Chevron Queensland Limited v The Crown
[1991] QLC 7
•3 May 1991
|
BRISBANE
3rd May, 1991
Re: Claim for compensation -
Resumption for Environmental Park
purposes.
A90-20.
Chevron Queensland Limited
v.
The CrownJ U D G M E N T
By Proclamation published in the Government Gazette on 12th September, 1987, the Crown resumed, as from that date for Environmental Park purposes, freehold land in the County of Ward, Parish of Pimpama, described as Lot 2 on RP 95016 containing an area of 762 acres 3 roods (about 308 hectares) and being the whole of the land contained in Certificate of Title volume 3911 folio 216 and Lot 1 on RP 92789 containing an area of 799 acres (about 323 hectares) and being the whole of the land contained in Certificate of Title volume 3911 folio 215. The resumption was effected under the provisions of the Acquisition of Land Act 1967-1986. The land was in the ownership of Chevron Queensland Limited which company acquired the land in December, 1984. The lands may reasonably be described as comprising the dry land on Woogoompah Island. This island is situated in the Broadwater region of the Gold Coast to the south-east (by about 3 kilometres) of the small coastal township of Jacobs Well and at the mouth of the Pimpama River, the main channel of which swings around the south-west and south of the island with a narrower and shallower channel meandering its way up the western and north-western area of the island. The total area of the island is about 1,000 hectares. Apart from the freehold land, there are two small unused reserves in the eastern section of the island connected by an unformed dedicated road. These reserves are described as Water Reserve R138 (1.06 hectares) and Public Purposes Reserve R139 (3.642 hectares). The balance of the island (about 365 hectares) is tidal mangroves and salt couch flats, all within the Jumpinpin- Broadwater Fish Habitat Reserve, save for an exclusion zone 250 metres wide on the western side of the island - (comprising an "access" strip 50 metres wide (unreserved) bounded on each side by strips 100 metres wide which strips are within the Pimpama Wetland Reserve). The "access" strip corresponds with the continuation of Woogoompah Road from Jacobs Well were it to be continued from its present mainland location and construction to the banks of the northern channel of the Pimpama River. The existing subdivisions literally divide the island with Lot 1 being the southern half and Lot 2 the northern half. At the date of resumption the island was unimproved and vacant. No services were connected and access was by boat or helicopter. Mainland departure points to the island by boat could be taken from a boat ramp in Coleman Road at the mouth of McCoys Creek (to the south) and from jetty facilities at Jacobs Well. Marina facilities exist further north at McLarens Marina whilst such facilities are available in the south at Paradise Point.
Under the 1982 Town Plan for the Shire of Albert in which the subject land is situated, the resumed land was zoned "Rural C" whilst the balance of the island was zoned "Public Open Space". The resumed land comprises principally sandy forest land timbered with bloodwood, blue gum, Moreton Bay ash and brush box. Contours rise throughout this area from 2 metres generally across Lot 1 to 3 and 4 metres across the northern area of Lot 2. The boundary of the freeholds at two points (site 1 which is in Lot 1 in the south-east of the lot and site 4 which is in Lot 2 to the north-west of the lot) extend to or protrude into the channel waters. The resumption of the subject land was effected contemporaneously with the resumption of Coomera Island for the same purpose. Coomera Island is to the south of Woogoompah. Previously (29th March, 1986), Kangaroo Island (the freehold) was resumed for the same purpose. Kangaroo Island is to the north of Woogoompah Island. The resumption of Kangaroo Island involved the taking of three separately subdivided freehold lots in the one ownership, having a total area of about 415 hectares of which about 63 hectares was forest land above marine flats and mangroves. Coomera Island was also in three separate subdivided parcels in the one ownership with about 100 hectares of land above wetland. Compensation for the taking of Kangaroo Island was assessed by the Land Appeal Court in the sum of $400,000. This assessment was made on the basis that the highest and best use of the island was for sale as a single residential site rather than by sale of the lots separately. The determination effectively endorsed the recommendation of the Crown's assessing officer, Mr G.J. Coonan. He also made the assessment in respect of Coomera and on the same basis. His valuation of Coomera Island as a single residential site was $1 million. This assessment was accepted by the Court (A90-50/51 - 15th March, 1991). Comparatively speaking the islands have a lot in common. They are within the Broadwater, they are made up of large areas, they have a common zoning, they are surrounded in whole or in part by wetland or fish habitat reserves, they had no services, access was by boat or helicopter and they were unimproved. They differ in terms of composition of land, in elevation, in situation and access and in terms of whether rights could be obtained for the construction of jetties and walkways to service the chosen homesites (a matter which turns primarily on the preferred location and whether one or more sites are chosen for the purpose). Mr Coonan also made the assessment of compensation in this case. He valued the island as one site at $650,000. In doing so, he has identified a site (site 1 on Lot 1) as the preferred homesite.
