Sostheim v Chief Executive, Department of Natural Resources

[1999] QLC 22

[1999] QLC 22

 

LAND COURT,

BRISBANE

31 March 1999

Re:     Determination of Unimproved Value –

Local Authority:  Redland –
  (Ref. AV98-468)

Yvonne Sostheim

v.

Chief Executive, Department of Natural Resources

D E C I S I O N

This is an unusual matter.  Ms Sostheim comes before the Court seeking to have the Chief Executive’s determination of an unimproved value of $2,300 for her land increased to $100,000.  The land is situated on Russell Island (at 28 Grove Road) and is more particularly described as Lot 334 on RP 133120, Parish of Russell, containing an area of 519 square metres.  It is zoned “Residential A” under the Town Planning Scheme for the Redland Shire which was gazetted on 20 February 1988.  The parcel is rectangular in shape and of low elevation and almost level.  Its frontage is at road level and it has good access.  Services available to the site include reticulated town water, electricity and telephone.  The site is vacant.  The relevant date for the determination of the unimproved value is 1 October 1997.

Ms Sostheim furnished evidence in support of the grounds of appeal as contained within the notice of appeal which read:

“1.This valuation has been decided without consideration of the values on the mainland.  The valuation should be cognisant with the same rates as on the mainland.  This is for the simple reason that the rates are based on the same values as are applicable on the mainland.

2.If the land was rural, the value would be taking into account the fact that there was no water, electricity, telephone, etc.  As there is reticulated water, electricity and telephone (are) available, then this land is of the same standard of services as those on the mainland.  Therefore again, the values should be based on the same conditions as the mainland.

3.There is no verifying documentation, from Redland council, to substantiate a   different valuation between the mainland and the islands.

4.The values taken by the Lands department are ambiguous in as much as they are taking in ‘Forced sale’ valuations only, where land has been given up due to the value of rates to be disproportionately high compared with the so called ‘values’.

5.Nobody is aware of any land sales that have been accepted at a price of $2000 let alone be sold at that price without undue necessity.

6.There is no such alteration of values on the mainland due to ‘views’ or no views.  Only due to better facilities and access.

7.Forced sales, as such, as due to the Redland Shire Council wanting too much for the rates, giving minimal returns for the money paid into the revenue from our rates.

8.The land would be of similar value as the mainland, if the council would allow the island to be developed, as it should, with the money collected from the island owners for the rates.

9.My land at 28 Grove Road is Residential ‘A’.  It has had the soil test done at a cost of $150.0 which has been certified as perfect for the septic system required by the council.  I have also had the environment test done again at a cost of $150.0 to satisfy the council to the positioning of the septic pipes.  And this has been accepted as suitable for a house to be built there.

10.At no other similar site in Queensland (i.e. close to Brisbane) have I known of land such as 28 Grove Road with a valuation of $2300.00.

11.The council must take the brunt of the blame for non-development of the island, and subsequent dissatisfaction among the landowners for the fact that they have been resistant in allowing the procedure of building.  This is due to the Redland Mayor saying ‘there will be no bridge while I am Mayor’.  Which again is prejudicial to the owners of Russell Island.  ”

Ms Sostheim contends that the unimproved value of her land should be far in excess of $2,300 and submitted that one cannot buy a block for $2,000 within 50 kilometres of Brisbane.  She says there is no view available from the site but soil tests have been taken and she says the land is perfect for the installation of a septic system if building on the site is contemplated.

Ms Sostheim told us that a site at 42 Grove Road had been sold for $9,500 and she cannot distinguish between that site and the subject land.  She tendered four photographs, one of which (No 3) is of her land and the other three are of  land taken at random from roadways in New South Wales.  The photographs are, to say the least, of no assistance to me at all in my task of determining the unimproved value of the subject land.

Ms Sostheim placed in evidence a schedule showing the unimproved value applied by the Chief Executive to her land over the years.  The 1992 value was $8,300, the 1994 value was $7,900, the 1 October 1996 value was $7,500, and the 1 October 1997 value is $2,300.

Ms Sostheim tendered a copy of a residential mortgage valuation taken on 30 July 1997 by the firm Taylor Byrne.  A Mr Andrew Hoolihan valued her land at $5,000.  She is not happy with the valuation.  No reliance can be placed upon this valuation by the Court since Mr Hoolihan was not called in evidence to support his valuation.

Ms Sostheim contends that the transactions of land on the island in which lots were surrendered to the Redland Shire Council should not be taken into account.  Some of these transfers took place at prices under $2,000.  In addition, she says that many sales are forced sales due to the rating liability and lack of facilities and people are virtually giving land away and there is no market any more for land such as the subject land.

Ms Sostheim does not know anything about the circumstances of the sale of the land at 42 Grove Road, although she believes the parties to the transaction were not local.

