Nguyen v Brisbane City Council
[2013] QLC 3
•30 January 2013
LAND COURT OF QUEENSLAND
CITATION: Nguyen & Anor v Brisbane City Council [2013] QLC 3 PARTIES: Xuan Thu Nguyen & Thi Thu Hang Le
(Applicants)v
Brisbane City Council
(Respondent)FILE NO: AQL087-09 DIVISION: Land Court of Queensland PROCEEDINGS: Application for the determination of compensation under the Acquisition of Land Act 1967 DELIVERED ON: 30 January 2013 DELIVERED AT: Brisbane HEARD ON: 30 August 2010 HEARD AT: Brisbane MEMBER: His Honour Mr WL Cochrane ORDER: 1. The respondent is to pay to the applicants a sum of Seventy Six Thousand Nine Hundred and Eight Dollars ($76,908) representing interest payable between 28 July 2006 and 29 April 2009 less the rent received by them of $8,400. CATCHWORDS: Acquisition of land ― resumption ― relevant date for determination of interest ― Interest
Acquisition of Land Act 1967, ss 12(7), 28
Small v Brisbane City Council (1968) 35 CLLR 234
Silverton Grazing Pty Ltd v The Commissioner of Water Resources (1981) 7 QLCR 197
William Collins & Sons Pty Ltd v Coordinator General of Public Works (1971) 38 CLLR 50
Francesco Pappalardo and Ors v The Council of the Shire of Mulgrave Land Court Brisbane 18 June 1993 (unreported)
Barnes Milling Limited v Brisbane City Council (1979) 6 QLCR 217
Merchin v The Commissioner of Main Roads (1989) Land Court of Queensland 16 June 1989 delivered at Brisbane (unreported).
Estate T. O’ Grady Conroy (dec’d) v The Co-Ordinator General 3 QLCR 353
APPEARANCES: Mr SM Ure instructed by Cooper Grace Ward, Solicitors, for the applicants
Mr DA Quayle instructed by Brisbane City Legal Practice for the respondent
Background
This decision relates to land located at 239 Progress Road, Richlands in the Brisbane City Council Local Government Area.
The land is otherwise described as Lot 30 on SP 127004 Parish of Oxley and contains an area of 14,220 m².
A notice to resume was issued on 29 July 2005 indicating that the land was required for park purposes.
The notice of intention to resume includes in the statement of reasons an apposite description of the subject land in the following terms:
“The subject site has frontages along Garden Road (to the east), Progress Road (to the south) and is bordered by Council park # 2129 ‘Garden Road Park’ (to the north) and vacant State land (to the west).”
That description also included Lot 225 which land was in different ownership and with which I am not concerned.
The background statement indicated that the subject site forms part of a proposed 5.2 ha district sport park which had been identified in the Richlands area infrastructure charges plan (ICP) adopted by Council in 2001.
The subject site, at the time of resumption, was developed as a rural residential lot with an existing dwelling but appears from the evidence to have been used as a market garden.
Pursuant to the Brisbane City Plan 2000 the land was classified as being within the “emerging community” domain.
The proceeding
This proceeding was begun by an originating application filed on 8 April 2009.
In that originating application the relief sought was expressed in the following terms:
“That the respondent pay the applicants the sum of $1,400,000 plus disturbance costs and interest and rates, less rent, calculated in accordance with the attached statement of claim.”
The attached statement of claim at paragraph 9 set out the applicants’ claim in the following terms:
“9.The Applicants claim:
(a) compensation for land and improvements $1,400,000
(b) legal costs to 15/05/2008 $ 2,904
(c) valuation fees $ 2,200
(d) legal costs from 16/05/08 to 30/03/09 $ 11,185
(e) interest to be assessed
(f) refund of rates paid from 28/07/06 to be assessed
Claim (excluding interest, refund of rates and professional
fees incurred after 30/03/2009) $1,414.089
10.The Applicants’ total claim (excluding interest, refund of rates and professional fees incurred after 30/03/09) is calculated as follows:
Sub Total:$1,414,089
Less rent$ 5,651
Total claim$1,408,438
The Applicants also claim costs incurred since 30 March 2009 and interest.”
