Perpetual Nominees Limited v Department of Natural Resources, Mines and Energy
[2004] QLC 42
•21 May 2004
LAND COURT OF QUEENSLAND
CITATION: Perpetual Nominees Limited & Ors v Department of Natural Resources, Mines and Energy [2004] QLC 0042 PARTIES: Perpetual Nominees Limited; Commonwealth Funds Management Limited; Permanent Trustee Australia Limited as Trustee and Commonwealth Bank Officers Superannuation Corporation Pty Ltd as Trustee; Permanent Trustee Australia Limited as Trustee; Perpetual Nominees Limited; CPT Manager Limited as Trustee; AMP Life Limited; PT Limited; Kent Street Pty Ltd as Trustee, Westfield Management Limited and AMP Pacific Fair Pty Ltd as Trustee; AMP Life Limited and Westfield Management Limited; Queensland Investment Corporation; QIC Robina Pty Ltd
(appellants)v. Chief Executive, Department of Natural Resources, Mines and Energy
(respondent/applicant)FILE NO: AV2003/0798; AV2003/0799; AV2003/0804; AV2002/0802; AV2002/0271; AV2003/0800; AV2003/0806; AV2003/0796; AV2003/0803; AV2003/0795; AV2003/0797; AV2003/0805; AV2003/0801 DIVISION: Land Court of Queensland PROCEEDING: Applications for the hearing of certain issues as preliminary points DELIVERED ON: 21 May 2004 DELIVERED AT: Brisbane HEARD AT: Brisbane MEMBER Mr RP Scott ORDER: The applications are dismissed. CATCHWORDS: Practice and Procedure - Application for preliminary determination (of certain appeal grounds) - Relevant criteria to consider - Initial presumption that all issues of fact and law determined at one time following hearing - No advantage found in granting preliminary hearing - Application dismissed
APPEARANCES: Mr S Doyle SC, with him Mr L Kelly, for the applicants
Mr T Quinn for the respondent
SOLICITORS: Minter Ellison for the appellants
Legal Counsel, Legal Services, Department of Natural Resources, Mines and Energy for the respondent
Decision on Application
The appellants have lodged appeals, under the Valuation of Land Act 1944, against determinations by the Chief Executive of the unimproved value of various parcels of land throughout the State. All properties have situated on them major shopping complexes. The relevant date of valuation in all appeals is 1 October 2002, apart from AV2002/0271 with a relevant date of 1 October 2001.
By general application of 16 April 2004 the respondent has sought to have certain grounds of appeal in the above matters determined by the Court as preliminary points, well in advance of the proposed full hearing date of 12 October 2004. The week of 7 June 2004 has been set aside for the hearing of such preliminary points, should this become necessary. Whilst the general application included 10 issues for preliminary determination (or other action) including striking out of certain grounds of appeal, counsel for the respondent indicated that the Chief Executive was now pressing four issues only to be determined as preliminary points. These related to three separate grounds of appeal and two (grounds 6 and 11(a)) which are conveniently grouped together:
1.Ground 12
Absence of Reasons
The Chief Executive erred in law in failing to provide an adequate statement of reasons for the decision -
a.to determine the unimproved value of the land;
b.to allow the objection in part only to that determination;
c.to determine the unimproved value of the land after allowing in part that objection.
2.Ground 13
Alleged Invalidity of Valuation of Land Act Regulation 2003
The Chief Executive erred in the determination of the unimproved value of the land by reason of the following -
a.the Chief Executive applied or purported to apply Regulation 3 of the Regulations to identify non-physical improvements which are intangible improvements;
b.the Chief Executive applied or purported to apply Regulation 5 of the Regulations to identify the percentage referred to in section 35A of the Act;
c.each of Regulation 3 and 5 is invalid;
d.each of Regulation 3 and 5 was made in excess of the regulation making power conferred by the Act.
3.Grounds 6 and 11(a) -
Excessive Improved Value
The Chief Executive in purporting to determine the unimproved value of the land -
a.failed to take into account the "improved value" of the land within the meaning of section 4 of the Act;
b. failed to make an assessment of the "improved value" of the land within the meaning of section 4 of the Act;
c.wrongly took into account as the improved value a capital sum greater than the sum which the fee simple of the land including improvements might be expected to realise if offered for sale on such reasonable terms and conditions as a bona fide seller would require.
