Scarr v Chief Executive, Department of Natural Resources
[1997] QLC 151
•19 September 1997
|
BRISBANE
19 SEPTEMBER 1997
Re: AV96-448
An appeal against an unimproved valuation -
Valuation of Land Act 1944 -
Longreach Shire
D.A. and C.F. Scarr
v.
Chief Executive, Department of Natural Resources
(Hearing at Longreach)
D E C I S I O N
This appeal relates to an unimproved valuation of land situated at 141-143 Eagle Street, Longreach. The land is described as Lot 2 on RP 605859 containing 809 m² and Lot 42 on L3571, containing 1,214 m², Town and Parish of Longreach.
Lot 2 is a vacant rectangular shaped site situated at 141 Eagle Street at the southern corner of Pelican Street, with frontages of 20.1 metres and 40.2 metres to those streets respectively. It is directly opposite commercial development to the north, and adjoins Lot 42 to its south. A residence adjoins to the west on a small surveyed lot at the corner of Pelican Street and Crow Lane.
Lot 42 is situated at No. 143 Eagle Street with frontage to that street of 20.1 metres as the eastern boundary then 20.1 metres to Crow Lane as the western boundary. The site is rectangular in shape with depth from Eagle Street to Crow Lane of 60.3 metres. Constructed on Lot 42 is a building accommodating a business engaged in retail sales of tyres and repair of tyres together with retail of polythene pipe and miscellaneous rural products.
Eagle Street and Pelican Street are bitumen sealed with concrete kerbing and channelling while Crow Lane is gravel formed.
As at 1 January 1996, the unimproved value of the land was assessed by the Department in the amount of $67,000. An objection against that valuation was disallowed.
Mr and Mrs Scarr appealed to this Court against that decision. The grounds of appeal were set out as follows:
"1.We are being discriminated against and unfairly treated. This is the highest valuation in the 'residential' area of Longreach. Our valuation is the equivalent of $30 per m², the same as Smith Bros. Timber Yard in the heart of the business area. 111-113 Galah Street.
2.The basis of our valuation is wrong in that in the valuation for 27.6.94 a starting figure of $60,000 was used where it should have been $55,000 as per the decision of Land Court AV94-463. This has carried a false figure forward for the year 13.3.95 and this year. Refer Property Data List 28/02/96 page 37.
3.143 Eagle Street is an existing business in a residential area with a house on either side of the business. The house block to the south - 145 Eagle Street is valued at $16,800 the house to the north is $10,000 (small block). 143 Eagle Street is valued at $33,500 with 141 Eagle Street the same. 152 Eagle Street, three blocks south and across the road sold this year for $75,000 with a three bedroom house on it. This would severely test the $16,800 valuations in this area much more so the $67,000 for our area.
4.We are being valued on a decreasing scale from the business area as a distance from the Post Office. We should be valued as an increase on the values of our residential area, the increase being for a corner block. The Town Plan has effectively cut our valuation as we can't sell for business premises - any purchaser must get council permission to build a business and the council has taken a stand to enforce the town plan - see Longreach Leader 19/1/96 - this has reduced the value of our vacant corner block to a residential value."
The appellants estimated the unimproved value of each lot to be $21,000, totalling $42,000.
Mr Scarr attended the hearing and conducted the appellants' case. The appellants believe that the land, being zoned "Town", which Mr Scarr interprets as meaning in effect, "Residential", should be valued on a residential basis rather than as commercial land regardless of the existence of the business conducted on Lot 42. At least the vacant land, it is argued, should not be included for valuation purposes with the land used for the business in one valuation based on commercial levels of value over the total aggregation.
Mr Scarr pointed out that while the town planning provisions permitted the existing business to remain, the use of that land is restricted to that particular use which he described as being limited to primarily a "tyre business". While he did not disagree that polythene piping was retailed from the site and that its storage sometimes might have encroached onto the vacant Lot 2, the business was intended to be operated solely from Lot 42. In comparison with the recognised commercial areas where streets were sealed and footpaths paved, Crow Lane was "dirt" as were the footpaths, except when contribution to the cost of concreting had been made. Reference was made to the difficulties involved in operating a business of the nature of that conducted from Lot 42 with houses on both sides.