A directions hearing occurred at callover on 10 June 2009 at which time Mr Evans, solicitor for the Brisbane City Council advised that since the date of the filing of the originating application an advance had been paid to the claimants who had then sought advice from the Council as to interest calculation and had submitted a further claim with respect to disturbance items, which matters required some time for consideration.
It appeared at that time that the issue of the principal amount of compensation may have been resolved but that time was needed to consider other matters.
The matter was mentioned further on 10 September 2009 at which time leave was given to add a sum of $10,000 associated with a subterranean irrigation system located on the land.
Further orders were made for the filing of statement of facts, matters and contentions.
That occurred and by a statement of facts, issues and contentions that the applicants filed on 2 October 2009 the nature of the applicants’ claim was clarified in the following terms:[1]
“11.The Applicants claim:
(a) the sum of $1,500,000 compensation for the taking of the land;
(b) legal costs in the sum of $11,185;
(c) valuation fees in the sum of $2,200;
(d) interest being the sum of $206,456 being interest on $1,365,000 calculated at 5.50% per annum from 28 July 2006 to 1 May 2009;
(e) interest on the difference between the amount of compensation finally determined by the Land Court for the taking of the land and the sum of $1,365,000 calculated at the rate of 5.50% per annum for the period FROM 28 July 2006 to the date of payment;
(f) interest on the monies expended for valuation fees and legal fees calculated at 5.50% per annum from the date of payment of those fees to the date of payment of the interest.”
[1] Statement of Facts, Issues and Contentions of the applicants filed 2 October 2009, paragraph 11.
It is noteworthy that a Court assisted mediation occurred on 1 February 2010 so that agreements reached at that mediation conference somewhat displace some of the earlier facts, matters and contentions and responses filed in Court by the parties.
By a second statement of facts, issues and contentions of the applicants filed on 5 March 2010 the matters for determination by the Court had crystallized and were expressed in that document in the following terms:
“8.As a consequence of a Court assisted mediation on 1 February 2010, the parties agreed inter alia that:-
(i) the value of the land resumed is $1,382,500 (‘the agreed sum’);
(ii) the Respondent would pay the sum of $17,500 being the balance value of the land taken;
(iii) the Respondent would pay a further sum of $14,169.25 which together with the sum of $101,112.93 interest paid as part of the advance, reflects interest on the agreed sum at the rate of 5.25% per annum from 1 October 2007 to the date of payment.
9. All other maters of the claim were resolved, save for the determination of the date from which the interest on the agreed value of the land resumed, namely $1,382,500 should be calculated;”
Those paragraphs reflected a valuation of the land at an agreed figure of $1,382,500.
In that statement of contentions the applicants contend as follows:
“The applicants contend that additional interest should be paid by the Council in the sum being the difference between the interest on the agreed sum at the rate of 5.25% from 28 July 2006, the date of the resumption, to the date of payment less the amount of $115,282.18 being interest already paid or agreed to be paid pursuant to the court assisted mediation.”
It is appropriate to identify the mutual releases which were set out in the mediation agreement.
That mediation agreement provided at paragraph 10:
“10.The parties hereby agree that payment of the settlement sum shall be in full and final settlement of all claims capable of being brought by the applicants arising out of or in anyway connected with the resumption by the Council from the applicants of the land at Lot 30 on RP 127004 situated at 233 Progress Road, save for:
(a) determination of the date from which interest on the agreed value of the land resumed ($1,382,500.00) at the rate of 5.25% per annum, until 29 April 2009, should be paid by the Council to the applicants;
(b) the costs of and incidental to the determination either in a Court or otherwise of the issue at (a) hereof.”
Consequential upon that mutual release, the only matter for determination by the Court in this application is the date from which interest on the agreed value of the land should be paid up until 29 April 2009.
It was, apparently, common ground between the parties that the taking of the land occurred on 28 July 2006.[2]
[2] See document 23 at page 63 - 65 of Exhibit 1 - bundle of documents.
The applicants, somewhat unsurprisingly, contend that interest should be paid from that date, namely 28 July 2006.
The respondent in its response to the applicants’ statement of facts, issues and contentions of March 2010 corrected a number of minor errors and upon a fair reading of a relatively detailed response does not admit the entitlement of the applicants to the interest sought and, effectively, puts the applicants to proof of their claim.
