Plancastle Pty Ltd v Department of Natural Resources and Water

[2007] QLC 32

LAND COURT OF QUEENSLAND

CITATION:	Plancastle Pty Ltd v Department of Natural Resources and Water [2007] QLC 0032
PARTIES:	Plancastle Pty Ltd (appellant)
v.
Chief Executive, Department of Natural Resources and Water (respondent)
FILE NO:	AV2005/1305
DIVISION:	Land Court of Queensland
PROCEEDING:	Appeal against annual valuation under Valuation of Land Act 1944
DELIVERED ON:	20 April 2007
DELIVERED AT:	Brisbane
HEARD AT:	Ipswich
MEMBER:	Mr PA Smith
ORDER:	The appeal is dismissed.
CATCHWORDS:	Valuation – Factors in valuation – Presumption in favour of correctness of valuation – Valuation of Land Act 1944
APPEARANCES:	Mr A Weeks, Director, on behalf of the appellant Mr M Heather, Senior Legal Officer, Department of Natural Resources and Water, appeared for the respondent

Background:

1. This is an appeal by the appellant against a valuation by the respondent, pursuant to the Valuation of Land Act 1944 (the VLA) which valued the appellant’s property situated at corner of Old Logan Road and Langley Road, Camira, in the sum of $260,000 as at 1 October 2004.  The appellant contends for a valuation of $133,000.  The land has an area of 1847m2.

2. The appellant was represented by its Director, Mr A Weeks, who gave evidence at the hearing.  Mr Weeks has no legal or valuation qualifications.  The respondent was represented by Mr M Heather, a senior legal officer employed by the respondent, and relied on evidence of a registered valuer, Mr Jason Carey. 

3. Mr Carey provided a comprehensive analysis of the situation and nature of the subject land.  Mr Weeks effectively agreed with Mr Carey’s report in this regard.  Mr Carey’s report states:

   "Old Logan Road is an arterial road linking the suburbs of Camira and Springfield to the Ipswich Motorway and also to the Centenary Highway via Springfield Parkway.  It carries a heavy volume of local traffic.  Consequently the subject property receives good exposure as a local neighbourhood commercial/retail site.  The property has direct access to Old Logan Rd with shared reciprocal rights of carriageway with the adjoining service station property providing a 6 metre wide access and egress point at the front north western corner.  In summary the property has road frontages on 3 sides plus a shared right of way access overlapping the northern boundary.  Access is considered good. 

   The subject is at the centre of a Local Retail/Commercial precinct which services the suburb of Camira.  Adjacent properties include a service station to the north and a local convenience shopping centre to the south.

   The land comprises a slightly irregular shaped parcel with a 38.38 metre frontage to Old Logan Road, 6.705metre splay corner to the Old Logan Road Langley Road T-intersection, 32.188 metre frontage along the southern boundary to Langley Road and splay corner of 4.448 metres to the junction of Langley Road and Bruce Land.  The eastern boundary along Bruce Land is 54.027 metres and northern boundary 37.068 metres.

   The subject property is burdened by a 3 metre wide easement (EMT B) inside the northern boundary with a total area of 111m2 enabling access rights for the adjoining Lot 1 RP803120.  An identical 3metre wide easement conferring similar rights of access (EMT A) benefits the subject property.
   The land falls gently from west to east below the Old Logan Rd frontage.  The site appears to be satisfactorily drained.  There is good visibility to both north and south bound traffic offering good business exposure.

   The property is service with electricity, telephone, town water and sewer.  Old Logan Road and Langley Road are bitumen sealed roads with concrete kerb and gutter.  Bruce Lane to the rear of the site is also bitumen sealed.  There is a concrete footpath constructed along the Old Logan Road and Langley Road frontages of the property.  Limited kerbside parking is available in Langley Street, Additional public parking is also available adjacent to the eastern alignment of Bruce Land with the neighbouring Park Reserve.  A bus service operates to provide public transport to this local neighbourhood centre with a bus stop situated on the western side of Old Logan Road opposite the subject property.

   The land is designated LC2 Local Retail and Commercial Sub Area 2 under the Ipswich City Council Planning Scheme adopted 5/4/2004.

   The existing use of the property as a multi-tenanted retail and commercial building is a consistent use under the Local Retail and Commercial designation."

Relevant legislative provisions

1. Pursuant to s.13 of the VLA, the respondent is required to determine the unimproved value of the land.  Relevantly, s.3(1) of the VLA says as follows:

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

   (a)     in relation to unimproved land – the capital sum which the fee simple of the land might be expected to realise if offered for sale on such reasonable terms and conditions as a bona fide seller would require; and

   (b)     in relation to improved land – the capital sum which the fee simple of the land might be expected to realise if offered for sale on such reasonable terms and conditions as a bona fide seller would require, assuming that, at the time as at which the value is required to be ascertained for the purposes of this Act, the improvements did not exist."

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

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

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

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

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

I respectfully agree with these observations.

