Herbert v Chief Executive, Department of Natural Resources
[1999] QLC 97
•24 September 1999
|
BRISBANE
24 September 1999
Re: Determination of Unimproved Values –
City of Brisbane – Division of Coorparoo.
(Refs. AV98-891, AV98-892, AV98-897,V98-903 and AV98-904).
PA and LS Herbert and Others
v.
Chief Executive, Department of Natural Resources
D E C I S I O N
Five appeals have been filed against the determinations of the unimproved values made by the respondent Chief Executive for five Residential B – “R4” zoned parcels of land situated in Beanga Street, Greenslopes. Particulars of each appeal are:
Appeal Ref AV98-891 – An appeal by Pauline A and Leonard S Herbert against the determination of an unimproved value of $187,500 for a parcel described as Lot 8 on RP 75777, Parish of Bulimba, containing an area of 698m² - appellants’ estimate of unimproved value as contained within the notice of appeal $137,000 – situation 40 Beanga Street.
Appeal Ref AV98-892 – An appeal by Erene Rossetti against the determination of an unimproved value of $187,500 for a parcel described as Lot 3 on RP 135261, Parish of Bulimba, containing an area of 728m² - appellant’s estimate of unimproved value as contained within the notice of appeal $137,500 – situation 36 Beanga Street.
Appeal Ref AV98-897 – An appeal by Susan A and Gregory H Nutting against the determination of an unimproved value of $230,000 for a parcel described as Lots 4 and 6 on RP 13206, Parish of Bulimba, containing an area of 931m² - appellants’ estimate of unimproved value as contained within the notice of appeal $200,000 – situation 42 Beanga Street (corner Henzell Terrace).
Appeal Ref AV98-903 – An appeal by John P and Angela H Sophios against the determination of an unimproved value of $194,000 for a parcel described as Lot 2 on RP 135261, Parish of Bulimba, containing an area of 900m² - appellants’ estimate of unimproved value as contained within the notice of appeal $143,000 – situation 32 Beanga Street.
Appeal Ref AV98-904 – An appeal by Penelope Sophios against the determination of an unimproved value of $325,000 for a parcel of land described as Lots 50, 52, 54, 56 and 58 on RP 13206, Parish of Bulimba, containing an area of 2,327m² - appellant’s estimate of unimproved value as contained within the notice of appeal $237,500 – situation 17 Henzell Terrace (corner Beanga Street).
The relevant date for the determination of the unimproved value of each of the five parcels is 1 October 1997. The appeals were heard together and as a result, I am writing a composite decision, especially as it was agreed by the parties that the evidence as a whole would be applicable in the individual cases. The case for the appellants was conducted by one of them, Mr Leonard Sidney Herbert, while the respondent Chief Executive was represented by counsel.
I propose firstly to tabulate the appellants’ grounds of appeal to which they are limited under the provisions of Section 45(4) of the Valuation of Land Act 1944. But before so doing, I should comment that the grounds of appeal as contained within the notices of appeal are, in many cases, quite similar, but for the sake of completeness, I will list them although I say in advance that there will be some repetition.
Appeal Ref AV98-891 – Appellants Pauline A and Leonard S Herbert.“1) Following our objection to a valuation increase of 67% (from $125,000 in 1997 to $209,000 in 1998), a 10% reduction was allowed. Our property is now valued at $187,500 – a 50% increase on the 1997 value.
2) This 50% increase is some three times greater than the 17% increase for Greenslopes reported in the Courier Mail of 23rd March 1998 and several times greater than the increase reported by Estate agent sources for sales of houses and land in this area in the past year or so.
3) Access, services & amenities in our locality have deteriorated markedly in recent times. Replacement of single dwellings with units has increased population and traffic. The banning, between 7 & 9a.m., of turns into Upper Cornwall St for cars travelling West along Chatsworth Rd, has resulted in greatly increased traffic problems during this period, which affects local side-streets including Beanga St. For example, it is often difficult to turn left from Henzell Terrace or Holland St into Chatsworth Rd and even more difficult to turn right.
4) There have been no sales of vacant land in this street, the only recent sale of house and land being 32 Beanga St. When costly improvements to that house made by the sellers are taken into consideration, land value must have decreased from its 1994 level.
5) In a letter from General Manager, Valuations dated 23 Oct 1998, it is stated that ‘the review has highlighted some anomalies and inconsistencies with the valuations in the Coorparoo and surrounding areas’. Our analysis of new valuations in this locality show some glaring examples; for example, No. 43 Chatsworth Rd, adjoining our back fence, with exactly the same area as ours – 698m² -, was revalued at $126,000. On the N. side of Chatsworth Rd, No 30, area 2074m², three times our area, with identical views, amenities etc. was revalued at $205,000. Similarly No 34 Chatsworth Rd, with an area of 1120m² was revalued at only $136,000.
6) The above and other inconsistencies indicate to us a lack of any rigour in the valuation process and we offer the above grounds for appeal against the excessive increase in the 1998 revaluation of our property.”
Appeal Ref AV98-892 – Erene Rossetti
“On March 11, 1998, we received notification stating that the above property’s unimproved land value had increased from $125,000 to $209,000, a 67.2% rise in twelve months; this is out of all proportion in relation to Greenslopes and surrounding suburbs which supposedly had an average rise of 26%. How is it possible for an increase of 67.2% in value when CPI is less than 3%?
We find this increase unreasonable and extremely excessive and hence the reason for this formal objection. We question how this massive increase is possible, given that land values in our suburb dropped last year: E.g. Our land valuation:
1996 - $137,000
1997 - $125,000
1998 - $209,000 – an extraordinary increase
In the South East Advertiser, Wednesday, March 25, 1998, an article stated: ‘Brisbane City Council Finance Committee Chairman stated – Rates would increase in suburbs where valuations had increased. The council averages the land value over three years, and has rate capping which means the maximum increase any owner occupier receives will be 10%.’ Obviously, this unrealistic system needs to be reviewed.
Our basis for appeal is:
1) An unreasonable 67.2% increase in twelve months;
2)Access – services and amenities views etc. have not changed since we bought the property in 1972;
3)No sales of vacant land in Beanga Street – the only recent house/land sale was 32 Beanga Street (When costly improvements to the house by the vendor are considered, the actual sale price decreased from its previous value $400,000 to $375,000).