4.Ground 10 -
Planning and Other Approvals
The Chief Executive failed to take into account adequately or at all -
a.the time and cost involved in obtaining all planning and other approvals;
b.the time and cost involved in effecting the improvements;
c.the time and cost involved in effecting site works relating to the improvements.
(It is only ground 10(a) which the Chief Executive now seeks preliminary determination.)
The appellants oppose such preliminary determination on the following bases:
(a)The applications are premature. (I take this to mean that it would be premature to determine any of the issues in a preliminary way.)
(b)It is prejudicial to the appellants to have separate determinations of parts of the appeal when the appellants are in a disadvantageous position of not understanding important aspects of the respondent's valuation methodology.
(c)The Chief Executive has not adduced evidence to identify important aspects of the methodology that was used in making the challenged valuations - essentially the grounds of appeal which the respondent seeks to have separately determined on a preliminary basis depends on the Court making findings concerning the actual methodology used by the Chief Executive.
(d)To embark upon separate determination would contravene the principles identified by the High Court in Bass v Permanent Trustee (1999) 198 CLR 334.
(e)The preliminary hearing of the appeal in relation to certain isolated issues is not warranted from a point of view of considerations of practicality and convenience. The appeals will continue even if the preliminary points are determined in favour of the applicant.
(f)The preliminary trial on nominated grounds of appeal will not facilitate the sooner determination of the proceedings in any material way.
(g)The hearing of the substantive appeals could be dislocated by the adoption of the course proposed by the respondent. Delays could arise from the need for the Court to prepare its reasons; by the prospect of appeal and of the Court needing to deal afresh with the outcome of any appeal that is allowed.
The appellants have also advanced arguments as to why the preliminary points, if dealt with as such, should be determined in their favour. These arguments are essentially advanced at this stage to demonstrate that an arguable case exists and that the grounds cannot be summarily rejected. No attempt was made to fully argue the grounds. This decision is, therefore, concerned only with the question of whether the matters should be determined as preliminary points and not with the ultimate validity of the grounds. Having said that, the respondent made submissions as to the validity of the grounds of appeal. This was done, I apprehend, to demonstrate that the relevant ground was totally without merit so ought to be disposed of in a preliminary hearing.
The Law
The principles governing the circumstances in which an order may be made to determine preliminary issues were summarised in Reading Australia Pty Ltd v AMP [1999] FCA 718 by Branson J in the Federal Court. The relevant Federal Court Rules have counterparts in the Queensland Uniform Civil Procedure Rules. Only those principles relevant to the current matters are listed below:
1.The judicial determination of a question must involve a conclusive or final decision based on concrete and established or agreed facts for the purposes of quelling a controversy between the parties (Bass v Permanent Trustee (1999) HCA 9 at para 45).
2.Where the preliminary question is one of mixed fact and law, it is necessary that all of the facts that are relevant to the determination of the question are ascertainable, either as facts assumed to be correct for the purposes of the preliminary determination or as agreed facts or as facts to be judicially determined (Bass v Perpetual Trustee at para 53).
3.Care must be taken in utilising the preliminary decision procedure to avoid the determination of issues not ripe for separate and preliminary determination. An issue may not be ripe for separate and preliminary determination in this sense where it is simply one of two or more alternative ways in which an applicant frames its case and determination of the issue would leave significant other issues unresolved.
4.Factors which tend to support the making of a preliminary order include that the separate determination of the question may:
(i)contribute to a saving of time and costs by substantially narrowing the issues for trial or even to disposal of the action; or
(ii)contribute to the settlement of the litigation.
5.Factors which tell against the making of a preliminary order include that the separate determination of the question may:
(i)give rise to significant contested factual issues both at the time of hearing of the preliminary question and the time of trial;
(ii)result in significant overlap between the evidence adduced on the hearing of the separate question and at trial, possibly involving calling of the same witnesses at both stages;
(iii)prolong rather than shorten the litigation.
