Madden v Department of Environment and Resource Management

[2010] QLC 50

LAND COURT OF QUEENSLAND

CITATION:	Madden v Department of Environment and Resource Management [2010] QLC 0050
PARTIES:	William John Madden (appellant)
v.
Chief Executive, Department of Environment and Resource Management (respondent)
FILE NOS:	VLA1218-05 VLA082-09
DIVISION:	Land Court of Queensland
PROCEEDING:	Appeal against annual valuation under Valuation of Land Act 1944
DELIVERED ON:	26 March 2010
DELIVERED AT:	Brisbane
HEARD AT:	Murgon
MEMBER:	Mr PA Smith
ORDERS:	The appeals are dismissed.
CATCHWORDS:	Valuation – Factors in valuation –presumption in favour of correctness of valuation –  grounds of appeal – error in valuation report - Valuation of Land Act 1944 - Vegetation Management Act 1999
APPEARANCES:	Mr W Madden, self representing Mrs T M Johnson, Principal Lawyer, Department of Environment and Resource Management, for the respondent

Background:

1. This decision relates to two appeals by the appellant Mr Madden against valuations by the respondent, pursuant to the Valuation of Land Act 1944 (the VLA) which valued the appellant’s properties situated at Back Creek Road, Proston (“the Proston land”) and Evans Road, Wondai (“the Wondai land”) in the sums of $96,000 and $72,000 respectively, as at 1 October 2004.  The appellant contends for valuations of $80,000 and $68,000 respectively.

The Proston Land

1. The Proston land has telephone and water connected.  The water supply is part of the Proston Rural Water Supply and allows for maximum water supply of 27 KL per day to the property for stock and domestic purposes.  The property does not have reticulated power connected.  The area of the land is 392.283 hectares.  The property is located about 10 kilometres north of Proston, and 48 kilometres north-west of Wondai. 

2. The property is easy to moderately to steeper in part, snuffy scrub and forest country rising to gum and spotted gum ridges on the western boundary. About 50% of the property is available for crop assisted grazing purposes with the balance being poorer forest grazing country.  There is a lack of natural water on the property. The land is zoned “Rural Precinct” under the Wondai Town Plan for the Wondai Shire Council, gazetted on 16 December 1994.  The land is used for the grazing of cattle, has been valued as a primary production property.

3. Approximately 42 hectares (10.7%) of the property has been recorded as restricted vegetated country under the Vegetation Management Act 1999 (“the VMA”). This land is primarily part of the poorer forest grazing country of the property.

4. The Real Property Description of the property is Lot 23 MZ276 and Lots 1 & 2 on RP183950, Parish of Wigton.

The Wondai Land

1. The Wondai land has telephone and reticulated power connected.  The property does not have water connected, and is not part of the Proston Rural Water Supply.  The area of the land is 1,070.46 hectares.  The property is located about 20 kilometres south of Proston, and about 42 kilometres west of Wondai. 

2. The property comprises gently sloping to undulating forest country timbered by ironbark, bloodwood and wattle, rising to harder forest ridge country  A seasonal supply of water is provided by Coverty Creek, located in the south-west corner of the property.  The land is zoned “Rural Precinct” under the Wondai Town Plan for the Wondai Shire Council, gazetted on 16 December 1994.  The land is used for the grazing of cattle, has been valued as a primary production property.

3. Approximately 91 hectares (8.5%) of the property has been recorded as restricted vegetated country under the VMA. This land is primarily part of the poorer forest grazing country of the property.

4. The Real Property Description of the property is Lots 3 and 14 on Plan BO49, Parish of Ballogie.

The Hearing

1. The appellant self represented and gave evidence at the hearing.  Mr Madden has no legal or valuation qualifications.  The respondent was represented by Mrs T.M. Johnson, a Principal Lawyer employed by the respondent, and relied on evidence of a registered valuer, Mr B Gaskell.

Relevant legislative provisions

1. Pursuant to s.13 of the VLA, the respondent is required to determine the unimproved value of the land. 

2. Section 3(1) of the VLA says as follows:

   “3.(1) For the purposes of this Act –
   ‘unimproved value’ of land means –

   (a)     in relation to unimproved land – 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; and

   (b)     in relation to improved land – 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.”

