State of Queensland v Pajares
[2004] QLAC 59
•20 July 2004
LAND APPEAL COURT OF QUEENSLAND
CITATION: State of Queensland v Pajares [2004] QLAC 0059 PARTIES: State of Queensland
(appellant/respondent)v. Luis James Pajares
(respondent/appellant)FILE NOS: LAC2003/0474 and LAC2003/0472 DIVISION: Land Appeal Court of Queensland PROCEEDING: Appeals from a decision of the Land Court in the matter of determination of compensation consequent upon the resumption of land for National Park Purposes pursuant to the Acquisition of Land Act 1967 ORIGINATING COURT: Land Court of Queensland DELIVERED ON: 20 July 2004 DELIVERED AT: Brisbane HEARD AT: Cairns JUDGE:
MEMBERS:Justice Jones
Mr RE Wenck
Mr RP ScottORDER: 1. To the extent that the State has been successful in having the quantum of the Land Court's determination reduced, and the claimant has been unsuccessful in having it increased, the appeal by the State is allowed and the appeal by the claimant disallowed.
2. Compensation is determined in the amount of $3,419,689 (Three Million Four Hundred and Nineteen Thousand, Six Hundred and Eighty-nine Dollars).
3. The respondent pay interest at the rate of 6 per cent per annum on the amount of $3,393,689 from the date of resumption, 19 November 1999, until 13 April 2000, when an advance of $1,830,000 was paid; and on the amount of $1,563,689 from 14 April 2000, until 25 August 2000 (which the parties agreed is the appropriate date that the legal and valuation fees were paid) and then on the amount of $1,589,689 from 26 August 2000 up to the day immediately preceding the date upon which final payment of compensation is made.
CATCHWORDS: Resumption – Determination of compensation – Pointe Gourde and San Sebastian principles – Land taken for National Park purposes – Conservation scheme underlying resumption – Direct relationship between conservation scheme and zoning of land – Whether zoning a step in the resumption process – Characteristics or attributes of land – Effect of zoning on land value – Acquisition of Land Act 1967, Nature Conservation Act 1992.
Resumption – Determination of compensation – Pointe Gourde and San Sebastian principles – Issuing of Interim Conservation Orders (ICOs) – Whether a step in the resumption process – Effect of ICOs on value – Nature Conservation Act 1992.
Valuation – Highest and best use – Development standards for differing uses – Risks associated with realizing highest and best use – Added value of clearing for differing highest and best uses – Consideration of expert advice available to prudent purchaser.
Resumption – Determination of compensation – Special value – None present – Premium classed as severance damage – Original allowance not disturbed.
Resumption – Determination of compensation – Costs in purchase of replacement land – Disallowed – Catered for in severance premium – “double dipping”.
Resumption – Determination of compensation – Professional fees incurred in preparation of claim for compensation – Cut off date – Claimant may serve sequential claims – Date of last claim is cut off date.
Resumption – Determination of compensation – Professional fees incurred in association with making originating application – Disallowed – Costs of the action.
Practice and Procedure – Role of appellate Court – When permissible to overturn finding on evidence of lower Court – Appeal Court able to draw proper inferences from evidence.
APPEARANCES: Mr D Gore QC, with him Mr RS Jones, for the appellant/respondent
Mr C Hughes SC, with him Mr RM Needham, for the respondent/appellantSOLICITORS: Crown Solicitor for the appellant/respondent
Suthers Taylor for the respondent/appellant
Background
These are appeals by both the State of Queensland ("the State") and Mr Pajares ("the claimant") from the decision of the Land Court concerning compensation for the resumption of part of the claimant's land. The State’s grounds of appeal are considered in paras [29] to [89] and the claimant’s grounds in paras [90] to [156].
By Notice of Resumption published in the Government Gazette on 19 November 1999, the State resumed from the claimant land containing an area as finally surveyed, of 1,248 ha being part of a sugarcane and grazing property containing 2,311 ha. The parent parcel is situated in the Shire of Cardwell on the lower reaches of the Murray River flood plain, about 16 km south of Tully, easterly of the Bruce Highway.
The predominantly undeveloped resumed land comprised the eastern section of the parent parcel. It is bounded by the Murray River on the south and east and by Bedford Creek on the north-east.
One of the areas of dispute in the Land Court related to the extent and development potential of various classifications of land types contained within the resumed area. However there was no dispute that a useful description of the land forms and natural drainage features of the resumed land was as set out in Reasons for Judgment (RJ) of the learned President of the Land Court ("the Land Court") in the judgment delivered on 23 June 2003 at [37]. That description does not require repeating here.
The Cardwell Shire Council Town Planning Scheme relevant at the date of resumption had been gazetted on 15 May 1997. The northern part of the resumed land containing an area of about 210 ha was included in the "Agriculture" zone, the remainder of the resumed land, comprising an area of about 1,038 ha, was included in the "Natural Resource Protection" zone. As was relevant to the potential use of the land neither growing of sugarcane nor grazing required the consent of Council in the "Agriculture" zone. Agriculture and animal husbandry were "permitted development subject to conditions" in the "Natural Resource Protection" zone. However there was no dispute that an application for such development could not have been refused. In the earlier (1983) Town Planning Scheme the northern part of the resumed land had been included in the "Rural (Agriculture)" zone and the balance area in the "Rural (General Farming)" zone. Agriculture (including growing of sugarcane) and animal husbandry (including grazing) had been permitted uses not requiring the consent of Council in either of those zones.
The evidence in the Land Court was that the State commenced to show interest in part of the parent property in the early 1990's. The claimant said that he had been advised in about 1995 that the State wanted to negotiate the purchase of part of his land to protect habitat for the mahogany glider. He had been in the process of clearing parts of his overall property when an Interim Conservation Order (ICO) under the Nature Conservation Act 1992 was issued. That ICO covered an area approximating that which was eventually resumed. Subsequent to the issue of that ICO negotiations to purchase the land were commenced. No further clearing was attempted by the claimant while those negotiations proceeded. However clearing recommenced in late 1997 after the negotiations had failed. In December 1997 a second ICO was issued over the same area. Further negotiations then occurred in March 1998. According to the claimant, verbal agreement had been reached between the claimant and the relevant Minister of the State Government, that an area of about 650 ha as identified on a plan signed by both parties on 3 March 1998 would be acquired by the State, the acquisition price not having been agreed upon at that stage. In November 1998 clearing was commenced on the area which the claimant thought would be retained by him in accordance with the March plan agreement. However that renewed clearing activity resulted in another ICO being issued over the original total area of interest. The claimant was advised that the verbal agreement, with the, by then, previous Minister, had no standing. Subsequent ICOs and their extensions occupied the period to the date of resumption.
There was evidence before the Land Court that the State had influenced the Cardwell Shire Council to give consideration to a "Nature Conservation (Mahogany Glider) Conservation Plan", prior to the 1997 Town Planning Scheme coming into effect. The State had requested, in writing, that "In any planning scheme review Council should ensure scheme provisions are consistent with the conservation plan." As it happened the conservation plan was in draft form at the time that the letter was written and had not in fact been gazetted, notwithstanding what had been stated in that correspondence. The intent of the "Natural Resource Protection" zone was set out in zoning provisions as follows:
"3.3.1 INTENT
This zone is intended to provide special protection, conservation and enhancement to those areas within the Shire which have significant natural resource value. It is intended to conserve, preserve and enhance the Shire's natural resources for current and future populations.
Uses in the zone should be compatible with the sensitivity of natural resource values associated with a site or locality and should have minimal impact on the environment. It is intended to permit those activities which can be suitably managed to ensure minimal impact on the resource, not adversely affecting the integrity of any value by virtue of historical, topographical, ecological or social interest.
Uses that are preferred in the zone are those which can demonstrate that the proposed use would protect, conserve and enhance the natural resource values. Inappropriate uses includes those activities which will detrimentally impact on the long term ecological sustainability of the environment."
The description of lands included within the zone was set out in Clause 3.3.2, as follows:
"3.3.2 DESCRIPTION OF LANDS
Lands included within this zone include areas in both public and private ownership. The zone is characterised by the Wet Tropics World Heritage Area, areas with significant natural and remnant vegetation, waterways, wetlands, areas of habitat value for endangered, rare or uncommon flora and fauna, the islands, Great Barrier Reef World Heritage Area, National Parks and rural areas with scenic values which require special protection."