In the circumstances of this case the attitude of the respondent is hardly surprising.
The relevant section of the Acquisition of Land Act 1967 is s.28 which provides at sub-section [1] as follows:
“28 Interest
(1)Subject to subsection (2), in respect of the period or any part of the period commenced on and including the date on and from which any land is taken and ending on and including the day immediately preceding the date on which payment of compensation is made the Land Court or, upon appeal, the Land Appeal Court may order that interest be paid upon the amount of compensation determined by it.
(1A)Such interest shall be at such rate per centum per annum as the Land Court or, upon appeal, the Land Appeal Court, deeming reasonable, fixes by the order.
(1B)Interest so ordered to be paid shall be payable as if it were part of the compensation in question and shall be added to the amount thereof and be payable by the constructing authority accordingly.”
Mr S.M. Ure of Counsel for the applicant drew the Court’s attention to the observations of the Land Appeal Court in Small v Brisbane City Council[3] where it was observed “from 1925 to the present time the practice of the Land Court and the Land Appeal Court has been to award interest on compensation money except where the dispossessed owner has remained in possession or derived some benefit from the resumed land after date of resumption. In the latter cases the court has refrained from granting interest or reduced the rate of interest usually awarded commensurate with the benefit derived from the land and dependent on circumstances applying in the particular case under consideration.”
[3] (1968) 35 CLLR 234 (at 246).
Mr D Quayle, Counsel for the respondent also, in his written outline of submissions drew the Court’s attention to Small v Brisbane City Council but contends that the gravamen of that decision is that interest would not normally be awarded for period during which the dispossessed owner has remained in possession of, or derived some other benefit from, the resumed land after the date of resumption.
Counsel for the respondent went on to refer to the decision in Silverton Grazing Pty Ltd.[4]
[4] Silverton Grazing Pty Ltd v The Commissioner of Water Resources (1981) 7 QLCR 197.
In particular he drew the Court’s attention to the following passage:
“ ‘When a dispossessed owner loses possession of his land at the date of resumption, interest is usually granted by the Court from the date of resumption to the date of payment. Where the owner continues to reside on or make productive use of the resumed land after the date of resumption, I have held that the owner is not entitled to an allowance for interest on compensation during the period he resides or makes productive use of the land rent and rate free, but that interest should only be paid from the time he ceases to enjoy such rights. In Conroy (Supra) at page 363, the Land Appeal Court said that no award of interest would be made because the claimant had continued to occupy the resumed land … While I have sympathy for the claimant company on the question of an advance of compensation, the fact remains that the company has elected to remain in occupation of the resumed land and has continued to use it without any interference in the way it was used prior to resumption, both rent and rate free. By its own action it has not placed itself in a position at resumption date to command money equivalent to the higher use value of the land as found.
The Privy Council in Inglewood Pulp & Paper Company Limited v. New Brunswick Electric Power Commission (1928) AC 492 held that upon the expropriation of land under statutory power, whether for the purpose of private gain or of good to the public at large, the owner is entitle to interest upon the principal sum awarded from the date when possession was taken, unless the statute clearly shows a contrary intention. In delivering the judgment of their Lordships, Lord Warrington of Clyffe at page 499 said, ‘The right to receive interest takes the place of the right to retain possession…’.
Here I find that the retaining of possession takes the place of the right to receive interest. I determine that no interest will be allowed on the amount of compensation.’.”
It should be noted that that was a decision of a single member of this Court and while it may be persuasive it is not binding upon me.
So much was recognised by Mr Quayle in his submissions who pointed out that “unarguably the exercise of the discretion is dependent upon the facts and circumstances of each particular case”.[5]
[5] Respondent’s submissions paragraph 8.
The respondent also pointed to the decision in William Collins & Sons Pty Ltd v Coordinator General of Public Works[6] where the Land Appeal Court observed:
“As the claimant had full use of the resumed land free of all liability during the whole of the statutory period during which interest, in the discretion of the Court, may have been payable, there will be no award of interest.”
[6] (1971) 38 CLLR 50.
It is thus appropriate to consider the particular facts of the instant case.
On the applicants’ case the applicants received a notice of intention to resume from the Brisbane City Council on or about 29 July 2005.
