the land was resumed.
First, Mr Skinner submitted that there is a reduction of the value of the applicants' retained land by reason of the public work for which their land was resumed, at least in relation to the Nuich, B Rudez and A and B ִRudez properties, because the public work for which their land was resumed is a four lane road, whereas, prior to the public work, the road comprised only two lanes. A four lane or dual carriageway road is a larger road and has a greater vehicular capacity than a two lane or single carriageway road. The increase in the size of the road and in the number of vehicles on the road reduces the value of the adjoining land.
However, the premise of this submission is factually incorrect. The public work for which the applicants' land was resumed is a two lane or single carriageway road, with the facilities referred to earlier, including 1 kilometre overtaking lanes in each direction, not a four lane or dual carriageway road. The overtaking lanes do not, whether individually or taken together with the two overtaking lanes to the north, which, as noted earlier, comprise only approximately 12.2% of the 18 kilometres of widened and upgraded highway, transform what was previously a single carriageway in each direction into a dual carriageway in each direction. Moreover, as Mr Palumbo indicated in is evidence, the widening and upgrading of Great Northern Highway was not carried out in order to facilitate an increase in vehicular capacity, but rather, to improve safety and convenience for road users. As he explained, the capacity of the road, both generally and in the area of the overtaking lanes adjacent to the Nuich, B Rudez and A and B Rudez properties in particular, is constrained by the single carriageway comprising the overwhelming majority of the widened and upgraded highway and, specifically, at both ends of the overtaking lanes. This is confirmed by traffic counts. Whereas on 31 October 2007 (prior to the carrying out of the public work), 13,440 vehicles were counted 2.5 kilometres north of Beryl Avenue, in August 2011 (after the carrying out of the public work), 12,194 vehicles were counted at a now permanent count site at Susannah Brook, approximately 1.5 kilometres south of Beryl Avenue.
Second, Mr Skinner submitted that there is a reduction of the value of the applicants' retained land by reason of the public work for which their land was resumed, because the public work for which the applicants' land was resumed is the 'use for the designated purpose(s) of the public work' specified in the Taking Orders, namely, 'Road widening and upgrading' or 'Road widening' to Great Northern Highway. Mr Skinner submitted that this description of the public work includes the actual or prospective widening of Great Northern Highway within the expanded road reserve, whether the widening has been physically carried out to date or not.
Section 178(1)(d) of the LA Act requires that a Taking Order must:
Designate appropriately any land or interests in land required for the purpose of the public work[.]
The Taking Orders that resumed strips of land from the applicants' properties also used the terminology 'use for the designated purpose(s) of the public work'.
The noun 'purpose' relevantly means:
1. the object for which anything exists or is done, made, used, etc. 2. an intended or desired result; end or aim. 3. intention or determination. 4. that which one puts before oneself as something to be done or accomplished. (The Macquarie Dictionary (5th edition, 2009, page 1346))
Thus, the 'purpose' or 'designated purpose' of the public work, in this case road widening or road widening and upgrading, is not the public work for which the land is resumed, but rather, the object for which the public work is done; the intended or desired result of the public work, or its end or aim; the intention or determination in carrying out the public work; and that which is to be done or accomplished by the carrying out of the public work. While the 'purpose' or 'designated purpose' of the public work stated in the Taking Order is relevant to ascertaining the public work for which land is resumed, as the public work must fall within that purpose, the purpose of the public work involves a broader concept and is not synonymous with the public work itself.
Furthermore, in this case, the Tribunal has direct evidence from Mr Palumbo, which was not seriously questioned or contradicted, and which I accept, as to the scope of the public work for which the applicants' land was resumed. The public work for which the applicants' land was resumed is the road construction that was carried out between March 2009 and December 2010. It does not include any other road widening or road widening and upgrading to Great Northern Highway within the expanded road reserve of the highway.
Third, Mr Skinner submitted that the retained adjoining land of the applicants is reduced in value by reason of the public work for which their land was resumed, because a four lane or dual carriageway road can potentially be constructed within the expanded, generally 40 metre wide, road reserve of Great Northern Highway. Mr Skinner submitted that a hypothetical purchaser 'perfectly acquainted with the land, and cognisant of all circumstances which might affect its value, either advantageously or prejudicially' (as stated in the classic dictum of Isaacs J in Spencer v The Commonwealth of Australia (1907) 5 CLR 418 at 441), would regard the construction by Main Roads WA of a dual carriageway on Great Northern Highway as something that 'might well happen'. Mr Skinner relied on the evidence of Mr Ferguson that:
A hypothetical purchaser would be wondering what they're going to build in 40 metres, and they'd pay a lesser price. It's like buying a property next to a redevelopment site you know, you'd always be wondering what they're going to build there, and you know, if there was in a residential area up against a commercial area, you'd be worried they're going to build a big tower alongside of you. So you'd pay a lesser price if you were residential adjoining a commercial, and similarly here. If you were a residential property adjoining a major highway, a 40 metre highway now, you'd be expecting them to do something else in there, and they pay a price reflecting that. (T:76.7T:76.9; 02.02.12)
