Hunter v Chief Executive, Department of Natural Resources
[1998] QLC 8
•6 February 1998
|
BRISBANE
6 February 1998
Re: Appeal against Annual Valuation -
Valuation of Land Act 1944 -
Shire of Flinders.
(AV96-666).
Stuart A Hunter and Beryl R Hunter
v.
Chief Executive, Department of Natural Resources
(Hearing at Hughenden)
D E C I S I O N
Mr and Mrs Hunter are the owners of a grazing property known as "Torquay" in the Hughenden District. "Torquay", also known as Grazing Homestead Perpetual Lease 23/16529, is described as Lot 2 on Plan DG 90, Parish of Walker, and Lot 1 on Plan RM 5, Parish of Torquay. It has an area of about 10,231 hectares. Under the provisions of the Valuation of Land Act 1944, as at 1 January 1996, the respondent Chief Executive determined the unimproved value of that land at $118,000, or $11.53 per hectare. Mr and Mrs Hunter objected against that valuation and after being advised by the respondent that their objection had been disallowed, they appealed to the Land Court, advising that their estimate of the unimproved value was $95,000.
The appellants' grounds of appeal were to the effect that:•the unimproved value of black basalt country can only be derived from sales of other black basalt properties, not from sales of downs country; and
•the improvements on a property affect its sale price, so consideration should be given to the cost of effecting those improvements in arriving at the unimproved value.
At the hearing of the appeal Mrs BR Hunter appeared and gave evidence on behalf of the appellants, while the respondent was represented by Mr R Vize, of counsel. Valuation evidence on behalf of the respondent was given by Mr LR Croton, a registered valuer employed by the Department of Natural Resources.
Mr Croton's report stated that "Torquay" is situated about 66 kilometres north-west of Hughenden, with access by means of the formed earth and gravel Old Richmond Road for about 58 kilometres, then about 4 kilometres of the formed earth and gravel Glendalough Charlotte Poseidon road, then about 4 kilometres of unnamed earth and gravel track.
Mrs Hunter took issue with that statement. She claimed that "Torquay" is situated 80 kilometres north-west of Hughenden, that being the distance for which the appellants were charged for stock transport. She also claimed that the best access was via the bitumen-sealed Hughenden to Richmond Road to Walkers Creek for approximately 30 miles and then 20 miles of dirt road to "Torquay", which crossed the Flinders River and was impassable during times of flood.
The issue of distance from town was never satisfactorily resolved. Mr Croton adhered to his contended distance, claiming that it had been measured by the odometer of his motor vehicle. However, whether the access is 66 kilometres or 80 kilometres, it seems to be generally agreed that there is a considerable distance of dirt road, a low level crossing of the Flinders River, which becomes impassable during flood time and a poorly maintained road to the property boundary, the appellants having to maintain the last third of it.
Mr Croton described "Torquay" as comprising approximately 75% (5,750 hectares) of basalt wall and tableland, with the balance generally comprising undulating brown soil downs, the northern downs having scattered whitewood and boree, with gidyea trees on the basalt wall and gorges, and coolibah shade on the watercourses. Grasses comprise mainly flinders, mitchell and other annual species. He estimated the carrying capacity at 1 beast to 13 hectares, or 787 head. The property is watered by six dams, one flowing bore with a bore drain and one equipped bore. Waterholes in Compton, Codfish and Scrub Creeks last for only a short period.
Mrs Hunter did not disagree with the description of the land or the carrying capacity. She explained that "Torquay" had been a sheep property until the abandonment of the dingo barrier fence, which forced the appellant into running cattle, as the running of sheep was impossible. Being north of the Flinders River it was in the cattle tick area.
She emphasized that while Mr Croton had correctly described the land, the area of downs country was cut by a rugged basalt wall and tableland, making the management of the property difficult and expensive. The southern area of downs, of about 8000 acres, was severed from 3000 acres of downs in the north-west, by the 14,000 acres of basalt wall and tableland. The major difficulty was access onto and across the tableland, the construction of roads being particularly expensive. It was also too expensive to fence off the basalt country, which had to be mustered by helicopter.
Mr Croton supported his valuation by reference to two improved sales, "Kentle Downs" and "Mount Sturgeon".
"Kentle Downs", of 12,594 hectares, is situated approximately 100 kilometres south of Hughenden and sold in January 1995, for $1,087,000. That sale analysed to show an unimproved value of $254,983, or $20.25 per hectare. As at 1 January 1996, the respondent had applied an unimproved value to that land of $19.50 per hectare.
According to Mr Croton's report, "Kentle Downs" comprises about 70% undulating black soil downs and about 30% gidyea, boree scrub and desert tableland. It has a carrying capacity of 1 beast to 13 hectares, or 968 head. It is watered by six dams, one bore, one share bore and two earth tanks.
Mr Croton considered that "Kentle Downs" was superior to "Torquay", because of its better of country and better access.
"Mount Sturgeon", of 140,000 hectares, is situated approximately 100 kilometres north of Hughenden and sold in June 1995 for $4,250,000. That sale was analysed to show an unimproved value of $735,000, or $5.25 per hectare. As at 1 January 1996, the respondent applied an unimproved value equivalent to the analysed figure. According to Mr Croton's report, "Mount Sturgeon" comprises about 11% black basalt forest and plain, about 11% red basalt forest timbered with ironbark, bloodwood and ghost gum, about 55% red sandy tableland, timbered with ironbark and bloodwood with a wattle and silver myrtle understorey interspersed with white sandy patches of pine, about 9% broken granite ridges and about 14% unavailable gorges. It also has heartleaf infestation. Mr Croton estimated the carrying capacity of "Mount Sturgeon" at 1 beast to 20 hectares, or 7,000 head of cattle. It is watered by one permanent waterhole, one spring, two earth tanks, 17 bores, four dams and one well.
