Maltman v Department of Natural Resources and Mines
[2004] QLC 107
•6 December 2004
LAND COURT OF QUEENSLAND
CITATION: Maltman v Department of Natural Resources and Mines [2004] QLC 0107 PARTIES: Cleveland John Maltman
(applicant)v. Chief Executive, Department of Natural Resources and Mines
(respondent)FILE NO:
AV2003/0719
DIVISION: Land Court of Queensland PROCEEDING: Appeal against annual valuation under Valuation of Land Act 1944 DELIVERED ON: 6 December 2004 DELIVERED AT: Brisbane HEARD AT: Maroochydore MEMBER Dr NG Divett ORDER: The appeal is dismissed, and the unimproved value of Lot 151 on RP 91397 as determined by the Chief Executive in the sum of One Hundred and Two Thousand Dollars ($102,000) is affirmed. CATCHWORDS: Valuation – Statutory valuation – Unimproved value – Factors in valuation – Impact of filling – Original source of fill not available – Need to use external fill APPEARANCES: Mr CJ Maltman appeared on his own behalf
Mr Heather, Legal Officer for the respondent
Background:
This matter relates to land at 28 Pandanus Street, Mudjimba, described as Lot 151 on RP 91397. The subject land has an area of 607 square metres and is located in the Mudjimba Beach area about 400 metres from the beach. Access is easy to Pandanus Street, which is bitumen sealed with grassed earthen gutters and grassed footpaths. Water, sewerage and overhead electricity are available, and the subject land is zoned Mixed Residential under the Town Plan of the Maroochy Shire Council effective at the date of valuation of 1 October 2002. The key issues are changes in the values, relativity, comparison of sales and impact of filling.
On 24 February 2003 the Chief Executive issued a valuation of the subject land at $102,000. Following an objection the Chief Executive confirmed that figure on 2 September 2003. The owner has now appealed, claiming the unimproved value should more properly be $92,000.
Mr Cleveland J Maltman appeared and gave evidence on his own behalf. Mr M Heather, Legal Officer, appeared for the respondent, calling evidence from Maxwell John McLaren, the departmental registered valuer responsible for determining the valuation. An unsuccessful preliminary conference was held before the Judicial Registrar on 11 February 2004.
Nature of the land -
The subject land is a regular shape parcel in the older area of Mudjimba, which lies between the coastal beach frontal dunes and low lying coastal swamp. The land is at street level sloping very moderately. The parcels on either side of the subject land have been filled, so that surface waters flow on to the subject land. The subject land has been partially filled to about 0.6 metres in order to satisfy the Council's requirements to achieve flood-free and adequate drainage status. However the entire low lying area is liable to street flooding during periods of extreme storm surges. Mr Maltman argues that the stormwater drainage system does not work and street lighting in that area is minimal.
The Mudjimba Beach area is a relatively small beach settlement, which is now being expanded by new estate developments to the north and west of Pandanus Street and Coolibah Street. About 1.5 kilometres to the north-west of the Mudjimba Beach is the existing Sunshine Coast airport (Exhibit 5). Mr Maltman has resided in the area for many years, as his family were pioneers of the district. He has personally been involved in property matters since 1987, and as an active member of community organisations, is very familiar with the locality.
Mr Maltman is also involved in the aviation industry for many years, and is familiar with noise intrusions from circling aircraft, or on approach paths. He argues that while there is some noise levels in that area, the variations in noise levels do not vary greatly across the area of his sales used to demonstrate the market levels in Mudjimba. He argues that over short distances of about 300 metres between some areas of the new and old parts of Mudjimba, there would be little noticeable difference in noise problems. He notes that as aircraft noise is generated from above, then noise intensity is in inverse proportion to the distance from the aircraft. Mr McLaren agrees that aircraft noise is a general problem in the area, but argues that the noise intrusions do increase as you move nearer to the airport, and into the new areas of Mudjimba towards the north-west. He notes that the proposed flight paths for the proposed new east/west runway extend down into Lot 99 on SP 131493 on Exhibit 2.