4)Analysis of new valuations in this locality shows many inconsistencies e.g., Number 43 Chatsworth Road (adjoining our back fence, area 698 square metres) is valued at $126,000, a 32% increase, whereas number 30 Chatsworth Road, area 2074 square metres, (views, amenities and access etc. identical to ours) is valued at $205,000, a 26% increase, and Number 34 Chatsworth Road, area 1120 square metres, is valued at $136,000, a 26% increase.
The above and other inconsistencies indicate the lack of vigour in the valuation process and therefore we request a review of the valuation of our property. We would further be only too happy to discuss this matter with a mediator.”
Appeal Ref AV98-897 – Appellants Susan A and Gregory H Nutting
“1.The original increase from $170,000 and the ‘adjusted’ increase to $230,000 are well in excess of the published increases in the area and Brisbane in general.
2.Nothing has happened to increase the unimproved value of the land over and above those properties in the vicinity which have not had their values increased to the same degree.
3.Recent sales in the area do not support the impression that the unimproved value has increased at all.
4.Amenities and facilities have deteriorated, not improved; traffic re routed along Cornwall St., public transport less accessible, construction of units, etc. all mean more people and less access.
5.Licensing of the bowling alley (in this street) has further deteriorated property values.
6.The disproportionate increase simply is not justified. ”
Appeal Ref AV98-903 – John P and Angela H Sophios
“On 11 March 1998 we received a valuation notice stating that our property’s unimproved land value had increased from $143,000 to $216,000, a rise of $73,000 in just 12 months. In these harsh economic times we found it very hard to believe that the land value of our property had increased OVER 51% in one year. How could this have been possible when CPI is less than 3% and property values around the Greenslopes area where our property is situated, the average price of properties had not even risen, and in some cases had decreased. This being the case how then was it possible that land values could increase? We found the 51% increase in our land valuation to be EXTREMELY EXCESSIVE and UNREASONABLE and therefore sent in a formal written objection.
The result was that a review of objections in the Coorparoo Valuation District highlighted some anomalies and inconsistencies with the valuations and as a result, those that objected within this area were given a 10% reduction in their valuations. The review of objections clearly stated that there were inconsistencies between the valuations of the various properties. How then can an across the board 10% reduction in land valuations for all those who objected remove these inconsistencies? I would assume that each property should be looked at individually. John Sophios is also part owner of two other properties within Greenslopes. The other two properties valuations were increased by 26% each, whilst the residential property by 51% yet as all properties objected they all got an across the board reduction in their valuations by 10%. How can this be fair. Each property should be looked at individually.
Our basis for appeal is as follows:
1.As there has been no increase or betterment in the community services available to us since the last valuation and no change in our view how can you possibly justify any increase in land valuations, especially a 36% (51% before the 10% reduction), increase.
2.Residents in the exact same street, who have the exact same proximity and access to services as we do and similar views have only had their valuations increased by 20-25%. Although we feel that even a 20-25% increase is EXTREMELY EXCESSIVE we believe that the department's valuations of properties are inconsistent. How can our property's valuation increase by MORE THAN 36% (51% before the 10% reduction), and our neighbours down the road be only 20-25%. How can this be?
3.Some residents in Chatsworth Road, which is parallel to Beanga Street have only increased by 18-26%. They have exactly the same community services as we do and exactly the same view, (if not better), yet their increases have been less than half of ours. How can this be justified?
4.The average increases in valuations for Greenslopes as a suburb have been 26%, yet our property was hit with a 51%, (now 36%) increase. How inconsistent.
5.As you would agree it is the market which sets the value of property. We purchased our property on 26 May 1997 for $350,000. The previous owners purchased the property at auction for $272,000 two years prior, (which we were present at), and since filled and levelled the property and did renovations to the house at a cost of $150,000. This means the total cost of the property is $422,000, ($272,000 + $150,000). YET the VALUE that our property brought at auction when we purchased it on 26 May 1997 was only $350,000. Therefore the value of our property on the OPEN MARKET actually fell by $72,000; i.e. a 17% decrease in value. There are only four months difference between the time we purchased our property on 26 May 1997 and the date of our property’s valuation i.e. 1 October 1997. How is it possible for there to be a 17% decrease in the value of our property in two years and yet a 36% (51% before the 10% reduction), increase in it in just four months from the date we purchased it? It is impossible!
According to literature obtained from the Department of Natural Resources the unimproved value of land is calculated by deducting from the sale price the value of improvements such as buildings and earthworks. Therefore applying this formula to our property we get:- Sale Price $350,000 less value of house including levelling and filling of $210,000, giving the land an unimproved value of $140,000.
We believe that the revised valuation of $194,000, ($216,000 less the new 10% reduction), fails to reflect the price willing purchasers, (like ourselves) would be prepared to pay for our unimproved land. According to professionals within the property industry and more importantly the market, the value of our land excluding improvements such as house and earthworks is only $140,000.
We find it extremely hard to believe that the average prices of properties situated close to ours have increased over 36% (51% before the 10% reduction) in one year. In these economic times how can you justify a 36% return of investment in just one year, it is impossible. That would mean that we would have made a 36% return on our house in just four months. We therefore request that our valuation be reassessed in light of the above and that the value of our property remains at $143,000 as previously valued. ”
Appeal Ref AV98-904 – Appellant Penelope Sophios
“On 11 March 1998 I received a valuation notice stating that my property’s unimproved land value had increased from $237,500 to $360,000 – a rise of $122,500 in just 12 months. In these harsh economic times I found it very hard to believe that the land value of my property had increased over 51% in one year.
How could this have been possible when CPI is less than 3% and property values around the Greenslopes area where my property is situated, the average price of properties has not even risen, and in some cases has decreased. This being the case how then was it possible that land values could increase? I found the 51% increase in my land valuation to be extremely excessive and unreasonable and therefore sent in a formal written objection.
The result was that a review of objections in the Coorparoo Valuation District highlighted some anomalies and inconsistencies with the valuations and as a result, those that objected within this area were given a 10% reduction in their valuations. The review of objections clearly stated that there were inconsistencies between the valuations of the various properties. How then can an across the board 10% reduction in land valuations for all those who objected remove these inconsistencies? Each property should be looked at individually.
Our basis for appeal is as follows:
1)As there has been no increase on betterment in the community services available to us since the last valuation and no change in our view how can you possibly justify any increase in land valuations especially a 36% (< 51% before the 10% reduction >) increase.