Mr Scarr believed that a reduction in the valuation of the land as at 30 June 1993 (achieved through appeal to the Land Court) had not been "carried through" in subsequent valuations. He based that allegation on the copy of the "I.V.A.S Property Data Listing" which he had obtained showing the 30 June 1993 valuation as being $60,000.
The appellants' estimate of value was derived from an opinion of relativity with valuations applied to land nearby used for residential purposes. Rather than being valued on a decreasing scale from the business area, Mr Scarr was of the opinion that the valuation should have been increased from inside residential levels of value to include any premium for the business and then the corner influence on Lot 2.
In connection with the town planning status of the land, Mr Scarr provided a copy of an article in the "Longreach Leader" dated 19 January 1996 referring to the Council's refusal to consent to an application for "establishment of commercial premises outside of the commercial core" (a video library).
The appellants, by letter dated 12 May 1997, had sought from the Council, approval in principle to use Lot 2 for a "Panel Shop and Spray Painting Booth" in a proposed building intended to complement the existing building and business on Lot 42. The Council responded on 18 June 1997 advising that it was opposed to the application "as it considers such use should be located in an industrial area".
Mr R.B. Hyman, registered valuer, took responsibility for the valuation appealed against. The valuation had been calculated on a base of $33 per m² over the total aggregation - the calculation of $66,759 being rounded to $67,000.
His report contained the information that the land was "zoned for 'Town' purposes" and that the existing use was a lawful fettered use under the Town Plan. Mr Hyman's evidence under the heading "'Town Planning Scheme' and Development Potential of Scarr's Land" contained the opinion that within the town planning definition, the use of the land (at least Lot 42) was a "shop" rather than commercial premises and any shop with a gross floor area of 100 m² or more required the consent of Council.
Mr Hyman's evidence overall indicated to me that the Town Planning Scheme for Longreach is somewhat different to those of many other local governments in that the "Town" zone embraces a wide range of urban uses including, for example, both residential and commercial. The information provided to the Court relevant to the Town Planning Scheme was limited, but as I understood it, commercial uses within the "Town" zone (as opposed to shops with gross floor area of 100 m² or greater) do not require consent of Council but approval of Council which is a less stringent procedure than obtaining consent. Mr Hyman's report contained the information that included within the Town Planning Scheme was a Strategic Plan indicating preferred dominant land uses. An excerpt of the Strategic Plan showed the preferred dominant retail/commercial designated area as being northerly of Pelican Street. It was Mr Hyman's evidence that the preferred dominant use of land southerly of Pelican Street, in the street block accommodating the subject land was residential. It was his information that such a designation was not intended to prohibit other types of development, including commercial, and that the Council's policy was to use discretion in approving those uses requiring approval rather than consent. Such uses in the "Town" zone were:
Commercial Premises
Home Occupation
Place of Public Worship
Professional Rooms
Public Purpose
Shop - where GFA less than 100 m².
Mr Hyman had interviewed the Town Planner who informed him that "he considered the highest and best use of Mr Scarr's land as development for office purposes" as "he felt there was a lack of office space on the fringe commercial areas, even though the preferred dominant land use was shown in the Strategic Plan as residential".
Mr Hyman's evidence gave the impression, in the first instance, that the valuation had been conducted under the provisions of s.3(4)(a) and (b) of the Valuation of Land Act, which in summary directs that the assumption be made that the land may be used or may continue to be used, for any purpose for which it was being used and such improvements "may be continued or made on the land". Mr Hyman gave evidence to the effect that the vacant land had been observed to have been used for at least the encroachment of stored polythene pipe retailed from Lot 42. As it happened however, his valuation approach had been more in keeping with the provision in s.3(4) "but nothing in this subsection prevents regard being had, in determining" (the unimproved value of the land), "to any other purpose for which the land may be used on the assumption that any improvements ... had not been made".
It might have been argued that the existing use was one less than retail, because the Council had seen the proposal to extend the building on to Lot 2 (for use as a panel shop and spray painting booth) as reflecting an industrial, rather than commercial use.
That was not the case however because after considering Mr Hyman's evidence closely, there is now no doubt in my mind that his valuation was intended to reflect a highest and best use of the whole of the land as commercial and more precisely for development of office premises, rather than retail premises.