Changes in value -
A major concern of Mr Maltman is the apparent inconsistency in the percentage change in values that has occurred in that locality since the previous valuation at 1 October 2000. During those two years for example he notes that the subject land has increased by about 40% from $73,000 to $102,000; while another parcel close by that he owns has only increased by about 25% from $71,000 to $89,000. That comparison parcel is located at 44 Coolibah Street (Lot 74 on RP 140499), and is only 300 metres north-west of the subject land. Mr Maltman notes that while the subject land is in the older part of Mudjimba, the comparison parcel at 44 Coolibah Street is in the new area, with concrete kerbing and channelling, concrete footpaths and good underground power and street lighting. He argues that it is not self-evident therefore why the older parcel should increase much faster than the new parcel.
To further demonstrate how those percentage changes are inconsistent with market evidence, Mr Maltman draws comparisons between sales in the new areas and the old areas of Mudjimba. In making those comparisons, Mr Maltman has sought only closely aligned sales in time and location, to ensure that there was a consistent market level, and similar locality inputs. He also avoids using sales within 200 metres from the beach, where he argues that proximity to beach frontage makes a significant difference in value of lands.
Mr Maltman provides the following comparisons of improved dwelling sales:
New AreaOld Area
SaleArea Price Date Sale Area Price Date
(1) 711 m² $320,000 October 2002 (2) 610 m² $310,000 October 2002
(Satinash Place and Sassifras Street - Lot 1) (Saffifras Street – Lot 109)
(3)700 m² $361,000 December 2002 (4) 607 m² $275,000 October 2002
(Satinash Place – Lot 23) (Cupania Street – Lot 214)
(5)830 m² $340,000 August 2002 (6) 607 m² $212,000 August 2002
(Satinash Place – Lot 21) (Pandanus Street – Lot 285)
Mr Maltman advises that while he selected improved properties for comparison purposes, he focussed on parcels that had similar houses erected upon them. He argues that Sale 2 is smaller in area, with inferior streetscape and no concrete kerbing and channelling, but is a lot closer to the beach. He notes that Sale 2 sold for less than Sale 1, which is further from the beach, but has superior landscape environment. A similar comparison between Sales 3 and 4 reveals a superior price in the newer area; as also does comparisons between Sales 5 and 6. Mr Maltman argues that those trends support his understanding that the newer areas sustain higher levels than the older areas, except where immediate beach proximity has a high impact.
To demonstrate why he sought comparative sales in close time proximity, Mr Maltman explains that the property market had increased rapidly between 2000 and 2002. He provides a schedule of sales and resales as evidence to support that conclusion. Some of those sales for instance demonstrate the following increases:
ParcelIncrease Period
44 Coolibah Street $47,800 (43%) April to August 2002
30 Cupania Street $45,000 (20%) July to October 2002
1 Satinash Place $127,000 (66%) January 2001 to October 2002
32 Satinash Place $118,000 (53%) December 2001 to August 2002
5 Sundew Street $55,000 (24%) August 2002 to January 2003
Mr Maltman therefore argues that in order to achieve comparability of market levels in the old and new areas, it is important to adopt sales no more than a few months apart in such a rapidly rising market. Mr McLaren agrees with that scenario, but notes that where any sales were improved sales, then it would need to be demonstrated that there had not been major improvements to the dwellings. Mr Maltman agrees that you can't compare sales with vacant lands against improved sales, as it must be on a like with like basis.
Mr McLaren argues that the market evidence demonstrates that the older areas of Mudjimba, nearer to the beach and surf club, which is on the esplanade between Mudjimba Beach Road and Pandanus Street, have experienced greater demand than the newer areas. He also advises that the change in percentage increases in the unimproved values argued by Mr Maltman, occurred as a result of changing policies in respect of the added value of filling, explained later.