2)Residents in the exact same street, who have the exact same proximity and access to services as we do and similar views have only had their valuations increased by 20-25%. Although we feel that even a 20-25% increase is extremely excessive we believe that the Department’s valuations of properties are inconsistent. How can my property’s valuation increase by more than 36% (< 51% before the 10% reduction) and my neighbours down the road by only 20-25%. How can this be?
3)Some residents in Chatsworth Road, which is parallel to Beanga Street have only increased by 18-26%. They have exactly the same community services as I do and exactly the same view (if not better) yet their increases have been less than half of mine. How can this be justified.
4)The average increases in valuations for Greenslopes as a suburb have been 26% yet my property was hit with a 51%, now 36% increase. How inconsistent.
I therefore request that my valuation be reassessed in light of the above and that the value of my property remain at $237,500 as previously valued.”
The principal witness for the appellants was Mr Herbert. He told us, mainly through a tendered statement, that the valuation of his property in recent years has varied from $137,000 in 1994 and 1995 to $125,000 in 1996 (a drop of $12,000), then increasing to $209,000 in 1997 and this value was reduced after objections by a very large number of landholders in his area by a factor of 10% to $187,500. Mr Herbert points out that the increase from $125,000 in 1996 to $209,000 in 1997 represented an increase factor of 67%, with the reduced unimproved value of $187,500 represented an increase factor of 50%. Mr Herbert pointed out that these increase factors were about four times greater than the average increase of 17% reported in “The Courier Mail” for the Greenslopes area on 23 March 1998. He told us that the injustice of the massive increase over the 1996 value was recognised with the 1998 valuation being reduced to $187,500, but even this value does not take into account the following factors:-
Close to our property are several blocks of units, a nursing home and a ten-pin bowling alley which has been granted a liquor licence about two years ago. Several houses close by, including three adjoining his property, are rented and he says this gives a consequent diminution in good neighbour relations.
With regard to the access, services and amenities in the Beanga Street locality, Mr Herbert says these have deteriorated markedly in recent times. He stresses that the replacement of single dwellings with units has increased population and vehicular traffic. Further Mr Herbert says that the banning of turns between 7a.m. and 9a.m. into Upper Cornwall Street for cars travelling west along Chatsworth Road has resulted in greatly increased traffic problems during this period, which affects local side streets including Beanga Street. He says it is often difficult to turn left from Henzell Terrace or Holland Street into Chatsworth Road and even more difficult to turn right. But Mr Herbert told us that the banning of turns only occurred at the beginning of this year so it is really a post-relevant date (1 October 1997) event.
Mr Herbert told us that there have been no sales of vacant land in his street, with the only recent sale being that of a house and land at 32 Beanga Street (the Appeal Ref AV98-903 property owned by John P and Angela H Sophios), He says that when costly improvements to the house on the Sophios property, which were made by the vendors, are taken into consideration, then the Sophios land value must have decreased from its 1994 level.
Mr Herbert emphasised that in a letter from the General Manager, Valuations, dated 23 October 1998, it was stated that “the review had highlighted some anomalies and inconsistencies with the valuations in Coorparoo and surrounding areas”. His analysis of the new valuations in his locality shows what he calls some glaring examples of incorrect valuation relativity. He points to the property at No 43 Chatsworth Road, which adjoins his property at the rear, with exactly the same area of 698 square metres being revalued at $126,000. Further on the northern side of Chatsworth Road, No 30 with an area of 2074m² (three times the area of his land) with identical views, amenities, etc., was revalued at $205,000. He also points to the valuation of 34 Chatsworth Road, with an area of 1120m² of only $136,000. Mr Herbert says that the foregoing, and other inconsistencies, indicate to him that there has been a lack of rigour in the valuation process, and he offers this evidence against the excessive increase in the 1997 revaluation of his property.
Mr Herbert understands that the valuer responsible for the valuations under appeal used as a basis for his valuation recent sales of land in the “Coorparoo Heights” area. He does not know the actual sales, and did not offer an opinion as to how the sale parcels compare with his land. He says this area comprises a network of secluded streets and parklands and there are few, if any, blocks of units in it, and judging by the excellent community spirit there, it is probable that most houses are owner-occupied. It is further pointed out by Mr Herbert that recent Brisbane City Council regulations will protect the green and pleasant environment in the Coorparoo Heights area for the foreseeable future. Mr Herbert says that it is simply not valid to compare the attractiveness to a buyer of land in the “Coorparoo Heights” with his property as he has no parks nearby, and increasingly the gardens and trees of older houses, after which Greenslopes was named, are being replaced with units and concrete driveways. Mr Herbert says there is little doubt that houses behind his property will soon give way to units, further increasing the problems which come with intensive development and increased density of population.
Mr Herbert believes that it is not fair to compare blocks of land at Coorparoo Heights with those in Beanga Street, certainly not the block at Welwyn Crescent which is in a very high class and very community-conscious area.
Mr Herbert told us that as a result of the article in “The Courier Mail” on 23 March 1998, landholders objected to their valuations and had them reduced by a factor of 10%.Mr Herbert also commented in evidence that on four occasions rather demented elderly people were coming along his street and they were obviously patients from the nursing home. There is a rubbish collection at the home which comes in at regular intervals into the driveway adjoining the nursing home, and there is an incinerator in which they burn all their old meals and he presumes other unpleasant medication. When the wind is from the west it affects the appellants’ house and is very unpleasant. He says that for these reasons, proximity to the nursing home is an undesirable feature for residents in Beanga Street.
John Peter Sophios, who is a joint appellant in Appeal Ref AV98-903, furnished evidence in support of the appeal against the valuation of his land and that of his mother (Appeal Ref AV98-904). With respect to his own land (Appeal Ref AV98-903) Mr Sophios’ evidence largely accords with the grounds contained within his notice of appeal. He also offered the opinion that the injustice of the massive increase in his valuation over the 1996 valuation was recognised by the Department, with the 1997 valuation of $216,000 being reduced by a factor of 10% to $194,000. Mr Sophios says that a review of objections in the Coorparoo Valuation District highlighted some anomalies and inconsistencies with the valuations and as a result, those who objected within the area were all given a 10% reduction in their valuations. But he says that a review of objections letter clearly stated that there were inconsistencies between the valuations of the various properties and also he wonders then how an across the board reduction of 10% in land values for all those who objected can remove the inconsistencies. He believes that each property should be looked at individually.