There was an objection hearing on 24 January 2006 and on 1 March 2006 it is uncontentious that a Council officer wrote to the applicants advising that the Brisbane City Council proposed to continue with the resumption.
There was some dialogue regarding a land swap arrangement which came to nothing.
The applicants had the assistance of Mr Connolly a solicitor in their dialogues with the Council and on 8 June 2006 Mr Connolly sent on to the Nguyens a letter which he had received from the Department of Natural Resources, Mines and Water of 24 May 2006 which advised that the Department would decide to resume their land.
The resumption of the land occurred by notification in the Government Gazette on 28 July 2006.
A significant part of the applicants’ case rests upon the proposition that they received no proper notice of the formal resumption from the Brisbane City Council but, being aware of an intention to resume the land they rented it to a Mr Tan at a below market rental rate in order to have the land cleaned up and so enhance its value when the resumption took place.
At the hearing of this matter the applicants evinced an intention to call evidence from:
(a) Daniel John Connolly the solicitor acting for the Nguyens at the relevant time whose statement became Exhibit 2;
(b) Mr Nguyen the male applicant whose statements became Exhibits 3 and 4;
(c) Mrs Nguyen the female applicant whose statement became Exhibit 5;
(d) Mr Michael Munt an employee of Westpac whose statements became Exhibits 6 and 6A;
(e) Mr Cameron Keller another Westpac employee whose statement became Exhibit 7;
(f) Carly Ashwood an employee of Mr Nguyen’s solicitors whose statement became Exhibit 8.
Mrs Nguyen, the female applicant, was not required for cross-examination. Some of Mr Nguyen’s evidence, when he was called, was given with the assistance of an accredited translator and interpreter, Mr Andrew Nguyen, who, it was established, was despite the common surname not a relative of Mr Nguyen the applicant. Mr Andrew Nguyen’s curriculum vitae became Exhibit 9.
A document setting out calculations relating to interest at the relevant Land Court published interest rates at the time, namely 5.25% per annum became Exhibit 10.
The respondent, Brisbane City Council, called oral evidence only from Mr Latter, an employee of the Brisbane City Council with the responsibility of serving the various notices required in accordance with s.12(7) of the Acquisition of Land Act 1967 namely and primarily the gazettal notices.
Mr Stevens, a team leader, north, in the rates processing section of the Brisbane City Council, a précis of whose evidence became Exhibit 11, was not required for cross-examination.
Accordingly, only Mr Latter gave oral evidence and was cross-examined.
It seems to me to be appropriate to consider the evidence given by Mr Connolly, Mr Munt and Mr Latter together.
The evidence of Mr Connolly who was the solicitor advising and acting for Mr Nguyen establishes to my satisfaction that he received instructions from the applicants to deal with and, to some extent, negotiate with the Brisbane City Council on Mr and Mrs Nguyen’s behalf.
Further, his evidence satisfies me that, so far as the files maintained by him in respect of the Nguyen’s affairs relating to the subject land are concerned, those files contain no copies of correspondence from either the Department of Natural Resources and Water or from Brisbane City Council advising that the resumption notices had been issued or that the taking of the land had been recorded in the Queensland Government Gazette.
It also seems passably clear that the arrangement between Mr Connolly and the Nguyens was that if they had received any correspondence relating to the subject land they would have passed it on to Mr Connolly. Indeed his files reveal other correspondence prior to the resumption which appear to confirm his arrangements with the Nguyens.
I shall come later to consider in detail the evidence of Mr Nguyen. However at the present time it seems appropriate to record that I was satisfied by Mr Nguyen’s evidence that he had a sufficient interest in and concern about the proposed resumption of the land that consistent with his other dialogue with Mr Connolly, Mr Nguyen would have passed on to Mr Connolly for advice and assistance any correspondence received from the Brisbane City Council confirming that the land of the applicant’s had, in fact, been resumed and that Mr Nguyen had ceased to be the registered proprietor.
Mr Connolly was cross-examined in some detail about a bundle of correspondence which starts generally in about March 2006.[7]
[7] See pages 60 - 65 of Exhibit 1.
That passage of correspondence dealt with the proposal for a land swap in lieu of compensation.