In the Queensland decision of Re Cotton Crops [1985] 2 QdR 448, McPherson J observed that where a preliminary issue of law or construction arises, considerations of cost savings and convenience may require the trial of such preliminary issues separately from the trial of the factual disputes in the action. It is unnecessary to show that a decision either way on the preliminary issue will put an end to the whole litigation. A similar approach was adopted by the Court of Appeal in Re Multiplex Constructions Pty Ltd (1999) 1 QdR 287.
Absence of Reasons for Decision (Appeal Ground 12)
Respondent's Argument
· The respondent was willing to proceed on the basis that there was a duty to give reasons and that the reasons given were inadequate.
· There is no provision in the Valuation of Land Act 1944 which requires the provision of reasons such that failure to comply would undermine the validity of the valuation.
· If it were otherwise, the later validity of the appeal would depend upon the rather arbitrary matter of whether such valuations were the subject of a request for a statement of reasons and the response to such request. It would introduce the notion of a valuation valid when issued, but subject to subsequent invalidity depending on later events. Clear words would be necessary to compel such a conclusion. None have been identified.
Appellants' Argument
· The issues presented on this ground of appeal are reasonably arguable.
· Whether it is made out will turn on disputed issues of facts which cannot be determined now. I note, however, the concession of the respondent as to the adequacy of reasons.
· To have a determination on this ground in a preliminary way will not shorten the ultimate appeal hearing at all, nor materially contribute to any savings of costs. There will, thus, be no utility in having it determined as a preliminary matter.
· If the Chief Executive's decision on appeal is held to be invalid because of the failure to give adequate reasons, the appeal must be allowed by the Land Court declaring that the decision was invalid. However, the Land Court will still have to proceed to determine the correct valuation of the land. There is, therefore, no saving in judicial resource in deciding the question as a preliminary one.
Validity of Regulation (Appeal Ground 13)
In 2003 s.35A was inserted in the Valuation of Land Act. The section provides for an owner of land to apply to the Chief Executive to have the value of intangible improvements taken into consideration in a valuation of the land. (s.35A(1)). The appellants made applications of the type mentioned in s.35A.
Intangible improvements was given a meaning in s.6(5):
"(5) In this section -
'intangible improvements', in relation to land, include the benefit of -
(a)the following non-physical improvements to the land -
(i)a lease, licence or other right;
(ii)the goodwill associated with the purpose for which the land is being used; and
(b)other non-physical improvements prescribed under a regulation."
Section 35A(5) of the Valuation of Land Act 1944 provides:
"(5) The chief executive must not value intangible improvements at more than the percentage prescribed under a regulation of the improved value of the land."
Regulation 5 of the Valuation of Land Regulation 2003 states:
"Valuing intangible improvements - Act, s 35A
For section 35A(5) of the Act, the percentage is 20%."Regulation 3 of the Valuation of Land Regulations 2003 says:
"3 Non-physical improvements that are intangible improvements - Act, s 6(5)
For section 6(5) of the Act, definition 'intangible improvements', paragraph (b), the following non-physical improvements are prescribed -
(a)risk management procedures in place for a development on the land, including, for example, procedures dealing with the following -
(i)capturing and retaining a share of the market;
(ii)turnover of tenants;
(iii)establishing a stable and quality mix of tenants;
(b)market advantages resulting from the business skills of the owner or manager of a development on the land;
(c)market advantages of a brand name used for a development on the land."
Respondent's argument
· Subordinate legislation cannot reviewed on the grounds of unreasonableness. The validity of subordinate legislation cannot be determined by focus on its operation in a particular case.
· The 20% figure that is identified in Regulation 5 is a valid demonstration of how to make a regulation of that kind. There is nothing in terms of the Statute which would indicate that the prescription of a percentage is in any way constrained.
· The things which are identified in Regulation 3 are of a kind which fulfil the requirement of s.6(5)(b) of the Act that they be non-physical improvements and there is no other impediment to their inclusion by way of regulation.