The nursing home which was referred to in evidence by Mr Herbert is situated adjacent to Mr Sophios’ property. He complains of the noise emanating from the use of the home and from staff, as well as from ambulances and from deliveries at all hours, day and night. He says these are constant sources of disturbance. Having the nursing home next door to his land has meant that visitors and the staff are continually parking their vehicles in front of his property. Mr Sophios also confirms that the nursing home has an incinerator, which is located near the boundary of his property and that it often emits noxious fumes. Mr Sophios told us the smoke and smell is quite unbearable.
Mr Sophios also says that his land suffers from noise emanating from the use of the garbage truck which runs down his boundary two or three times a week to service the nursing home. He also referred to the problems people in the street have with the bowling alley and from the use of its liquor licence.Mr Sophios also says that it is not valid for the Departmental valuer to use recent sales of land in secluded streets like Sirius Street, Solar Street and Buena Vista Avenue in the suburb of Coorparoo with parkland close by as the basis for revaluing his property in Beanga Street, Greenslopes.
Mr Sophios told us that there is a large pine (ficus) tree in his neighbour’s backyard which has been continually growing taller and wider and now severely obstructs his view to the City. He further says that as his neighbour likes this tree, she has refused all his propositions to trim it for her.
Mr Sophios stressed that the new valuations in his area show some obvious examples of valuation anomalies. He referred to the valuation of $126,000 for No 41 Chatsworth Road (area 701m²) which parcel backs onto his land. He submits No 41 has similar views to those available from his property, but has 200 metres less area and it was valued at almost half the valuation of his land. Further, directly across the road from his property is No 31 Beanga Street (area 927m²) which has been used as a unit site which he believes is a more valuable use, yet it has been revalued at only $165,000. He also referred to No 30 Chatsworth Road (area 2074m²) - over double the area of the subject land and a site with identical views, amenities, etc., as having a valuation of $205,000. Mr Sophios also referred us to the valuation of 16 Henzell Terrace (739m²) which was revalued at $180,000 and No 18 Henzell Terrace (area 1098m²) which was revalued at only $173,000, both, he says, with similar views as those available from his property.
Mr Sophios confirmed in evidence that the appellants purchased the property in 1997 for $350,000.He says that a sum of $150,000 had been expended on the house by the vendors. The vendors bought the house for $271,000 earlier when the land valuation was $140,000. Now what he said is that the vendor spent $150,000 on the property and that the improvements were worth $130,000 before this money was spent, then that brings the value of the property up to $280,000. If this value was taken from the price the appellants paid for the property, then that leaves a land value of only $70,000. But while they are not seeking a determination at $70,000, they would be happy to keep the land value at the same value of $140,000.
Mr Sophios provided the Court with a list of sales of vacant urban land in the suburb of Greenslopes which was produced by Ray White Commercial (Queensland). He suggests that these sales would be more useful in the valuation process for properties in Beanga Street. He refers in particular to some sales in Roseglen Street which took place at prices ranging from $79,000 to $89,000. Mr Sophios says that Roseglen Street has some noise problems, but the sites have views to the mountains. Certainly they have also got views of the Freeway which is a disability, but he stresses that sites in Beanga Street also have disabilities as well. He says that the sales in Roseglen Street are in the suburb of Greenslopes, and that is why he thinks they should be compared to the Beanga Street properties to the exclusion of the sales in Coorparoo.
Mr Sophios knows a sale property at No 71 Solar Street which forms part of the basis for the Departmental valuations in Beanga Street. He says there are views available from this land to the City and to the mountains.Mr Sophios does not know what is the basis for the 10% reduction in the valuations in the area for those who objected. He assumes there was a big outcry and protests, and he thinks it was a political ploy just to keep everybody happy.
With respect to his mother’s property (Appeal Ref AV98-904), Mr Sophios told us that the valuation had increased from $237,500 in 1996 to $360,000 in 1997 – a 51% increase. This valuation was also reduced by 10% as a result of an objection to the valuation under appeal - $325,000. Mr Sophios points out that the 51% increase from $237,500 in 1996 to $360,000 in 1997 was well over three times the average increase of 17% for the Greenslopes area as reported in “The Courier Mail” of 23 March 1998.
Mr Sophios also says that the banning of turns into Upper Cornwall Street for vehicles travelling west along Chatsworth Road has resulted in greatly increased traffic problems not only for his mother’s property, but for all the properties in Beanga Street and he confirms that it is often difficult to turn left from Henzell Terrace or from Holland Street into Chatsworth Road and even more difficult to turn right. But as aforementioned, the banning of turns is a post-relevant date event.
The major point stressed by Mr Sophios in respect of his mother’s property is that there is absolutely no City view from it. There is a view down to the mountains overlooking the bowling alley and the Greenslopes Hospital. But there is no actual view to the City facing north. Mr Sophios told us that this property did have a better view facing north but there was a house built in front of her property (this is the Nutting house (Appeal Ref AV98-897)) which restricts the City views.
Commenting on one of the sales relied upon by the respondent Chief Executive in Welwyn Crescent, Coorparoo, Mr Sophios stressed that this is a property with a good land size of 713m² and is zoned Residential “A”. He knows the property very well and he suggests it would have a 270 degree view of the City to the mountains. He regards the view available from this site as being one of the best views in Brisbane, and probably three to four times better than the views available from any property in Beanga Street. In addition, Mr Sophios told us that the Welwyn Crescent sale property is in a higher elevated position.
Erene Rossetti furnished brief evidence in support of her tendered statement. In general terms it reconfirms the matters raised by Mr Herbert and by Mr Sophios but again her main objection to the valuation is the substantial rise in it and she believes that property values in the area have not improved to that extent. Mrs Rossetti also feels that properties in Beanga Street cannot be compared with the prestigious Residential “A” area in Coorparoo in which the respondent’s sales evidence is located.
There is in evidence a statement prepared by Susan A and Gregory H Nutting, bearing GH Nutting’s signature (the appellants in Appeal Ref AV98-897). Unfortunately Dr Nutting was unable to attend at Court due to him having medical commitments. There was no objection by counsel for the respondent to the admission of the signed statement, but more weight would attach to it if Dr Nutting had been at Court to swear to it.