It does not go so far, however, as to satisfy me that it was evidence of a knowledge of the actual resumption by either the Nguyens or by Mr Connolly.
There is certainly abundant evidence of notification to Mr Connolly and to the Nguyens that the Council proposed to proceed with the resumption and that the Council was not interested in any sort of a land swap arrangement. Being satisfied of those matters however does not satisfy me that they were notified of the actual resumption.
Mr Latter an officer of the respondent was, at the material times the council officer responsible for carrying out the legal mechanics associated with resumptions including preparation of notification letters to owners of resumed land.
Mr Latter whom I regard as an honest witness keen to assist the Court gave evidence that in the resumption file he could find copies of the letters that he believed had been sent on or about the 4th August 2006 to Mr Nguyen, Ms Le and the Westpac Banking Corporation.
The Westpac Banking Corporation had an interest as a secured creditor/mortgagee in the subject land.
Mr Latter’s was to the effect that he really had no independent recollection of the details of this particular resumption but did his best to reconstruct and to infer from what he could find on the file what he believed had happened. There is no criticism to be made of Mr Latter.
Mr Latter’s evidence was to the effect that while there appeared in the file copies of correspondence sent to both Westpac and Nguyen and Le in or about August 2006 and that some correspondence existed of notification dated 2008 he believed that he reprinted the notification letters at a later date and that the printing system automatically inserted the date of printing rather than producing a copy of the correspondence as it was dated at the date it was sent.
Mr Latter’s evidence however confirms in my mind that he received from Mr Connolly on behalf of Nguyen and Le a request for a copy of the notification of resumptions. Such a request would not normally be forthcoming if a party was already in possession of such correspondence.
The view I take of the evidence of Mr Latter is influenced by the evidence given by Mr Munt.
The witness, Mr Munt, was an employee of Westpac bank. On the day arranged for him to give evidence he fell ill and ultimately his evidence was given a day later and by telephone.
Mr Munt was a senior relationship manager with the Westpac bank and gave evidence that he had managed the Nguyen accounts since December 2007 up to the date of his giving evidence.
Mr Munt’s oral evidence was generally in accordance with the material set out in the two statements signed by him which had become Exhibit 6 and 6A. In his first statement signed on 15 July 2010 he states that notwithstanding what appear to be extensive searches of both the current file and archived files relating to the Nguyen’s business affairs he can find nothing which evidenced that Westpac had been informed by the Brisbane City Council of the resumption of the land.
In his second statement sworn on 15 September 2010 Mr Munt exhibits correspondence which he acknowledged not having previously seen dated 4 August 2006 from the Brisbane City Legal Practice to Westpac Banking Incorporation advising them of the gazettal and, apparently, attaching a copy to the correspondence.
Mr Munt was cross-examined as to the possibility of ineffective or inefficient filing practices causing the relevant documents to be mislocated but that cross-examination was insufficient in its outcome to satisfy me of any serious likelihood that the relevant correspondence had been misfiled.
Similarly, Mr Latter had been cross-examined in some detail by Mr Ure Counsel for the applicant’s about the processes and procedures which existed at the relevant time relating to insuring that correspondence was posted.
Clearly Mr Latter was not all consumed by his responsibility for dealing with only the resumption of the Nguyen and Le land. He gave evidence that he was responsible for administering a large number of files.
Mr Latter also acknowledged that while the format of the letters created to give notification was such that it was clearly intended to be sent in a window faced envelope his practice was not to use window faced envelopes but to individually address a closed faced envelope.
Mr Latter acknowledged that the procedures adopted by him were pregnant with the opportunity for making a mistake with the address but he also said that the file did not reveal any correspondence which had been returned to sender as undeliverable.
The evidence of Mr Nguyen was not without its problems for the applicant’s case.
In his submissions at the conclusion of the case Mr Quayle, Counsel for the respondent submitted as follows:
“14.Mr Nguyen's evidence should be treated with caution. The respondent does not dispute that Mr Nguyen was essentially an honest witness. But practically, his evidence should be treated as if he were not. Mr Nguyen was so intent on producing the outcome he considers (no doubt honestly) to be just, his evidence lost all reliability and logical connection to the realities which the contemporaneous documents show existed.