Mr Croton considered that "Torquay" was far superior per hectare to "Mount Sturgeon", because it is smaller, its better country and its location closer to Hughenden.
Mrs Hunter did not have detailed knowledge of either of the sales. However, she knew that "Kentle Downs" was much superior country, while "Mount Sturgeon" was largely red basalt country. She emphasized that black basalt country like "Torquay" should only be compared with sales of other black basalt country.
In support of this opinion, Mrs Hunter produced details of the sales of several black basalt properties, known as "Soda Valley", "Alston Vale", "Expressman Downs", "Dunraven" and "Glendalough".
Mrs Hunter did not attempt to analyse any of those sales. The details which she produced were the result of a search of the records of the Department of Natural Resources. Those extracts showed the basic details of each sale, including date of sale, sale price and parties' apportionment of the sale price. Mrs Hunter produced those sale details to indicate the overall prices for which black basalt properties were selling. She contended that if the value of improvements on "Torquay" was deducted from an improved value based on those sale prices, the result would be a negative unimproved value.
Mrs Hunter's main argument in relation to "Torquay" was that while the downs country was good, it was separated by the black basalt tableland with rugged basalt walls. In addition, the best of the downs country had a creek running through the middle of it which was badly infested with prickly acacia. She contended forcefully that "Torquay" should be valued in accordance with sales of other black basalt properties and not the two sales which Mr Croton had relied upon.
Mr Croton stated that he was aware of all the difficulties in relation to "Torquay" which had been raised by Mrs Hunter. He was of the view that he had made sufficient allowance for them when comparing "Torquay" with the two sale properties. He agreed that it would have been preferable to have compared "Torquay" with similar type black basalt country. However, he had not analysed any of the sales referred to by Mrs Hunter for various reasons.
He did not analyse the "Soda Valley" sale because it was complicated by a subdivision arrangement to sell part of the property to an adjoining owner. There was also pressure from the bank for the property to be sold. The "Alstonvale" sale occurred on 8 April 1994. While he thought that sale was probably the start of a rise in the market at that time, he considered it to be too old to be a useful basis.
The sale of "Expressman Downs" was a family transaction. He had interviewed one of the parties and she informed him that it was for the purpose of reorganising a family partnership. Therefore, he thought it would be unreliable as a basis for a valuation.
While he conceded that the sale of "Dunraven" was close to the relevant date, Mr Croton had investigated the background to the sale and had come to the conclusion that the purchasers were motivated by considerations which made him consider their purchase to be over anxious.
Mr Croton said that the sale of "Glendalough" occurred twelve months after the relevant date and was to an adjoining owner. It was also a relatively small parcel of land. In addition, he was of the opinion that there had been a downturn in the market since the relevant date and the sale of "Glendalough" may well be at that lower level.
In this case, the appellants rely heavily upon the fact that the subject land has a large proportion of black basalt country which separates the two better areas of downs country. The basalt country makes the management of the property difficult and very expensive. "Torquay" is situated to the north of the Flinders River, which is crossed by means of a low level crossing and is impassable during times of flood. They contend that since there were sales of black basalt country, "Torquay" should be compared with with sales of similar country, rather than the sales referred to by Mr Croton.
Mr Croton said that he investigated what sales there were of black basalt country and had rejected them for various reasons. He said that he was forced to rely on the sales of "Kentle Downs" and "Mount Sturgeon". While they are, in my opinion, far from perfect as a basis of valuation, they are the only sales that the respondent has produced. "Kentle Downs" has 70% good downs country, while "Torquay" has only 25% downs and suffers from significantly more severe problems. "Mt Sturgeon" has basalt country, but is simply too large to be a useful comparison.
It is indeed unfortunate that Mr Croton did not analyse at least some of the black basalt sales, even though allowance may have been required for their circumstances. Such evidence would have added weight to his opinion derived from other sales.
However, the Valuation of Land Act 1944 provides that the appellant bears the onus of proof. Section 33 of the Act provides that the respondent's valuation must be deemed to be correct until proven otherwise. In Brisbane City Council v. The Valuer-General (1978) 140 C.L.R. 41,, the High Court held that the statutory presumption of correctness could be rebutted once it is shown that the Valuer-General acted upon a wrong principle, or made a serious error of fact, or that the valuation was made by a method fundamentally erroneous.
In this case I cannot say that the respondent has acted upon a wrong principle, or made a serious error of fact, or adopted an erroneous method of valuation. Mr Croton relied upon the analysis of improved sales, a method which has been considered to be appropriate in circumstances where there are no unimproved sales. I have had careful regard to the unimproved value applied to the sale of "Kentle Downs" of $19.50 per hectare, compared to the figure of $11.53 per hectare applied to the subject land, a difference of almost $8 per hectare. The carrying capacity in both cases was estimated to be 1 beast to 13 hectares, even though the properties have different proportions of downs country and "Kentle Downs" no doubt has many advantages.
Having regard to those factors, plus the undeniable fact that the subject land suffers from an access problem, has management difficulties and suffers from greater pest problems than does "Kentle Downs", in the absence of other cogent evidence, the difference of $8 per hectare might reasonably take into account the differences between the properties. Without the benefit of detailed analyses and comparisons with the other black basalt sales, I feel that I have no alternative other than to find that the appellants have not proved that the comparison is not reasonable. Therefore, the appeal must fail.
Accordingly, the appeal is dismissed and the unimproved value of the subject land as determined by the respondent as at 1 January 1996, at $118,000, or $11.53 per hectare, is affirmed.
(JJ Trickett)
President of the Land Court
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