I shall deal briefly with the matters raised by Dr Nutting which have not been already covered by other witnesses. Dr Nutting says that the increase in the rateable value of his property from 1996 at $170,000 to $257,000 in 1997 cannot be justified on the basis of logic, local sales or any sudden increase in prestige of the area. Dr Nutting says that his land, whilst elevated, was also elevated 20 years ago when he bought it at a relative value compared with surrounding properties. He says nothing has happened to increase the value by the percentage adopted by the Department.
Dr Nutting says that the reduction in the valuation as a result of an objection to $230,000 (as a token gesture) is the result of perhaps some political influence, and his understanding also is that everyone who objected had their valuations reduced by 10% with the promise that subsequent valuations would address any anomalies and inconsistencies both within the Coorparoo District and the surrounding areas.
Dr Nutting submits that the valuation of the four properties on the adjoining corners of the intersection of Henzell Terrace, Beanga Street and Merinda Street have no consistency. Despite the fact that the views, services, etc., have not improved and most have deteriorated in tangible ways and are comparable for these four sites, he says that no proportional value is seen. But Dr Nutting was not at Court to tell us about the values of the three corner parcels.Dr Nutting also further commented in his statement that the unimproved value comparisons between properties in Beanga Street and the sales evidence relied upon by the Departmental valuer are invalid since the Coorparoo Heights area has many advantages over the subject area. He says that comparisons with properties sold in the immediate area would reflect a more meaningful valuation. Dr Nutting says that the valuation under appeal has been a bad guess, is unlikely to have been arrived at by any mathematical process, and has certainly not taken account of recent real estate sales in the immediate vicinity. His statement ends with the words “It should stand condemned as a result of this alone”.
THE VALUATION EVIDENCE
Valuation evidence was called by the respondent Chief Executive from Registered Valuer Allyn Charles Horne who is in the employ of the State Valuation Service. The following valuation information is extracted from his tendered valuation documents:-
Appeal Ref AV98-891 – Lot 8 on RP 75777, Parish of Bulimba – Appellants PA and LS Herbert.
Mr Horne describes the nature of the subject land as being on street level at its frontage, with a fair crossfall to the south-west and to the north-west. He says some earthworks have been carried out to improve the land. Although the land is zoned Residential B – “R4” under the Town Planning Scheme for the City of Brisbane, it is used as a site for a single dwelling. Accordingly, Mr Horne has valued the land under the provisions of section 17(1) of the Valuation of Land Act as a single dwelling house site.
Mr Horne points out that the valuation of the Chief Executive is $187,500, but as the valuer for the area, he values the land at $209,000. Mr Horne considers his valuation is supported by the following sales evidence:
Sale 1 – Lot 391 on RP 41729 – 693m² - McEniery to Gleeson on 10.01.97 for $230,000 – analysed unimproved value $228,000 – applied unimproved value as at 1.10.97 $205,000 – situation 71 Solar Street, Coorparoo – zoning Residential “A”.
Mr Horne says that the sale land is slightly inferior to the subject land but he says the Chief Executive’s valuation of it does not reflect this. The sale land and the subject land are similar in size, but Mr Horne says that the subject land has better views to the City and to the mountains. Mr Horne agrees with the appellants that the sale land is located in a better location generally, and describes it as being almost level, whereas the subject land has a fairly steep crossfall.
Sale 2 – Lot 399 on RP 41729, Parish of Bulimba – 653m² - Blockley to Parker on 23.09.97 for $130,000 – analysed unimproved value $128,000 – applied unimproved value as at 1.10.97 $121,000 – situation 135 Sirius Street, Coorparoo – zoning “Residential A”.
Mr Horne considers this sale land to be inferior to the subject land as it does not have any City or mountain views. He points out that it is marginally smaller in size, and has an inferior standard of development surrounding it.
Appeal Ref AV98-892 – Lot 3 on RP 135261, Parish of Bulimba – Appellant Erene Rossetti.
Mr Horne describes the nature of this land as having a fairly steep crossfall to the south-west, and a slight to gradual fall to the north-west. He again says some earthworks have been carried out to improve the site. While the land is zoned Residential B – “R4” under the Town Plan for the City of Brisbane, it is used as a site for a single unit dwelling and accordingly Mr Horne has again valued it under the provisions of section 17(1) of the Valuation of Land Act as land being used for a single dwelling house.
Mr Horne says that the valuation of the Chief Executive is $187,500. But as the valuer for the area, he values the land at $209,000.
Mr Horne bases his valuation of the subject land upon the same sales as he relied upon in Appeal Ref AV98-891 (LS and PA Herbert). He compares the 71 Solar Street, Coorparoo land (again Sale 1) as being slightly inferior to the subject land, but again points out that the Chief Executive’s valuation does not reflect this. Both the sale land and the subject land are similar in size, but Mr Horne describes the views from the subject land to the City and mountains as being better. Mr Horne again agrees that the sale land is situated in a better general locality. He describes it as being almost level, whereas the subject land has a fairly steep crossfall.
With regard to the sale of 135 Sirius Street, Coorparoo (again Sale 2), Mr Horne describes this sale land as being inferior to the subject land as it does not have City or mountain views. Mr Horne says it is slightly smaller in size, and again has an inferior standard of development surrounding it.
Appeal Ref AV98-897 – Lots 4 and 6 on RP 13206 Parish of Bulimba - Appellants SA and GH Nutting
Mr Horne describes the nature of this land as having a slight to fair crossfall to the south-west and a slight fair crossfall to the north-west. He says it is generally on street level at its frontages. Once again the land is zoned “Residential B – R4” under the Town Planning Scheme for the City of Brisbane, but again it is used as a site for a single unit dwelling house. For this reason, Mr Horne has again valued the land under the provisions of section 17(1) of the Valuation of Land Act as a single unit dwelling site.
Mr Horne says that the valuation of the Chief Executive is $230,000, but as the valuer for the area he values the land at $257,000.
Mr Horne considers his valuation is supported by the same sales evidence as he relies upon in Valuation AV98-891 (LS and PA Herbert) and AV98-892 (E Rossetti). He compares the sale of 71 Solar Street, Coorparoo (again Sale 1) land to be inferior to the subject land as it has inferior views towards the City and mountains. He says the sale land is smaller in size and is not on a corner as is the subject land. Once again Mr Horne agrees that the sale land is located in a better general locality. He points out that 71 Solar Street, Coorparoo, was previously sold on 22.02.96 for $180,000.