Comparison of sales -
In comparing Mr Maltman's sales in paragraph [9], Mr Heather notes that there are some significant differences between the properties which would impact their direct comparability. Mr Heather notes for instance that the dwelling on Sale 1 (Satinash Place) has a double garage, while Sale 2 only has a single garage. It is also noted that Sale 1 has an area of 711 square metres, while Sale 2 has a smaller area of 607 square metres. Mr Maltman concedes those differences, but argues that it is balanced by the closer distance of Sale 2 to the beach. Similar differences were noted for Sales 3 and 4 and also Sales 5 and 6, although Sale 6 has a double garage. However Mr Maltman argues that Sale 6 is an old 1970 era weekender, which is a quite small dwelling on 607 square metres, while Sale 5 has an area of 830 square metres. Mr Maltman agrees that a much smaller house on a larger lot on Sale 5 would account for the much higher sale price than Sale 6.
To support his valuation Mr McLaren provides the following sales of vacant lands from a total of about 15 vacant sales in that area:
· Sale 1 – (North Beach Place and Sulo Court – Lot 3 on SP 131148). This is a 700 square metre parcel located about 400 metres north of the subject land. The sale is in a newly developed estate on formerly reclaimed land, and about 180 metres from the beach. It is also nearer to the future aircraft noise. The sale is seen as slightly superior as a filled site, but inferior as an unimproved site due to the greater filling needed. The sale sold in March 2002 for $147,000, was analysed at $132,100 after allowing for clearing and filling at $11,900, and applied at $113,000. As a filled site, the sale is valued at $128,500.
· Sale 2 – (Sulo Court – Lot 1 on SP 131493). This sale has an area of 690 square metres and similar location and features as Sale 1. The sale has similar comparisons as Sale 1. The sale sold in March 2002 for $147,000, was analysed at $133,500 after allowing for clearing and filling of $10,500, and applied at $112,000. As a filled site the sale is valued at $126,000.
[16]
· Sale 3 – (North Beach Place – Lot 5 on SP 131493). This is a 612 square metre parcel with similar features and location as Sale 1. It is about 245 metres to the beach, but has similar comparisons as Sale 1. The sale sold in March 2002 for $145,000, was analysed at $132,500 after allowing for clearing and filling of $9,500, and applied at $106,000. The sale is valued at $118,500 as a fully filled site.
[17]
· Sale 4 – (North Beach Place – Lot 37 on SP 131493). This is a 601 square metre with similar features and location as Sale 1, but 220 metres from the beach. The sale is seen as slightly superior to the subject land. The sale sold in March 2002 for $138,000, was analysed at $123,000 after allowing for clearing and filling of $12,000, and applied at $104,500. The sale is valued as a fully filled site at $119,500.
[18]
· Sale 5 – (North Beach Place – Lot 38 on SP 131493). This is a 700 square metre parcel with similar features and location as Sale 1, and 200 metres from the beach. The sale is seen as superior over all. The sale sold in June 2002 for $148,000, and was analysed at $131,200 after allowing for clearing and filling of $13,300, and applied at $112,000. The sale is valued at $129,000 as a fully filled site.
[19]
· Sale 6 – (Sulo Court – Lot 49 on SP 1314933). This is a 610 square metre parcel with similar features and location as Sale 1, and 190 metres to the beach. The sale is seen overall as slightly superior to the subject land. The sale sold in March 2002 for $159,000, was analysed at $147,000 after allowing for clearing and filling at $9,150, and applied at $115,000. The sale is valued at $127,000 as a fully filled site.
[20]
· Sale 7 – (North Beach Place – Lot 46 on SP 131493). This is a 636 square metre parcel with similar features and location as Sale 1, and 160 metres from the beach. The sale is seen overall as superior to the subject land. The sale sold in February 2002 for $159,000, was analysed at $144,500 after allowing for clearing and filling of $11,500, and applied at $113,000. The sale is valued at $127,500 as a fully filled site.