Appellants' Argument
· Regulations 3 and 5 were made in excess of the regulation making power conferred by the Act.
· The issues raised by this ground of appeal are reasonably arguable.
· To have a determination on this ground in a preliminary way will not shorten the ultimate appeal hearing at all, nor contribute to any savings of costs. The respondent cannot point to one piece of evidence or step in the appeals which will be avoided by having these issues determined now.
· The determination being hypothetical is one which the Court cannot embark upon.
· The appellants intend to lead evidence to establish that the existing cap attacks the wrong centres, that is the cap attacks centres which are productive and appropriately capitalised. The cap is inconsistent with the policy of the Act. The appellant needs to identify how the cap operates with respect to the successful centres. Evidence will include identifying values of a range of centres including unsuccessful ones, over capitalised, under capitalised and appropriately capitalised ones. It is still to be investigated how the cap operates in particular cases.
· It may be that after hearing the evidence in the appeal the Court will make findings as to the improved value and the value of intangible improvements such that the cap would be triggered into operation, though not relied on by the Chief Executive in his valuation. How the cap operates in particular cases cannot be known until the Court has made determinations as to the improved value and as to the value of intangible improvements at the hearing of the appeal.
Excessive Improved Value (Appeal Grounds 6 and 11(a))
Under a s.35A application, where an owner applies to the Chief Executive to have the value of intangible improvements taken into account, the application must:
· state the market value of land and improvements mentioned in the owner's financial records;
· state the type of intangible improvements;
· include an assessment by the owner of the value of each of the intangible improvements.
Time limits for lodging such application apply for the current valuations. The s.35A applications were required to be lodged with the Chief Executive by 31 August 2003. The appellants say that considerable time pressures existed as the legislative amendment providing for the lodgement of such application for the relevant valuations took effect only in June 2003.
Respondent's Argument
· The improved value figure used by the Chief Executive was the figure provided by the appellants themselves. If there is any excess involved in that figure, the appellants ought to be able to particularise it.
· It is evident that there is really nothing in this ground and the appellants ought either to abandon it or undertake to provide particulars.
Appellants' Argument
· Whether or not the respondent erred in the respects contended for in Grounds 6 and 11(a) depends on findings of fact yet to be made by the Court as to:
1. The improved value actually used by the respondent.
2.The actual or true improved value determined in accordance with s. 4 of the Act.
· These are not preliminary issues; these are to a real extent the issues which will arise in the appeal in many respects. As to 2 above, the appellants will call expert evidence at trial as to the improved value. They are in the process of making investigations as to what the improved value for each property was at the relevant time in accordance with the Act and are seeking expert assistance in this regard. That evidence is likely to reveal that the improved value is something other than the amounts used by the appellants in their applications pursuant to s.35A. It is too early to make a determination as to this issue until the appellants have been able to finalise expert opinion.
· Such valuations do not incorporate or rely on the degree of detail and analysis necessary for the presentation of expert evidence in Court.
· Although the appellants retained consultant valuers during the s.35A process, these valuers did not value the improved value or the unimproved value of the centres, but provided assistance relevant to making s.35A applications under the time constraints and with limited information.
· The respondent's contention in relation to Grounds 6 and 11(a) is based on an assumption that because the appellant used a value figure for s.35A applications, though adjusted by him for various reasons; that can be accepted as the improved value. This assumption is misconceived for a number of reasons. The appellants do not contend in the appeal that the improved value of each shopping centre is the same as the market value identified in s.35A applications. The particularised case of the appellants is not that the book value is the improved value.
· Some of the valuations included in the s.35A applications were not made at the valuation date of 1 October 2002. The only valuation opinion in evidence (see Affidavit of Russell Reid Bowie, 23 April 2004, para.15) is to the effect that differences in timing are likely to have a significant effect on the valuation of improved value. There is no evidence so far provided that the Chief Executive has made any adjustments for timing (see Affidavit of Russell Reid Bowie, 23 April 2004, para.15).