The claim which was filed in Court in response to an Order under Section 25 of the Act was in the sum of $40 million. Leave of the Court was sought on the day of hearing and obtained to amend the claim to $1.5 million. This sum represents the summation of the selling prices expected to be obtained for the two lots if sold separately at the date of resumption ($750,000 each). This assessment was made by Mr M.J. Eccleston, registered valuer. Were he to value the island as a single site he would value it at $1.25 million. Mr L.J. Hamilton, registered valuer, was also called on behalf of the claimant. He valued the northern lot (Lot 2) at $750,000 and the southern lot (Lot 1) at $650,000. He assumed a sale of the lots to the one purchaser and allowed a discount of $100,000. His assessment thus becomes $1.3 million. As a single site he would value the island at $1.2 million. It follows that both found that the highest and best use of the land was for sale of the lots separately. Mr Coonan is of the opposite opinion. On the assumption that the lots were sold separately and by adopting sites 1 and 4 as the preferred homesites, he would value Lot 1 at $390,000 and Lot 2 at $195,000, giving a total consideration of $585,000 which he would then discount by $35,000 on the basis of the sale being made to the one purchaser with he retaining one lot (Lot 1) and selling Lot 2. The resolution of these opinions turns on a number of issues but predominantly on the question whether access to water (for jetty/pontoon purposes) could be obtained to the preferred homesites as seen by the respective valuers and nonetheless important whether the premium applied by Mr Coonan throughout his assessments in this area for the aura or mystique (exclusivity) in owning a whole island would be destroyed by sale of the lots separately.
The principal basis for the assessments made by Mr Eccleston and Mr Hamilton is the Coomera determination which they sought to apply to Woogoompah on the footing that as each surveyed lot possessed such a sizeable mass of forest land when compared with Coomera and Kangaroo and with homesites from up to 1 to 2 kilometres apart, they would be seen in the marketplace as the equivalent of islands. Indeed some comfort was thought to exist from the presence of another resident on the island. They could speak on the evidence which formed the background to the assessments made by Mr Coonan who wrote this valuation following on or contemporaneously with writing his assessments in respect of the other resumptions. Whilst their approach is in the nature of a critique of Mr Coonan's relativity between the subject island and Coomera, I do not see that as detracting from their approach or their opinions nor, for that matter, does it add weight to the opinions of Mr Coonan.