· Sale 8 – (Coolibah Street – Lot 78 on SP 140499). This is a 720 square metre located about 300 metres north-west of the subject land, and adjoining Mr Maltman's comparison parcel of 44 Coolibah Street (Lot 74). The sale is about 660 metres from the beach, and is seen overall as inferior due to the major filling of the sale. The sale sold in March 2002 for $122,500, was analysed at $100,300 after allowing for clearing and filling of $18,700, and applied at $84,000. The sale is valued at $106,000 as a fully filled site, compared to $112,000 for the subject land as a fully filled site.
· Sale 9 – (Coolibah Street – Lot 77 on SP 140499). This is a 720 square metre parcel adjoining Sale 8, with similar features and comparisons to that sale. The sale overall is inferior as an unimproved parcel to the subject land, due to the major filling. The sale sold in January 2002 for $119,000, was analysed at $97,000 after allowing for clearing and filling of $18,700, and applied at $85,000. The sale is valued at $107,000 as a fully filled site.
[23]
· Sale 10 – (Coolibah Street – Lot 75 on SP 140499). This is a 720 square metre parcel adjoining Sale 8, with similar features and comparisons to the subject land. Overall the sale is inferior as an unimproved parcel, and marginally inferior as a fully filled site. The sale sold in December 2001 for $122,500, was analysed at $100,300 after allowing for clearing and filling of $18,700, and applied at $87,500. The sale is valued at $109,500 as a fully filled site.
[24]
· Sale 11 – (Pandanus and Coolibah Streets – Lot 302 on RP 91397). This is a 597 square metre corner site located about 60 metres west of the subject land, in the older part of Mudjimba. The sale required slightly more filling, but is otherwise comparable to the subject land. The sale sold in January 2002 for $125,000, was analysed at $118,500 after allowing for clearing and filling of $2,500, and applied at $102,000 similar to the subject land. The sale is valued at $113,500 as a fully filled site.
Mr McLaren sees his Sale 11 (Pandanus Street) as the most comparable sale due to its close proximity to the subject land. He notes that Sale 11 has the same type of access to Coolibah Street, and while he has allowed about $3,000 for its better access as a corner parcel, that is balanced by the slightly greater filling on that parcel. However if Sale 11 and the subject land were filled fully as now required by the Council, then Sale 11 at $113,500 would be slightly superior to the subject land at $112,000. Mr McLaren also advises that the purpose of Sales 8, 9 and 10 were to demonstrate the impact of the extra filling required in that location. He notes that filling of 0.6 metres was allowed for on the subject land, and 1.3 metres of filling on Sales 8, 9 and 10. He advises further that Sale 11 did require the further 0.5 metres of fill by the Council subsequent to purchase in 2002.
In respect of Sales 1 to 7 Mr McLaren argues that those seven sales are all much closer to the future aircraft noise from the future east/west runway. He notes that closer proximity would be considered by the marketplace. He argues that Sales 8, 9 and 10 are also fully within the designated noise exposure forecast areas of the new runway, while Sale 11 is outside those designated zones.
Supporting sales -
To further support his conclusions, Mr McLaren provides a schedule of other sales of vacant lands reflecting market evidence in the old and new areas.