Despite the State's argument to the contrary, the Land Court accepted the claimant's contention that the change of zoning of part of the claimant's land from "Rural (General Farming)" to "Natural Resource Protection" had been influenced by the State and there was a "direct relationship" between the zoning restriction and the proposed resumption (RJ [55]). The Land Court concluded that any consequent effect of the zoning on the value of the land at the date of its resumption was to be ignored in accordance with the Pointe Gourde principle (Pointe Gourde Quarrying and Transport Co Ltd v. Sub-Intendent of Crown Lands (Trinidad) [1947] AC 565), as explained by the High Court in Housing Commission (NSW) v San Sebastian Pty Ltd (19778) 140 CLR 196.
If the "Natural Resource Protection" zoning caused an adverse effect on the value of that part of the resumed land so zoned, that effect was related to the risk that the full potential of the land to be cleared and developed may have been restricted. Rather than uses of agriculture and/or grazing being as of right under the earlier zoning, an application for such development had become necessary as at the date of resumption. Such an application could not have been refused but the Council could have imposed conditions involving alteration to and/or the scaling down of the development proposal.
The second aspect which the Land Court found was to be ignored in terms of the Pointe Gourde principle was the risk attached to the clearing of the land at the date of resumption. By that time, while not yet in force, the imminent legislative obstacles to the clearing of timber on the subject land, pursuant to the provisions of the Commonwealth Environmental Protection and Biodiversity Act 1999 and the Vegetation Management Act 1999 would have been within the knowledge of an informed prudent purchaser. Any attempt to overcome those impending obstacles by an early large-scale clearing operation might have "fallen foul" of the existing Environmental Protection Act 1994 and the Integrated Planning Act 1997. However the evidence before the Land Court as to the history of the claimant's development intentions through the clearing of the land suitable for development and the restrictions on such clearing imposed pursuant to the ICOs, led to the Land Court's acceptance of the claimant's contention that the issuing of the ICOs was a step in the resumption process. The Land Court found that in the absence of those ICOs "it would have been possible for Mr Pajares to have cleared all the developable areas on the subject land to improved pasture grazing standard, before being prevented from doing so by the relevant legislation. Those areas would then be available for later development for sugarcane." (RJ [96])
The questions of the likelihood of sugarcane assignments being granted and the area of the resumed land which had potential for development for sugarcane and/or grazing were relevant to the determination of compensation.
The Land Court accepted that the conditions attaching to new assignments to the Tully Mill would be relevant in this matter. The Tully Local Board was the body responsible for granting such assignments and it adopted the recommendations of a technical review committee established by the Government, as to conditions which should attach to new assignments. In this matter the Land Court had set out the "immediately relevant" recommended conditions which are repeated as follows:
" Draft Conditions for Attachment to New Assignments
1.This grant of assignment must be utilised on land categorised as classes 1, 2 or 3 by the Department of Primary Industries' land suitability criteria.
2.This grant of assignment excludes those areas of land which are:
(a)Land categorised as classes 4 or 5 by the Department of Primary Industries' land suitability criteria.
(b)Watercourses, natural drainage lines and preferential flow paths.
(c)Wetlands, swamps, marshes, lagoons and lakes.
(d)Mangrove areas and other areas naturally subject to tidal inundation.
(e)Riparian zones of a width which complies with the CSRIT method of assessment along watercourses, drainage lines and preferential flow paths.
(f) Areas below the 3.00 metre contour (Australian Height Datum)
...
8.Areas of significant remnant habitat as delineated on a Property Management Plan negotiated and endorsed by QDoE are expressly excluded from this grant."
There was evidence before the Land Court that in terms of condition 8, "where areas had been identified as important habitat corridors for the mahogany glider, riparian zones of 20 metres on both sides of a watercourse were recommended." (RJ [64])
The Land Court observed (RJ [65]) that "the most controversial aspects of those conditions concern the recommendations that assignments be granted only in respect of land categorised as Class 1, 2 or 3 by the DPI land suitability criteria, and that land below 3 metres AHD contour be excluded from any assignment." It was also observed to be common ground between the parties that if the "photogrammetric mapping" was not available, "the DPI soil and land suitability mapping was essentially the sole indicator of whether land was suitable for sugarcane".
The "photogrammetric mapping" was a reference to information produced by a survey project associated with future development of sugarcane production on the Tully and Murray River floodplains. That information was being produced at the date of resumption and had been utilised by various experts in their evidence before the Land Court. Although it might have been expected that the existence of the mapping project was public knowledge at the date of resumption, no survey data produced through the project was available to the public at that date. The Land Court found that any evidence based on survey data unavailable at the date of resumption was to be disregarded. There was no challenge before us as to that specific finding.
The Land Court found (RJ [80]) that the type of information available to a prudent purchaser at the date of resumption included:
"•the guidelines adopted by the Tully Local Board for the granting of assignments;
• the broad-scale DPI soil and suitability mapping;
• the 1997 aerial photography.
• the adjoining Marsilio land of similar elevation growing sugar cane under assignment.
In addition, the prudent purchaser would carry out further investigations, including:
• an inspection of the subject land and the surrounding area both on the ground and by air (probably by helicopter);
• consulting relevant experts, particularly with regard to the suitability of the Class 4 (marginal) land for sugar cane production and also a grazing expert about that possible alternative use."
The DPI soil and suitability mapping indicated areas of 100 ha of Class 1 land and 512 ha of Class 3 land on the resumed land. The Land Court considered that -
"On the tests applied at the time, the areas of Class 1 and Class 3 land would have satisfied condition 1 of the standard conditions, because if an area was categorised as Class 1, 2 or 3, it was considered suitable for sugar cane and no further inquiry would be undertaken about its contour level. The later photogrammetric mapping cast doubt on the accuracy of some of the suitability mapping, but that was not available at the relevant date." (RJ [82])
The Land Court did not accept the State's contention that the relevant experts whom a prudent purchaser would consult would have included a surveyor to provide survey data similar to that which, although ascertained on information which had not been available at the date of resumption, would have been relatively inexpensive to obtain even in the absence of that information. With such information doubt would have been cast on the accuracy of the soil suitability mapping, in respect to the Class 1 category land. The Land Court reasoned that a prudent purchaser who had no knowledge of the then unavailable survey project information would not have seen the need to establish contour levels "in an area which would have been accepted as suitable for sugar cane with minor limitations. There would have been nothing to prove." (RJ [83])
It followed that the Land Court considered that a prudent purchaser "would accept as a starting point, that the subject land comprised at least 100 ha of Class 1 land and 512 ha of Class 3 land, suitable for sugar cane." In the end result however neither Mr Eales, the valuer for the claimant, nor Mr Cross, the valuer for the State, valued the land based on the areas measured from the suitability mapping. Both had relied on the advice of relevant experts, part of which advice was in turn reliant on survey information which would not have been available at the relevant date. Mr Eales had increased the area from the suitability mapping "starting point" while Mr Cross decreased the area, importantly by deleting the total area of Class 1 land.
The amount finally claimed in the Land Court was based on a land value component calculated by Mr Eales as follows:
Land (cleared to grazing standard)
123ha (Class 1 arable) @ $8,000 per ha $984,000.00
72 ha(Class 2 arable) @ $6,000 per ha $432,000.00
254 ha (Class 2/3 arable) @ $5,000 per ha $1,270,000.00
387 ha (Class 3A arable) @ $4,500 per ha $1,741,500.00
145 ha (Class 3B drainage not feasible) @ $3,000 per ha $435,000.00
52 ha (Class 4 land grazing) @ $3,000 per ha $156,000.00
215 ha(Class 4/5 mangrove) @ $775 per ha $166,625.00
1,248 ha$5,185,125.00
Less cost to clear to grazing standard 1,033 ha @ $750 per ha $774,750.00
$4,410,175.00
(We calculate this to be $4,410,375)
The final valuation of the land by Mr Cross was calculated in its "timbered" state as follows:
512 ha Class 3 arable @ $2,500 per ha $1,280,000
89ha Class 3 drainage (Class 4) @ $500 per ha $44,500
321 ha Class 4 drainage @ $500 per ha $160,500
326 ha Class 5 mangroves @ $250 per ha $81,500
Total $1,566,500
On the basis of the information available at the date of resumption and after consideration of the evidence of various experts able to provide the type of advice which it considered a prudent purchaser would seek, the Land Court concluded that a total area of 850 ha could have been cleared, had there been no restrictions placed on the claimant's development strategy. That area is less than the claimant's experts estimated and more than the State's estimate. Of that area it was concluded that the prudent purchaser would have accepted that 670 ha, comprising 120 ha of Class 1 and 550 ha of Class 3 land was suitable for agriculture, with highest and best use for growing of sugarcane once assigned. The balance area of 180 ha with potential for clearing was not considered to have been capable of use for agriculture but suited to grazing instead.
