Scott v Chief Executive, Department of Natural Resources
[1998] QLC 68
•16 June 1998
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BRISBANE
16 JUNE 1998
Re: Determination of unimproved value
City of Brisbane - Division of Sandgate
AV97-485
Graham R and Margaret G Scott
v.
Chief Executive, Department of Natural Resources
D E C I S I O N
This appeal is against the determination by the respondent Chief Executive of an unimproved value of $125,000 ($81/m²) for a "Light Industry" zoned parcel of land situated at 93 Connaught Street, Sandgate. The land is more particularly described as Lot 5 on RP 77342, Parish of Nundah, County of Stanley and contains an area of 1,533 m². The relevant date for the determination of the unimproved value is 1 October 1996, and the appellants contend within the Notice of Appeal for an unimproved value of $113,442 ($74/m²).
The grounds of appeal, to which the appellants are limited under the provisions of s.45(4) of the Valuation of Land Act 1944 read:
"Our property No. 93 Connaught Street is side by side with No. 101. Both properties are zoned 'Light Industry'. The area is a back water in Sandgate (only two streets of Light Industry) not like Geebung or Virginia which has large areas of general industry and light industry. Sandgate cannot be compared with these areas.
Our property No. 93 is 1533 sq metres and No. 101 is 2023 sq metres. Both have the same depth and No. 101 is slightly wider.
No. 101 New Valuation is $150,000 which equates to $74.00 sq metre.
Our property No. 93 valuation is $125,000 which equates to $81.00 sq metre.
The Department of Natural Resources is trying to tell me that No. 101 alongside our block No. 93 is valued at $7.00 sq metre cheaper than our block because it is slightly larger.
On that basis I put the scenario to several Real Estate Agents who sell Industrial Property. If you removed the capital improvements off both blocks and put them up for sale side by side on the same day, they all said No. 101 the larger block would sell per sq metre for more money than No. 93. One thing for sure that they all agreed on was that No. 101 certainly wouldn't sell for less per sq metre than No. 93. On that basis No. 93 should be devalued to $74.00 per sq metre, the same as No. 101 at the very least.
The present valuation on our property of $81.00 per sq metre is very unfair."
Graham Raymond Scott furnished evidence in support of the grounds of appeal. Mr Scott stressed that he is at a loss to understand that his land is valued at a higher rate per m² than the adjoining site at 101 Connaught Street (Lot 23 on RP 29204). He says that his land suffers from having an underground Brisbane City Council sewer main pipe some 1½ metres in diameter running through from the back to the front of the land. This pipe is large enough for a man to climb down a steel ladder in the manhole and almost stand up in the pipe. Mr Scott claims this pipe creates enormous building problems with the Brisbane City Council. I note that the appellants have erected a small office building at the rear of the site from which a connection has been made to the sewer line. There is a manhole for the line in close proximity to the building. No registered easement exists for the pipeline, which Mr Scott says is about 2 metres inside the eastern boundary of the subject land. Mr Scott submits that the adjoining Lot 23 has no similar problems with an underground sewer line.
Mr Scott told us that he has had to fill a depression which was almost like a gully through the block and which would have been in its unimproved state akin to a tea-tree swamp. The filling was done as part of the provision of hard standing on the site for the storage of motor vehicles, etc. The filling was necessary to bring the level of the land up to the natural ground level of the adjacent property at 101 Connaught Street. Mr Scott furnished evidence about the "chalk and cheese" difference between industrial land values at Sandgate in comparison with most other areas of industrial land on the north side of Brisbane since he believed the respondent Chief Executive would have been relying upon sales evidence in those areas to support his valuation. But this turned out not to be the case, as departmental registered valuer Alan Ross Kirby, who conducted the case for the respondent and who furnished evidence in the matter, did not feel the need to introduce sales evidence as a basis of valuation in view of the fact that the grounds of appeal were limited to the ground of relativity in value with the adjoining parcel. With this decision I agree.
Mr Kirby describes the nature of the subject land as being of fairly low elevation, slightly above street level at its street frontage, and about level. He does not see any valuation relativity problem between the value applied to the subject land and that applied to 101 Connaught Street. It has been his professional experience over the years that with industrial properties, it is normally the case that, other things being equal, the smaller properties attract higher values per unit area (m²).
Mr Kirby points out that the sewerage line and manhole are located close to the eastern boundary and he considers the effect on the value of the subject land would be minimal. He scaled its location from a Brisbane City Council Bimap and confirmed that it is about 2 metres from the boundary, and in any event, Mr Kirby says that a building would have to be offset from the boundary for approximately that distance.
Mr Kirby sees the filling on the subject land as being part of the development works for the site improvements placed on the land by the owners, and he envisages that all other blocks in the area would have required some earthworks for development owing to the low-lying nature of the land in general.
For the appellants to succeed in this matter they have to do so within the grounds of appeal. I agree with Mr Kirby that, in all probability, the sites in the area would require earthworks prior to their development, and in addition we have no evidence from Mr Scott about the cost of the fill placed upon his land.
There is no doubt that the valuation opinion expressed by Mr Kirby about "the lesser the area, all other things being equal, the higher the unit area value per sq metre" has received the endorsement of this Court over the years.
I am generally satisfied that the valuation under appeal is not anomalous when compared with that applied to the adjoining 101 Connaught Street. But I think that the assumed hypothetical well-informed purchaser for both lots, if offered for sale at the same time, would be inclined to discount marginally the price he would pay for the subject land in comparison with that for 101 Connaught Street for the fact that it has the major sewer line through it albeit being close to the property boundary. Notwithstanding that there was no reference to the pipeline in the grounds of appeal, I see its existence as being a factor bearing weight upon the unimproved value of the subject parcel in comparison with that for 101 Connaught Street. I find that this marginal discount factor should be quantified in the sum of $5,000.
Accordingly the appeal is allowed, the determination of the Chief Executive is set aside, and the unimproved value of Lot 5 on RP 77342, Parish of Nundah, is determined in the sum of One Hundred and Twenty Thousand Dollars ($120,000).
CH CARTER
MEMBER OF THE LAND COURT
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