Mr Hyman, having decided that the highest and best use was in keeping with the Town Planner's opinion, established a valuation base from two sales with commercial use potential. The details, briefly, of those sales are as follows:
1.A 1,214 m² site described as a "fringe commercial site" at the corner of Swan and Crane Streets and Parrot Lane, within two main blocks of Eagle Street (the main street within the business centre) sold in March 1995 for $30,000 as vacant land or $24.71 per m² unimproved. The site was zoned "Town" and although the predominant use designation in the Strategic Plan was not stated, its full corner position clearly would have allowed for use of a commercial nature. In his comparison of this land with the subject land, Mr Hyman saw it as having inferior location and commercial potential.
2.An inside 1,214 m² site at 132 Eagle Street with rear access from Magpie Lane, within the business centre, to the north of the subject land, zoned "Town" and within the retail/commercial predominant use designation in the Strategic Plan, sold in June 1994 for $80,500 as vacant land or $66.30 per m² unimproved. Mr Hyman saw that land as having superior location and commercial potential. It also had bitumen sealed rear lane access as opposed to the gravel lane to the rear of the subject.
On the basis of that sales evidence, Mr Hyman applied the rate of $33 per m² to the subject land.
Findings
Had the existing use of Lot 42 been a more valuable use than might have been possible under the provisions of the Town Planning Scheme, then it would have been necessary for that higher use, at least for Lot 42, to have been reflected in the valuation. That would have been in accordance with s.3(4) of the Valuation of Land Act. In other words, the Act would have required the land to be valued for that higher use. The use of Lot 2 at the date of valuation is not so clear, but that is not in my opinion relevant. Mr Scarr's opinion that the land, if unimproved, was restricted to "residential" use is, on the evidence, incorrect. That is clear from the Column 3(B) uses capable of being approved by Council under the "Town" zone.
The existence of the preferred residential dominant use designation of the land in the Strategic Plan, cannot be ignored, but I accept the argument that commercial use of the subject land could be seen not to intrude, to any significant degree, into the residential amenity of the land to the south. Nevertheless, a dwelling is located at the corner of Pelican Street and Crow Lane adjacent to the subject lands and another dwelling immediately adjoins to the south of Lot 42. When the question of the valuation of this land had previously come before the Land Court, the learned President, as he is now, reduced the valuation determined by the chief executive to allow for the risk element in approval being granted for commercial use. That risk element must, in my opinion remain, particularly if the land is to be considered as notionally unimproved. The fact that adjoining residents may prefer office development to the existing tyre business needs to be put aside, in considering the risk of having unimproved land approved for office development. The question is whether the risk factor has been addressed in the valuation appealed against. If it was, it was not directly referred to by Mr Hyman, but I do not accept the submission of Mr Scarr that the effect of the previous Land Court decision had necessarily been ignored. It would appear that the valuation as at 1 January 1995, which took effect from 30 June 1995, (as contained in the information tendered by Mr Scarr) was written and became effective prior to the Land Court decision (relevant to the 30 June 1993 valuation) having been pronounced. The formal evidence before the Court as tendered by Mr Hyman is that the valuation relevant to 1 January 1996 had been "rewritten" at the same level as the 1 January 1995 valuation.
Regardless of what has occurred previously, it seems to me that, on the basis of the land being considered in its notional unimproved state, any risk factor in obtaining approval for commercial development is well provided for in the applied value of $33 per m² when the sales evidence is considered.
The allegation contained in Mr Scarr's submission, that discrimination has occurred through the two surveyed sites being valued together, is not supported. As unimproved land, both lots have similar potential with the smaller Lot 2 having superior location. Section 34(1) of the Valuation of Land Act provides as follows:
"Unless the chief executive otherwise directs, there shall be included in 1 valuation -
(a)several parcels of land which adjoin and are owned by the same person ...".
The chief executive had clearly not "otherwise directed". Although the potential of the subject land has been clouded to a degree by the somewhat unusual provisions of the relevant Town Plan, I have not been convinced that the appellants have carried the burden of proving that the approach taken by the chief executive or the valuation itself is wrong. For the subject land to be valued as residential, it would, in the particular circumstances, need to be exclusively used for purposes of a single dwelling, when the provisions of s.17(1) of the Act would permit such a valuation to disregard the actual potential as unimproved land.
Accordingly, the appeal is dismissed and the determination of the chief executive affirmed.
RE WENCK
MEMBER OF THE LAND COURT
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