Apart from the differing estimates of land suitable for clearing and then for growing sugarcane, the valuers had adopted different approaches to the valuation of those areas. Mr Eales had analysed sales to either an actual or hypothetical standard on the basis of the land being developed to improved pastures for grazing. The sales evidence had been selected based predominantly on the suitability of the sale land for the growing of sugarcane. Much of that land was developed to improved pasture, for grazing use in the interim period until assignment to the Mill might be granted. That had been the development strategy of the claimant: to clear and develop land to improved pastures for a joint grazing operation until assignment for sugarcane became available. The valuation methodology of Mr Eales circumvented analysis of the sales to an uncleared condition. The resumed land with development potential was valued by Mr Eales as if hypothetically developed to improved pasture standard for grazing use, based on values extrapolated from the sales analyses, then the cost of development, to that standard, deducted to provide the value of the land as it existed in its undeveloped state at the relevant date.
Mr Cross analysed the sales which he considered relevant, by deducting the added value of improvements, including the added value of land development to its actual condition, to find the value of the land in its unimproved or timbered state. That value became the basis for comparison with the resumed land in its timbered state.
Apart from dispute as to the state of the market at the relevant date and the value of the resumed land in its uncleared state, the cost of development and the added value of development to improved pastures once established, became contentious issues.
The Land Court resolved the valuation differences by generally adopting Mr Eales' approach including the levels of value applied by him to the land with arable potential, together with the cost of development to improved pasture for grazing standard, as estimated by him.
The Land Court determination of the value of the land resumed was as follows:
120ha Class 1 land at $8,000 per ha $960,000
550ha Class 3 land at $4,500 per ha $2,475,000
180ha grazing land at $2,000 per ha $360,000
$3,795,000
Less cost to develop to improved pasture grazing standard
850ha at $750 per ha $637,500
$3,157,500
Plus:
398ha mangroves and swampy tidal areas at $250 per ha $99,500
Total$3,257,000
The remaining differences between the quantum of the claim and the final valuation of the State are as set out below with the resultant Land Court determination:
Special Value:
Claimant - 15% of land value $661,526.00
State$78,325.00
Land Court$244,275.00
Commercial Timber:
Claimant$182,000.00
State$131,702.00
Land Court$168,689.00
Disturbance
Claimant -
Legals and stamp duty to purchase replacement property $207,257.00
StateNil
Land CourtNil
Claimant -
Legals, valuation and other consultants' fees for preparation
of claim$117,060.75
State$26,000.00
Land Court$26,000.00
The final total claim amounted to $5,578,018.75 and the State's valuation $1,802,527. The Land Court determination was in the total amount of $3,695,964 rounded to $3,696,000.
The Appeal by the State
Ground 1
"The Court below erred in its application of the principles enunciated in Pointe Gourde Quarrying and Transport Co Ltd v. Sub-Intendent of Crown Lands (Trinidad) [1947] AC 565 and Housing Commission (NSW) v San Sebastian Pty Ltd (1978) 140 CLR 196 in respect of:
(a) the Natural Resource Protection zoning of the land; and
(b) the Interim Conservation Orders."
The Pointe Gourde and San Sebastian Principles
First, the Land Court interpreted the evidence before it as establishing "that there was a direct relationship between the zoning restriction on the land and the proposed resumption." (RJ [55])
Second, the Land Court found that the issuing of the ICOs and the consequent restriction on clearing in the period leading up to the date of resumption was a step in the process of resumption. (RJ [97], [98])
As a consequence, any disadvantage to the land at the date of resumption which resulted from those two issues were excluded from consideration by the Land Court.
In its considerations relevant to the Pointe Gourde principle, the Land Court referred to the reasons of the High Court in San Sebastian at 206 which included the following:
"In such a case where there is a direct relationship between the restriction on land use and the proposed establishment of the public works the effect on value of the zoning or restriction ought to be ignored."
Consideration was also given by the Land Court to the following statement by the High Court, in The Crown v Murphy (1990) 64 ALJR 593 at 595; where, in a joint judgment, after discussing the principle in San Sebastian: their Honours said:
"Of course, a characteristic or attribute of the land which affects its value must be taken into account in the assessment of compensation even if the planning restriction which is a step in the process of resumption is dependent upon or directed to that characteristic or attribute."
The Land Court at (RJ [58], [59] and [60]), in comparing the circumstances of the subject land with that of the land in Murphy, and the zoning status of the lands before consideration of the resumption processes, rejected the State's submission that the Pointe Gourde principle did not apply in the subject resumption process.
The State argued before us that underlying the "Natural Resource Protection" zoning of the land and the issuing of the ICOs was a conservation scheme with statutory authority pursuant to the Nature Conservation Act. The State does accept that there was a direct relationship between the "Nature Resource Protection" zoning restriction and the conservation scheme provided for under that Act. However, because of the existence of the statutory authority for the conservation scheme, it was submitted that such relationship is quite unlike the direct influence brought to bear on the planning authorities in San Sebastian and Murphy, which led to a site-specific planning attitude. The argument continues that in this case, the relationship between the zoning restriction and the resumption process was not "clear-cut" as had been the situation in Chapman v The Minister (1966) 13 LGRA 1), to which case the High Court had made reference in San Sebastian.
Part of the State's argument is that the Pointe Gourde principle as explained by the High Court in San Sebastian and Murphy requires consideration not only of the question of whether, in this case, the adoption of the "Natural Resource Protection" zoning was part of the resumption scheme, but, even if it was, the question of a possibility or likelihood of such zoning being adopted by the local government independently of the resumption. It was suggested that it would be wrong for the State to be burdened with the application of the Pointe Gourde principle in any later resumption process, simply because one of its agencies had given "advice" to a relevant planning authority on matters associated with conservation value or environmental significance of different land, and, in circumstances where legislation exists, such as the Nature Conservation Act, the implications of that legislation.
It was submitted by the State that, at the threshold, distinction must be drawn between a "self-contained" conservation scheme with statutory authority and a resumption scheme. In this case, steps taken under the Nature Conservation Act were seen by the State to be steps in a conservation scheme. It was argued that for such steps to be regarded as also being steps in a resumption scheme it would be necessary to demonstrate that such steps were being taken for the purpose of resumption.
We accept that in the circumstances of this matter the State may well have, at the outset, engaged in a "conservation scheme", namely for the purpose of a proposed Nature Conservation (Mahogany Glider) Conservation Plan, under the statutory authority of the Nature Conservation Act. As accepted by the State, there was a direct relationship between the "Natural Resource Protection" zoning and that conservation scheme.
The Notice of Intention to Resume the land for National Park purposes was issued on 28 May 1999. Attached thereto was a statement "outlining the reasons as to why the State is intending to take the land". That statement set out the relevant background; material on which findings of fact were based; findings on material questions of fact and the reasons for the decision.
Reference was made under the "Background" heading to the unsuccessful attempts to acquire the land by agreement and the high conservation value of the land, particularly in relation to the critical habitat for the endangered mahogany glider. The material on which findings of fact were made included consideration of the Nature Conservation Act 1992 and the draft "conservation of the mahogany glider conservation plan".
The findings on material questions of fact made further reference to: the ICOs; advice which had been given to the land owner relating to the conservation value of the land through the designation of proposed areas of critical habitat in the draft plan; the State's interest in acquiring the land for National Park purposes and the clearing activities of the land owner.