Time for Planning Approvals (Appeal Ground 10)
Respondent's Argument
· In view of the provisions of s.3(4) of the Act, this ground of appeal is doomed to fail and ought to be disposed of without further delay. Section 3(4) states:
" (4) Notwithstanding anything contained in this section, in determining the unimproved value of any land it shall be assumed that -
(a)the land may be used, or may continue to be used, for any purpose for which it was being used, or for which it could be used, at the date to which the valuation relates; and
(b)such improvements may be continued or made on the land as may be required in order to enable the land to continue to be so used;
but nothing in this subsection prevents regard being had, in determining that value, to any other purpose for which the land may be used on the assumption that any improvements referred to in subsection (1) had not been made."
· A great deal of time and expense would be consumed in preparing for and dealing with the factual inquiry which would only become material if the ground was well founded in principle. (See Affidavit of Robert Paterson of 16 April 2004, para.20). It is submitted that the preliminary determination of that point of principle is amply justified by reference to the considerable savings in time and cost that can be achieved by its disposal.
Appellants' Argument
· It is unlikely that there would be any significant savings in time and cost in the conduct of appeals based on this ground.
· Mr Bowie deposes to his extensive experience in this area that:
(a)It would not be necessary to address the range of expert evidence suggested by Mr Paterson - Mr Bowie is aware of no case in which the kind of evidence Mr Paterson refers to has been led.
(b)Evidence as to time and cost in obtaining planning approvals is usually given by a town planning consultant with evidence as to legal costs, if necessary, being given by a solicitor.
· Mr Bowie's evidence is to be preferred. He has relied on his considerable experience in giving the evidence. He was cross-examined as to his extensive knowledge in the area. This cross-examination did not challenge his experience but tended to establish it. On the other hand, Mr Paterson says nothing of his experience.
· Even if the costs of obtaining planning approvals may be excluded from consideration, the Act does not identify, practically speaking, how the purchaser is to have access to the drawings, plans, specifications etc, developed in the course of obtaining planning approvals. The Act does not say these are to be disregarded. The purchaser would be expected to seek and obtain access to these and to pay for that right. (See Affidavit of Russell Reid Bowie, 23 April 2004, paras.25-28).
· This is not a ground which can be dealt with in a preliminary way as it is not at all separate from other issues in these appeals.
Consideration of Issues
I now turn to make some specific comments on each of the four grounds nominated for preliminary determination. Following this, some general observations, relevant to all four grounds are also included.
Reasons for Decision
A statement of reasons for the decision (on objection) was properly requested by the appellants under s.33 of the Judicial Review Act 1991 and subsequently provided by the Chief Executive. More detail, particularly as to the respondent's methodology, should have been provided (according to the appellants' submission). That view was conceded by the Chief Executive for the purpose of the application. (See [7] above). The appellants attack the statement on two separate grounds (broad and narrow) contending that the Chief Executive's valuation may consequently be invalid.
The broad approach is that failure to give adequate reasons invalidates the decision and would entitle the appellants to a declaration that the decision under appeal is invalid.
The narrow approach is that failure to give reasons is a factor which, together with other circumstances, permits an inference to be drawn that the decision maker has erred in making his decision and the decision should be declared invalid.
Counsel for the respondent argues, in written submission in response, that the cases advanced by the appellant on the obligation to give reasons are essentially ones on the duty of Courts or quasi-judicial bodies - not administrative bodies like the Chief Executive here. Public Service Board of NSW v Osmond [1986] 159 CLR 656 is cited as authority that there is no common law duty to provide reasons. I am in agreement with these submissions.
However, the obligation in the present case has a statutory basis - s.33 of the Judicial Review Act. If adequate reasons are not provided on request, the requesting party can apply to the Supreme Court for an order for a further statement of reasons.
No question properly arises as to the jurisdiction of the Land Court under the Judicial Review Act. This Court, clearly, has no such jurisdiction. The Court may, however, inform itself as to a statement of reasons given by the Chief Executive pursuant to the provisions of that Act and any implications thereof.
If the final statement of reasons is inadequate the conclusions the appellants seek to draw may well be open. A declaration of invalidity would result in the Chief Executive not being able to rely on the presumption of correctness under s.33 of the Valuation of Land Act. He could, of course, still lead valuation evidence at the hearing.
