Herbert v Chief Executive, Department of Natural Resources
[1999] QLC 84
•6 August 1999
LAND COURT,
BRISBANE
6 August 1999
Re: Appeal against Annual Valuation Valuation of Land Act 1944 Shire of Livingstone. (AV98-288) Ian H Herbert and Catherine C Herbert
v.
Chief Executive, Department of Natural Resources
(Hearing at Rockhampton)
D E C I S I O N
This is an appeal by Mr and Mrs Herbert against the unimproved value applied to their land by the Chief Executive, Department of Natural Resources, under the provisions of the Valuation of Land Act 1944 (“the Act”).
Introduction: was $45,000.
Mr and Mrs Herbert are the owners of a parcel of land described as Lot 1 on
Registered Plan 604432, Parish of Yeppoon, containing an area of 7.057 hectares. As
at 1 October 1997 the respondent applied an unimproved value to that land of
$79,000. Following an unsuccessful objection against that valuation, Mr and Mrs
The appellants’ grounds of appeal were as follows:
“1. There is a conservation agreement over the land which declares the allotment a nature reserve under Section 42 of the Nature Conservation Act 1992.
2. Only 1495 square metres of the land can be developed with a residence and/or sheds.
These factors have not been considered in assessing an unimproved value of
$79,000. ”
The appellants were represented by Mr MD Sheehan, a registered valuer of
the valuation firm Sheehan & Sheehan. The respondent was represented by Mr JA Thomas, a senior valuer of the Department of Natural Resources and valuation evidence was given on behalf of the respondent by Mr BT Coe, a registered valuer also employed by the Department of Natural Resources.
The Subject Land:
There was general agreement between the valuers about the physical
characteristics of the subject land. It is situated on Vaughans Road, about 4 kms north-west of Yeppoon, with bitumen sealed access except for the last 100 metres, which is either formed earth (Mr Sheehan) or formed gravel (Mr Coe). Electricity and telephone services are available. Mr Coe said that water could be provided from neighbouring subdivisional development at a cost of approximately $6,000. The land is zoned “Rural B” under the Livingstone Shire Town Planning Scheme and at the relevant date was vacant, although it seems that in the past a house had been constructed on a cleared area towards the southern end.
Mr Sheehan described the land thus:
“The allotment is generally above street level with a gentle rise to the rear northern boundary. There is a gentle cross slope from west to east. There is a natural gully along the eastern boundary. The allotment would be subject to surface water runoff problems. The land is uncleared except for three (3) small areas in the southern sector.”
Mr Coe went on to say:
“The property comprises Alexander closed Palm forest, eucalypt open forest and rainforest. The property is mostly virgin with the exception of three cleared areas.”
The Purchase of the Subject Land:
Mr Ian Herbert, one of the appellants, gave evidence of the purchase of the
subject land by himself and his wife on 6 July 1995 for $100,000. He said that they purchased the land in order to save it from being cleared. They had been advised that the land was for sale and was in danger of being cleared and subdivided by a future purchaser. When they inspected the land they were amazed to find that it consisted of a substantial area of palm grove surrounded by rainforest, so close to the centre of Yeppoon. All neighbouring land had been cleared for agriculture or urban development.
They were informed by the Department of Environment and Heritage that this “Archontophoenix alexandrae” closed palm forest which is in a relatively undisturbed state and is near the southern limit of its geographical range, is a highly significant vegetation community.
The appellants decided to purchase the block to save it from being cleared. Their intention was to negotiate a conservation agreement with the State Government in order to have it declared a nature refuge with a management plan that precluded subdivision and clearing. They were aware at the time that this would probably result in the lowering of its market value, but were prepared to bear that cost for the sake of the environment. It was never their intention to live on the block, but to sell it once it was suitably protected. They were prepared to pay a premium for the land because of their desire to retain the vegetation on it.
The appellants negotiated a conservation agreement with the Minister for Environment and Heritage which was signed on 28 October 1997. That agreement preserves the natural values of 6.91 hectares of the land, but excludes 1,495 square metres in three small sites which had previously been cleared, sufficient for a house, garden and shed. The nature refuge “Archontophoenix Grove” was gazetted on 29 May 1998.
According to Mr Herbert, the conservation agreement commits future owners to manage the land in accordance with the stated conditions, which means ensuring the preservation of the natural values of the land in perpetuity. This includes the requirement to control environmental weeds.
In Mr Herbert’s opinion, the purchase price of $100,000 reflected the future subdivision potential of the land, situated as it is close to the rapidly expanding coastal residential community of Yeppoon. Under the conservation agreement, subdivision or rezoning are prohibited. However, the land is capable of being used for a single unit dwelling and the appellants believe that it should be valued similarly to small residential blocks of between 1000 and 2000 square metres.
The Conservation Agreement:
The conservation agreement entered into between the appellants and the State
of Queensland was made under the provisions of Division 4 of Part 5 of the Nature Conservation Act 1992. It is declared a nature refuge and assigned the name “Archontophoenix Grove Nature Refuge” under the Nature Conservation (Protected Areas) Regulation 1994 (Part 15 of Schedule 5).
