CITIC PACIFIC MINING MANAGEMENT PTY LTD and VALUER GENERAL [2016] WASAT 23

Jurisdiction:	STATE ADMINISTRATIVE TRIBUNAL	Citation No:	[2016] WASAT 23
Act:	VALUATION OF LAND ACT 1978 (WA)
Case No:	DR:169/2015	Heard:	3 AND 4 FEBRUARY 2016
Coram:	JUDGE D R PARRY (DEPUTY PRESIDENT)	Delivered:	9/03/16
No of pages:	37	Judgment Part:	1 of 1
Result:	Application for review allowed Gross rental value of a 100 hectare portion of Lot 263 on Deposited Plan 220164 comprising and known as Eramurra transient workers' accommodation village as at 1 August 2011 of $12,008,880 set aside and decision substituted that gross rental value of that land as at that date was $3,396,055.10
Category:	B
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Parties:	CITIC PACIFIC MINING MANAGEMENT PTY LTD VALUER GENERAL
Catchwords:	Valuation of land Gross rental value Transient workers' accommodation village in Pilbara region Isolated and remote location Whether gross rental value of the land can reasonably be determined on the basis of gross annual rental that the land might reasonably be expected to realize if let on a tenancy from year to year Whether gross rental value of the land is required to be determined on the basis of assessed value Methodology of valuation Comparable rent method adopted and applied by Valuer General to derive hypothetical gross annual rental of the land Rents relied upon by Valuer General as 'comparable' in respect of transient workers' accommodation villages in Karratha and Roebourne townsites Whether rents relied upon by Valuer General are 'comparable' having regard to differences in location and size in comparison to Eramurra Village Whether specific adjustments for differences in location and size can safely be made on evidence to determine gross rental value of the land Whether the land is 'land in respect of which ... a lease is held under the Mining Act 1978' for purposes of definition of 'unimproved value' and hence 'capital value' and 'assessed value' of the land where the land is only part of the property leased under the Mining Act 1978 (WA) Whether there is sufficient evidence of 'the estimated replacement cost of improvements to the land' for the purposes of the definition of 'capital value' and hence 'assessed value' of the land
Legislation:	Local Government Act 1995 (WA), s 6.28 Mining Act 1978 (WA) State Administrative Tribunal Act 2004 (WA), s 27 Valuation of Land Act 1978 (WA), s 4(1), s 18, s 32(1), s 32(3), s 32(7), Pt III, s 33(1), s 33(2) Valuation of Land Regulations 1979 (WA), reg 3(2)
Case References:	Buckingham v ValuerGeneral (2002) 30 SR (WA) 30 City of Kwinana v Lamont [2014] WASCA 112 Duffy v Minister for Planning [2003] WASCA 294 Fremantle Markets Pty Ltd and Valuer General [2015] WASAT 121 Leichhardt Municipal Council v Seatainer Terminals Pty Ltd (1981) 48 LGRA 409
Orders	1. The application for review is allowed.,2. The determination by the Valuer General of gross rental value of a 100 hectare portion of Lot 263 on…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2016] WASAT 23
Decision Date: 9 MARCH 2016

CaseChat Overview and Summary

The case between CITIC Pacific Mining Management Pty Ltd and the Valuer General involved a dispute over the valuation of a 100 hectare portion of land known as the Eramurra transient workers' accommodation village in the Pilbara region. The court was tasked with determining whether the gross rental value of the land could be reasonably assessed based on the gross annual rental that the land might reasonably be expected to achieve if let on a tenancy from year to year. Additionally, the court had to decide whether the gross rental value should be determined on the basis of the assessed value, and if the methodology of valuation adopted by the Valuer General was appropriate. The court also examined whether the rents relied upon by the Valuer General as 'comparable' for similar transient workers' accommodation villages in Karratha and Roebourne townsites were indeed comparable, given the differences in location and size. Furthermore, the court addressed whether specific adjustments for these differences could be safely made on the evidence to determine the gross rental value of the land. Lastly, the court considered whether the land qualified as 'land in respect of which... a lease is held under the Mining Act 1978' for the purposes of defining 'unimproved value' and hence 'capital value' and 'assessed value' of the land, given that it was only part of the property leased under the Mining Act 1978 (WA). The court also examined if there was sufficient evidence of 'the estimated replacement cost of improvements to the land' for the purposes of the definition of 'capital value' and hence 'assessed value' of the land.

The court found that the Valuer General's method of valuation was flawed in several respects. The court held that the Valuer General had not correctly applied the comparable rent method in deriving the hypothetical gross annual rental of the land. The court found that the rents relied upon by the Valuer General as 'comparable' were not in fact comparable due to significant differences in location and size. The court further held that the Valuer General had not made sufficient adjustments to account for these differences, and that the evidence was insufficient to support the adjustments that were made. The court also found that the land did not qualify as 'land in respect of which... a lease is held under the Mining Act 1978' for the purposes of defining 'unimproved value' and hence 'capital value' and 'assessed value' of the land. Finally, the court held that there was insufficient evidence of 'the estimated replacement cost of improvements to the land' for the purposes of the definition of 'capital value' and hence 'assessed value' of the land.

The court allowed the application for review and set aside the gross rental value of the land as determined by the Valuer General. The court substituted its own decision that the gross rental value of the land as at 1 August 2011 was $3,396,055.10. The decision provides important guidance on the methodology of valuation of land in remote and isolated locations and the requirements for determining the gross rental value of such land. The decision also highlights the importance of ensuring that the evidence relied upon in the valuation process is sufficient and appropriate to support the conclusions reached.

Orders

Orders of the court

Application for review allowed

Gross rental value of a 100 hectare portion of Lot 263 on Deposited Plan 220164 comprising and known as Eramurra transient workers' accommodation village as at 1 August 2011 of $12,008,880 set aside and decision substituted that gross rental value of that land as at that date was $3,396,055.10

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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