When Mr Coonan inspected the island for the purpose of ascertaining likely homesites he had with him Dr J.P. Beumer, Manager (Marine Resources), Fisheries Branch, Department of Primary Industries. Dr Beumer described his function within the Department as manager, technical adviser and assessor of fish habitat areas in coastal and inland Queensland and manager of commercial and recreational fisheries. He would appear to be the person in Government best capable of advising a landholder of the significance of wetland and fish habitat reserves and of the sensitivity of the Department and Government to the destruction of mangroves and marine plants. He would also appear to be the person in Government best capable of advising on the possibility or probability of obtaining a revocation of such reserves for such things as the construction of pontoons, jetties and walkways and on the issue of permits to destroy mangroves and marine plants for like purposes, these being the only relevant issues in this case. As a result of their joint inspection, Mr Coonan said this in his report:"It would be possible to construct floating pontoons on the island provided that such pontoons can be anchored above High Water Mark without piling in the Fish Habitat Reserve and provided that such construction would not involve the destruction of mangrove plants. I consider that three such sites exist on the island, two are found on the western foreshore of the island to the north of the Fish Habitat Reserve exclusion strip and one at the southern end of the island on the banks of the Pimpama River. "
The site he mentioned at the southern end of the island is the site which I have referred to as site 1 and coincides with the site identified by Mr R.M. Morton, marine biologist, in his report (Exhibit 12). Mr Morton gave evidence on behalf of the claimant. The first two sites are in the location of the site which I have referred to as site 4 - also identified as such in the report of Mr Morton. The other sites which have come in for consideration are in the north-eastern section of the lots - site 3 in respect of Lot 2 and site 2 in respect of Lot 1 (again taken from the report of Mr Morton). Mr Coonan and Dr Beumer had also considered the latter sites. These sites, prima facie, possess constraints in that it is accepted that a revocation of the Fish Habitat Reserve would be required so as to allow for the construction of jetties and walkways. Permits would also be required for the destruction of mangroves and marine plants. The provisions governing revocation and the granting of permits are contained in ss. 51 and 71 of the Fisheries Act. Dr Beumer gave evidence in support of his opinions. Two engineers were also called. Mr C.H. Abraham for the claimant and Mr R. Chapman for the respondent. Their evidence dealt with the costs of construction of pontoons, jetties and walkways. The costs differ mainly in terms of the type of construction required which it seems to have been accepted and I agree, is a matter of preference by the individual owner - the important point being that whichever mode of construction is adopted, a comparable construction on basic properties (such as Coomera) could be expected to cost a sum of comparable proportion. Their evidence requires no further comment.
Of the four possible locations for homesites, only three, as will become evident, call for serious consideration - sites 1, 4 and 3 - and I will examine them in that order.
SITE 1
Here an area of the channel is within the boundary of the freehold (Exhibit 14). The channel to this point from the Broadwater is capable of navigation by boats up to 11 metres in length. The waters edge is separated from the forest land where a residence is likely to be positioned by about 50 metres of fringing mangrove and salt marsh. It is not in dispute that a strip 3 metres wide would be sufficient to house a walkway/causeway to the access point. Historically the site has been identified as a water access point (remnant fencing posts remain) and the route to the water is clearly evident on aerial photography (Exhibit 16). On his inspection of the site, Mr Morton was of the opinion that the disturbance to mangroves associated with providing water access if appropriately located would involve the removal of less than ten mangroves (other than seedlings). Both he and Dr Beumer were of the opinion that if the depth of water within the boundary of the freehold was sufficient to float and anchor a pontoon, a revocation of part of the fish habitat reserve would not be required (the area within the freehold not being within the reserve) and they were of the opinion that disturbance to mangroves and marine plants associated with the provision of access from the pontoon would be minimal. In Dr Beumer's opinion an application under Section 71 would have more than a reasonable chance of success. My conclusion on the evidence is that if this site is viewed either as the preferred site to service Lot 1 or the island as a whole, a prospective purchaser could be reasonably certain a revocation of the reserve would not be required and that he would obtain the necessary permit to enable him to construct access to the water.
SITE 4
The preferred location of this site is within Lot 2 in the north-western area where the forest land and the boundary of the freehold coincide or protrude into the channel. The bank at this particular site is eroded. However, entrance into the channel from the north (the only practical entrance) is restricted and the channel is shallow. No mangroves or salt marsh occur at this location. It is agreed that if a pontoon could be floated in this location sufficiently proximate to the bank so as to obviate the need to carry out works in the reserve, a revocation would not be required. Subject to this qualification which equally applies to site 1, the degree of certainty favouring such constructions without revocation are comparable. However, accessibility to the site in terms of tides and vessel size is the problem with a shallow bar existing at the end of the channel which is navigable on the balance of probabilities by a 7 metre vessel at high tide down to half tide. I am satisfied on the evidence that in real terms this site would be considered by a purchaser as one of last resort.