With respect to 135 Sirius Street, Coorparoo (again Sale 2), Mr Horne regards the sale land to be inferior to the subject land as it does not have City or mountain views. Also he points out that it is smaller in size and again with an inferior standard of development surrounding it.
AV98-903 – Lot 2 on RP 135261 Parish of Bulimba - Appellants JP and AH Sophios
Mr Horne describes the nature of the land as having a fair crossfall to the south-west, and a gradual fall to the north-west. Some earthworks have been carried out to improve the land. Once again, Mr Horne has valued the land under the provisions of Section 17(1) of the Valuation of Land Act as a single unit dwelling site.
Mr Horne told us that the valuation of the Chief Executive is $194,000, but as the valuer for the area, he values the land at $209,000.
Once again Mr Horne relies upon the same two sales as a basis for his valuation. He compares 71 Solar Street (again Sale 1) in terms of the sale land being inferior to the subject land, but he again points out that the Chief Executive’s valuation does not reflect this. Mr Horne says that the sale land is smaller in size, and that it has inferior views towards the City and the mountains. Mr Horne again says that the sale land is located in a better general locality, and is almost level, whereas the subject land has a fairly steep crossfall.
The second sale relied upon by Mr Horne is that of 135 Sirius Street, Coorparoo (again Sale 2) is regarded by him to be inferior to the subject land as it does not have any City or mountain views. He points out that it is smaller in area and says that it has an inferior standard of development surrounding it.
AV98-904 – Lots 50, 52, 54, 56 and 58 on RP 13206 Parish of Bulimba - Appellant P Sophios
Mr Horne describes the nature of the land as being on street level at its frontage to Henzell Terrace and has a gradual fall to the south-west, then a further steep fall over nearly the last half of the land. Again, Mr Horne has valued the land under the provisions of Section 17(1) of the Valuation of Land Act as a single unit dwelling site.
Mr Horne informed the Court that the Chief Executive’s valuation of the land is $325,000, but as the valuer for the area, he values the land at $360,000.
Mr Horne again relies on the sale of 71 Solar Street, Coorparoo (Sale 2), as a basis for this valuation. He says that this sale land is inferior to the subject land as it has very limited views towards the CBD, and has views down the street to Mt Cootha. It is much smaller in area, and is a fairly level block, whereas the subject land has a gradual to steep crossfall.
Mr Horne has introduced a new sale as a basis for this valuation. Details are:
Sale 1 - Lot 1 on RP 115010, Parish of Bulimba – 713m² - HJ Lee & Sons Pty Ltd to Helen Coles on 07.07.97 for $380,000 – analysed unimproved value $377,000 – applied unimproved value as at 1.10.97 $340,000 – situation 8 Welwyn Crescent, Coorparoo – zoning Residential “A”.
Mr Horne considers this sale land to be slightly inferior to the subject land as it is much smaller in area. The sale land has better views to the CBD and mountains, and is located in a generally more desirable area. Mr Horne describes the sale land as being a fairly level block above street level, while the subject land has a gradual to steep crossfall. Mr Horne told us that the purchaser of 8 Welwyn Crescent has had numerous offers to sell the land, with the highest firm offer being $500,000.
Speaking generally about the appeal parcels, Mr Horne says that the main feature of the sites as far as valuation is concerned is the views. Other aspects do come into consideration, but he thinks in these elevated areas the views are the most important factor. For this reason he had a look at sales as comparable as possible to use as a basis for his valuations. Mr Horne agrees with the appellants that his sales are located in a better area being in Coorparoo, but he disagrees with Mr Sophios about the views available from 71 Solar Street. He says the views from this site to the City are extremely limited, but it does have a view down the street towards Mt Cootha, but in terms of City views, Mr Horne says that those available from 71 Solar Street do not compare as being as favourable as the views from four of the five properties the subject of these appeals. Mr Horne is confident that if the Solar Street site had comparable views, then it would certainly have sold for a higher price.
Mr Horne stresses that his sale in Sirius Street is also generally in a better locality but it is the sale of a standard-type block in that area without views so that the sale sets the base for valuing anything that is better than Sirius Street.
Mr Horne confirms that the Welwyn Crescent sale is of a block with excellent City and mountain views, it is an elevated position above street level as well, so it is an excellent site in a good suburb. Mr Horne feels that for its size, the Welwyn Crescent sale site is probably one of the better blocks in the whole of the Coorparoo Division.
Mr Horne considers that sales in Coorparoo with views would attract a higher price than properties in Greenslopes with similar views and he recognises that Coorparoo is a better quality locality generally speaking than the locality within which the subject lands are situated.
With regard to his valuation of 32 Beanga Street, Mr Horne’s original valuation was $216,000 but he reviewed this valuation to $209,000 after he learned of some of the problems raised by Mr Sophios about the adjoining nursing home at an earlier preliminary conference.
Mr Horne told us that the delegate who made the decisions on the objections was a Mr Gavin Dunn who is a Registered Valuer in the Caboolture Office of the Department. Mr Dunn disallowed the objections against the valuations which are the subject of these appeals, but later the Chief Executive reduced all objection valuations by a factor of 10%. Mr Horne told us that unfortunately he did not have any influence over the Chief Executive’s decision on the objections.
Mr Horne agrees with Mr Sophios in respect of the rather restricted City views available from Mrs Sophios’s property (17 Henzell Terrace). He says this property has an outlook down Beanga Street and across to the mountains but when he made the valuation, he was of the opinion that the City views were substantially blocked out by the Nutting house.
Mr Horne knows the properties in Roseglen Street. He says this a newer subdivision which has come in onto the Freeway. The sites in Roseglen Street overlook the Freeway and he regards the sales mentioned by Mr Sophios to be even less comparable than the sales he has used. They do not have views and they are near the Freeway which he describes as being a definite detriment.
Mr Horne told us of a sale near the subject properties which had been used for the revaluation in 1996. It was the sale of 61 Henzell Terrace on a corner. The land sold on 27 May 1996 for $230,000 and it had an area of 503m². It was purchased by Denmac Nominees. Mr Horne did not have regard to this sale when he made the subject valuations but he considers it is some evidence of value even though it is not within the relevant valuation period. This sale land has good views down a narrow valley and the 1.10.97 relevant date valuation of it is $210,000. So Mr Horne considers it to be somewhat comparable with the properties we are concerned with here. Mr Horne told us that he did identify this sale until recently because at sale date there was a house on the property which has since been demolished.
