Collins v Chief Executive, Department of Lands
[1996] QLC 35
•22 March 1996
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BRISBANE
22 MARCH 1996
Re: AV95-580
An appeal against an unimproved valuation -
Valuation of Land Act 1944
Local Authority: Esk
Michael A and Jeanette C Collins
v.
Chief Executive, Department of Lands
(Hearing at Toogoolawah)
D E C I S I O N
Mr and Mrs Collins own land described as Lot 2 on Registered Plan 230871, Parish of Byron, containing an area of 24.1 ha. As at 1 January 1995, the Department of Lands valued the land unimproved in the amount of $98,000.
The land fronts the bitumen sealed Stanley Pocket Road, about 35 kilometres north of the town of Esk. Electricity and telephone services are connected.
Mr E.G. Ridley was the Department of Lands' valuer who carried out the valuation, based on its highest and best use as a rural residential site. He described the land as "moderately to steeply sloping forest type country timbered with spotted gum and ironbark. A suitable building site, which affords views over Somerset Dam, is located some 350 metres from the access point on Stanley Pocket Road. Some surface stabilisation is required on the steeper slopes of the internal access road." The grounds of appeal refer to what is described as the dramatic increase in the assessed unimproved value of the property on each valuation occasion since 1989 and the high valuation of the subject property when considered in the range of values applied to rural homesites throughout the shire. The relativity between valuations of the subject land and adjoining lands is challenged as being unreasonable. These adjoining valuations were analysed on a unit of area basis with the subject land being valued at $4,066 per ha, a property opposite to the east of 33.041 ha at $2,845 per ha and an adjoining property to the north of 107 ha at $1,542 per ha. Reference was made to the high cost of the guarantee which had been necessary to have electricity connected and the general lack of services in the locality and the distance from Esk. Despite grazing activities the land was valued purely as a "Homestead Block".
Mrs J.C. Collins attended the hearing and provided further material supporting the grounds of appeal. This included details of specific valuations the relativity of which was questioned. As an example a 23.76 ha homesite in the Parish of Beppo, 12 kilometres from Esk with rural views, postal and school bus service to the gate, bitumen road and electricity availability was valued at $64,000. In comparison while the subject land had views of the waters of Somerset Dam, electricity and bitumen road it was much further from Esk then 4 kilometres from a postal service and 9 kilometres from a school bus service and was valued at $98,000. Mrs Collins agreed that views of Somerset Dam waters would be expected to command a premium in value in comparison with pure rural views but believed in the example given that the disadvantaged location relative to services at least off-set the advantage of water view.
In her opinion the subject valuation should not have been higher than the larger 33 ha property (McCarron's) across the road which was higher in elevation and which in her opinion enjoyed better water views. While that block was of somewhat irregular shape in her opinion any disadvantage in comparison with the subject land was offset by the larger area. The homesite selected on McCarron's had required substantial access construction but Mrs Collins felt that was not necessarily a matter affecting unimproved value but more a matter of choice in the owners' preference for the best available site. She pointed out that while the homesite selected on the subject property might also be regarded as the best position available, the access to it was steep and the site had necessitated expensive construction due to the need for rock blasting. She did not agree that the direct water view from the best position on the subject land was superior to the view from McCarron's, which, while overlooking neighbouring properties encompassed wider views.
In Mrs Collins' opinion the much larger property (Samson's) to the north (comprising 81 ha of freehold land together with leasehold areas of 27 ha adjacent to the Dam) was far more superior than the relative valuation of $165,000 suggested. That land had direct water access and much superior water views.
Included in the material tendered by Mrs Collins was a letter written by Mr G.D. Evans, the manager of a local real estate agency. The letter was intended to support the unimproved value estimate of $60,000 in "taking into account recent property sales". I am unable to give weight to the statements in the letter because Mr Evans was not called to provide evidentiary support to his estimate or to be examined on the basis of his stated opinion.
Mr Ridley held the opinion that there was no irregularity in the relativity of valuations at the relevant valuation date. As I understood his evidence, that opinion was strictly limited to the valuation date. There has been, subsequent to the valuation date, a sale of the Sampson property. It seems that Mr Ridley has interpreted that sale as indicating a significant increase in value of property with direct access to and wide views of the waters of Somerset Dam. It is more likely that what Mrs Collins suggests was supported - that the valuation of the Sampson property was too low, in comparison, in the first place.
With regard to the McCarron property, Mr Ridley agreed that it comprised land higher in elevation than the subject land although he had been surprised with the unchallenged evidence of Mrs Collins that the highest elevations were "200 metres" and "145 metres" respectively. Mr Ridley preferred the view of some of the waters of the dam from the subject property to that available over neighbouring properties from the McCarron property. However he was more concerned with the expensive construction which had been necessary to access the homesite on the latter property. He also held the opinion that the somewhat irregular shape of the McCarron property, necessitating additional boundary fencing, was a disadvantage.