Old Area Sales
SaleDate Area Price Analysed Applied Comparison
ValueValue
1 4/2002 607 m² $150,000 $145,500 $88,000 Inferior
(Mudjimba Beach Road – Lot 327)
2.7/2002 607 m² $180,000 $178,000 $85,000 Inferior
(Cupania Street – Lot 355)
4.7/2002 607 m² $230,000 $223,000 $104,000 Marginally superior
(Cottonwood Street – Lot 262)
5.8/2002 607 m² $281,000 $276,500 $115,000 Superior
(Mudjimba Beach Road – Lot 195)
New Area Sales
SaleDate Area Price Analysed Applied Comparison
ValueValue
3 5/2002 720 m² $160,000 $137,750 $89,000 Inferior
(Coolibah Street – Lot 74)
6.9/2002 636 m² $300,000 $286,000 $114,000 Superior
(North Beach Place – Lot 47)
7.6/2002 688 m² $195,000 $178,500 $107,000 Slightly inferior
(North Beach Place – Lot 34) (site value)
Mr McLaren advises that those schedules demonstrate the impact of the varying levels of filling required in the older areas, compared to the new areas. He notes for example that Sale 7 in the newer area sold for $195,000, while Sale 4 in the old area sold for $230,000 at about the same time. While Sale 7 is valued slightly higher than Sale 4 on an unimproved basis, on a fully filled basis Sale 7 is valued at $123,500, while Sale 4 is valued at $110,000. The major difference between those parcels lies in the extent of filling required at Sale 7 ($13,000) and Sale 4 ($3,000). That is also demonstrated by the difference between Sale 2 and Sale 4.
Mr McLaren also argues that those sales also demonstrate that the closer the parcel is to the beach, the higher is the value of the land, as well as the different market appreciation of the old and the new areas. He notes that those differences are demonstrated by Sales 2, 4 and 5, where the sale price is varied from $180,000 to $281,000 for similar size lots. He notes that his supporting sales are at a more aggressive level than his basic 11 sales, supporting his conservative application in that area.
Mr Maltman queries whether Sale 4 is a fair comparison to the subject land, because it has two-street frontages to both Cottonwood Street and Sundew Street. Mr McLaren agrees that there are two-street frontages to that parcel, but argues that would not add much value in his opinion. However Mr McLaren agrees that there is a considerable difference in value between parcels only a few hundred metres from the beach, compared to those more further removed. Mr McLaren also agrees that the difference in value between parcels in relatively close proximity do not vary greatly until one gets west of Conebush Street, which is about 350 metres west of the subject land. He concedes that Conebush Street is about the present extent of developed parcels, but he notes that there are new lots under development along Pandanus Street to the west.
Mr Maltman also questions Mr McLaren's reliance upon some of his basic sales at Sales 8, 9 and 10 in Coolibah Street. Mr Maltman argues that those sales were all sold to "builders" at reduced prices in order to achieve sale commitments early in the development process. Mr Maltman notes that he sought to acquire one of those parcels early in the selling period and was declined an opportunity. He later acquired his "comparison" at 44 Coolibah Street (Lot 74) from one of those early "builder" purchasers at an inflated value of $160,000 in August 2002, some $41,000 more than the adjoining Sales 8, 9 and 10 sold at $119,000 only three months previously. Mr McLaren rejects that special discounted prices were paid by the builders, on advice from local selling agents.
Mr McLaren also notes that by selecting his sales from the beginning of 2002, he had provided a more conservative level of value. He argues that had he selected sales later in 2002, and nearer to the relevant date of 1 October 2002, then the level of values would have been much higher. He also agrees that because of rapidly increasing values in the older areas of Mudjimba, there is now a trend for some parcels being redeveloped as multi-units or duplexes. However he advises that there is little difference being paid for either duplex sites or single residential sites. He also notes that it would not be possible to build multi-units on his Sale 4 at Cottonwood Street (Lot 262).
Improved sales -
In seeking confirmation that the vacant land sales used in his comparisons are not inflated, compared to the established dwelling market, Mr McLaren analyses the following three highly improved sales:
· Sale 1 – (17 Sycamore Street – Lot 84 on RP 105140). This is a 589 square metre parcel with an 8 year old dwelling in fair condition, which was determined to have an added value of $86,122, and a land value of $152,378. The sale occurred in April 2002 for $238,500. After allowing for interest lost, and clearing, fencing and filling, the analysed unimproved value was $138,000. The sale is seen as improved land to have a similar level of filling, and is overall inferior to the subject land as it, while closer to the beach, is further removed from the main surf clubhouse, and closer to future potential aircraft noise. The sale was applied at $92,000 compared to $102,000 for the subject land. On a fully filled site basis, the sale is valued at $102,000 compared to $112,000 for the subject land.