Commenting upon the comparisons made by the appellants with the values in Chatsworth Road, Mr Horne told us that blocks on main roads such as Chatsworth Road, are generally less desirable as single unit dwelling house sites than those situated away from the main roads. He has sales evidence on Logan Road, Holland Park, of about 30% less value, for a block on the main road when compared with one situated one street back. He believes there is even evidence on Milton Road to show a factor of 50% less value, so he says the market regards main roads as less desirable than not living on a main road. Also Mr Horne feels that the likelihood of units being built in Chatsworth Road is at this stage more than it would be in the back streets where the higher values apply. Certainly, Chatsworth Road has always carried a fair amount of traffic so the values he has on residential properties in that street reflect the traffic noise on the main road and access problems getting in and out of the properties.
Being more specific, Mr Horne says that No 43 Chatsworth Road which is valued at $126,000, does have views to the City but it has the traffic noise problem, it has the access problems, so he considers it should be valued at less than No 30 which is a large block valued at $205,000. No 30 is at a much lower elevation than the appeal properties, but at the same time has an outlook towards the City at a low elevation. But No 30 has flats on two of its boundaries and units slightly further down in the next street. He believes No 30 is not as desirable as a residential site as is the subject properties. As for the valuation on No 34, this site has units on its back boundary. It is in a position where it has an outlook to the City, but again it has home units in the area as well.
Commenting upon the movement in valuations within the Division of Coorparoo over the years, Mr Horne told us that for a long time the values in the Division of Coorparoo have not risen by a straight factor each year. With the very limited sales evidence which has been available, the top and the bottom ends of the market have not moved at the same rate for most revaluations, and in fact, in the revaluation before this one, the poorer blocks were reduced by 5%, the elevated blocks were reduced by 10%,with properties in the middle range being valued at varying rates, so in reality the downturn shown in the previous revaluation merely highlights the extent of the increase this time. He has spoken to agents in the area, and it was about February 1997 that the market started to come good again. Before that it had been flat, and while in hindsight it would have been nicer to not increase values for the previous revaluation, the values reflected what the market was tending to show. For the 1 October 1997 valuation, it was the first year that Mr Horne had a number of sales in elevated positions to value some of these elevated properties. That is partially the reason for the relatively large increase in the value of the more elevated properties, since the top end of the market with City views has been moving at a much faster rate than the average blocks in the area.
Mr Horne was asked during the presentation of his evidence to comment upon his valuations of Nos 38, 42 and 46 Chatsworth Road. No 38 is valued at $112,000, No 42 at $280,000 and No 46 at $115,000. Mr Horne says that the higher valuation for No 42 is because it is developed with units and has not been valued under the provisions of section 17(1) of the Act as a single dwelling house site.
REASONS FOR DECISIONS
Apart from some references to disabilities, the appellants in these cases rely upon the ground of errors in valuation relativity or, alternatively, upon the ground that inequitable increases in valuations for the 1 October 1997 relevant date valuations within the Division of Coorparoo have seriously and improperly disturbed the valuation relativity within the Division which was established by the 1 October 1996 relevant date valuation.
But before considering the merits of the appellants’ cases, it is perhaps helpful if I refer to some decisions of the Land Appeal Court which are relevant to the use of the principle of valuation relativity or percentage increases in valuation as a ground of appeal in appeals of this nature.
In Re: Appeal by Landholder against determination of the Valuer-General – City of Brisbane (V81-532) – the Fischer case – (1983) 9 QLCR 44 at p.46, the Land Appeal Court had this to say:
“ It is indeed a fundamental principle of valuation that the best basis for assessment of unimproved value is the use of sales of vacant or lightly improved parcels. Whilst maintenance of correct relativity is also of considerable importance for rating or revenue-type valuations, we cannot prefer in the circumstances of this case, the use of the principle of relativity to the exclusion of sales evidence.”
The same Court in Re: Appeal by NR and PG Tow against the determination of the Valuer-General – Redland Shire – (1978) 5 QLCR 378, p.380 and 381 said:
“ The Valuation of Land Act requires the Valuer-General to make a valuation of the unimproved value of all lands in the shire as at a date fixed by him. Section 12(1) provides that ‘unimproved value’ of land means in relation to unimproved land such as the subject parcel, ‘the capital sum which the fee simple of the land might be expected to realise if offered for sale on such reasonable terms and conditions as a bona fide seller would require’.
The whole of the valuation processed must be based on this hypothesis. Courts of the highest authority have laid down that the best test of value is to be found in the sales of comparable properties, preferably unimproved, on the open market round about the relevant date of valuation and between prudent and willing, but not over-anxious parties.
Subject to certain statutory requirements as to the onus of proof and the restriction of the appellants to the grounds of appeal specified in their notice of appeal, the duty of the Land Court and of this Court is to make determinations of unimproved values based on the evidence presented to it by the parties and conforming to the aforementioned statutory formula.
It follows that a large increase over and above the previous valuation is in itself not a relevant issue provided bona fide sales of comparable parcels support the new valuation. ”
Again, in Appeal against determination of unimproved value – R and MM Barnwell v. Valuer-General (1990-91) 13 QLCR 13 at p.17, the Land Appeal Court observed:
“ It has been well recognised over the years that previously established relativity in unimproved values can and does change from valuation to valuation. If there was no justification for a change in relativity, the valuer’s task would be very simple in that all that would be required to establish value would be accomplished by the use of an adjusting formula. This, of course, is undesirable. ”
I might add that it has been clearly established in this Court also that references to percentage increases in valuation when the task at hand is to determine unimproved value is not a sound ground of appeal, and further that the best basis of valuation is again the application of evidence of sales of unimproved or lightly improved parcels of land which took place at or about the date of valuation.
Now the only reference to unimproved or lightly improved sales evidence which was made by the appellants was to the sales in Roseglen Street, Greenslopes, and it cannot be said that these sale parcels are in any way comparable with the parcels under appeal. They do not have City or mountain views and they are in close proximity to the Freeway, and it is self evident that those sales took place at much lower prices than did the sale of 61 Henzell Terrace..