SITE 3
This site is in the north-eastern section of the island and within Lot 2. The general location of the site is the area preferred by Mr Eccleston and Mr Hamilton for reasons that the elevation of the forest land rises to 3 to 4 metres which with selective clearing of timber would afford a home good north-easterly and easterly views. The site differs in this respect from site 2 (within Lot 1) where the forest land is of about the elevation of the land associated with site 1 (Exhibit 7). The boundary of the freehold at site 3 is about 60 metres from the waters edge. The area between is mangrove and salt marsh. It is agreed that revocation of part of the fish habitat reserve would be required for the construction and anchoring of a pontoon and that a permit would be required to destroy mangroves necessary to gain access to the site. In the opinion of Mr Morton the construction of these works at this point would not lead to any discernible impact to the aquatic ecology or fisheries of the area. His advice to a prospective applicant would be to approach the Department with the proposition that the area excluded in the west of the island (the exclusion zone) be included within the reserve in return for the exclusion of the area necessary for the works desired at this point. If this were done, he sees an overall benefit to the reserve in that any possibility of access being taken from the mainland to the island via a bridge would be locked off completely. He agreed with the principle that the number of access points to a reserve should be limited, that in principle any revocation should be for the benefit of the reserve, that in the absence of the owner foregoing any inherent rights he may possess in respect of the exclusion zone in the west, no benefit could be found in revoking part of the reserve in the eastern section and that a revocation for the sake of convenience to a landholder was irrelevant. Dr Beumer agreed that the development of access at this point would involve minimal disturbance to vegetation which is of significance to fisheries but would not recommend partial revocation in view of the alternative access points available at sites 1 and 4. The difficulty I have with this reasoning in this particular case is found in the philosophy lying behind the creation of these reserves in association with an area of freehold land intended to be kept in a rural zoning. The intent is contained in the 1974 Report (referred to in the Coomera decision) and in the zoning of the land since the inception of zoning. In the 1974 Report it was recommended that the freehold land on this island and others, the subject of the report, be retained in the least intensive of the rural zonings - in this case, "Rural C". This has been done. There was never any intention that the island should be denied access. Indeed the provision of the exclusion zone in the west has obviously been made so as to enable access to be gained to the island. Further, it can be taken as read that the committee recognised that under the zoning the land could be further subdivided within that zone - the minimum area applying at the date of resumption is 20 hectares. The exclusion zone is heavily mangroved and has a value to fisheries. Mr Morton says that if this zone is included within the reserve, the likelihood of access being obtained from the mainland by bridge would become so remote as not to be countenanced and so arises the overall benefit. On the other hand, I cannot lose sight of the fact that when this decision was made by the committee and subsequently adopted by the Government and reflected in the zoning laws, no provision was made by the committee for boat ramps or any form of private or public works on any part of the foreshore of the island. This is a feature which goes against the thinking of Mr Morton and lends support to the reasoning of Dr Beumer. In weighing up the evidence it appears to me that were a purchaser intent on obtaining access in this section of the island to serve Lot 2, he would put the probabilities slightly in his favour and perhaps on a score of 1:100 at about 60. As a potential site to serve the island as a whole, the chances would appear to be much fewer. The other matter I mention which is reflected in this conclusion is that if the island is sold in separate lots and a case is made out for the inclusion of the exclusion zone within the reserve in return for access at site 3 to service Lot 2, a joint application would have to be made and that such things can never be regarded as certain where separate owners are involved. With these conclusions in mind I turn to the evidence of valuation from the two principal points of view.