[34]
· Sale 2 – (22 Sassifras Street – Lot 114 on RP 92321). This is an approximately 25 year old dwelling in fair condition, which was analysed to have an added value of $193,451, and a land value of $189,124. The sale sold in March 2002 for $295,000. After allowing for interest lost, clearing, fencing and filling, the analysed unimproved value was $178,124. The sale is seen as inferior to the subject land, as whilst closer to the beach, it is further from the main surfing beach area, and near to future aircraft noise. Filling requirements are marginally different to the subject land, but unimproved the sale compares at $95,000 to $102,000 for the subject land. On a fully filled site value basis the sale is valued at $104,000 compared to $112,000 for the subject land.
[35]
· Sale 3 – (20 Pandanus Street – Lot 155 on RP 91397). This is 607 square metre improved parcel with a 30 year old dwelling in fair condition, which was analysed to have an added value of $46,620, and a land value of $168,380. The sale sold in December 2001 for $215,000. After allowing for interest lost, and clearing, fencing and filling, the analysed unimproved value was $158,000. The sale is seen overall as superior to the subject land, as it is closer to the beach, and needs less filling in its unimproved state. The sale was applied at $109,000 compared to the subject land at $102,000. On a fully filled site basis the sale is valued at $119,000, while the subject is valued at $112,000.
As all of those three improved sales are in the older part of Mudjimba, east of Coolibah Street, Mr McLaren argues that they demonstrate that the applied unimproved values from the vacant basic land sales are very conservative.
Impact of filling -
A key issue in this matter is the impact upon the unimproved values by the varying levels of filling applied to the relevant parcels. Subsequent to the previous valuation of the area at 1 October 2000, there has been a fresh direction in respect of the application of filling on reclaimed lands. That followed a decision of the Land Appeal Court in the matter of Landel Pty Ltd and Lakes Investments Pty Ltd v The Chief Executive, Department of Natural Resources and Mines [2002] QLAC 72, 12 September 2002, to be reported. Those issues are discussed later, but that decision now requires a different approach to filling issues which have now varied the previous relativities in Mudjimba.
In respect of the older area of Mudjimba, such as the subject land, where parcels were either not filled or were separately and individually filled, the impact of filling has not varied greatly. However in the new areas, where estates were filled by a process no longer available, filling is now to be valued on the basis of fully importing filling. That has resulted in significant increases in costs of filling in those areas, and resulted in relative reductions in the unimproved values of those parcels, and amended relativities between the new and older areas.
Mr McLaren notes that the "comparison" parcel of the appellant at 34 Coolibah Street (Lot 74) has filling of 1.3 metres of depth over its area of 720 square metres. That filling was previously valued at $8 per cubic metre, and has now been valued to $20 per cubic metre, resulting in a difference in the filling allowance of about $11,000. Mr McLaren advises that had the Landel precedent not occurred, then Lot 74 would have been valued at $100,000 which would have reflected a 40% increase similar to that applied to the subject land, which is not subject to the new filling application. Mr McLaren advises that the Council required filling in the older areas to a lower reduced level than that for the newer areas. As a result of those Council requirements he has only allowed filling of 0.6 metres to a fully filled site in the older areas, but 1.3 metres to a fully filled site in the newer areas.
Decision:
Before examining the evidence, I note that the meaning of unimproved value of land is relevantly defined by s.3(1) of the Valuation of Land Act which states:
"3.(1) For the purposes of this Act –
‘unimproved value’ of land means –
(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."
On that basis it is appropriate for Mr McLaren to seek to remove from the value of the land any matter which relates to improvements to the land.