However, in my view, the public work by reason of which the value of retained adjoining land of a claimant may be reduced, for the purposes of s 241(7)(b) of the LA Act, and for which compensation is, therefore, payable by the resuming authority is limited to a work that was planned, or at least in contemplation, by the resuming authority at the time of the compulsory acquisition. It does not extend to a hypothetical work which may potentially be accommodated within the resumed land, but which was not at least in contemplation by the resuming authority when the land was taken. Unless a public work was planned or in contemplation by a resuming authority at the time when land was resumed, it cannot be said to be the public work for which the land was resumed. This interpretation is consistent with the intention of the statute to provide full compensation to dispossessed landowners on a once and for all basis. If 'compensation' were payable under s 241(7)(b) of the LA Act for a hypothetical public work that may potentially be accommodated within the resumed land, but which was not at least in contemplation by the resuming authority when the land was taken, it would result in what counsel for Main Roads WA, Ms LA Eddy, aptly described as 'a windfall based on speculation', rather than compensation for a reduction of the value of the retained adjoining land.
The evidence of Mr Palumbo, which was not questioned or contradicted, and which I accept, shows that the creation of a dual carriageway within the expanded road reserve was not in contemplation by Main Roads WA at the time that the land was taken, and, indeed, is not currently in contemplation by the resuming authority. Main Roads WA resumed the applicants' land in order to construct a more convenient and safe single carriageway, not a dual carriageway. Furthermore, rather than contemplating a dual carriageway on Great Northern Highway, Main Roads WA has commenced planning for the construction of the PerthDarwin National Highway Swan Valley Bypass (Swan Valley Bypass), one of the purposes of which is to divert the heavy traffic currently generated by the mining industry away from Great Northern Highway. Funding has been provided by Government for the planning of the Swan Valley Bypass of $1,000,000 in 20112012, $3,000,000 in 20122013 and $4,000,000 in 20132014. Mr Palumbo said that the estimated cost of the Swan Valley Bypass is $500,000,000. While Mr Jonathon Riley, a traffic engineer who was called to give evidence by the applicants, said that 'my gut feel is that [a dual carriageway on] Great Northern Highway would be a cheaper construction [than the Swan Valley Bypass]', he conceded that his experience does not extend to road design and construction.
As the construction of a dual carriageway within the expanded road reserve of Great Northern Highway was not planned or contemplated by Main Roads WA at the time of the compulsory acquisition of the applicants' land, the public work for which the land was resumed, by reason of which the value of the applicants' retained adjoining land can be reduced and for which compensation is payable under s 241(7)(b) of the LA Act, does not include the hypothetical dual carriageway scenario referred to by the applicants.
Finally, and in any case, even if a hypothetical work that may potentially be accommodated within the resumed land, but which was not at least in contemplation by the resuming authority when the land was taken, can constitute the public work by reason of which the value of retained adjoining land may be reduced for the purposes of s 241(7)(b) of the LA Act, on the evidence in this case, there would not be a reduction of the value of the retained adjoining land. A hypothetical purchaser, perfectly acquainted with the land, would be aware, as stated in the witness conferral statement of Mr Riley and Mr Palumbo, that 'at some sections [of the expanded road reserve] it would be feasible to accommodate four lanes, while at other sections it would not'. Mr Palumbo referred, in particular, to a number of locations between Roe Highway to the south and West Swan Road to the north, which includes the locality of the applicants' properties, where a dual carriageway could not be accommodated without further acquisition of land. He also noted that, in certain locations, Western Power steel towers supporting 133 volt transmission lines, other services and bus facilities, would need to be relocated. Furthermore, if Great Northern Highway were to be widened at the crossing of the Swan River just south of West Swan Road, not only would further land have to be acquired and transmission lines and other services relocated, but a second bridge would have to be built across the river, which Mr Palumbo estimated would cost more than $35,000,000. Mr Palumbo also referred to other difficulties that would arise in seeking to construct a dual carriageway because of the nature of businesses carried on at, or other characteristics of, certain affected properties.
The evidence therefore shows that a dual carriageway could not be accommodated within the land taken for the purpose of the public work. Therefore, assuming that the public work for which land was resumed includes a hypothetical work not planned or in contemplation by the resuming authority, the hypothetical purchaser would not, in my view, reduce the purchase price which he or she would be willing to pay as at the date of compulsory acquisition in consequence of the potential construction of a dual carriageway within the expanded road reserve.
It follows that there is no reduction of the value of the applicants' retained land (outside the houses and the curtilages, and the winery and restaurant/reception centre on the Carija property) by reason of the public work for which their land was resumed, and consequently, no compensation is payable by Main Roads WA for damage suffered by the applicants due to a reduction of the value of that land under s 241(7)(b) of the LA Act.