In the valuations of Mr Eccleston and Mr Hamilton it was always envisaged that if the island was sold as a whole, the preferred homesite would be in the vicinity of site 3 and that such would also be the preferred site were Lot 2 sold separately. For Lot 1, the alternatives lay between sites 1 and 2 with some leaning towards site 2, although they made no distinction in the value of Lot 1 were site 1 the preferred site. The leaning towards site 2 lay in aspect which is seen as comparable with site 3 although there is an apparent difference in elevation. A development of site 2 would run the same risks as a development of site 3. The sites are exposed to the prevailing breezes. Their opinions may be scheduled as follows:
Mr Eccleston
Sites 1 and 3 Lot 1 Lot 2
$750,000 $750,000
Mr Hamilton
$650,000 $750,000
Mr Eccleston
Sites 1 and 4 $750,000 $500,000
Mr Hamilton
$650,000 $600,000
Mr Eccleston
Sites 1 and 3 with access to
site 3 by easement from site 1 $500,000 $600,000
Mr Hamilton
$575,000 $700,000
Throughout these exercises Mr Eccleston would value the island as a whole at $1.25M. Were access confined to the exclusion zone alone, he would value the island at $750,000 and the lots separately at $450,000 each. In those circumstances, Mr Hamilton would value the lots at $400,000 (Lot 1) and $500,000 (Lot 2). He thought that this exercise was of little assistance since he had not considered the manner and costs of obtaining access through the exclusion zone. The question was not addressed by either Mr Eccleston or Mr Coonan, save that in their valuations, alternative exercises included hypothetical subdivision with bridge access. These workings indicate that the costs of obtaining access in this manner would be prohibitive.
The above estimates were obtained by comparing Coomera as an island site with Lots 1 and 2 separately and the island as a whole. Included in the estimates is an escalation factor which was built into the Coomera assessment. This came about for reasons that since March, 1986 (the date Kangaroo Island was resumed), values rose considerably on the Gold Coast. In the absence of a sale of an island after that date, Mr Coonan had no alternative but to include in the Coomera assessment a reflection of the rise. For waterfront land at Paradise Point, the rise was of the order of 60 percent. For dry blocks in the same area, the rise was of the order of 40 percent. The period involved was barely 18 months. The escalation figure applied in Coomera was 50 percent. Because Woogoompah in his opinion is further from the Gold Coast than Coomera, he applied an escalation factor of 30 percent. If his estimates of the value of Lots 1 and 2 were put on the footing of 50 percent and by accepting sites 1 and 4 as the preferred sites, they would become:
Site 1 Lot 1 $300,000 x 150% = $450,000
Site 4 Lot 2 $150,000 x 150% = $225,000
But comparability as to footing between his values and those of the claimant's valuers does not end there. Whilst Mr Coonan freely admits that both lots as separate lots using sites 1 and 4 or for that matter, sites 1 and 3, have seclusion and privacy from each other, the fact that the lots are part of an island would detract from their value - exclusivity would be lost and the lots would become more comparable with acreage mainland sites with water access than with islands. In order to get on to a common footing, further assumptions must be made a) that access could be obtained at site 3 without any difficulty and b) that as separate lots the sites would be seen in the marketplace as islands. Were these assumptions made, his valuations would become:
Site 1 Lot 1 $500,000 x 150% = $750,000
Site 3 Lot 2 $400,000 x 150% = $600,000
He distinguished between the value of the lots mainly on the ground that access to Lot 2 would be exposed to the prevailing breezes blowing over a considerable distance of water thus giving rise to difficulty in manoeuvring and mooring. In order to resolve these competing opinions, I must first trace some of the background in respect of the market. The subject island was sold at auction by a mortgagee in possession in October 1984 for $480,000. At the time there were rumours that the land might be resumed. When determining compensation for Kangaroo, the Land Appeal Court regarded the sale as being tainted and was not influenced by it (J.A. and O.M. Alroy v. The Crown (1988-89) 12 Q.L.C.R. 67 at p. 75). In October, 1985, an area of 18 hectares on the mainland to the south-east of McCoys Creek and the boat ramp at Coleman Road sold for $417,000. This area is known as Waterways Point. The area rises to 10 metres in