Changes in the unimproved values –
Now while Mr Maltman has drawn attention to the varying percentage increases in the unimproved values, I note that such an approach should be taken with some caution, as there could be many reasons why parcels may increase between revaluations. I note for instance that this Court has cast doubt upon the wisdom of adopting a percentage change between valuations as evidence of unimproved value. I note for instance in NR and PG Tow v Valuer-General (1978) 5 QLCR 378, the Land Appeal Court said at 381:
"It follows that a large increase over and above the previous valuation is in itself not a relevant issue provided bona fide sales of comparable parcels support the new valuation."
That was also followed by the Full Court of Queensland in CH and BD Henricks v The Valuer-General (1983) 9 QLCR 59, where Queensland, Macrossan J (later CJ) said at 63:
"The appellants also relied upon a schedule, Exhibit 4 in the Land Appeal Court, which shows percentage increases in the value applied by the Valuer-General to a number of selected parcels of land from the date of the preceding valuation up to the March 1979 valuation date. The percentage increase shown in the selected case was in each instance considerably less than the increase applied to the subject land as between the two valuation dates. The weakness in such a selective comparison is obvious as there could be any number of reasons why blocks in the same valuation area should increase at different rates over a period of five years."
Clearly there could be many reasons why parcels of land could increase or decrease over a period of time.
While I am aware that such percentage rises in values are often of concern to appellants in seeking to have confidence that their personal property has been fairly treated in any valuation, they in fact do not prove conclusively that any error has been made in the valuation process. Such rises may, at best, be an indicator to owners that they should further investigate the valuation, but there may be many reasons why a valuation is changed at what would appear to be a rate out of line with some overall statistical percentage. As the Full Court said in Henricks, there could be many reasons why parcels of land can increase at different percentage rates over a period of time. The real test is not the percentage increase in the unimproved values, but a comparison of the subject land with sales of comparable sites in the vicinity of the subject land at the time of the valuation.
Relativity -
While the matter of correct relatively is an important issue in valuations for revenue raising purposes, it is important that any relatively check considers whether there has been changes to the situation over time. That was noted in R and MM Barnwell v Valuer-General (1990-91) 13 QLCR 13, where the Land Appeal Court said at 16:
"We are conscious that it is desirable that valuations made for the purposes of the Valuation of Land Act of comparable lands should bear proper relativity, one to the other, if the valuations are soundly based. It is, however, untenable to adopt a value for one parcel on relativity with another which has no sound basis."
The Land Appeal Court went on to say at 17:
"It has been well recognised over the years that previously established relativity in unimproved values can and does change from valuation to valuation. If there was no justification for change in relativity, the valuer's task would be very simple in that all that would be required to establish value would be accomplished by the use of an adjusting formula. This, of course, is undesirable."
In the current matter there has clearly been a revised approach by the Chief Executive to the consideration of filling upon lands in that locality.
The impact of filling -
In his analysis of the evidence, Mr McLaren has been directed by the precedent established by the Land Appeal Court in Landel v Natural Resources (supra). In that matter the Land Appeal Court considered the situation where a Lakes Estate development in Townsville had proceeded by creating an internal lake, and using that excavated material to create the residential parcels of the Estate by filling. It was agreed that by using such a process the filling would have been obtained at a cost of $10 per cubic metre. Such an approach had been formerly followed in an earlier matter of Alfred Grant Estate (Surfers Paradise Pty Ltd) v Valuer-General (1966) 33 CLLR 1, where the Land Appeal Court determined that such actual costs were reasonable to apply to the subject land at that time. That decision in Alfred Grant had then formed the basis of valuing such lands created by filling since 1966, and had been the basis upon the 2000 valuations of Mudjimba had proceeded.
In the Landel decision, the Land Appeal Court overturned that direction, and following guidance of the High Court in McDonald v Deputy Commissioner of Land Tax for New South Wales (1929) 43 CLR 277, at 290, found at paragraph 36 of the decision in Landel:
"[36] Applying the above principles to the present case would, it seems to us, lead to the following conclusion:
(a)The fill which was taken from the development site to form the land would not be available as at the date of valuation as the lake must be taken to be in existence. The learned member found that for a number of reasons the fill would not at the relevant date have been obtained in the way in which it was when the development work was carried out.