Mr Sophios did refer the Court to the appellants’ purchase of his property at 32 Beanga Street, but this is a highly improved sale and such a sale is not to be preferred to the use of a unimproved or lightly improved sales in the valuation process. In Re: Perpetual Lease Selection No 6191, Roma District – Determination of Unimproved Value for Conversion of Tenure – (1965) 32 CLLR 260, p.261, the Land Appeal Court commented:“ Unimproved values obtained by analysing the sale of one highly improved area do not normally provide a safe basis upon which to make determinations of value of comparable land. The improvements on ‘Croydon’ comprised buildings, boundary and subdivisional fencing, water improvements, yards and dip and timber treatment, and errors in valuing any or all of these improvements must be reflected in the final result. ”
On the other hand, the sales evidence relied upon by Mr Horne, albeit that it is agreed by him to be in a better location than Beanga Street, does, on the evidence, indicate that the appeal parcels should be valued at substantially higher levels of unimproved value than that contended for by the appellants within their respective notices of appeal.
Although the sale of 61 Henzell Street took place prior to the valuation period with which we are concerned, it is in close proximity to Beanga Street, and it cannot be said that it does not support Mr Horne’s valuation of each of the appeal parcels, especially as the only evidence of changed market conditions would support the view that it was improving during 1997 for elevated residential properties with views. In addition, the applied unimproved value for 61 Henzell Street for the 1 October 1997 revaluation was $210,000 - certainly within the range of Mr Horne’s valuations of the subject parcels.
I am convinced that the 1 October 1996 relevant date valuation relativity should have been altered by increasing the valuations of residential properties with views for the 1 October 1997 valuations. It then follows that the changes in valuation relativity for the 1 October 1997 relevant date revaluation of residential parcels within the Coorparoo division as a ground of appeal can have little or no significance on the basis of the evidence as a whole, and as a matter of law flowing from the Land Appeal Court decisions.
In all the circumstances, I cannot hold that the onus resting upon the appellants under the provision of Section 45(4) of the Valuation of Land Act has been discharged in these cases. But it remains for me to make determinations of unimproved value in each case.
Section 66 of the Valuation of Land Act 1944 provides:
“Upon an appeal under section 55 the Land Court or, upon the rehearing of any such appeal, the Land Appeal Court may –
(a)affirm the valuation appealed against; or
(b)reduce or increase the amount of that valuation to the extent necessary in its opinion to determine the same correctly under, subject to, and in accordance with this Act; ”
Now, it is clear that what is required of the Court is to make valuation determinations which are supported by the evidence, and the only valuation evidence before the Court is that provided by Mr Horne. Certainly, the respondent Chief Executive did not call the officer who was responsible for the decision to reduce the valuations upon consideration of the objections in the Division by the factor of 10%. As a consequence, there is no evidence as to the basis for the Chief Executive’s decision to reduce the unimproved value determinations to the valuations under appeal. Certainly, no recommendation for the 10% valuation reduction was made by either Mr Horne or by the Objection Delegate, Mr Dunn.
It is a pity that the appellants did not seek legal and/or valuation advice with these appeals, or I should say there is no indication that they did. Had they done so, in all probability their attention would have been drawn to the problem with reference to a variation in percentage valuation increases as a ground of appeal.
I have carefully considered all the evidence, including that of the disabilities suffered by the owners of the appeal properties – such as from traffic noise and congestion, the problems with the nursing home and the liquor licence at the Ten-Pin Bowl, the lack of City views from Mrs Sophios’ property (which is recognised by Mr Horne) and the restriction placed upon the City views by the neighbouring tree at 32 Beanga Street. Further I have examined the evidence of the appellants and Mr Horne about the alleged valuation irregularity as between the subject parcels and the parcels referred to by the appellants in Chatsworth Road, and I am satisfied that the subject lands should be valued at a higher level than the “single dwelling house” sites in the heavily trafficked Chatsworth Road.
The determination of unimproved value in these cases really turns on whether the Court has sufficient evidence upon which it could set aside Mr Horne’s valuations of each of the appeal properties. I cannot come to this conclusion. It follows that my determinations will result in increasing the Chief Executive’s valuation in each case, notwithstanding that this is an unfortunate outcome for the appellants.
But before proceeding to my formal determinations, I should add that there is judicial authority for the proposition that it is within the Court’s power to increase unimproved values determined by the Chief Executive under the provisions of the Valuation of Land Act. It is to be found in the judgment of the Land Appeal Court Court in Re: Appeal by TKW Muir against the determination of the Valuer-General – City of Brisbane – (1977) 4 QLCR 81, p.84, where the Land Appeal Court said:
“ We have given considered and serious thought to the powers of this Court on the hearing of an appeal pursuant to the Valuation of Land Act. We are of the opinion that the provision of section 21(7)(b) in that it refers to ‘the amount’ of a valuation, are sufficiently wide to require this Court to reduce or increase the amount of any valuation made by the Valuer-General and under appeal to the extent necessary to determine the same correctly under, subject to and in accordance with the Valuation of Land Act. ”
I should add that the terminology used in section 21(7)(b) of the now repealed Valuation of Land Act is identical with that used in section 66 of the current Act.
I make the following determinations:
Appeal Ref AV98-891 – The appeal is dismissed and the unimproved value of Lot 8 on RP 75777, Parish of Bulimba, is determined in the sum of Two hundred and nine thousand dollars ($209,000).
Appeal Ref AV98-892 – The appeal is dismissed and the unimproved value of Lot 3 on RP 135261, Parish of Bulimba, is determined in the sum of Two hundred and nine thousand dollars ($209,000).
Appeal Ref AV98-897 – The appeal is dismissed and the unimproved value of Lots 4 and 6 on RP 13206, Parish of Bulimba, is determined in the sum of Two hundred and fifty-seven thousand dollars ($257,000).
Appeal Ref AV98-903 – The appeal is dismissed, and the unimproved value of Lot 2 on RP 135261, Parish of Bulimba, is determined in the sum of Two hundred and nine thousand dollars ($209,000).
Appeal Ref AV98-904 – The appeal is dismissed, and the unimproved value of Lots 50, 52, 54, 56 and 58 on RP 13206, Parish of Bulimba, is determined in the sum of Three hundred and sixty thousand dollars ($360,000).
(CH Carter)
Member of the Land Court
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