Hutton v Department of Natural Resources and Mines
[2007] QLC 53
•13 July 2007
LAND COURT OF QUEENSLAND
CITATION: Hutton v Department of Natural Resources and Mines [2007] QLC 0053 PARTIES: Clement J & Shirley L Hutton
(appellant)v. Chief Executive, Department of Natural Resources and Mines
(respondent)FILE NO.: AV2005/1663 DIVISION: Land Court of Queensland PROCEEDING: Appeal against annual valuation under the Valuation of Land Act 1944 DELIVERED ON: 13 July 2007 DELIVERED AT: Brisbane HEARD AT: Maroochydore MEMBER Mrs CAC MacDonald ORDER: 1. The appeal is dismissed.
2. The unimproved value of Lot 2 on Registered Plan 896925 in the County of Canning, Parish of Maroochy as at 1 October 2004 is affirmed at $310,000.
CATCHWORDS: Valuation – unimproved value – correct methodology – onus of proof – sales evidence APPEARANCES: Mr CJ Hutton, for the appellants
Mr W Isdale, Crown Law, for the respondent
Clement J and Shirley L Hutton (the appellants) are the owners of land situated at 74 Lake Dunethin Road, Nambour. Mr and Mrs Hutton have appealed against the unimproved value of $310,000 placed upon the land by the respondent, the Chief Executive, Department of Natural Resources and Mines as at 1 October 2004 under the provisions of the Valuation of Land Act 1944. The appellants say that the value of the land at that date was $180,000.
Mr Hutton conducted the appeal on behalf of the appellants and gave evidence at the hearing. Mr RK Monteith, a registered valuer employed by the respondent, prepared a written report and gave evidence on behalf of the respondent. Mr Monteith was the valuer who was responsible for the valuation which is the subject of the appeal.
The subject property is located about 6 kilometres south-east of Yandina and about 5 kilometres north of Bli Bli. It has an area of 10.85 ha. Power, telephone and garbage services are available to the land. There are two dwellings on the property one of which is occupied by the appellants.
Mr Hutton agreed generally with Mr Monteith's description of the subject land as a long, narrow and irregular shaped parcel that is partly forested and partly cleared. Most of the forested area is very rocky with several outcropping boulders and most of the cleared areas are moderately sloping. The land falls generally to the east. The northern end of the property is bordered by Lake Dunethin Road which forms a barrier between the property and the Maroochy River.
The southern part of the property has access from the Yandina-Bli Bli Road, which is bitumen sealed. The property also has access directly to the north to Lake Dunethin Road which at that point is an unmade gazetted road. The appellants currently access their property via a track which passes through an adjoining lot, formerly owned by them but now owned by their daughter. There is no registered easement allowing that access over the adjoining lot.
The subject land is zoned sustainable cane land under the Maroochy Plan 2000. It is also designated as a regional landscape and rural production area under the South-East Queensland Regional Plan 2005-2006. The cleared areas of the property were formerly used by the appellants for cane farming but the property is now used as a rural home site and the appellants run some cattle on the land.
The appellants relied on four grounds of appeal. These were -
§the sale of a property owned by SJ & GA Page for $200,000. The appellants said that that property was far superior to theirs, and on that basis and also because of government restrictions limiting the use of their property, the value of their property should be $180,000; (This sale is considered in more detail subsequently in these reasons.)
§the description by previous valuers of the situation and access to and the topography of their property was incorrect. At the hearing of this appeal the appellants agreed that the description of the subject property contained in Mr Monteith's report was generally correct although they disputed Mr Monteith's opinion that the north-easterly views available over the Maroochy River to Mt Coolum added value to the property;
§as a result of a resumption by the Maroochy Shire Council, the appellants had lost their official access to Dunethin Rock Road. Although that road is maintained by the Council, it appears that from time to time it is inaccessible, and the made road comes close to the boundary of the appellants' land. The result is that a number of people who come down the road trespass on to the appellants’ land despite the fact that there are no through road signs erected and signs warning unauthorised persons to keep out;
§people also trespass onto the appellants’ land from the nearby picnic area and Scouts camp and drive along the appellants’ private access road.
Sales evidence
Mr Monteith valued the subject property as a rural home site by comparison with sales of rural home sites in the area. He relied on two sales in support of his valuation and also provided details of a third sale, the Page sale referred to by the appellants in their grounds of Appeal.
Sale 1 was Mr Monteith's primary sale. This property is situated on the Yandina-Bli Bli Road approximately 1.8 kilometres west of the subject property. It has an area of 6.753 ha and is situated within the sustainable cane land area. Electricity, telephone and garbage services are connected to the property. The property sold on the 31 July 2004 for $687,000 which Mr Monteith analysed to $605,000. He applied a value of $375,000.
The sale property is predominantly gently sloping to level cleared land with frontage to the Maroochy River. It is long and narrow in shape. Mr Monteith said that about 75% of the sale was flood prone river flats. The sale land, said Mr Monteith, is best suited to rural residential lifestyle use, although Mr Hutton thought that it is still being used for growing cane. Mr Monteith described the sale property as being slightly superior to the subject. The sale property is smaller and lower lying than the subject but it has direct river frontage. Despite that, Mr Monteith considered that the subject's river access via the esplanade was better than that of the sale because the esplanade provided the subject with a sandy level entry to the river and points where a boat could easily be accessed. By contrast, the sale was on top of a steep bank, suffered some erosion from the river and, he thought, direct access to the river might not be possible.