The reasons for the decision by the State to resume the land were set out in the Land Court decision at (RJ [3]). They are repeated here:
"1. The area is particularly significant for the maintenance or restoration of habitat of the endangered Mahogany Glider, and includes endangered lowland rainforest habitat for the endangered Southern Cassowary. In addition there are extensive and diverse wetland ecosystems, including forested freshwater wetlands, brackish bulkuru swamps and mangroves.
2. On the basis of its nature conservation values and the proposal to designate the subject lands as critical habitat, the view was formed that it is an area of major interest in accordance with section 102 of the Nature Conservation Act 1992."
Section 102 of the Nature Conservation Act provides for the issue of ICOs over, inter alia, "a critical habitat" and certain lands including "an area of major interest" when those lands are subject to a threatening process. Unless the making of ICOs to overcome a threatening process was accepted by the decision-maker as a step in the resumption process, the need for reference to s.102 in reason 2 above, is unclear.
Section 108 of the Nature Conservation Act provides for the payment of compensation to a land-holder of land subject to an ICO, because of the "making of the order", subject to compliance with provisions in relation to the claim for compensation.
Part 7 of the Nature Conservation Act deals with "Management and Conservation Plan" and procedures associated with the preparation of a draft and final conservation plan; the approval of that plan; the prevailing of the plan and its regulations over planning schemes; the requirement of consistency of local government decisions with a conservation plan and subject to limitations, the payment of compensation where a land-holder's interest in land in the area of a conservation plan is "injuriously affected".
Section 126 of the Nature Conservation Act relevantly provides:
"126 (1) This section applies if—
(a) a conservation plan is approved for an area identified under the plan as, or including, a critical habitat or an area of major interest; and
(b) a land-holder’s interest in land in the area is injuriously affected by a restriction or prohibition imposed under the plan on the land-holder's existing use of the land.
(2) The land-holder is entitled to be paid by the State the reasonable compensation because of the restriction or prohibition that is agreed between the State and the land-holder or, failing agreement, decided by the Land Court.
(3) The land-holder's interest in the land is not injuriously affected if the restriction or prohibition under the conservation plan is the same, or to the same effect, as a provision of another law applying to the land immediately before the commencement of the plan.
(4) Compensation is not payable if compensation has already been paid for—
(a) the restriction or prohibition; or
(b) a restriction or prohibition to the same effect."
Sections 108 and 126 of the Nature Conservation Act provide a statutory framework which if carried through to completion might suitably be described as a self-contained conservation scheme. The limiting provisions in s.126(3) and (4) would be invoked under certain circumstances. The fact that the Land Court had determined compensation for the making of two of the four relevant ICOs in this matter, was raised in the State's submission. Our interpretation of that determination is that compensation was assessed for the specific loss associated with the temporary restriction on the clearing of vegetation. Such one-off loss needs to be distinguished from any permanent restriction or prohibition which might be imposed under a conservation plan. If the making of an ICO was a step in causing injurious affection on the commencement of a conservation plan, then, in our opinion, the Pointe Gourde principle would be applicable to the extent that any consequential effect from the making of the ICO on the value of the land at the date of commencement of the conservation plan would be disregarded.
The Nature Conservation Act provides statutory authority for conservation schemes to be implemented in the absence of acquisition of land. That legislation effectively excludes the operation and application of the Pointe Gourde principle in circumstances where a restriction or prohibition imposed on affected land "is the same, or to the same effect, as a provision of another law applying to the land immediately before the commencement of the plan". As a consequence, even if the other law, including a local government town planning scheme zoning, resulted from a step in the conservation plan process, the effect of that law on the value of the land could not be disregarded.
In the circumstances relevant to the subject matter, and with the statutory authority available, the State could have implemented the proposed Nature Conservation (Mahogany Glider) Conservation Plan without any acquisition of the land. Had that strategy been adopted, we would not accept that injurious affection caused by the making of the ICO's would be necessarily excluded from consideration by application of the Pointe Gourde principle. However had gazettal of the Plan occurred subsequent to the inclusion of the land in the "Natural Resource Protection" zone, regardless of any influence by the State in the land being so included, the land would not be injuriously affected as a consequence of the zoning, pursuant to s.126(3).
However the State chose to resume the land pursuant to the Acquisition of Land Act 1967 and for a purpose wider than the conservation of the critical habitat of the mahogany glider and/or an area of major interest. The purpose was for National Park and included the conservation of the habitat of the Southern Cassowary, extensive and diverse wetland ecosystems, forested freshwater wetlands, brackish bulkuru swamps and mangroves. The resumption scheme became more akin to the intent of the "Natural Resource Protection" zone.
The State argued that not all land that is subject to an ICO will be acquired and the making of an ICO cannot be viewed as a step in a resumption scheme, as the two do not necessarily go hand in hand. In this case the facts suggest that they did and "the extent of the scheme is a matter of fact in every case". (see [54] below).
Conservation was clearly the scheme underlying the purpose of the resumption. The statutory authority pursuant to the Nature Conservation Act permitted the making of the ICO's for the purpose of temporarily preventing a threatening process (clearing) until the conservation scheme underlying the purpose of the resumption was able to be effected.
As Widgery LJ said in Wilson v Liverpool City Council [1971] 1 All ER 628 at 635:
"Whenever land is to be compulsorily acquired this must be in consequence of some scheme or undertaking or project. Unless there is some scheme or undertaking or project compulsory powers of acquisition will not arise at all, and it would I think be a great mistake if we tended to focus our attention on the word 'scheme' as though it had some magic of its own. It is merely synonymous with the other words to which I have referred, and the purpose of the so-called Pointe Gourde rule is to prevent the acquisition of the land being at a price which is inflated by the very project or scheme which gives rise to the acquisition.
The extent of the scheme is a matter of fact in every case as is shown by the decision of Fraser v City of Fraserville ([1917] AC 187 at 194), to which Lord Denning MR has referred. It is for the tribunal of fact to consider just what activities - past, present or future - are properly to be regarded as the scheme within the meaning of this proposition. The scheme will always exist in some shape or form by the time the notice to treat is served. It must, indeed, be in some shape or form at the confirmation of the compulsory purchase order itself, and then, as Lord Denning MR says, it may develop almost from day to day …"
It is our view that in this particular case, the "conservation scheme" and the "resumption scheme" are for the purpose of considering the Pointe Gourde principle, inextricably linked.
It was submitted by the State that the Land Court simply expressed the view that the ICOs "were part of the scheme of resumption in this case" without giving reasons.
However the Land Court reasoned that the State made the ICO's, which prevented the land from being cleared, resumed the land and then argued that there were obstacles to the clearing of the land at the date of resumption which affected the value of the land. The Land Court made a finding of fact that, in the context of the Pointe Gourde principle, the action by the State in issuing the ICOs was a step in the process of resumption and that action was part of the scheme of resumption. There can be no doubt that the scheme of resumption was accepted by the Land Court to be as explained in the statement of reasons attached to the Notice of Intention to Resume. In our view the finding by the Land Court that the ICOs were part of the scheme of resumption was open to it on the facts.
The issue of the Land Court's application of the Pointe Gourde principle to the "Natural Resource Protection" zone remains to be considered. As has been discussed, the State accepts that the inclusion of land in that zone was a step in a conservation scheme. We accept that the zoning of the land could not have been disregarded had compensation fallen to be assessed in terms of s.126 of the Nature Conservation Act. We have found that the conservation scheme became inextricably linked with the resumption process, as the scheme underlying the purpose of the resumption. However there is no legislative obstacle to the application of the Pointe Gourde principle to the determination of compensation pursuant to the Acquisition of Land Act 1967.
There can be little doubt that the State had attempted to influence the outcome of the town planning review which preceded the 1997 Planning Scheme. It had endeavoured to ensure that the Scheme provisions would be consistent with the "Nature Conservation (Mahogany Glider) Conservation Plan" which had then been in draft form. There was also evidence that the State had attempted to influence the Council in an approach to have some land not required for the scheme underlying the resumption, removed from the "Natural Resource Protection" zone and included in the "Agriculture" zone.
However, regardless of the consultation between the State and the Council in connection with the particular zone, it does not necessarily follow that, in terms of the Point Gourde principle, the zoning of the land was a step in the resumption process.