Conclusion

There is no compensation payable by Main Roads WA to any of the applicants due to a reduction of the value of their retained adjoining land (other than the parts of their land comprising houses and their curtilages, and the winery and restaurant/reception centre on the Carija property, as agreed between the parties), pursuant to s 241(7)(b) of the LA Act.
The parties should file consent orders reflecting the mediated outcome in relation to compensation for consideration by the Tribunal.

Orders

The Tribunal makes the following orders:

DR 278 of 2010

1.There is no compensation payable by Main Roads Western Australia to the applicants due to a reduction of the value of their retained adjoining land (other than the parts of their land comprising the house and its curtilage, and the winery and restaurant/reception centre, as agreed between the parties), pursuant to s 241(7)(b) of the Land Administration Act 1997 (WA).
2.By 15 May 2012, the parties are to file consent orders reflecting the mediated resolution of the applicants' compensation claim.

DR 279 of 2010

1.There is no compensation payable by Main Roads Western Australia to the applicant due to a reduction of the value of his retained adjoining land (other than the parts of his land comprising the house and its curtilage, as agreed between the parties), pursuant to s 241(7)(b) of the Land Administration Act 1997 (WA).
2.By 15 May 2012, the parties are to file consent orders reflecting the mediated resolution of the applicant's compensation claim.

DR 280 of 2010

1.There is no compensation payable by Main Roads Western Australia to the applicant due to a reduction of the value of his retained adjoining land (other than the parts of his land comprising the house and its curtilage, as agreed between the parties), pursuant to s 241(7)(b) of the Land Administration Act 1997 (WA).
2.By 15 May 2012, the parties are to file consent orders reflecting the mediated resolution of the applicant's compensation claim.

DR 281 of 2010

1.There is no compensation payable by Main Roads Western Australia to the applicants due to a reduction of the value of their retained adjoining land (other than the parts of their land comprising the house and its curtilage, as agreed between the parties), pursuant to s 241(7)(b) of the Land Administration Act 1997 (WA).
2.By 15 May 2012, the parties are to file consent orders reflecting the mediated resolution of the applicants' compensation claim.

I certify that this and the preceding [48] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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JUDGE D R PARRY, DEPUTY PRESIDENT