15. Mr Nguyen:
(a) constantly resorted to an inability to remember things;
(b) yet when the absurdity of that position (given, for example, the terms of his own statements or his own statement of contentions) was pointed out to him, he resorted to the position that his recollection was sound but not precise: ‘an estimate’ or that what had been said in those documents was the work of his lawyers and did not necessarily reflect the true position;
(c)furthermore, time and again he was revealed to have no real understanding of, or familiarity with, the statements of evidence he had sworn to be true and correct[8]; nor
[8] He said he had read them but once.
(d)any conception of the arguments that were (and are) apparently being advanced on his instructions: he did not ever really articulate or support the essential plank of his case, namely that he was uncertain about something and that led him to make less use of the land than he otherwise would have and that he would have insisted on possession of the land being taken by the respondent as soon as he knew of the resumption;
(e)he certainly never attempted to explain:
(i)what he was uncertain about - was it the all but inevitable outcome of the resumption following upon receipt of the NIR or was it just the timing of the resumption?; or
(ii)why he was, or how he could have been, uncertain given his professed (inevitably correctly) sophistication about resumptions[9], the admitted receipt of the NIR, the known likely futility of the objection hearing before it occurred[10], the communicated outcome of the objection hearing which was as predicted[11] and the non-receipt of any rates notice for the land after, at latest, November 2006[12]; or ·
[9] Given this was at least the fourth if not the fifth resumption he had suffered.
[10] As he and Mr Connolly accepted was expressly revealed to him and is set out in the letter from Mr Connolly to him at p163 of Ex 1.
[11] Ex 1, page 60.
[12] A year earlier than he contends in Ex 3, Ex 4 and the statement of contentions in his …
(iii)what he did given that uncertainty; or
(iv)what he did not do given it;
(f)but rather seemed to be fixed with a view that for the respondent not to willingly pay him interest on the value of the land taken, despite him remaining in possession of the land and using it, on the evidence, just as he had for the previous decade, was to treat him unfairly.”
Mr Quayle submitted that I should generally ignore the evidence of Mr Nguyen where ever it differed from the terms of written documents or from reasonable inferences drawn from those documents.
While I accept and, indeed had formed the opinion in the course of listening to the oral evidence of Mr Nguyen that he was inclined to tailor his answers to suit the outcome which he sought I am not prepared to find his evidence as unreliable or to ignore it.
In particular I note that it is not disputed by Counsel that Mr Nguyen on behalf of himself and Ms Le paid a rates notice for the period 1 July 2006 to 30 September 2006. There was no suggestion that any attempt was made to gather that apparent overpayment back the land having been resumed on 28 July 2006.
Mr Latter’s evidence was to the effect that the notices notifying resumption had been sent on 4 August 2006.
The summary of rates paid on the subject land found at page 190 of Exhibit 1 shows that the payment of the account sent to Le and Nguyen for the period July to September 2006 was paid on 28 July 2006.
One might wonder why someone as apparently astute as Mr Nguyen would proceed to pay a rates notice in respect of land which he was aware was going to be resumed. That is not a matter that was ventilated before me.
Nor was it made clear what happened to the apparent overpayment of the rates by Nguyen and Le.
Mr Quayle drew the Court’s attention to the decision in Pappalardo v The Council of the Shire of Mulgrave[13] in the Pappalardo decision the Court made some observations that liability for rates and other charges are matters governed by particular legislation and it is not a function of the Land Court to determine whether a claimant who has remained in possession is or is not reliable for rates over a period of occupation.
[13] Francesco Pappalardo and Ors v The Council of the Shire of Mulgrave Land Court Brisbane 18 June 1993 (unreported).
In my view I am not making any determination as to whether rates were payable by Nguyen and Le but merely observing that consistent with their case that they hadn’t been told of the impending resumption nor of the fact of the resumption and that they paid the rates believing they still owned the land. To that extent, in my view, the payment whether it was required or not is evidence of the belief by Nguyen and Le that they remained the registered proprietors of the property.
One matter of which the evidence of Mr Nguyen satisfied me was that he relied to a substantial extent on advice from his solicitor for formal matters involving properties owned by him.