The respondent referred me to Repatriation Commission v O'Brien (1984) 155 CLR 422 where at 445-446 Brennan J said:
"It is not clear to me that the A.A.T. did fail to expose its reasons for rejecting Mr O'Brien's claim but, in any event, a failure by a tribunal adequately to fulfil its statutory obligation to state the reasons for making an administrative decision does not, without more, invalidate the decision or warrant its being set aside by a court of competent jurisdiction. If a failure to give adequate reasons for making an administrative decision warrants an inference that the tribunal has failed in some respect to exercise its powers according to law (as, for example, by taking account of irrelevant considerations or by failing to consider material issues or facts), the court may act upon the inference and set the decision aside."
That raises a quite different consideration, in my view, from the issue under debate in the instant matter. Here we have s.33 of the Valuation of Land Act which provides:
"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."We also have the judgment of Gibbs J in Brisbane City Council v The Valuer-General (1978) 140 CLR 41 at 56:
"The question then is whether a court on appeal is bound to accept the Valuer-General's figure as correct unless it is positively established that the true value is lower, or whether it is enough to show that the value was reached as the result of an error in principle. 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."
Section 33 now expresses what was previously s.13(7).
The respondent also submits that appeal ground 12 does not raise a separate ground of appeal from grounds 26 and 27.
There is nothing repugnant, in my view, in an appellant expressing grounds of appeal that overlap - if that is the case here. So much was implicitly recognised in Reading (see[5]3 above).
If, after argument as to the merits of this ground, the valuation is not invalidated on the basis of any discrepancy in the statement of reasons, the case will proceed through to full hearing. Alternatively, if invalidity is found, that is not the end of the matter. The Court is still required to determine a correct valuation for the purposes of the Act. A finding of invalidity will not put an end to the litigation.
On this basis, there is no justification for a preliminary determination of this matter.
Invalidity of Regulation
If the issue here was merely a question of construction of the regulations (3 and 5) based on agreed facts, this ground could be determined as a preliminary point. However, as is apparent from the evidence of Mr Bowie, the appellants argue that the application of a 20% cap in regulation 5 is a misconceived use of the regulation making power authorising such regulation. Detailed evidence is proposed to be called (which would be led at trial anyway), that the more successful centres may well have a higher, rather than lower, level of value of intangibles. The Minister's Second Reading Speech stated that the cap was aimed at limiting abuse of unjustified level of intangibles. Detailed evidence will be required to substantiate what appears to be a fairly refined argument by the appellants.
The respondent submits that the validity of a regulation cannot be tested on a situation-by-situation basis. I accept that proposition, however I do not understand the appellants' case to be so constructed. I understand that the appellants intend demonstrating by reference to a range of properties that the cap operates capriciously or unreasonably - that is, in a manner not contemplated in the source legislation. I do not infer that the appellants accept that the cap operates in a fair manner in some cases but not in others and that it is the second class which is addressed in this ground of appeal.
The respondent submits that Williams v Melbourne Corporation (1933) 49 CLR 142 is clear authority for the proposition that it is not a matter for a court to conclude that based on the unreasonable operation of a regulation in some circumstances it may be declared invalid.
I understand that authority to be of that effect. If I have misunderstood the appellants as to the argument they wish to put and their proposition is of a type rejected in Williams, then that ground of appeal should be withdrawn. If I am right in my understanding, then the appellants should have an opportunity to run their case - whatever risk of failure there may be. That case will involve such evidence as will be led in any event.
The respondent submits that ground of appeal 13 operates only as an assertion of error on the part of the Chief Executive. It is submitted that where the Chief Executive has not purported to apply the cap, the appeal ground is irrelevant and should be struck out.
That submission is, I think, adequately met by the submission of the appellants that the application of the cap depends on the improved value - and that is a matter of evidence and for decision.
As to regulation 3: in the absence of evidence about the things included in Regulation 3, it cannot presently be determined whether there is a sufficient connection between the regulation making power and the regulation. Further factual evidence seems necessary as to whether matters included (such as risk management and market analyses) are really non-physical improvements under s.6 (valid) or merely something which may give rise to non-physical improvements (invalid).