Mr Monteith said that the market for land in the Maroochy Shire had boomed in the two years since the valuation as at 1 October 2002. The sale property had previously sold for $350,000 on 23 January 2002. Despite the fact that he analysed the 2004 sale to $605,000 he had applied a conservative value of $375,000 because he was unsure at that time whether the significant increase in the price would be supported by other sales. The rise in the market has subsequently been confirmed.
Mr Monteith's Sale 2 is situated at Toolborough Road, Yandina Creek, approximately 5.6 kilometres north-east of the subject. Electricity, telephone and garbage services are available. The property has an area of 24.37 ha and was sold on 3 July 2004 for $480,000 which Mr Monteith analysed to $445,000. He applied a value as at 1 October 2004 of $375,000.
Mr Monteith described Sale 2 as predominantly gently sloping to level cleared land partly on the low lying Yandina Creek flood plain. Most of the land is flood plain and was historically used for cane production but a flood free house site has been constructed on the land. The sale property is designated sustainable cane land but Mr Monteith considered that its highest and best use was as a rural residential home site, although the subject land was better as a house site than the sale land. Mr Monteith said that, overall, Sale 2 was slightly superior to the subject because of the larger area of the sale and its more usable land. This was offset by the subject's north-easterly aspect over the river and its outlook to Mt Coolum compared with the sale which faced west and was thus deprived of sea breezes and exposed to westerly winds.
Mr Monteith's Sale 3 was the sale by GA and SJ Page which the appellants referred to in their Notice of Appeal. Mr Monteith emphasised that he did not rely on the sale in support of his valuation but had simply provided information relating to it because it had been raised in the Notice of Appeal. He considered that the sale should not be used for the valuation because the date of sale was some two years prior to the date of valuation.
The sale property is situated at 26 Pearce Drive, Maroochy River approximately one kilometre west of the subject. It has an area of 16.351 ha and sold on 22 April 2002 for $200,000. Mr Monteith analysed the sale to $165,000. He applied a value of $450,000 to the sale property as at 1 October 2004, reflecting, he said, the increase in market since the sale of the property in April 2002. Mr Monteith supplemented his written report with evidence at the hearing that the sale property had resold on 23 January 2007 for $530,000.
As indicated previously, the only sale referred to by the appellants was Sale 3 discussed in the previous paragraph. The appellants considered that the sale was far superior to their property in every way.
Conclusions
Section 13 of the Valuation of Land Act requires that the Chief Executive must decide the unimproved value of the land to be valued for the Acts under which local authorities are established. The term "unimproved value" is defined in s.3 of the Act. Relevantly, s.3 (1)(b) provides that, in relation to improved land, unimproved value of land means –
"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, assuming that, at the time as at which the value is required to be ascertained for the purposes of this Act, the improvements did not exist.".
In effect s.3(1)(b) requires that the market value of the land be determined as at the date of valuation (Stubberfield v Valuer-General [1991] 1 QdR 278 at 283), on the assumption that the improvements do not exist.
It is well recognised that the best method for determining the unimproved value of land is by comparison with sales of comparable unimproved or lightly improved property (Fischer v Valuer-General (1983) 9 QLCR 44 at 46). In this case, the respondent's valuer, Mr Monteith, has relied on two sales in support of his valuation.
Sale 1 is located in the same area as the subject property and is similar in many ways to it. Sale 2 is located further away from the subject but is in the same general area. I consider that both properties are sufficiently comparable with the subject land to enable them to be used in the valuation. Further, the evidence indicates that Mr Monteith has made allowances for the differences between the sales properties and the subject land. In particular, he has allowed for the rocky outcrops on the appellants' land, the informal access used by the appellants and the impact of trespassers on their land.
The appellants have not challenged the applicability of Sales 1 and 2 and on the evidence before me I consider that they support the valuation under appeal.
The appellants relied on Sale 3 to the extent that they considered that their property was inferior to the sale and therefore that it should be valued at a lesser amount than the sale price. However, the evidence indicates that because of the substantial increase in the market since this property was sold in 2002 this sale should not be relied on to support a valuation as at 1 October 2004.
It is noted also that the unimproved value of Sale 3 as at 1 October 2004 was $450,000 compared with the unimproved value of the subject land, $310,000. Mr Monteith said that he considered that the sale property was superior to the subject property and the unimproved value applied to the subject property is consistent with that.
Mr Hutton objected to Mr Monteith's references to the views available from his land and the access to the river for boating because those features were of no interest or value to the appellants.
I consider that those are matters which could affect the market value of the subject land and, therefore, that they were properly taken into account by Mr Monteith.
Mr Hutton also complained about the trespassers on his land and the effect of the road constructed by the Council. Mr Monteith said that he had allowed for these disadvantages by reducing the valuation from $325,000 to $310,000 on objection. I can see no reason to reduce the valuation further for these difficulties.
The result is that I can find no error in the valuation under appeal. The valuation is supported by the evidence given by Mr Monteith and has not been effectively challenged by the evidence of Mr Hutton. Moreover, s.33 of the Valuation of Land Act provides that every valuation made by the Chief Executive shall be deemed to be correct until proved otherwise upon objection or appeal. There has been no evidence in this case to establish that the valuation is incorrect.
Orders
1. The appeal is dismissed.
2.The unimproved value of Lot 2 on Registered Plan 896925 in the County of Canning, Parish of Maroochy as at 1 October 2004 is affirmed at $310,000.
CAC MacDONALD
MEMBER OF THE LAND COURT
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