Kratzer Enterprises Pty Ltd v Chief Executive, Department of Lands

[1996] QLC 72

[1996] QLC 72

 

  LAND COURT

BRISBANE

31 MAY 1996

Re:     AV95-200 -
  An appeal against an unimproved valuation -
Valuation of Land Act 1944 - Warwick Shire

Kratzer Enterprises Pty Ltd
  v.
  Chief Executive, Department of Lands

(Hearing at Warwick)

D E C I S I O N

Lots 38, 41 to 44 on M341168 and Lot 126 on ML 1215, Parish of Wildash, provide an aggregation of 75.85 ha, situated about 24 km south of Warwick via the old Stanthorpe Road.  The final 4 km of the access is of earth and gravel formation. 
           The aggregation effectively comprises five separately surveyed rural sites, Lot 126 being surveyed as an access strip to Lot 38.  The land lies to the north and south of a central surveyed but unformed road.
           As at 1 January 1995 the Department of Lands, as it then was, assessed the unimproved value of the aggregation in the sum of $86,000.  It is accepted that the chief executive has used the discretion of not valuing separately those parcels separated by the public road.  The valuation was made by Mr D.P. Coe, registered valuer.  In his tendered report, he described the land as comprising undulating to moderately sloping gum and ironbark ridges - all lots being “sloping”.  The aspect of the land is generally east to south-easterly and all lots have good rural views. 
           The access to Lot 44 is described by Mr Coe as being a grassy track for about 400 m while Lots 41 to 43 have steep earth track access “suitable for four wheel drive”.  Lot 126 fronts the main road as the access strip to Lot 38 but the evidence is that it traverses a low flat area and then a boulder strewn slope.
           In the appellant company’s grounds of appeal, the land is described as “a worthless mountain covered in thick scrub, completely inaccessible”.  The complaint was made that when it was first acquired, the 1988-89 valuation had been in the amount of $36,280 then successive valuations rose to $60,000, $69,000, $86,000 and finally in 1995 to $99,000.  The 1995 valuation had been reduced on objection to $86,000 and it is that reduced valuation which is now appealed against.
           Mr E.E.F. Kratzer, a director of the appellant company, attended the hearing.  His evidence was that although the company “had paid” $200,000 for the land initially, it was the result of an exchange and was acquired sight unseen.  The land has since been advertised for sale in the amount of $100,000 but with no interest being shown.  Mr Kratzer told the Court that he could have sold Lot 43 to the owner of Lot 40 but that would have denied any possibility of access to Lots 41 and 42.  He said that he had tried to sell Lots 42 and 43 together and Lots 38 and 41 together for $55,000 without any success.  It was only after the subject valuation that Mr Kratzer had become aware of his rights to challenge the valuation.  His main concern is the “goat track” access on the internal surveyed road which is “very very steep and only accessible in very dry weather and then only by tractor or a real good four wheel drive”.  He had approached the Council, without success, to have reasonable access provided to the lots fronting the internal road.  He described those lots as “lovely blocks, if you could get to them”.  The estimate of value which was contained in the Notice of Appeal was $40,000. 
           It was Mr Coe’s evidence that he had given specific consideration to the question of access.  His valuation of the aggregation had been based on the following calculation:

Lot 38 & Lot 126  -          $18,000
           Lots 41 to 44 @ $20,000  $80,000

$98,000

Less Bulk Allowance @ 2.5% per block          $12,000

$86,000

The individual site values had been based on two sales.  A larger site of 34.68 ha with similar views, accessible only by a private easement arrangement and situated some distance closer to Warwick than the subject land, had sold in July 1992 for an analysed unimproved value of $30,500.  Another site of 18.46 ha, further from Warwick at Dalveen, but with superior highway access and easier slopes sold in February 1994 for an analysed unimproved value of $27,000.
           It is clear that the lack of all-weather and then the difficult dry-weather access, particularly to the internal lots, detracts from the saleability of the land for use as rural homesites or indeed even rural retreats.  On the evidence the land has little alternative use potential.  Mr Kratzer’s evidence indicates that he has the false impression that valuations for rating purposes should be expected to be at some artificial value less than market value.  In any event he sees the land as unsaleable at any price until reasonable access is available to each lot - although he has no intention he says, of listening to “ridiculous offers”.

On the evidence, it seems to me that Lot 38 (with the access strip Lot 126) and Lot 44 and probably Lot 43 would have been saleable at the relevant date at the site valuations applied to them by Mr Coe.  However while the access position remains as it is, I have been persuaded that it would not be unreasonable to provide the benefit of doubt to the real difficulties faced by Lots 41 and 42 as individual sites. 
           I will decide the matter as follows:

Lot 38 and Lot 126                 one site            -          $18,000
           Lots 41 and 42            two sites @ $15,000    -          $30,000
           Lots 43 and 44            two sites @ $20,000    -          $40,000

$88,000

Less Bulk Allowance of 2½% per site              say       $11,000

$77,000

The appeal is allowed, the valuation of the chief executive set aside and the unimproved value of the aggregation determined in the amount of Seventy-seven Thousand Dollars ($77,000).

RE WENCK
  MEMBER OF THE LAND COURT