Moore v Chief Executive, Department of Lands

[1995] QLC 108

[1995] QLC 108

 

  LAND COURT

BRISBANE

14 September 1995

Re:     Appeal against a valuation -
  Brisbane City Council, Balmoral -
  AV94-448.

Rufus and Gwen Moore
  v.
  Chief Executive, Department of Lands

D E C I S I O N

This is an appeal against the determination of the Chief Executive, Department of Lands, of the unimproved value of Lot 2 on RP 84464, parish of Bulimba, in the sum of $270,000 for the purposes of the Annual Valuation of the Area as at 30 June 1993. 
           The appellants are contending for an unimproved value of $240,000 on grounds that the applied value "is not supported by the most relevant sale which is physically closest to the subject and also closest chronologically to the date of valuation".  This sale land is described as Lot 10 on RP 12536, parish of Bulimba, containing an area of 837m².  It is situated one lot removed to the west of the subject land and sold in February 1993 from Smith to Kassos and Moses Holdings Pty Ltd for $330,000.  The sale land will hereinafter be referred to as Lot 10.
           In the hearing of the appeal, Mr R Moore, registered valuer, represented himself and Mrs Moore.             The valuation was written on behalf of the Chief Executive by Mr V Di Salvo, registered valuer in the employ of the Department of Lands.
           The subject lot is a hatchet-shaped lot situated at 78A Wynnum Road, Norman Park, and with frontage to the Brisbane River at the rear - refer Annexure A.  It has an area of 670m².  The land is zoned "Residential A" and has been valued as a single unit residential site.  Access to the site is via the outbound lane (left in left out) of Wynnum Road.  To access the site from inbound lanes, a U-turn is required west of the site.  The building on the site is set back about 20 metres from the river and possesses views across the river from the City to New Farm.  There is no dispute as to the amenity the site has to offer and in common with other lots on this frontage to Wynnum Road, it is subject to a realignment notice.  It is agreed that on redevelopment, a 20-metre setback from the river is required.  There is also no dispute as to the inconvenience of accessing the site from Wynnum Road and of noise, etc., nuisances suffered by lots with frontage to Wynnum Road.  In this last respect, the subject lot is buffered by having a residence on adjoining land.
           In the valuations which were exchanged prior to the hearing, the data appended to the valuation of Mr Moore went beyond the grounds of appeal in that detail was provided of a sale (89) and resale (91) of improved land situated at 26 Wendell Street; a sale at 74 Wynnum Road in 1989 and details of values applied by the Chief Executive to these lots and the subject lot over the years from the late 1980s to 1993, demonstrating that in the period the trend in values has been down from a peak said to have occurred in 1989/90.  Strictly speaking, this evidence is inadmissible.  However, in the circumstances of the case in view of the weight given by the parties to the sale of Lot 10, it appears to me that any excursion into the market previous to the relevant date is of academic interest only.  There is also little disagreement about the relativity in value between the subject lot and Lot 10.  Mr Moore, on analysing the sale of Lot 10, obtained an unimproved value of $290,000.  Mr Di Salvo obtained a value of $315,000.  The former applies $240,000 to the subject site whilst the latter applies a sum of $270,000.
           Lot 10 was sold improved with an old wood and iron shop and an old timber dwelling (about 92 years old) with about 180m² under roof of which about 66m² was verandah.  Subsequent to the sale, the shop was demolished and removed, the dwelling was extensively refurbished and a new annexe of about 146m² with a verandah of 15m² added.  The site was then sold in April 1994 for $975,000.  The site has large trees on the frontage to Wynnum Road and some pine/palm trees.  The redevelopment included landscaping and gardening.  An appreciation of the consideration paid on resale may be taken from the sale brochures in evidence showing external and internal aspects and fittings, etc.  Building approval plans show the GFA of the original home was retained with the same roofing lines etc.  The annexure which was added mirrors the architecture and style of the old home.  The added value of the old structure with trees etc is put at $40,000 by Mr Moore.  The allowance made by Mr Di Salvo is $15,000.  This allowance seems to have been based on the price which might be paid for the dwelling for removal purposes of around $10,000.  Mr Moore, in part, went in the other direction by obtaining estimates from Drake Removal Homes as to what it may cost to have the home removed and set up elsewhere.  Some examples of homes delivered and stumped with no services connected ranged from around $54,000 to $68,000 or in terms of costs per square metre from $266 to $405.  The evidence supported, in his opinion, the added value he ascribed to the structure on the subject land.  The question, however, in my opinion is best answered by asking what the structure added in terms of value to the purchaser of the site for the purpose it intended.  There is no doubt that substantial sums were incurred in redevelopment and refurbishment.  It would also appear that the money was well spent.  Having perused the plans and the photographic evidence of the structure before and after renovations, I am unable to accept that the prudent purchaser would give the old structure an added value no greater than the sum he may receive were the home sold for removal.  In the context of the physical product sold after redevelopment which carried with it the flavour of the original architecture with trees in place, etc., and in having no better evidence, I accept the added value applied by Mr Moore.
           After hearing the valuers on the various points of comparison between the subject lot and Lot 10, I prefer the relationship applied by Mr Di Salvo which on my calculations leads to a value of the subject land in real estate market terms in the sum of $250,000.
           The appeal is therefore allowed, the determination of the Chief Executive is set aside and the unimproved value of the subject land is determined in the sum of Two hundred and fifty thousand dollars ($250,000).

(DM White)              
  President of the Land Court