Ms Sostheim caused the registrar of the Court to issue subpoenas upon the Mayor of Redland (Cr Santagiuliana) and its Chief Executive Officer (Mr HG Wright) seeking their attendance at the Court to testify what they knew touching upon the matter of the valuations of land at Russell Island.  In response to the subpoena, Mervyn Leslie Ross Elliott appeared and gave evidence as a representative of those subpoenaed.  Mr Elliott is the supervisor of property services for the Redland Shire Council.

Ms Sostheim asked Mr Elliott if there was any land on the mainland worth only $2,000.  Mr Elliott knows of a site in Pear Street, Redland Bay, with an area of 607 square metres which is zoned “Drainage Problem” which would have a similar value, but he is not aware of any “Residential A” zoned land on the mainland which would be worth so little.

Mr Elliott told us that the Council has provided quite a lot of facilities on Russell Island including reticulated water, roads and drainage, and quite a bit of development work.  In addition a large marina has been constructed at Redland Bay to cater for water transport to the Islands.  Mr Elliott does not agree with a suggestion by Ms Sostheim that a threat of acquisition of land on Russell Island by the Council has caused owners to panic and sell at low prices.

The valuation under appeal was supported in evidence by Registered Departmental Valuer George Dudek who relies upon two sales of lots on Russell Island as a valuation basis.  Details are:

Sale No 1 – Lot 67 on RP 132856, Parish of Russell – 607square metres – Darko to Blackbarrow on 28.10.96 for $2,000 – analysed unimproved value $1,500 – applied unimproved value $1,500 (previously $4800) – situation 65 Glendale Road – zoning “Residential A”.

Mr Dudek describes this sale property as being a level allotment of regular shape, situated above street level.  It was purchased by an adjoining owner.  The vendor originally purchased the property in 1983 for $8,900 and had the property on the market for approximately 6 months, both with an agent and by advertising privately with an asking price of $3,500.

Mr Dudek points out that the sale property is larger than is the subject land but otherwise has similar access, topography and elevation.  The sale property is situated in close proximity to high voltage power lines and its location is slightly inferior to that of the subject land.  Mr Dudek considers the Sale No 1 property is overall inferior to the subject land.

Sale No 2 – Lot 226 on RP 135035, Parish of Russell – 546 square metres – Bradford to Spadijer on 02.04.1997 for $3,500 – analysed unimproved value $3,000 – applied unimproved value $2,800 (previously $9,400) – situation 22 Lawson Street – zoning “Residential A”.

Mr Dudek describes this sale property as being an elevated allotment of regular shape but with no views.  It is situated above road level.  The vendor, who originally purchased the land in 1985 for $11,990, had the property on the market for approximately 6 months, but with an agent and advertising privately with an asking price of $5,000.

Mr Dudek told us that this sale property and the subject land are similar in area and zoning with the sale land being slightly superior to the subject property in regard to topography and elevation.  Overall Mr Dudek considers this sale property to be superior to the subject land. 

Mr Dudek has investigated the circumstances surrounding these sales and has used them as a valuation basis because they were “local to local” parties and not absentee owner purchasers.  He has also investigated the circumstances of the sale of 42 Grove Road (Lot 377 on RP 133120) for $9,500, and he has established that the parties to the transaction were both from South Australia.  Mr Dudek says that at about the same time, the adjoining lot (Lot 378 on RP 133120) was sold for $2,000 and the parties were both from New South Wales.  Mr Dudek concludes that it is very hard to find some consistency with sale prices when the parties are not quite aware of local conditions.

Mr Dudek is of the opinion that land values on Russell Island showed a drop in 1996 and this is why he relies upon 28.10.96 and 2.04.97 date sales for a valuation basis.

There is clearly no evidence before the Court which would satisfy me that the value of the land under appeal should be $100,000 as at a relevant date of 1 October 1997.  This estimate placed before the Court by Ms Sostheim is fanciful.  Further, the appellant’s suggestion that there is no land within 50 kms of Brisbane worth as little as $2,000 is rebutted by Sale No 1 placed before the Court by Mr Dudek, and this is on Russell Island itself.  Again, Mr Dudek stresses that for the purpose of his 1 October 1997 relevant date annual valuation of lands on Russell Island, sales which conformed with the previously established “local to local” market (vide Olsson v. Chief Executive, Department of Lands – Ref. AV93-384) have been adopted by him as a valuation basis.  This being so it follows that no reliance should be placed upon the sale of 42 Grove Road.

The references to the increasing and then sharply receding valuations of the subject land as between 1992 and 1997 also is not helpful to the appellant as it has been well established that what has to be determined in cases of this nature is the value at the relevant date, and this is best related to sales evidence at  or about that time.  The level of value, whether it be more or less in previous years than the valuation under appeal is immaterial.

This leaves the Court with no evidence upon which it can rely to disturb the valuation under appeal.  It follows then that the appeal be dismissed, and that the unimproved value of Lot 334 on RP 133120, Parish of Russell, in the sum of $2,300 be affirmed.

(CH Carter)

Member of the Land Court