The High Court in Murphy accepted that, in the circumstances of that case, it had been necessary for consideration to be given to the prospect of rezoning "free … of the pressures … on the local authority" (at 595). Also at 595, it held that "a characteristic or attribute of the land which affects its value must be taken into account in the assessment of compensation even if the planning restriction which is a step in the process of resumption is dependent upon or directed to that characteristic or attribute."
We are not persuaded by the State’s submission that the prospect of the zoning restriction being imposed by the Council, free of pressure from the resuming authority, had not been considered by the Land Court. It found that, in any event, restrictions on the use of the land through any need for conservation of critical habitat was limited to relatively small corridors within the resumed land. The Land Court distinguished the site specific environmental characteristics of the turtle rookery land in Murphy from the extensive areas external to the subject land which had been included in the “Natural Resources Protection” zone.
The submission for the claimant was that it was a proper application of the Pointe Gourde principle for the Land Court to conclude that the zoning restriction should be set aside as comprising part of the scheme of resumption. There are, however, four matters that we see as militating against the correctness of that conclusion.
First:We do not agree with the Land Court’s reasoning that the site specific environmental characteristics of the turtle rookery land in Murphy are distinguishable, in terms of the Pointe Gourde principle, from the environmental characteristics which led to part of the subject land, together with extensive additional areas of the Shire being included in the “Natural Resource Protection” zone.
Second:It is clear that the town planning restrictions relevant to the zone were unable to provide the habitat protection critical to the State’s conservation scheme.
Third:The zone does not include the whole of the resumed land.
Fourth:Part of the State’s argument, at least before us, was that as there were, in fact, extensive areas of the Shire included in that zone, that was indicative not of the State’s influence, but the likelihood that the Council had acted independently in assessing the extent of land which met the intent of the zone. While that may not have been the thrust of the State’s submissions before the Land Court, it had unsuccessfully argued there that the principle flowing from Murphy was relevant in this matter.
Whether the subject land would have been included in the zone in the absence of the scheme underlying the resumption is conjectural and there is no “clear cut” answer as was the case in Chapman. That is, we have not been convinced that the zoning was created at the behest of the State with resumption in mind. Arguably the reasons for the resumption related to the lack of effective town planning restrictions.
It follows that the Pointe Gourde principle does not apply in respect of the zoning and Ground 1(a) of the State's appeal succeeds. Ground 1(b) in respect of the making of the ICO's fails.
Ground 2
"The Court below erred in concluding that:
(a)the presence of the mahogany glider on the land had not been proven; and
(b)if its presence had been proven, the preservation of habitat areas confined to 'relatively narrow corridors' along the Murray River and Bedford Creek, would have been sufficient; and
(c)the presence of the mahogany glider was not a characteristic or attribute of the land which would have materially affected the potential to develop the land."
This ground of appeal fails. The Land Court found, after considering Dr Jackson's evidence, that “the presence of the mahogany glider on the subject land was far from proven". (RJ [58]) (emphasis added) That finding was open to it. Preservation of relatively narrow corridors along the Murray River and Bedford Creek was in accordance with the evidence as to the exclusion of such corridors from sugar cane assignment. Had the ICO's not been issued, the Land Court found that clearing of areas other than those habitat corridors along the creek would have been available to the claimant. Clearing was an exempt development, at the date of resumption, in terms of the transitional provisions of the Integrated Planning Act 1969. Any restrictive town planning conditions which might have been applied in accordance with the "Natural Resource Protection" zone, related to agricultural or grazing uses. The Land Court's finding that, save for the issuing of the ICO's, the land suited to agricultural or grazing use might have been cleared by the date of resumption, based on the claimant's past development strategy, was open to it.
Ground 3.
"The Court below erred in failing to discount the value attributed to the land for the risks associated with its development, such risks being associated with:
(a)developing and otherwise obtaining cane assignments on the land below the 3M AHD contour; and
(b)the potential ramifications of the Vegetation Management Act 1999, the Environmental Protection Act 1994, the Environmental Protection and Bio-diversity Conservation Act 1999 (C'th); and
(c)the zoning of the land; and
(d)the risks and/or time associated with obtaining cane assignments over the whole of the area otherwise suitable for cane; and
(e)the presence of the Mahogany Glider; and
(f)the road reserve in the north-west section of the land; and
(g)the susceptibility of the land to flood inundation."
Ground 4
"The Court below erred in concluding that a prudent purchaser would not have sought survey advice of the type provided by Brazier Motti (surveyors) in determining how much of the land was below the 3M AHD contour."
Ground 5
"The Court below erred in concluding that the land below the 3m AHD contour line would have been capable of obtaining cane assignments."
Ground 6
"The Court below erred in over-estimating the area of sugar cane land at 670 ha."
Ground 7
"The Court below erred in placing reliance on the development of the 'Marsilio land' in circumstances where:
(a)the land below the 3m AHD contour had to be substantially treated to rectify the acid sulphate and drainage problems; and
(b)the long term viability of the land to grow sugar cane had not been established."
Ground 8
"The Court below erred in concluding that, but for the existence of the Interim Conservation Orders, the claimant/respondent would have cleared all of the developable area of the land to an improved pasture grazing standard by the date of resumption."
Ground 3 raises the argument that the values attributed by the Land Court to the land with potential for agricultural and/or grazing development should have been discounted for various risks suggested as being associated with development potential. Grounds 2, 4, 5, 6, 7 and 8 are interlinked.
Our finding in relation to Ground 2 and the application of the Pointe Gourde principle to any effect caused by the issuing of the ICO's, is relevant to our finding that Grounds 3(b), 3(e) and 8 also fail.
Grounds 3(a), 4, 5, 6 and 7 relate to the physical nature of the land and its suitability for assignment and development for the growing of sugar cane. The question as to the effect of draft standard Condition 2(f) on the potential of land for the granting of a sugar cane assignment is relevant to this argument. Condition 2(f) excludes from the grant of assignment those areas of land which are below the 3 metre contour (Australian Height Datum).
Inherent in the Land Court's finding as to the suitability of the land for assignment, was its acceptance that "the DPI soil and land suitability mapping was essentially the sole indicator of whether land was suitable for sugar cane". ((RJ [81]) The Land Court accepted evidence that there was difficulty in "assessing whether land was below the 3 metre contour level because of the lack of detailed contour information" and that "the DPI soil and suitability mapping was the main determinant of areas suitable for assignment grant".
The DPI mapping indicated an area of Class 1 land "that is suitable land with negligible limitations" and an area of Class 3 land "that is suitable land with moderate limitations". The Land Court took the view that once shown on the DPI mapping as land of a class suitable for sugar cane an assignment could be granted because Condition 1 of the standard conditions would be satisfied "and no further inquiry would be undertaken about its contour level". (RJ [82]) The Land Court found that although later survey information "cast doubt on the accuracy of some of the suitability mapping" there would have been no reason for a purchaser who had no knowledge of that later information "to establish levels in an area which would have been accepted as suitable for sugar cane with minor limitations. There would have been nothing to prove" (emphasis added). (RJ [83]) The Land Court expressed the opinion that "a prudent purchaser at the time of resumption would accept as a starting point that the subject land comprised at least 100 ha of Class 1 land and 512 ha of Class 3 land suitable for sugar cane" being the measured areas on the DPI mapping (emphasis added).
The State submitted that it is quite incorrect to say there would have been nothing to prove because Condition 2(f) would put a purchaser on notice that the contour level of the land remained something to know or prove, particularly in view of the nature and location of the land. It submitted that rejection of the State's contention that a purchaser would seek survey information was inconsistent with the Land Court's acceptance of the measured areas of Class 1 and Class 3 land on the DPI mapping as a starting point but then concluding that a prudent purchaser would have consulted relevant experts, particularly with regard to the suitability of Class 4 (marginal) land for sugar cane production and the extent of potential grazing land.