elevation and is connected with the mainland by a narrow neck. Mr Coonan sees the area as having features which could be identified with an island. Kangaroo Island was resumed in March, 1986. The Land Appeal Court accepted that the highest and best use of the land was for sale as an island and valued it at $400,000. In May 1986, Garden Island was sold for $430,000. It is agreed that between 1984 and March 1986 the market was static. In the period to 1987 (September) the market rose. The rise in value for canal blocks at Paradise Point which is the nearest urban area of the Gold Coast to Coomera and the subject land was slightly more than 60 percent. In the same period, for large rural residential sites in Foxwell Road (the access road to Coleman Road from the Pacific Highway) the rise in value varied between 8 and 18 percent. When Mr Coonan first valued Coomera, he did so on the basis that the preferred homesite on the island was in the south-western area of Portion 84, back from the water and with no views. As an island with that site as the preferred site, his estimate of value included an escalation factor of 30 percent. He valued the island at $572,000. Following receipt of engineering advice as to the suitability of a site on Portion 85, nearer Sanctuary Cove and with better views, he revised his estimate of value to $1M which included an escalation factor of 50 percent. There is no sale of an island which would confirm or deny this factor. However, there is included in the valuation of Mr Coonan, details of a bid of $1M made for Tabby Tabby Island when it was put to auction in October 1987. This island has an area of 66 hectares and is situated just north of Kangaroo and opposite the mainland township of Cabbage Tree Point. The island enjoys deep water access, is within 3 kilometres of a marina and has a sandy foreshore. In the opinion of Mr Coonan the island possesses panoramic views. Improvements on the island comprised a dwelling, jetty, machinery shed and a sub-station. The bid on his workings indicates a land value of $772,000.
The escalation factor should be settled at the outset. The period involved is short. The greatest movement occurred with blocks possessing waterfrontage. The rise was certainly not a steady rise by any means and there is a clear distinction between blocks with waterfrontage and dry blocks. The highest of the increases was in substance applied in Coomera. The distinction drawn by Mr Coonan between the subject island and Coomera as sites with waterfrontage has been determined by the situation of the areas to the Gold Coast. In this instance he considers that the movement reflected in the sales of rural homesites in the Foxwell Road area has a greater impact than it possessed at Coomera. The subject land as with Coomera, Kangaroo and other bases in his evidence have been seen as sites with no significant regard to size. In that light any conclusion of the market movement should be dominated by the movement in waterfront sites. It is a feature which any prudent vendor would not overlook and I would expect would not be overlooked by a prudent vendor of Waterways Point and Kangaroo were they put up for sale in 1987. It can be assumed that this market movement was reflected in the bid for Tabby Tabby which in round figures represents a land value of about $800,000 in October, 1987. There is no comparison before the Court between Tabby Tabby and Kangaroo or between Tabby Tabby and Waterways Point. The relationship between Kangaroo and Waterways Point at $400,000 to $417,000 was acceptable to the Land Appeal Court. Both have the ingredients we are speaking about - sites with water frontage. Were those values escalated by 30 percent they would represent for comparison purposes $520,000 and $540,000 in round figures. That relationship with Tabby Tabby does not sit as comfortably in my opinion as one where an escalation factor of 50 percent is applied, which would represent for comparison purposes values of $600,000 and $625,000. Coming from north to south and applying this form of consistency of approach, the sums for comparison purposes without other considerations would represent:
Tabby Tabby - $800,000
Kangaroo - $600,000
Woogoompah - $750,000
Coomera - $1 million
