Stanfield v Brisbane City Council
[1995] QLC 49
•16 June 1995
|
BRISBANE
16 June 1995
Re: Claim for Compensation -
Resumption of Easement for water supply purposes.
A94-50.
James and Elaine Stanfield
v.
Brisbane City Council
J U D G M E N T
By notification published in the Government Gazette of 9 July 1993, Brisbane City Council (the respondent) resumed an easement for water supply purposes being Lot F in Lot 45 on RP 89369, parish Moggill, containing 628m2 and being part of the land contained in Certificate of Title, Volume 3807 folio 179. Lot 45 has an area of 1.7414 hectares and is situated at 14 Dolman Road, Anstead. At the date of resumption, the fee simple of the land was in the ownership of James Stanfield and Elaine Stanfield who are the claimants in these proceedings. Following the issue of the notice of intention to resume the easement in September 1992, the claimants obtained an assessment of compensation from Mr Peter Austin, registered valuer. The report was written in April 1993. He assessed compensation in the sum of $13,162. The report formed the basis for the claim which was served on the respondent in May 1993 by the claimants and in the sum of $35,362 - apart from an adjustment of Mr Austin's allowance of $2,800 for "blot on title" to $25,000. The valuation is as follows:
"(1)Market value of land taken, 628 square metres.
Unimproved value of the property divided by the area
to give a rate of the site per square metre.
Multiply this rate by the area taken, then assume
some value left to the owner of the land,
therefore adopt a percentage.
($124,000/17,410 = $7.12 per square metre
628* 7.12 = $4,472. Adopt 80%) $3,578.00
(2) Any special value over and above
market value. Nil
(3)Severance damage. Injurious affection.
Balance area of land potentially severed
by the proposed easement. Portion
severed between pipe and creek
approximately 6000 square metres.
(6,000 square metres * $7.12=$42,720
Adopt 10% = $4,272
Effect of having the easement
registered on title, visual effect
of the construction on a potential
sale, access past dwelling at any time
with machines and personnel.
Nominal value, therefore adopt estimated
market value of property and assign a
percentage
($280,000 @ 1% = $2,800) = $2,800 $7,072
(4) Disturbance.
Items that are included under this heading
include, injury to fencing and gates, land
drainage, subsidence, temporary severance
of the property.
Due to the nature of the items, allow cost
to re-turf surface
(628 square metres * $4 = $2,512) $2,512
(5)Legal and valuation expenses TO BE CLAIMED
TOTAL CLAIM EXCLUDING LEGAL AND VALUATION EXPENSES $13,162
The claim was adhered to in the hearing of the matter and evidence in support of it was given by Mr Stanfield and by Mr Austin. The valuation written on behalf of the respondent by Mr GJ Bertenshaw, registered valuer in the employ of the respondent, was in the sum of $217. He adopted compensation in the sum of $1,000. Briefly stated his calculation was made by applying a land value to the site of $150,000 of which he apportioned 25% to the rear land containing 10,844 square metres through which the easement passes ($37,500) and then applied 10% of that value per square metre to an area of 628 square metres encumbered by the easement. Mr AP Karan, an engineer with the Metropolitan Construction Department of the Division of Water Supply and Sewerage Services of the respondent, gave evidence on the nature of the works constructed under the authority of the Proclamation. He was involved in the design of the works and was project engineer and contract administrator for the job. The purpose of the works is to supply Logan City with water tapping from the Mount Crosby-Brisbane mains. It is anticipated that with future growth requirements the trunk main has a life of 25 to 40 years before duplication is required. Initially, consideration included the construction in the alternative of an above-ground or under-ground pipe. It was resolved to place the pipe underground using a steel pipe with the result that maintenance is not required unless there is a break. As the pipe is designed for a 120 metre head and is taking 35/40 metre head at present, bursting is considered in the opinion of Mr Karan to be remote. He said that the design and construction is such that if a duplication is required it can only parallel the existing pipe system which is underground. In the report of Mr Bertenshaw, he says: "