1. I note that the subject land in both appeals is improved.  Accordingly, put simply, the task is to find the market value of the land on the assumption that none of the improvements are on the subject land.  An assessment is then undertaken as to the highest and best use of that land.

2. As the then President Trickett said in Fairfax v Department of Natural Resources and Mines [2005] QLC 0011 at paragraphs 11 and 12:

   “The principles for determination of the 'market value' of land were established by the High Court in Spencer v The Commonwealth (1907) 5 CLR 418. In that case, the High Court found that the value of land is determined by the price that a willing but not over-anxious buyer would pay to a willing but not over-anxious seller, both of whom are aware of all the circumstances which might affect the value of the land, either advantageously or prejudicially, including its situation, character, quality, proximity to conveniences or inconveniences, its surrounding facilities, the then present demand for land and the likelihood of a rise or fall in the value of the property. (See Griffith CJ at 432 and Isaacs J at 441).

   It has been well established that the unimproved value of land is ascertained by reference to prices that have been paid for similar parcels of land.  In Waterhouse v The Valuer-General (1927) 8 LGR (NSW) 137 at 139, Pike J said that:

   'Land in my opinion differs in no way from any other commodity.  It certainly is more difficult to ascertain the market value of it but – as with other commodities – the best way to ascertain the market value is by finding what lands comparable to the subject land were bringing in the market on the relevant date – and that is evidenced by sales."”

I respectfully agree with these observations.

Presumption of correctness of valuation

1. I now turn to section 33 of the VLA, which states as follows:

   33      Status of valuation

   Any and every valuation, or alteration of the valuation, of any land made, or purporting to be made, under this Act by the chief executive shall be deemed to be correct until proved otherwise upon objection or appeal or until altered or further altered.

2. This section was considered by the High Court in the case of Brisbane City Council v The Valuer-General for the State of Queensland 1977-78 140 CLR 41 where Justice Gibbs (as he then was) made the following observation at page 56:

   “In my opinion once it is shown that in making the valuation the Valuer-General acted upon a wrong principle, or made a serious error of fact, the presumption created by s. 13(7) is rebutted.”

It should be noted that s. 33 of the VLA is in essentially the same terms as what was then s. 13(7) of the Act. 

The issues in the Proston Appeal

1. The appellant’s grounds of appeal essentially are that the property has been adversely affected by the imposition on it of restricted vegetated country under the VMA. The appellant contends that he purchased freehold title, and that his freehold rights have been diminished by the restrictions which flow from the VLA. The appellant also contends that the inability to clear parts of the property have resulted in those parts no longer being suitable for grazing, and that dead trees, which are also unable to be removed, make working parts of the property dangerous.

2. The appellant also says that, in the VLA impacted parts of the property, should he desire to cut scrub to feed his cattle, he is required to pay $281.80 for a permit.

3. A further ground of appeal advanced by the appellant is that lot 23 is very shallow country and unable to hold water in ground tanks or dams. Additionally, the appellant contends that a sale of the property to the Department of Primary industries for forestry purposes did not proceed due to the existence of the VMA restrictions.

The issues in the Wondai Appeal

1. The appellant’s grounds of appeal are very similar to those of the Proston appeal. It is again contended that the property has been adversely affected by the imposition on it of restricted vegetated country under the VMA. The appellant contends that he purchased freehold title, and that his freehold rights have been diminished by the restrictions which flow from the VLA. The appellant also contends that the inability to clear parts of the property have resulted in those parts no longer being suitable for grazing, and created a harbour for wild pigs and dingoes.

2. The appellant again says that, in the VLA impacted parts of the property, should he desire to cut scrub to feed his cattle, he is required to pay $281.80 for a permit.

The evidence

1. I accept Mr Madden’s evidence with respect to each of the disabilities referred to in the grounds of appeal for both properties.  However, that said, I also accept that the appellant’s objections have been properly taken into account by Mr Gaskell in both his oral evidence and his report.

2. One aspect that arose during the evidence related to the provision of reticulated power to the Proston property.  Mr  Gaskell, after hearing the evidence of Mr Madden, corrected his report to say that the Preston property did not have reticulated power connected.  In its original form, the report stated that the property did have power connected.  It is important to note that each of the three sales relied upon by Mr Gaskell have electricity connected[1]. 