Based on expert evidence other than evidence as to the contour level of the land, the Land Court accepted that the DPI mapping "was proven to be inaccurate and that a greater area was suitable" (of Class 1 and Class 3 land) (RJ [123]). For valuation purposes the Land Court found that the area of Class 1 land could be increased from 100 ha to 120 ha and the area of Class 3 land from 512 ha to 550 ha. The Land Court accepted evidence that an applicant for assignment of land shown on the DPI mapping as Class 4 would have been required by the Tully Local Board to prove that, before such land could have been upgraded to Class 1, Class 2 or Class 3 -
"•areas below 3 m AHD could have been feasibly drained without environmental implications, and
• no areas of acid sulphate soil would be disturbed." (RJ [125])
There was however no finding that an applicant for assignment of the increased areas of Class 1 and Class 3 land would have also needed to establish the extent of land below 3 m AHD and the feasibility of its drainage, before standard Condition 2(f) could be overcome.
The State's argument as to the risk associated with land within any DPI classification being below 3 m AHD, is persuasive. It seems, at least, that a prudent purchaser considering the question of an application for assignment of areas larger than those indicated as Class 1 or Class 3 land on the DPI mapping, would have expected the Tully Local Board to seek satisfaction of its concern as to any areas below 3 m AHD, before Condition 2(f) was to be waived.
Prima facie, Condition 2(f) would be fatal to an application for assignment of any land below 3 m AHD. However the evidence before the Land Court indicated otherwise, provided any restrictive implications created by its contour level were subject to inquiry and resolution. We accept however that risk of land being below the 3 metre contour would be a relevant factor for consideration and was not considered by the Land Court at least once the area of mapped classifications was subjected to expansion inquiry.
To the extent discussed we see merit in Ground 3(a).
Ground 3(c) is also seen to have merit in principle, on the basis that we have concluded that the Land Court erred in its application of the Pointe Gourde principle to the zoning of the land.
Grounds 3(d) and (g) allege that the Land Court's determination of the value attributed to the land with agricultural potential failed to reflect discount for the risks and/or time associated with obtaining assignments over the whole of the otherwise suitable areas, together with any risks associated with the susceptibility of the land to flood inundation. The Land Court's determination of value, as it might have been affected by these two issues, was based on valuation evidence, each valuer having valued the various land classifications after allowing for the particular attributes of the subject land whether positive or negative. Their valuations were based on comparisons with the relevant sales evidence including evidence of unassigned land, in some cases of significant area. We see no merit in Grounds 3(d) and (g) and they fail accordingly.
Ground 3(f) relates to the alleged risk associated with a drainage plan, in relation to the proposed development of the areas contended by the claimants to be suitable for sugar cane production, utilising a road reserve in the absence of tenure in favour of the claimant. The Land Court did not rely on the drainage plan to which the State made reference. In any event, the Land Court accepted evidence that the area of the road reserve "could have been incorporated into the development by the temporary or permanent closure of the road, or by a licence to occupy". (RJ [100]). We see no substance in this ground of appeal.
Ground 4 is relevant to our finding as to the risk involved in expanding, for valuation purposes, the area of land suitable for agricultural use, in the absence of survey evidence. This ground of appeal is seen to have merit but only to the extent of the risk argument.
Ground 5 alleges that the Land Court found "that the land below 3 m AHD contour line would have been capable of obtaining cane assignments". We have given consideration to the relevance of the 3 metre contour in terms of the risk argument. Except to the extent that consideration needed to be given, in our opinion, to the 3 metre contour, if the area shown on the DPI mapping was to be expanded for valuation purposes, this ground of appeal fails.
Ground 6 alleges that the Land Court erred in over-estimating the area of sugar cane land at 670 ha. We do not agree that the Land Court erred, on the evidence, by overestimating the area available for valuation purposes, subject again to our finding as to the risk involved in that approach.
Ground 7 makes specific reference to the reliance alleged to have been placed by the Land Court on the development of the "Marsilio land". The Land Court found (RJ[80]) that the type of information available to a prudent purchaser included, inter alia, the fact that "the adjoining Marsilio land of similar elevation" was growing sugar cane under assignment. That factual information was available to those experts who had promoted the potential of Class 4 land, as mapped by the DPI, being upgraded. As the State argued, the assignment on that land was granted prior to the 3 metre contour being associated with a relevant standard condition for the granting of an assignment. However even if the expert evidence was influenced by the development of the Marsilio land, the finding as to the area suitable for sugar cane was open to the Land Court, for valuation purposes, on the totality of the evidence, had the 3 metre contour been accepted as a risk factor.
Ground 8 has been found to fail in company with the discussion on Grounds 3(b) and 3(e).
Ground 9
"The Court below erred in concluding:
(a)that the cost of clearing the land to improved pasture grazing standard was $750 per hectare;
(b)that no additional allowance ought to have been made for further treatment of the land including treatment of regrowth, stickpicking, pasture fertilisation and removal/destruction of tree stumps."
There are two aspects to the allegation in Ground 9 which need to be treated separately. Ground 9(a) alleges that the Land Court erred in concluding that the cost of clearing the land to improved pasture grazing standard was $750/ha. On our review of the relevant evidence but subject to our findings with regard to Ground 9(b), it was open to the Land Court to adopt Mr Eales' allowance of $750/ha for the standard of clearing to improved pasture for grazing as he had envisaged for the subject land. In fact the evidence indicates that there was no, or no significant difference between the valuers in their estimate of the cost of "crashing, windrowing and burning" operation. (Exhibit 75 - p.2001 Record). The major difference between the valuers related to either the follow-up operations which might be undertaken in developing land to an improved pasture standard and/or the added value of the actual clearing which existed on the sale lands. The Land Court had gained the impression that "clearing to improved pasture standard as explained by Mr Cross was more intensive than that envisaged by Mr Eales … The operations described by Mr Cross would result in cleaner pasture land …". (RJ [241])
Ground 9(b) alleges that the Land Court erred in concluding "that no additional allowance ought to have been made for further treatment of the land including treatment of regrowth, stickpicking, pasture fertilisation and removal/destruction of tree stumps.”
Mr Eales had been careful in his desire to compare like with like, to assume that all improved pasture land on both the hypothetically developed subject property and the relevant sale properties, possessed an added value of $750/ha for grazing use. That was the basis of his valuation approach. That may have been a reasonable approach had the highest and best use of both the sale lands and the subject land been for grazing, when economic development costs would have been a relevant consideration. However that was not the case in this matter where some of the subject lands had arable potential, as did the "improved pasture" sale lands. Where the highest and best use of improved pasture land had progressed to arable potential, the added value of the clearing to improved pasture was no longer related to economic grazing development, but to the additional cost involved in improving the standard of existing development to a cultivation standard. The higher the standard of existing development, the lesser cost to convert to cultivation and the greater the existing added value. The Land Court observed that "(C)rucial to Mr Eales' method is the accuracy of his assessment of the cost of development of the subject land to improved pasture". Even more crucial in our opinion, was the need for Mr Eales to then ensure that the added value of that envisaged development for conversion to the highest and best potential use as cultivation land, was capable of direct comparison with the added value of the development on the sale properties.
Crucial to Mr Cross' valuation methodology was the correct assessment of the added value of clearing, either to cultivation standard or to improved pasture standard in the sales analyses. If his assessment of added value was excessive, then his "timbered" value analyses would be too conservative. Under cross-examination he explained that the added value of clearing to improved pasture standard was considered in terms of "the actual cost of taking it from pastures to cultivation" (Transcript p.885). However he conceded that he had in an earlier analysis of one sale adopted a lower level of value for clearing to improved pasture standard.
While we are unable to agree with the allegation made in Ground 9(b) as it is framed, it does in our view, identify the error which would result in Mr Eales' approach if the sale properties were cleared and developed to a higher standard than that envisaged in the hypothetical development of the subject land, and/or the added value for that higher use was greater than for a grazing standard as qualified by Mr Eales.
It follows then that in accepting Mr Eales' assessment of values for the subject land arable classifications, based on hypothetical development to an improved pasture standard for grazing, the Land Court does not appear to have given consideration to the real risk that Mr Eales' valuation methodology was flawed. Therefore, the issue of risk is addressed in the conclusions at which we have arrived.
The Appeal by the Claimant
In the written submission, the claimant stated "Paragraphs 1, 3, 5, 6, 8 and 13 are not actively pursued in these submissions (although the allegations in paragraph 1 are certainly not abandoned)." Accordingly we see no need to address these grounds of appeal except with regard to Ground 1 which will be considered with Ground 2. Ground 13 is, of course, of general application. Ground 13 was expressed thus:
"The errors referred to in the preceding paragraphs hereof were either errors of law or findings contrary to the evidence or the weight of the evidence."