A 1670 millimetre diameter water supply main has been laid underground, with a cover of approximately 1.5 metres, within the 10 metre (approx) wide easement. A concrete air valve pit with a steel manhole cover, is located near the northern end of the easement, and the top of this structure is at ground level. The disturbed ground has been regraded and seeded. "
These works pass through the rear land of the subject lot. The lot has an area of 1.7414 hectares and is situated on the eastern side of Dolman Road. The area is accepted as a popular rural residential locality. The subject lot has a frontage to Dolman Road of about 40 metres where the land is well elevated from which it slopes gently for about 130 metres before falling steeply for about 10 metres and then levelling out over the flood plain of Pullen Pullen Creek which forms the rear boundary. Mr Bertenshaw calculated that about 6570m2 of the lot is above the toe of the embankment and 10,844m2 below it. The claimants dwelling is on the elevated land. The site is used for residential purposes with horses being agisted on the lower area. The land is zoned "Rural Residential" and has electricity, water, Telecom and refuse collection provided. The easement crosses the lower land as shown on Annexure A and below the flood regulation line. Mr Stanfield said that the site was on the market at the time of the resumption. It was subsequently taken off the market. He is of the opinion that the construction works on both the subject property and neighbouring properties, (particularly the construction of a pump house inside an earth mound on the lot one removed to the north), had an effect on potential purchasers. He said that he was led to believe that construction would take about three days whereas in fact it took some months and that because of the activity he was required to fence off the works at a cost of $250 in order to retain horses agisting on the property. He said that a drain-pipe from the pool was broken when access was taken across land to the easement. Although it was expected that the area would be rehabilitated, such rehabilitation took time to get the land back to its former state and condition. He believes that any potential purchaser on passing the pump house mound would be made aware that works are in the vicinity and enthusiasm dampened. He freely conceded that the market was "a bit limp" at the time and that market forces contributed to the problems he has had with the sale of the property. He accepts that the only visible sign of the works on the subject lot is a manhole cover which is at ground level and a marker peg above ground. He accepts that the land has been graded to its former level and that the disturbed area has been returfed. He further accepts that the lower area of the lot is flooded. He is aware that the Mount Crosby/Anstead area is one which is traversed by a significant number of easements. Mr Austin who wrote his report in April 1993 was influenced by the wording of the Proclamation allowing the respondent to lay such pipe/s "on, over, through or under" the encumbered land and that access may be obtained to the area over other land of the claimants. Were such pipes laid above ground (in common with the mains from Mt Crosby), effects would include severance, visual pollution and so forth. On the assumption that the works will remain underground he agreed
1)that with the exception of the marker peg and the manhole cover the encumbered land bears no sign of physical damage;
2)that there is no interruption or impediment to the use of the property for grazing purposes;
3)that severance or injurious affection does not arise;
4)that a 10% depreciation of the value of the affected land would be more appropriate than the 80% he allowed.
He agreed that the allowance made for "disturbance" was of an ambient nature and on the assumption that injury or damage to gates, fences, etc., might take place. The position as related by Mr Karan is that the area was returfed but due to seasonal conditions the turf did not strike. He said that later it was seeded and that the contractors "even went back to returf certain sections". He accepts that as the pipe was progressively laid through the subject property and others along the line, the subject easement was used for access purposes and hence the disturbance extended beyond the period of actual construction.