He also gave evidence prompted by Mr Quayle that he had relied upon the services of Mr Connolly in respect of four other resumptions of land which he owned.
His evidence, although disjointed, satisfies me that he retained some optimistic but apparently unfounded view that he may have been able either to stop the resumption by objection or to achieve some sort of a land swap for the land that was taken.[14]
[14] See for example Transcript 2 – 62 Line 10-40 and Transcript 2 – 63 Lines 10-40.
That was not withstanding that he had had legal advice that there was no chance of stopping the resumption.[15]
[15] Transcript 2-51 Line 50 to 2-52 Line 30.
Counsel for the respondent pointed to some dicta in Small v Brisbane City Council[16] in which Stable J delivering the judgment of the Court observed:
“From 1925 to the present time the practice of the Land Court and the Land Appeal Court has been to award interest on compensation monies except where the dispossessed owner has remained in possession or derived some benefit from the resumed land after date of resumption. In the latter cases the Court has refrained from granting interest or reduced the rate of interest usually awarded commensurate with the benefit derived from the land and dependent on circumstances applying in the particular case under consideration.
[16] Small & Anor v Brisbane City Council (1968) 335 CLLR 239 at (246).
Later in the same decision Stable J (delivering the judgment of the Court) observed:
“We think it would be most unfair and contrary to equitable principles to deny a dispossessed owner interest on his compensation monies in cases where he has lost possession of his property, its enjoyment and/or productivity. To deny interest is to deny him the earning power of the money into which the law provides his interest in the resumed land is ultimately to be converted. It would be a normal incidence of bargaining in the business and commercial world for a purchaser to pay interest on outstanding purchase money after he had obtained possession of the land the subject of his purchase and we fail to see why a resuming authority should be placed in a more favourable position than a hypothetical prudent purchaser.”
His Honour’s observations about owners remaining in possession of the land can only be obiter as the facts of the Small v Brisbane City Council case did not require any determination of the benefit which the claimant in that case may have gained by remaining in possession of the land.
Counsel for the respondent also referred to Barnes Milling Limited v Brisbane City Council[17] in Barnes Milling the claimant was a flour milling company which subsequent to the notification of resumption remained in possession of part of the subject site and made limited use of an office section of the complex and of some parts of the premises for product storage.
[17] Barnes Milling Limited v Brisbane City Council (1979) 6 QLCR 217.
The learned Land Court Member in that context said:
“It is not equitable for the resuming authority to pay interest on such part of compensation unpaid by it equivalent to the value of the premises utilised by the claimant.”
In that decision the learned Member excluded the value of the office premises and part of the land from any calculation of interest but in general otherwise allowed interest.
There was suggestion in the BarnesMilling case that the claimant had been unaware that resumption had occurred or that the remaining in possession was in the absence of any knowledge of the resumption.
Similarly in Silverton Grazing Pty Ltd v The Commissioner of Water Resources[18] a case in which the Land Court did not allow interest on the amount of compensation on the basis that the claimant company had retained possession of the resumed land rent and rate free, the Court observed:
“While I have sympathy for the claimant company on the question of an advance of compensation, the fact remains that the company has elected to remain in occupation of the resumed land and has continued to use it without any interference in the way it was used prior to resumption, both rent and rate free. By its own action it has not placed itself in a position at resumption date to command money equivalent to the higher use value of the land as found.”
[18] Silverton Grazing Pty Ltd v The Commissioner of Water Resources (1981) 7 QLCR 197.
In the Silverton Grazing decision the Court referred to a decision in Conroy[19] in which it was said:[20]
“We were not told that the claimant had ceased to occupy the resumed land since the hearing in the Court below, and in these circumstances we do not intend to order the payment of interest on the award of compensation.”
[19] Estate T. O’ Grady Conroy (dec’d) v The Co-Ordinator General 3 QLCR 353.
[20] Page 363.
In my opinion, in the present case, it can not be said that the claimants have remained in occupation of the resumed land and continued to use it without any interference in the way in which it was used prior to resumption both rent and rate free.
In the first place they paid rates for, arguably, the first two months after the notice of resumption issue. Secondly, there was no real contradiction to the assertion that they rented the property to Mr Huynh Van Tran on generous terms to facilitate the cleaning up of the land subsequent to it being vacated by the preceding tenant Ms Le.[21]
[21] See paragraphs 38, 39 of Exhibit 3 and paragraphs 1, 2, 3 and 4 of Exhibit 4.