In comparing Coomera with the subject land as island sites, the principal issues involved in the comparisons were situation and access, size and flooding. Both Mr Eccleston and Mr Hamilton were firmly of the opinion that the size and quality of the subject island was very much a plus factor in that the forest land could be easily traversed and used for recreational pursuits, whereas Coomera, although of substantial area, comprised land broken by salt marsh and mangrove areas. No such enhancement is included in the valuation of Mr Coonan. The comparison properties of Tabby Tabby, Kangaroo and Waterways Point have areas of 66 hectares, 63 hectares and 18 hectares respectively. Mr Eccleston has estimated that there are about 500 hectares of good timbered sandy forest country on the subject island. In Mr Hamilton's exercise he has estimated that there are 110 hectares of land on Lot 2 above level 2.5 and about 20 hectares above that level on Lot 1. The homesite selected on Coomera as the preferred site is on Portion 85 in the western area of the island, opposite the Sanctuary Cove development and with access via the south branch of the Coomera River, which access also serves Sanctuary Cove. The access is not encumbered by reserves. Lund's Marina adjoins Sanctuary Cove whilst another exists at Paradise Point. There is no dispute that Coomera has superior access and situation. The preferred homesite on Coomera would, on the engineering advices received by Mr Coonan, require the placement of pads. Comparatively speaking, costs of the provision of pads were insignificant in a value of $1 million. Nevertheless, it is a valuation consideration and one which no doubt a purchaser would prefer to be without. The preferred homesites on the subject land are either in the location of site 1 or site 3. Having regard to the evidence of Mr Coonan dealing with the exposure of site 3 and in taking into account the risks involved in obtaining permission to construct access to the site, I have concluded that the hypothetical prudent purchaser would accept site 1 as the preferred homesite for the island. In comparing the islands on this basis, it appears to me that the most telling feature coming out of the evidence of comparison is this - it is agreed that Coomera would appeal to a greater section of the market (almost to the extent of rendering the site not comparable with the subject site) by virtue of its location to Sanctuary Cove and to the Gold Coast. This being so, I am unable to appreciate how the subject island as an island site could be superior to Coomera, notwithstanding the positive elements favouring the island, including size and the element of flooding. Further, when comparing Coomera with the subject lots separately and including therein all the ingredients of privacy and exclusivity, Mr Eccleston and Mr Hamilton each have the lots priced at sums substantially below Coomera. The difference between the value of Lot 1 of say $750,000 and the value of the whole at say $1.25M on this reasoning could only be attributed to the additional area. Clearly the additional area by itself could not account for the difference. As island to island and bringing into account some benefit by virtue of the size and quality of the subject land, a more reasonable relationship would appear to be of the order of $850,000 to $900,000.
The alternative test involves the sale of the lots separately. Mr Eccleston has assumed a sale of each lot on the relevant date or within a short time thereafter, to separate purchasers. Mr Hamilton assumes an acquisition of the two sites "in one line" in which the hypothetical purchaser would require a discount reflecting the costs of disposing of one of the parcels. Mr Coonan had taken a similar approach. In Canberra Freeholds Ltd v. Queanbeyan Municipal Council (1971-73) 27 L.G.R.A. 134, Else-Mitchell J. at p. 137 said:"As I see the position, it is a question of fact for determination by the tribunal assessing compensation in the light of the circumstances of each resumption, whether one should assume the immediate sale of the entirety of the land resumed to one purchaser or the sale of individual subdivided lots to several purchasers; and according to whichever assumption is made it will usually be necessary to consider also how far the market price would be affected and to what extent any delay in the sale of all the sub-divided parcels might ensue. "