Before turning to the valuation evidence, I should state some relevant principles. It is well settled that the principles to be applied in the compulsory taking of an easement are no different from those applying when the full fee simple is taken. "For practical purposes it becomes a matter of assessing the extent to which he (the claimant) has been disadvantaged as a natural and reasonable consequence of the taking of the easement" and that "each case must be considered according to the terms and conditions of the easement created and the frequency and magnitude of the disturbance likely to result in consequence to the claimants' proprietary rights" Joyce v. Northern Electric Authority of Queensland (1974) 1 QLCR 171. It should be stated that in applying these principles, compensation for injurious affection is limited to that which can be attributed to the activities of the respondent on the land taken from the claimants. Edwards v. Minister for Transport (1964) 2 QB 134. In the application of this last principle, any influence which the construction of the pump house has had upon the value of the subject land through the eyes of potential purchasers is not compensable. The bulk of the assessment of compensation derived by Mr Austin is based on what could happen under the terms and conditions of the easement as opposed to what has actually happened and the foreseeability of that remaining. The prudent hypothetical purchaser which is envisaged in the authorities is to be taken as cognisant of all matters which may affect value and he is expected to interpret evidence of matters affecting value reasonably. Refer Spencer v. The Commonwealth (1908) 5 CLR 418 and Pejama Pty Ltd v. Commissioner of Main Roads (1988-89) 12 QLCR 278. In this light, having regard to the evidence of the nature of the works constructed under the authority of the Proclamation and the evidence of Mr Karan on the degree of maintenance required and what is most probable should duplication be required in years to come, it appears to me that the hypothetical prudent purchaser would approach the matter in much the same way as the position has been seen by Mr Bertenshaw subject to the qualification which I will come to shortly.
It follows on the application of the relevant principles to the evidence that some heads of claim addressed by Mr Austin have no foundation in law or in fact. It may be seen that having valued the land component of the lot at $124,000 he apportioned that value overall and applied a depreciation factor of 80%. On the other hand Mr Bertenshaw has valued land at $150,000. He, however, places 75% of that value on the elevated homesite area arguing that the balance of the lot adds value to the homesite only insofar as it adds to the amenity of the site.
Under the zoning of the land the minimum lot size is 1 hectare. However, more importantly, it is agreed that the rear land has no potential other than for grazing purposes. The highest and best use of such land is accordingly the use made of it - adding value to a homesite on the higher elevated land. Were the rear land not attached to the homesite but available for attachment by purchase, Mr Bertenshaw would say that the owner of the homesite would be prepared to pay $37,000 to obtain the amenity offered by it. On the method adopted by Mr Austin he would ask an owner of the homesite to pay about $77,000 to obtain it. I have no hesitation in applying the former estimate which I would round off at, say, $40,000. The authorities including Joyce supra, hold that diminution in value in a case where the easement is over land with no higher use than a grazing use, may be related to diminution in value of the area encumbered by the easement (in this case 628m2) and the application of a factor of 10% is common. That exercise would yield a sum of about $231. To this there could be added the cost of fencing at $250. The matter of damage done to a drain pipe is not, in my opinion, a matter for this jurisdiction - refer Joyce supra.
The claim for disturbance during construction has been quantified by Mr Austin in a sum which cannot be sustained. Nor is there evidence of any expenditure by the claimants in that respect other than the claims made for fencing and damage to the drain pipe. The evidence concerning the saleability of the lot in the period is caught up in factors concerning the weakness of the market at the time and with emphasis placed on works which can have no influence in this determination. It may well be in view of the market at the time that possible purchasers were looking for reasons not to buy or to reduce prices rather than looking for reasons to purchase. In my opinion any bona fide purchaser intent on purchasing would not be unduly deterred by the works placed upon the subject land knowing of their real import. Finally, on perusal of the terms of the Proclamation (notably para (2)) and on reading an awareness that access may be obtained to the easement area past the dwelling of the claimants which has in fact occurred and bearing in mind that an air valve is on the subject property, the prudent purchaser would in my opinion seek and obtain a discount of purchasing price for this factor. Were gates placed in boundary fences to enable access over the easement or if the air valve were not on the subject property, the position would be different. I have concluded that a reasonable allowance for such is $2500.
Compensation for land will therefore be determined in the sum of $2,981. Valuation fees are agreed in the sum of $1250. These fees were paid shortly before the resumption. In the circumstances, compensation under all headings is determined in the sum of Four thousand, two hundred and thirty-one dollars ($4,231). Interest on this sum at the rate of 8.75 percentum per annum is ordered to be paid from and including the date of resumption up to and including the day preceding the date the said sum is paid.
(DM White)
President of the Land Court