The object of the Nature Conservation Act 1992 is stated to be:
“The conservation of nature is to be achieved by an integrated and comprehensive conservation strategy for the whole of Queensland that involves among other things, the following –
(a) … (b) dedication and declaration of protected areas (c) management of protected areas (d) protection of native wildlife and its habitat (e) use of protected wildlife and areas to be ecologically sustainable (f) … (g) cooperative involvement of land-holders.”
Division 4 of that Act (Sections 43 to 52) makes provision for the Minister and a land-holder to enter into a conservation agreement which may contain terms that are binding on the State and a land-holder and the land-holder’s successors in title. The conservation agreement may contain terms which allow a land-holder to carry out specified activities, or prohibit a specified use of land in the area, or restrict the use or management of land in the area, or require a land-holder to refrain from, or not to permit, specified activities, or require a land-holder to carry out specified activities, or provide for any other matter relating to the conservation of the area, including the implementation of the management plan for the protected area.
The Governor in Council may by regulation declare a specified area the subject of a conservation agreement to be a nature refuge. The regulation must specify the declared management intent of the nature refuge and the duration of the declaration which must be the duration of the agreement (Section 46).
A conservation agreement may be terminated only if the land-holder who entered into the agreement requests its termination under the terms of the agreement and the Minister is of the opinion that the area to which the agreement relates is no longer needed for, or is no longer capable of being used to achieve the declared management intent of the area (Section 47).
A conservation agreement may be varied by a later agreement between the State and land-holders concerned (Section 48). A conservation agreement is binding on the successors in title to the land-holder who entered into the agreement (Section 51).
The conservation agreement in respect of the subject land states in clause 2 that the agreement is made with the specific purpose of creating a nature refuge over the land which is to be managed in accordance with the principles set out in Section 22 of the Act, which are to conserve the area’s significant natural resources, provide for the controlled use of the area’s natural resources and provide for the interests of land-holders to be taken into account. The land-holder agrees in managing the land, to provide for the controlled use of the land’s natural resources, having particular regard to the values of the land specified in Item 2 of the schedule attached to the agreement, which reads:
“The Land consists of approximately 7 hectares along a drainage line in the eastern footslopes of Mt Barmoya, approximately 5 kilometres west of Yeppoon in Central Queensland. The soil is colluvial-alluvial outwash derived from sedimentary and volcanic rocks.
The Land contains an Archontophoenix alexandrae closed palm forest, eucalypt open forest and rainforest. The palm forest is near the southern limit of its geographical range in this area and is representative of a more extensive local community type that has been mostly cleared for agricultural purposes. Similar, although more complex, palm forest ecosystems are considered to be endangered and are poorly represented in protected areas. This remnant represents an important source of propagules and food and shelter for fauna.”
The land-holder may make such economic or exploitative use of the land specified in Item 4 of the schedule provided that such use is conducted with minimal environmental impact and which is consistent with the management principles. Item 4 of the schedule sets out the approved uses as follows:
“(a) Access to The Land for nature based recreation, education, and scientific
research;(b) construction of minimal disturbance walking tracks; (c) seed collecting subject to current best practice for sustainable harvesting; (d)
planting of local native plant species to assist revegetation of disturbed areas, using locally collected seed;
(e) the use and maintenance of existing fences, tracks, and roads; (f) activities associated with the control of exotic plants; and (g) activities associated with control of feral animals, including cats.”
Under clause 5 of the agreement, the land-holder is to make reasonable efforts to prevent the spread or invasion of pests and weeds, particularly lantana, rubber vine, guinea grass, mango trees and queen palms, and to remove any existing pests or weeds by environmentally sympathetic means, or as agreed in writing by the Minister.
Under clause 11 of the agreement, the Minister (through his delegate) may enter the land to give effect to or carry out any provisions of the Act or the agreement.
Under clause 17 of the agreement, the agreement is binding on the land-holders successors in title and those with an interest in the land.
A plan attached to the agreement shows that it applies to an area of approximately 6.91 hectares, which is the whole of the subject land except for three small areas towards the southern or Vaughans Road end of the property, comprising area A on the western boundary with dimensions of about 25m x 30m, area B towards the southern centre of the land, with dimensions of about 25m x 25m, and area C just to the south of area B, with dimensions of about 6m x 20m. It is common ground that the three excluded areas remain outside of the agreement and may be used for purposes such as the construction of a dwelling house, sheds or gardens.
The Issues between the Parties:
The appellants through Mr Sheehan argue that only 1495 square metres of the subject
land is available for development and therefore it should be valued on the basis of sales of small rural residential sites rather than sales of larger areas. They contend that the property should be valued at $45,000. Mr Sheehan was of the opinion that the 6.91 hectares of land the subject of the agreement had very little additional value, as it could not be used for development and it was doubtful whether lending institutions would consider it for security purposes. He thought that it would add no more than $10,000 in value to the 1495 square metres of the excluded areas. Under cross-examination, he ventured the opinion that if the land was not subject to the agreement, but had no subdivisional potential, its unimproved value as a rural homesite would be between $65,000 and $70,000.