Ground 1
"The Learned President erred in finding [para 81] that it was common ground that if the photogrammetric mapping was not available, the DPI soil and land suitability mapping was essentially the sole indicator of whether land was suitable for sugar cane in circumstances where:
(a)he accepted [para 109] that a hypothetical prudent purchaser as at the date of resumption (hereafter simply 'a prudent purchaser') would consult some relevant experts including a grazing expert (such as Dr Teitzel) and have advice similar to the evidence given by Dr Teitzel before him.
(b)there was evidence (particularly from Dr Teitzel) that vegetation growing on land gave a good indication as to its suitability for agriculture (including sugar cane); and
(c)there was evidence including 1997 aerial photography, that land immediately adjoining the subject land (ie the Marsilio land) was successfully growing sugar cane at the relevant time."
Ground 2
"The Learned President erred in concluding [para 122] that a prudent purchaser would have concluded that only about 850 hectares of the subject land would have had the potential for development to improved pasture (rather than 1,033 hectares identified by Dr Teitzel – see [para 113]) as follows:
(a) the Learned President found [para 109] that a prudent purchaser would have sought advice from an expert in cattle property management with special expertise in tropical pastures such as Dr Teitzel and had available advice similar to Dr Teitzel’s evidence;
(b)there was no finding by the Learned President, nor was there any credible evidence, that a prudent purchaser would have sought advice from a fisheries expert such as Mr P.W. Hales; nevertheless
(c)the Learned President reduced the area a prudent purchaser would have concluded was available for grazing from 1,033 hectares to about 850 hectares on the basis of the evidence of the fisheries expert Mr Hales [para 120]. "
We do not accept that the Land Court erred as alleged in these grounds of appeal. It was the fact that the DPI Soil and Land Suitability Mapping was essentially the sole indicator of whether land was suitable for sugar cane which led the Land Court to accept that a prudent purchaser would then consult with the relevant experts. It is also a fact that the evidence of the expert Dr Teitzel was then considered. It was open to the Land Court, in our view, to make findings of fact based on its consideration of the expert evidence.
In making findings of fact the Land Court was not obliged to adopt in its entirety, the evidence of relevant experts. It would be wrong for the Land Court to adopt expert evidence in its totality where that evidence failed to give consideration to relevant facts, ie the potential for interference to fish habitat.
Ground 4
"The Learned President erred [para 267] in finding that a prudent purchaser would not, after considering the evidence of various experts, have investigated the possibility, and accepted, that some of the Class 3 land might be upgraded to Class 2 (which the Learned President found ought to be valued at $6,000.00 per hectare) in circumstances where he had found [para 80] that such purchaser would have had available relevant experts."
We see some merit in the allegation in Ground 4. It is our view however that the potential for some Class 2 land to exist, within the overall area contained within the area of Class 3 land as adopted by the Land Court, is relevant to the value of the Class 3 land component. That consideration will be further discussed in our overall findings.
Ground 7
For reasons which will become apparent, we propose to deal with Ground 9 in advance of Ground 7.
Ground 9
The learned President erred [para 299] in adopting the figure of 7.5% of the value of the land (or $244,275.00) by way of special value, rather than the higher figure of 15% contended for by the claimant's valuer Mr Eales, with such error no doubt flowing from his acceptance of the respondent's incorrect and illogical contention that in assessing the special value the "absolute amount" is relevant.
Before the Land Court both parties' valuers included, in addition to their respective estimations of market value of the resumed land, an added amount for what each saw as its special value. The concept of special value to the owner is historically referable to the Privy Council decision of Pastoral Finance Association Ltd v The Minister [1914] AC 1083 where at 1088 their Lordships said:
"That which the appellants were entitled to receive was compensation not for the business profits or savings which they expected to make from the use of the land, but for the value of the land to them. No doubt the suitability of the land for the purpose of their special business affected the value of the land to them, and the prospective savings and additional profits which it could be shown would probably attend the use of the land in their business furnished material for estimating what was the real value of the land to them. But that is a very different thing from saying that they were entitled to have the capitalised value of these savings and additional profits added to the market value of the land in estimating their compensation. They were only entitled to have them taken into consideration so far as they might fairly be said to increase the value of the land. Probably the most practical form in which the matter can be put is that they were entitled to that which a prudent man in their position would have been willing to give for the land sooner than fail to obtain it."
The valuer for the respondent, Mr Cross, added a premium of 5% to the valuation of the resumed land which had been deduced by the use of the before and after valuation method. That 5% represented a premium that he considered the dispossessed owner would pay for the land "… given its adjacency to his existing farm operation, rather than purchase comparable timbered country elsewhere and develop that." (RJ [283]).
The learned President said, "Mr Cross recognised that Mr Pajares was one of the fortunate landowners who had not been required to purchase additional land elsewhere in order to expand his cane farming enterprise". (RJ [284]) Mr Cross approached his task of assessing what he saw to be special value as an adjoining owner might when considering the price to pay for land which borders his.
Mr Eales, the valuer for the claimant, told the Land Court that the economic advantage of the resumed land had been lost to the claimant. He said that that economic advantage lay in the resumed land being part of a large area that the claimant, together with his family, had been progressively developing with an intention that the family enterprise would, when fully developed, grow 100,000 tonnes of sugar cane.
Mr Eales proceeded on the assumption that the claimant would need to purchase a developed sugar cane farm to preserve his intentions of achieving a tonnage of that order. In his valuation Mr Eales assessed that special value at 15% of his estimated value of the resumed land. The Land Court explained Mr Eales' approach at [288]:
"To justify his special value assessment of $661,526, Mr Eales itemised the increased working costs which would be involved if land remote from the retained land was purchased. In addition to the movement of machinery, such as cane harvesters, tractors and other equipment, he contended that there would be the duplication of infrastructure, such as machinery sheds, maintenance equipment and security, in addition to increased costs of working a non-adjoining property."
The learned President said that "… it would be relevant to consider the economic advantages of being able to expand his farming activities into the (resumed land) in the future" (RJ [297]). He went on, "Because of the special advantages the resumed land had to the owner of the retained land, I think the claimant would pay more than (the 5% suggested by Mr Cross) rather than fail to obtain it, if he had been temporarily deprived of it". The Land Court also took into account "the expense and inconvenience associated with the acquisition of a replacement property" and settled on an allowance of 7.5% of the value of the resumed land as representing the premium associated with these advantages.
The High Court recently considered the special value concept in the case Boland v Yates Property Corporation Pty Ltd (1999) 74 ALJR 209. Justice Callinan particularly directed his attention towards Kennedy Street Pty Ltd v The Minister [1963] NSWR 1252 in which the dispossessed owner whose business was that of the development, subdivision and sale of land had resumed from it a parcel of land it had purchased for the purpose of its business. The company had expended some moneys on preparing a survey plan, applying for and obtaining an approval in principle from the local Council for development of the land and had undertaken some other works on the land. His Honour summarised the reasoning of Hardie J in Kennedy Street:
"[334] Hardie J held that the market value of the land should be determined at £19,500 and that in the circumstances the land did have some special value for the plaintiff who, were it the purchaser, would have paid an additional sum of £2,500 over and above its market value.
[335] Hardie J said that the matters that caused him to make a finding of special value in favour of the plaintiff were that the plaintiff had given close and careful consideration to the problems associated with the proposed subdivision; it had paid stamp duty to acquire it; it had also paid survey fees and engineering fees, and the council fee in relation to the subdivision application."
Then at [336] Justice Callinan said:
"To regard these matters as ones entitling the plaintiff to an allowance for special value is to ignore or misunderstand the formulation in Spencer's case of the principles to be applied in assessing compensation. A vendor armed with the relevant materials, an approval and information which might enable a property to be profitably subdivided would be foolish not to seek and to insist upon obtaining full value for the land or any estate or interest in it having regard to those matters, from any purchaser. And a prudent purchaser would need to be prepared to pay a price accordingly as the utilisation of those materials would enable that purchaser to realise the highest and best use of the property. Everything the plaintiff had in its possession in Kennedy Street was, as is the situation in this appeal, readily transmissible to, and of value to any purchaser coming into possession of the property."