Presumption of correctness of valuation

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

   33      Status of valuation

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

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

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

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

The issues in the Appeal

1. The appellant, in its notice of appeal dated 5 October 2005, only listed one ground of appeal in the following terms:

   "The depressed nature and valuation of the property at date of valuation."

   However, during the course of his evidence in support of the appellant’s appeal, Mr Weeks gave evidence that the main points of complaint of the appellant were that the shared access easement arrangement with their neighbouring property, which is a service station, causes difficulty in accessing the subject land particularly when the service station is having its tanks refilled; and that the park reserve opposite the subject land is used at night as a meeting point for neighbourhood gangs who regularly (once a month or perhaps more so) cause graffiti problems and vandalism to the buildings on the subject property.  Mr Weeks says that, being the closest buildings to the park reserve, the buildings on the subject property suffer more from vandalism and graffiti, in his view, than the surrounding commercial buildings.

2. Mr Weeks also made reference to the valuation of an adjoining block, No. 326, as being $6 a square metre lower than the subject. 

3. Mr Carey gave specific evidence relating to all of the points raised by Mr Weeks.  In Mr Carey’s view, the fact that the subject property and the service station have each only had to provide 3 metres of land in order to obtain a 6 metre wide access to both properties is much more of a benefit than a detriment to each property, including the subject, as it increases the total amount of square meterage available on the subject for development.

4. As regards the issue of graffiti and vandalism, Mr Carey had no doubts that it would be an issue.  Mr Carey also pointed out that trouble with graffiti and vandalism is an issue for all commercial property owners and that he felt that, in his experience, the vandalism and graffiti issues of surrounding businesses would be similar to those of the subject.  He also pointed out that, on the flipside to the detriment the park may be seen of at night time, during the day time that area contains tables and significant off-street parking, both of which are used by patrons of the commercial precinct and, in particular, the subject property.  Mr Weeks conceded that the park tables and additional car parking area would be a benefit to the subject property during the day. 

5. Mr Carey also indicated that he had undertaken the valuations of commercial property in this precinct with some care taking into account all aspects of each property, and that in his view the valuation of the subject property was both appropriate to that particular parcel of land and in good relativity to surrounding properties.

6. A direct comparison approach has been adopted by Mr Carey to determine the unimproved value of the land.  As is so often the case in matters such as this, the issues basically all come down to market evidence.  This is reflected in the sales evidence set out in Mr Carey’s report.  Mr Carey’s evidence relates to three sales as follows:

Sales	Area	Zoning	Date of Sale	Analysed U/Value	Applied U/Value 1/10/2004	Comparison
1 9 William St GOODNA	1112m2	Residential Mixed Density under Eastern Corridor Structure Plan	11/10/2003	$215,000 ($193/m²)	$240,000 ($216/m²)	Superior
2 36 Springfield Parkway SPRINGFIELD	1522m2	Community Residential under Springfield Structure Plan.  Approved as neighbourhood centre under Area Development Plan	14/2/2003	$338,500 ($222/m²)	$335,000 ($222/m²)	Superior
3 Osiris Crt CAMIRA	621m2	Residential Low Density	24/11/2004	$116,500 ($188/m²)	$105,000 ($169/m²)	Vastly inferior

1. I accept the valuation evidence of Mr Carey.  Whilst I also accept that the subject land experiences graffiti and vandalism issues extenuated by its close locality to a park, I also accept that the park in providing recreational and parking facilities acts as a benefit to the subject land during daylight hours.  I also accept that the subject land does experience some difficulty from time to time in light of the shared access arrangements through easement with the service station, but that any derogation that those shared rights cause is more than adequately counteracted by the fact that the area available for commercial development on the subject property has benefited by the loss of only 3 metres from the subject for its share of the access easement.

2. Mr Carey’s Sale 3 shows how unrealistic the appellant’s contentions are.  Sale 3 is of a small residential block, some ⅓ the size of the subject, and has a valuation not greatly lower than that sought for by the appellant for the subject.  As Mr Carey said in his report when considering Sale 3:

   "Not directly comparable to the subject due to the different land uses to which the respective properties may be put.  However this sale is helpful in demonstrating the underlying value of similarly located land with substantially inferior designation under the planning scheme."

3. In the circumstances, on the basis of the evidence in its entirety the appellant has not established that the presumption of correctness of the valuation referred to early should be disturbed.

4. Having considered all of the evidence before me, and applying the relevant authorities, I am not satisfied that the valuation of $260,000 involves a significant error of fact or was arrived at by a fundamentally flawed method.  Further, I note that the points raised by the appellant on appeal are not detailed in the Notice of Appeal.

Conclusion

1. For the reasons set out above, I have reached the conclusion that the appellant has failed to establish that the respondent’s assessment of the unimproved value should be reduced to $133,000, or in any amount at all. It follows that the appeal must be dismissed. The valuation of the subject land is accordingly affirmed in the sum of $260,000.

Order

The appeal is dismissed.

P A SMITH

MEMBER OF THE LAND COURT