At the relevant time assuming that the lots were reasonably priced and covered any element of risk in obtaining water access, the climate was favourable to a quick sale, such that a vendor could expect to dispose of both lots on the given date. This is the approach I intend to follow. With sites 1 and 3 as the preferred homesites, it is agreed that such sites would afford seclusion and privacy. Mr Eccleston and Mr Hamilton are of the opinion that they would possess the degree of exclusivity as is reflected in the Coomera valuation. Mr Coonan thinks not and for that reason submits that the principle of comparing "like with like" would be offended if Coomera is compared. His opinion is that exclusivity is lost by separate sales and that pricing then becomes more a matter of comparison of the lots with Waterways Point than with any other basis, since Waterways Point, although not possessing exclusivity has many of the ingredients of an island - isolation, aspect, water frontage and water access. He has previously argued that the history of sales in this area of the coast supports his opinion. The evidence before this Court takes from that opinion somewhat in that the last transactions involving Kangaroo, Woogoompah and Coomera were made to purchasers who had not intended to use the islands for single unit residential purposes. On the other hand there is no evidence of sales of islands which were bought for subdivision and sale into more than one residential lot. This kind of exercise was performed as a check method of assessment by Mr Eccleston and Mr Coonan in relation to the subject land. In a group title subdivision with bridge access from the mainland, lots (31 lots) are priced at $125,000 by Mr Eccleston and $100,000 by Mr Coonan. No site would possess access to a jetty on the island, either singularly or in common. Nevertheless, the influence of privacy, seclusion and exclusivity is evident in these sums. In view of the size of the island and the relative isolation of sites 1 to 4, neither Mr Eccleston nor Mr Hamilton could answer satisfactorily why a sale of the two lots separately was preferable to a subdivision of those lots into four lots. I have accordingly concluded that Mr Coonan's approach is the preferred approach and that for the purpose of pricing the lots, the better basis is the sale of Waterways Point. Mr Coonan is of the opinion that given the area of the lots and the greater privacy the lots would have by being on Woogoompah, they would still not be as good as Waterways Point and could only gain superiority if they possessed mainland access. Whilst I have accepted that the hypothetical prudent purchaser could feel reasonably certain of obtaining access at site 1, a risk remains at site 3 (a matter which was not accounted for in the valuations made for the claimant). On the assumption that Waterways Point possessed a value of $625,000 at 1987, a reasonable pricing of the lots would, in my opinion, be of the order of $500,000 for Lot 1 and $400,000 for Lot 2, bearing in mind as well evidence such as the value of Kangaroo if brought forward to 1987 at an escalation factor of 50 percent and the bid for Tabby Tabby. In both exercises, the doubts whether the emphasis placed on the situation and access of Coomera to the Gold Coast when compared with Waterways Point and the subject land would call for a lesser escalation factor has been resolved in favour of the claimant, in keeping with well established principles (Commissioner of Succession Duties (SA) v. Executor Trustee and Agency Co of SA Ltd (1946/47) 74 C.L.R. 358 per Dixon J. at pp. 373/4). Notwithstanding that the results of these exercises virtually coincide, I am inclined to the view that the more prudent method of marketing the island would be as one site and for that purpose I find that it could reasonably be expected to fetch the sum of $900,000 at the relevant date.
Compensation will therefore be determined in the sum of Nine hundred thousand dollars ($900,000). Interest on this sum is ordered to be paid at the rate of 13 percentum per annum from and including the date of resumption up to and including the day immediately preceding the date compensation is paid save that interest shall not be paid on any sum advanced against compensation.
Member of the Land Court
Re: Application for Costs
- Section 24(3) Acquisition of Land Act
- leave to amend claim.
It is further ordered in the exercise of the Court's discretionary powers that the claimant pay the respondent's costs thrown away as a result of the amendment of the claim granted pursuant to the provisions of Section 24(3) of the Acquisition of Land Act. The amount of such costs shall be ascertained and fixed by the costs taxing officer of the Supreme Court at Brisbane according to the scale of costs prescribed by law for the time being in respect of proceedings in the Supreme Court and in accordance with the provisions of Section 41(9) of the Land Act 1962 - 1990.
Re: Costs of and incidental to thehearing of the claim as amended.
No order is made as to costs of and incidental to the hearing of the claim as amended.
Member of the Land Court
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