On the other hand, Mr Coe was of the opinion that the conservation agreement did not affect the value of the subject land as a rural residential site, but he did agree that it removed its subdivisional value. Although he was not the original valuer, he had satisfied himself that the applied value of $79,000 was appropriate. In his opinion, that figure reflected the value as a rural homesite based on sales of similar sized properties. If the subject land was not affected by the conservation agreement, he thought it should be valued at $100,000 a value which would reflect its subdivisional potential.
In other words, Mr Coe was of the opinion that the conservation agreement prohibited the subdivision of the land, but did not affect its value as a rural residential property. He reasoned that a house, sheds and garden could be built on the areas outside of the agreement. The agreement allowed for the maintenance of existing tracks to those areas and he was of the opinion that there were potential purchasers who would be prepared to pay $79,000 to purchase the property, notwithstanding their obligations under the agreement.
Mr Coe referred in a general way to purchasers of rural homesites, particularly in the Byfield area, who did no more than clear an area for a residence and leave the rest of the timber on the property intact. He conceded that there were other purchasers of rural homesites who would clear much more extensively to run livestock, or perhaps to replant with trees of their own choosing. He felt that there were purchasers who would see the natural beauty of the subject land who would appreciate its attributes, notwithstanding the restrictions on its development and the requirement to maintain free of noxious weeds.
Mr Sheehan’s Basis of Valuation:
Mr Sheehan based his opinion of the unimproved value of $45,000 for the subject
land on a mixture of sales and relativity with the unimproved values applied to nearby properties. He referred to the sales of three properties zoned “Rural B” just to the south of the subject land and fronting Limestone Creek Road, with areas ranging from 1.3486 hectares to 2.023 hectares, which sold between January 1994 and April 1997 at prices ranging from $30,000 to $53,500. Unimproved values applied to those properties by the respondent ranged from $35,000 to $49,000.
Mr Sheehan was of the opinion that there had been little increase in sales levels since 1994. In comparing the sales with the subject land he took into account the following factors: they were larger than the area available for development on the subject land, they had the same zoning, they were uncleared and they were situated on a bitumen road, while the subject land was situated on a formed earth road. He also made the point that the sales were not the subject of conservation agreements and the whole of the allotments could be developed.
In addition to the sales, Mr Sheehan referred to the unimproved values that had been applied by the respondent to properties on the opposite side of Vaughans Road, which ranged in area from 7.807 hectares to 10.715 hectares, all zoned “Rural B”, which had been valued by the respondent at unimproved values ranging from $80,000 to $90,000. However, it emerged that these properties had been valued under the concessional provisions of Section 17 of the Act.
Mr Sheehan also referred to the unimproved values applied to the neighbouring subdivisional development immediately to the east of the subject land, which comprised rural homesites ranging in area from just over 1 hectare to approximately 1.5 hectares. As at the relevant date the respondent had applied unimproved values to those properties ranging from $49,000 to $56,000.
In addition, Mr Sheehan referred to another subdivisional development on the opposite side of Vaughans Road to the subject land, where rural homesites zoned “Park Residential” with areas ranging from just over 4,000 square metres to 5,670 square metres, had been valued by the respondent at unimproved values ranging from $46,000 to $49,000.
Mr Coe’s Basis of Valuation:
Mr Coe relied on three sales, all of which are situated some distance from the subject
land. Sale 1 is situated on the bitumen sealed Bungundarra Road, has an area of 10.16 hectares and sold in December 1996 for $90,000. The sale was analysed to show an unimproved value of $80,400 and to which as at the date of valuation, 1 October 1997, the respondent had applied an unimproved value of $70,000.
Sale 2 has an area of 10 hectares and is situated on the bitumen sealed Woodbury Road. That property sold in January 1997 for $80,000, was analysed to show $77,700 and as at the relevant date, the respondent had applied to it an unimproved value of $70,000.
Mr Coe considered that both those properties were inferior to the subject land.
Mr Coe also included the sale of a 4,047 square metre allotment situated on the
bitumen sealed Stones Road, which sold in May 1997 for $44,500. The sale analysed to show an unimproved value of $43,250 and at the relevant date the respondent had applied an unimproved value to that land of $40,000. Mr Coe considered that property to be vastly inferior to the subject land. He did not explain why he had used such a small property as a comparison to value the subject land. However, I assume it was intended to show the price that was obtained near the date of valuation for a small allotment much further removed from Yeppoon.
| I have come to the conclusion that the conservation agreement must affect the market | Conclusion: applied to the nearby properties, I am of the opinion that the subject land must be worth more than the unimproved values applied to the small rural residential sites in the neighbouring subdivisions, but less than the unimproved values applied to those larger properties which have been valued under section 17 of the Act. I feel that an unimproved value of $60,000 would be appropriate. |
Order:
Accordingly, the appeal is allowed. The valuation of the respondent is set aside and the unimproved value of the subject land as at 1 October 1997 is determined at Sixty thousand dollars ($60,000).
(JJ Trickett)
President of the Land Court
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