Mr Ridley has had long valuation experience in Esk Shire and his knowledge of the rural residential market assisted him in the relevant date valuation exercise. He had specific regard to two sales which in his opinion, supported the valuation appealed against. Brief details of these sales were:
(1)A 50.17 ha site sold in Mt Byron Road from Bradfield to Wainwright in March 1994 for $120,000 the sale having been analysed to show an unimproved value of $100,460.
(2)A 18.17 ha site in Stanley Pocket Road sold from Burke to Artiemiew in May 1994 for $78,000, the sale having been analysed to show an unimproved value of $71,000.
In neither case was a separate valuation applied as at 1 January 1995, the sale lands becoming amalgamated for valuation purposes with adjoining land. Both sales were to adjoining owners. Mr Ridley's inquiries satisfied him that the sales were not inflated through the adjoining owner status of the purchasers. As he saw it, although acquired for amalgamation with grazing lands, any premium paid was above grazing values - the purchasers having to meet the rural residential site market. In fact it was established during the hearing that the unimproved value which had been applied to the land in the first sale as at a valuation date of 30 June, 1993 had been $108,000. That information supported Mr Ridley's opinion that the level of value indicated no adjoining owner premium above rural residential site value. It does however suggest that at least prior to 1 January 1995 the sale land had been considered by the Department (and Mr Ridley) to be superior in value to the subject. In Mr Ridley's comparison here, were the following comments:
"The sale property has inferior situation, services and access. It is of similar land formation as the subject. It has slightly superior water. Suitable building site has good views, but not over body of water. Sale is larger in size and considered overall comparable with the subject".
The second sale, in comparison with the subject land, was described as follows:
"This sale property has slightly superior situation, similar access and services. It does not possess a building site affording extensive desirable views. It is smaller in size and considered overall inferior to subject."
It would have been preferable to have had as a basis, sales evidence of land with comparable view and without the adjoining owner taint. However, I accept that Mr Ridley has given sufficient consideration to the broader geographical evidence within the shire to obtain support for the general level of value applied to the subject land. In contrast, there is no acceptable evidence to support the general level of value sought by the appellants. The land is used as a rural homesite with hobby type grazing activity and there is no reason for it to be valued other than on a site basis. There seems no disagreement (as there should not be) that while the size of a rural homesite is one aspect affecting value, it would be wrong to attempt to value such land on a unit of area (eg a value per ha) basis. It obviously seems unfair to the appellants that the valuation of the land should be made on the basis that it has electricity available when the appellants were required to pay for, or at least contribute towards, the cost of extending the service to allow the internal connection. Nevertheless, the external infrastructure is not appurtenant to the land and is not an improvement attaching to the land. In Clough v. The Valuer-General (1981-82) 8 QLCR 70 at pp.73-74 the Land Appeal Court said:
"A road, or service (sewerage, water or electricity) are not in the strict legal sense appurtenant to a parcel of land. They do not belong to it as a property right ... the wires ... exterior to the parcel (and in some cases within the bounds of the parcel) are owned by the relevant service authority."
Then at p.75:
"We think it beyond doubt that what has to be valued is the subject parcel of land viewed as if the improvements thereon, visible or invisible, never existed but that other wise the parcel was situated in the community (and environment) with the amenities and facilities that had grown up around it as at the date of valuation."
In this case, just as the land is to be viewed with bitumen road access, the availability of electricity connection cannot be ignored, regardless of how that was provided by the relevant authority. Similarly the distance from, or lack of services is to be taken into consideration.
In the end result, I return to the appellants' argument regarding relativity between valuations in the immediate area. Mrs Collins obviously has a precise knowledge of the quality of at least the Sampson and McCarron lands. While she is probably correct in her opinion that there is insufficient margin between the valuations of the Sampson land and the subject land, I am not convinced that that is as a result of the subject valuation being wrong. Although the subject land was not free of the need for access construction to the preferred homesite, Mr Ridley is correct in taking into consideration any additional difficulty in accessing the best homesite on the McCarron property. The McCarron property is of irregular shape, but to compensate, it also has additional area. There is difference of opinion as to the quality of the relative views, but it seems to me that if views of Somerset Dam waters enhance value (which is logical) then it seems a reasonable argument that the wider views from higher elevation land, of waters within similar proximity, as from the McCarron land, should be the more valuable.
The evidence before me as to the relativity between the subject property and the McCarron property has created sufficient doubt for me to decide that all things considered, there should be no practical difference between the valuations of the two properties. Closer consideration of the relative criteria may be necessary in the future to produce more convincing evidence to the contrary.
The appeal is allowed, the valuation of the chief executive set aside and the unimproved value of the subject land determined in the amount of Ninety-four Thousand Dollars ($94,000) as at 1 January 1995.
RE WENCK
MEMBER OF THE LAND COURT
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