On balance, there seems no advantage in deciding regulation validity at this preliminary stage.
Improved Value
The appellants assert that their nominated improved value included in the s.35A application was not intended to be a fully informed figure for purposes of s.3(2) of the Valuation of Land Act. Time constraints for the submission of this s.35A application and absence of detailed reports from its expert valuers render this figure unreliable for full Court hearing. Much more detailed valuation evidence, including evidence of improvements, is intended to be submitted at the full hearing by the appellants.
Further, the improved values submitted did not all have a common date of October 2002. Some were for a date considerably earlier.
Now that the above explanation is before the Court, it appears to be at least arguable that the respondent should not have relied on such preliminary figures (even with certain adjustments) to make a determination of improved values for the purposes of the Act.
In all the circumstances, it seems appropriate that this ground should be argued at the full hearing when much more precise valuation evidence will be forthcoming and made subject to cross-examination.
Planning Approvals (Ground 10(a))
One of the issues here relates to the proper construction of s.3(4) of the Act. If valuations are based on the existing use (shopping centres) which use may be higher than that allowed if the land were now notionally unimproved, does time and cost of obtaining planning approvals have to be allowed for in determining improved value?
The appellants advance two important points which militate against preliminary determination. First, if it does become necessary to determine cost and time of planning approvals, evidence on these matters can be given in succinct but adequate form by a town planner and solicitor experienced in such matters. Mr Bowie, an experienced legal practitioner in this planning field, deposes to that process. Second, and perhaps more importantly, time and cost of planning matters are closely interrelated with the preparation of drawings, building plans, etc. Evidence will be necessary to show this relationship. Thus, even if it were decided that planning costs and time allowance should be ignored for purposes of s.3(4), it may be that little will be achieved once the intermingling with the other essential building items is also factored into calculations. Again, on balance, the grounds are best argued at full hearing.
General Comments:.
First, the matters need to be assessed against the criteria outlined in Reading and Bass (discussed above) to determine if they qualify. The initial presumption authorised in Reading is that ordinarily all issues of fact and law in a proceeding will be determined at the one time by a Court following a trial. In other words, it is for the applicant/respondent here to demonstrate that it is preferable to set aside that presumption in favour of early disposal of the grounds of appeal identified. That has not been done in my view.
Second, after consideration of the evidence (both affidavit and oral) adduced by the appellants and submissions (written and oral) by counsel for the appellants, I am satisfied that all four matters are at least arguable. None could be summarily dismissed as being without foundation.
Third, in at least two of the matters, (Invalid Regulation and Excessive Improved Value) and possibly a third (Absence of Reasons) there appears to be no present agreement on the facts upon which those matters may be determined. Evidence from either side will be necessary at some stage of the proceedings from expert witnesses and others to provide a basis for the proper consideration of the issues. There seems no obvious advantage in such evidence being given in June 2004 in a preliminary hearing rather than the full hearing in October 2004. Indeed, it may be such evidence or some of it would not be available in a form suitable for presentation on 7 June 2004.
Fourth, after considering evidence and submissions from either side, I am not convinced that there will be any savings in time or cost by having a preliminary hearing. No obvious convenience for the parties or the Court has been demonstrated.
Fifth, there appears certain merit in the appellants' submission that preliminary determination may result in a prolongation of litigation, its fragmentation, increase in costs as a result of successive and separate appeals and possible loss of the present trial dates. Prejudice to the appellants could result.
Sixth, in fairness to the respondent, I should say that while there may well have appeared to be some justification for preliminary determination as the appeal grounds were initially presented, the subsequent elaboration by provision of particulars, certain disclosure, affidavit and oral evidence and detailed legal submissions has swung the pendulum in the appellants' favour.
In Reading at [14] the Court referred to the question of whether a preliminary determination might enhance the prospect of settlement.
Nothing that I have heard in submissions, nor in my understanding of the cases at this point leads me with any confidence to that view.
Accordingly, the applications are dismissed.
RP SCOTT
MEMBER OF THE LAND COURT
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