Those propositions were not contradicted. Accordingly, I accept them.
The statement tendered as the evidence of Mrs Nguyen (Ms Le) was, as Counsel for the respondent has pointed out “to an extent objectionable” because when one reads the statement carefully it is clear that Ms Le was endorsing and adopting statements of fact about matters in which she had no personal involvement and arguably only hearsay knowledge.
I agree with Counsel for the respondent that the evidence of Mrs Nguyen (as he refers to her) who was not called to be cross-examined has little if any probative value and I have given it no weight.
As I observed above, Counsel for the respondent has fairly pointed out having regard to the decision in Merchin v The Commissioner of Main Roads[22] the exercise of the discretion with respect to payment of interest by a resuming authority is depended upon the facts and circumstances of each case.[23]
[22] Merchin v The Commissioner of Main Roads (1989) Land Court of Queensland 16 June 1989 delivered at Brisbane (unreported).
[23] See various cases referred to in the Merchin decision.
In the present case I am satisfied that, for unexplained reasons, none of Mr Nguyen, Ms Le, the solicitors acting for Nguyen and Le, or the Westpac Banking Corporation (as mortgagee) received a notice of the resumption having occurred.
There are a number of possible explanations for that failure. The relevant correspondence may have been inadvertently misaddressed or alternatively the mail system within the Brisbane City Council in some manner broke down. It is also possible although this was not ventilated before me that inadvertently correspondence may have been destroyed.
I would be less inclined to find as I have set out in the above paragraph that the correspondence was not received had the Westpac bank been able to find such correspondence on its file.
It was for the purpose of this hearing a disinterested party and there is no reason to not accept the evidence of Mr Munt.
I should also record that upon my reading of s.28 and giving consideration to all of those cases identified to me by Counsel for each of the parties I am of the view that an application of s.28 with respect to payment of interest does not have a prerequisite jurisdictional fact that a candidate for an award of interest cannot in any way have remained in occupational possession of land after the formalities of the resumption have been completed by gazettal of the resumption notice. A disposed landowner could lease a property back for a long period and so remain in occupation but not be disqualified from claiming interest.
I accept that where a party does remain in either residential occupation of land or continues to carry out its usual productive activities on the land then those matters may disentitle a party from the Court exercising its discretion to award interest by way of compensation to them.
The authorities referred to make it clear, in my view, that the issue of interest remains always a matter of discretion and in the somewhat curious circumstances of the present case I am persuaded that the discretion ought be exercised in favour of the applicants.
For whatever reason the respondent has not served the notice of resumption of the land on the applicant’s.
Accordingly, I come to the view that it is appropriate that interest should be paid from the date of resumption namely 28 July 2006 to 30 September 2007.
However, some allowance must be made for the rent paid by Mr Tan of $400 per month. Mr Nguyen in his statement which became Exhibit 4 swears to the amount of rent received from Mr Tran as being in the sum of $8,400. That assertion was not in my view contradicted and accordingly Mr Nguyen and Ms Le are not entitled to receive both rent and interest. To do so would be “double dipping”.
It is said by the applicant that the $400 per month paid by Mr Tan was not the commercial rent for the property.
There was no evidence as to what the commercial rent was but in circumstances where land valued at $1,382,500 was resumed I am prepared to infer that an asset of such worth would command a commercial rental in excess of $400 per month.
The parties before me tendered an exhibit which became Exhibit 10 setting out the interest calculated at the then applicable rate of 5.25% per annum as producing a total interest payment of $85,308. ($1,382,500 x 5.25% ÷ 365 days (1 year) and x 429 days).
The sum of $8,400 must be deducted from the interest otherwise payable of $85,308, which computes to an amount owing of $76,908.
Accordingly, I direct that the respondent pay to the applicants a sum of Seventy Six Thousand Nine Hundred and Eight Dollars ($76,908) representing interest payable between 28 July 2006 and 29 April 2009 less the rent received by them of $8,400.
HIS HONOUR, WL COCHRANE
MEMBER OF THE LAND COURT
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