(b)The added value which a reasonable purchaser would ascribe to the improvements constituted by the fill at least to RL 3.5 may be established at the relevant date by reference to what the purchaser would incur to acquire the fill, that is, the costs of acquiring the fill from the most readily available source at a reasonable price. On the evidence before the Land Court that exceeded $10 per cubic metre, and was $15.46/ m³."
Applying that principle in the current matter, Mr McLaren has now updated his value of filling on the newer filled estate areas of Mudjimba from $8 per cubic metre to $20 per cubic metre to equate to fill which had to be trucked in into the lands, rather than be created by onsite excavation procedures. That changed approach considerably altered the previous relativities.
Comparison of sales –
In relying mainly upon sales of vacant lands, Mr McLaren has also followed precedents long established by courts all levels throughout Australia. That principle was perhaps best explained in PH Clough v Valuer-General (1981-82) 8 QLCR 70, where the Land Appeal Court said at 76:
"It has been judicially laid down many times and in many jurisdictions that in ascertaining unimproved value, sales of unimproved land of comparable quality, situation, etc., to the subject parcel, if they are available, are to be preferred as the best guide for arriving at unimproved value. The reason is obvious. In applying such sales there is no room for error in analyzing the value of improvements.
Because there is less room for difference of opinion as to value of the various items of improvement and comparison is thus simpler, it has been held that highly improved sales should be avoided in preference to sales comprising a lesser degree of improvement."
However to provide a further check on his basic sales of vacant lands, Mr McLaren has also provided seven supporting sales of vacant lands, which shows his original eleven basic sales were selected from a conservative timeframe in a rapidly rising market. He also provides the three improved sales, which further demonstrates the greater level of judgment needed in assessing added value of improvements, and also supports the basic sales information.
If I then turn to his basic sales evidence I find that Sales 1 to 7 are seen as slightly superior or superior to the subject land as filled sites, reflecting their closer proximity to the beach, and their more pleasing landscaped nature and generally larger areas. I would tend to agree with the appellant that while aircraft noise is an acknowledged concern in Mudjimba, its impact does not vary widely across the relatively small locality. I also agree with Mr McLaren that nearness to the beach is the most important feature.
If I then consider Mr McLaren's Sales 8, 9 and 10, I agree that while they have a more pleasant landscape, and they are larger, they are also further from the beach than the subject land. Sales 8, 9 and 10 are very comparable to Mr Maltman's "comparison" parcel at 44 Coolibah Street (Lot 74), and I agree are slightly inferior on a site basis.
I believe that the best comparison is really Sale 11, which has all of the features and disabilities of the subject land, with virtually the same distance to the beach. While it has a small advantage as a corner site, Sale 11 is only marginally superior as a site, or a fully filled site, and from a practical perspective is comparable on an unimproved basis.
Now while those comparisons are reasonable on a site basis, the relativities change when the varying levels of filling are applied to obtain unimproved value. I see no problem in Mr McLaren's applied unimproved values.
Summary –
In summarising this matter I am reminded that in respect of the notice of appeal, section 45(4) of the Act directs that the onus to prove his case rests upon the appellant. I also note that under s.33 of the Act the unimproved value by the Chief Executive is deemed to be correct unless proved to the contrary. The evidence does not disclose any error. Certainly Mr McLaren has followed correct principles in his valuation procedure.
Conclusion:
Having considered the whole of the evidence, I am not persuaded that the appellant has proved his case. The appeal is dismissed, and the unimproved value of Lot 151 on RP 91397 as determined by the Chief Executive in the sum of One Hundred and Two Thousand Dollars ($102,000) is affirmed.
NG DIVETT
MEMBER OF THE LAND COURT
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