   [1]            See Exhibit 5, sales schedule, and transcript, p 41.5

3. The evidence as between Mr Madden and Mr Gaskell is in conflict as to the impact that the lack of an electricity connection has on the Proston property.  Mr Madden is clearly of the view that the lack of an electricity connection diminishes the unimproved value of the property.  Mt Gaskell is equally forthright in saying that he has not observed any difference in sales of relatively remote properties, such as the Preston property, with or without electricity connected[2]. 

   [2]            Transcript, p 34.5

4. Given the conflicting state of the evidence, and the amendment to his report, this issue could potentially be a difficult one to reconcile.  Unfortunately for the Appellant, the issue can be easily resolved.  The absence of reticulated electricity supply was not a ground of appeal with respect to the Proston property, and therefore, pursuant to the provisions of s. 45(4) of the VLA, such issue cannot be relied upon or taken into account in the determination of this matter.

5. There is no doubt that the appellant, who has owned and worked each property for decades, find himself in what he see as a difficult position by the manner in which the VLA has impacted on his ability to work both properties.  His concerns are genuine and well-founded. 

6. It is, however, the role of this court to determine appeals such as these strictly on the basis of the VLA and decided precedents. A direct comparison approach has been adopted by the respondent’s valuer to determine the unimproved value of both properties.  As is so often the case in matters such as this, the issues basically all come down to market evidence.  This is reflected in the sales evidence set out in Mr Gaskell’s two  reports, summarised as follows:

   The Proston sales

Sales	Area Ha	Date of Sale	Analysed U/Value	Applied U/Value 1/10/2004	Comparison
1 Ten Chain Rd, Hivesville	166.7	12/03/2003	$40,0633 ($240/ha)	$36,000 ($216/ha)	Similar 48% subject to VMA
2 Rankins Rd, Brigooda	129.3	07/04/2003	$52,592 ($407/ha)	$46,500 ($360/ha)	Slightly superior No VMA issues
3 Wondai Proston Rd Mondure	201.809	09/06/2004	$102,362 ($486/ha)	$93,000 ($441/ha)	Superior No VMA issues

The Wondai sales

Sales	Area Ha	Date of Sale	Analysed U/Value	Applied U/Value 1/10/2004	Comparison
1 Gayndah  Hivesville Rd Wigton	1771.714	13/02/2003	$74,498 ($42/ha)	$65,000 ($37/ha)	Inferior 3.5% subject to VMA
2 Manar Rd Boondooma	1232.533	06/10/2003	$91,084 ($74/ha)	$82,000 ($65/ha)	Inferior 15% subject to VMA
3 Wondai Proston Rd Mondure	201.809	09/06/2004	$102,362 ($486/ha)	$93,000 ($441/ha)	Superior No VMA issues

1. It should be noted that Sale 3 is common to both valuations.

2. I accept the valuation evidence of Mr Gaskell, and note that the unimproved value of the Proston property is $245 per hectare, and the Wondai property $67 per hactare.  Whilst some points made by the appellant are well argued and reasoned, I am satisfied that Mr Gaskell is well acquainted with the properties (save for the issue of electricity connection already discussed) and has taken all relevant points referred to into the appeals into account.  On the basis of the evidence in its entirety, Mr Madden has not produced evidence sufficient to disturb the presumption of correctness.[3]

   [3] see paragraphs 15 and 16 above

3. Having considered all of the evidence before me, and applying the relevant authorities, I am not satisfied that the valuations of $96,000 and $72,000 involve a significant error of fact or were arrived at by a fundamentally flawed method. 

Conclusion

1. For the reasons set out above, I have reached the conclusion that the appellant has failed to establish that the respondent’s assessment of the unimproved value should be reduced to $80,000 and $68,000 respectively or in any amount at all. It follows that the appeals must be dismissed. The valuations are accordingly affirmed in the sum of $96,000 for the Proston land and in the sum of and $72,000 for the Wondai land, as at 1 October 2004.

Order

The appeals are dismissed.

P A SMITH

MEMBER OF THE LAND COURT