His Honour went on to make further criticism of the reasoning in the Kennedy Street case, however it is what he said at [336] and with which Justices Gaudron and Gummow agreed, that is presently of interest.
Callinan J provided further clarification of the nature of special value at para [292]:
"There will in practice be few cases in which a property does have a special value for a particular owner. Obviously neither sentiment nor a long attachment to it will suffice. The special quality must be a quality that has an economic significance to the owner. A possible case would be one in which, for example, a blacksmith operates a forge in the vicinity of a racetrack on land zoned for residential purposes as a protected non-conforming use, the right to which might be lost on a transfer of ownership or an interruption of the protected use. Such a property will have a special value for its blacksmith owner, and perhaps another blacksmith who might be able to comply with the relevant requirements to enable him to continue the use but to no one else."
Inherent but not expressed in the reasoning of both valuers in the present case is the proposition that any interested cane farmer would have paid a higher price for the parent parcel than the values revealed by the sales evidence relied upon by each of them. As we understand the evidence, that higher price would reflect the advantages that the size of the property yielded in the form of economies in sugar cane production.
There is nothing in the evidence to reveal that the claimant was peculiarly advantaged over other cane farmers with respect to the potential that lay in the larger area of land. Any competent cane farmer as the owner of the parent parcel could have seen the potential in the timbered eastern section and could have either acquired machinery to develop that land or contracted others to do so.
Mr Pajares had no unique advantage in relation to his ownership of the land - no advantage that was lost following its resumption. He was not in the same class as Justice Callinan's blacksmith.
This is a case where the words of Kitto J in Turner v Minister of Public Instruction (1956) 95 CLR 245, 291-292 are particularly appropriate:
"I must reiterate, however, that this is not a case where there is a difference between the value of the land in general and its value to the expropriated owner in particular. The suitability of the land for subdivision was one of its inherent characteristics; it was available to be exploited by the owner whoever he might be; the land had no special value for the appellants. But I cannot forbear to add that if the test of value which has been approved for cases where there is special value to the owner be applied here, the question must be asked in the familiar words of Lord Moulton in Pastoral Finance Association Ltd. v. The Minister: what would a prudent man in the position of the appellants have been willing to give for the land sooner than fail to obtain it? And the answer must be: precisely what any other prudent purchaser would have been willing to give for it."
That reasoning leads us to the view that there was no special value in the resumed land of the type described in Pastoral Finance and further explained in Boland v Yates.
This is not to say, however, that the resumed land as part of the parent parcel did not add a value to that parcel greater than the value revealed by the sales evidence. In effect, both parties considered that it did. That added value is, however, part of the market value and its loss falls to be dealt with as severance damage.
Neither Mr Eales nor Mr Cross in the matter before us purported to assess any severance damage arising from the loss of the resumed land. Compensation for such damage is authorised by s.20(1)(a) of the Acquisition of Land Act 1967:
"(1) In assessing the compensation to be paid, regard shall in every case be had not only to the value of land taken but also to the damage (if any) caused by either or both of the following, namely -
(a)the severing of the land taken from other land of the claimant;"
This head of compensation was explained by the Land Appeal Court in Suntown Pty Ltd v Gold Coast City Council (1979) 6 QLCR 196, 207:
"Severance damage arises from the separation or division of the claimant's land as a result of the resumption. The severance may be by way of a division of the retained land into two parts, for example, by way of a resumption for an intersecting road. It may also occur where a part only of the claimant's land is taken leaving a compact parcel. Severance damage is depreciation in the value of the retained land resulting from its division into two or more parts, or its reduction in area and consequent loss of value for some current or higher (potential) use."
Our reasoning has led us to conclude that the loss complained of is not properly special value, however we accept that it can be accommodated as severance damage even though that is usually referable to the land retained and not to the land taken.
In these circumstances the ground of appeal suffers the difficulty of having raised complaints that cannot arise in the terms that the ground is expressed. Be that as it may, the Land Court did allow a premium of $244,275 as part of the compensation due to the claimant based on evidence from both parties that a premium was justified. In Corbould v The Crown (1986) 11 QLCR 50, the Land Appeal Court said:
"… it may be observed that it is immaterial that a category of the claim, e.g. disturbance, may from time to time overlap, even sometimes completely, other heads of compensation provided that the claimant is properly compensated for his loss according to law and providing there is no duplication. The point is that a justifiable area of compensation does not go wanting for lack of a precise classification and disturbance is often a suitable description."
Whilst the Court on that occasion was concerned particularly with the disturbance and injurious affection heads of compensation, it expressed what we think is a principle of general application. Indeed, in Robinson's case (unreported Supreme Court of South Australia, 18 August 1965) Napier CJ said that "… it does not matter what the allowance is called, that is to say whether it is said to be severance, disturbance or special value". (Quoted by Bray CJ in Arkaba Holdings Limited v Commissioner of Highways (1969) 19 LGRA 398 at 405).
Accordingly, we will consider the ground of appeal on its merits.
We now turn to consider the submissions of the claimant on appeal which are to the effect that the premium allowed by the Land Court is too low and ought to be assessed at 10% of the value of the resumed land. Those submissions are adequately summarised in the claimant's written outline at clause 23:
"It is submitted that the learned President fell into error in underestimating the extent of this disturbance item on two bases:
(a)it seems clear that he placed considerable weight on the submission by Counsel for the respondent that regardless of the percentages adopted by the valuers, in assessing the special value the absolute amount is relevant (Reasons, para [299]); and
(b)in adopting what is submitted is a very conservative approach to a special value, he neglected to take into account that he had, against the dispossessed landowner's interest, already declined to allow future acquisition costs in respect of replacing the resumed land (Reasons, para [295])."
We do not accept the first of these submissions for two reasons. First, it is not correct to characterise the Land Court as having placed considerable weight on the absolute amount proposition. This is what was said at [299] of the decision under appeal:
"Counsel for the respondent argued that regardless of the percentages adopted by the valuers, in assessing the special value in this case the absolute amount is relevant. I agree with that contention, but where I am unable to quantify the various elements of special value, like the valuers, I must resort to a percentage of land value. I propose to adopt 7.5%, which amounts to $244,275."
It is quite clear that whilst the Land Court indicated a preference for the quantification of the premium and, therefore, the estimation of an absolute amount, it did not have before it evidence that would allow it to proceed in that manner. The Court therefore adopted a percentage allowance which we understand was intended to reflect the view taken of the evidence as to the economic advantage the resumed land gave to the parent parcel.
We deal with the second part of the claimant's submission in our discussion of the following ground of appeal. We can say at this stage, however, that the claimant had not convinced us that the premium assessed by the Land Court was too low. We are in no better position than the Land Court was in dealing with the striking of the premium expressed as 7.5% of the value of the resumed land as determined.
Ground 7
The learned President erred [para 295] in concluding that stamp duties and professional fees that would be incurred in purchasing replacement property cannot be allowed as a head of disturbance, in circumstances where:
(a)the resumed land was not, as he found [para 294] an investment property;
(b)the resumed land was part of the claimant's property which he accepted was to be developed for future use in the expansion of this business [para 294];
(c) the claimant is and was a farmer and the subject land, far from a discretionary investment, was part of his farm;
(d)the learned President accepted without doubt [para 96] that, but for the interim conservation orders (which he accepted [at para 98] formed part of the scheme for which the land was resumed) all of the developable areas of the resumed land could have been cleared prior to the date of resumption.
(e)the claimant gave credible evidence which the learned President accepted that with no undeveloped land available he would have to purchase replacement property after the Court had determined compensation [para 287]; and
(f)the respondent had allowed such items of disturbance to the other landowners from whom land for the relevant scheme had been resumed and Mr Cross had allowed same in an earlier valuation in respect of the subject land.
The Land Court decided that stamp duties and professional fees that may in the future be incurred in purchasing a property to replace the resumed land should not be allowed. The decision was founded on the basis that recovery under this head does not come within any category of case where such compensation is permitted in principle.
We need not embark on a consideration of the Court's reasoning on that basis as it is our view that such compensation should not be allowed on another quite clear basis.
The award by the Land Court reflected the premium which the potential of the resumed land added to the parent parcel. Now it matters not whether that premium is characterised as special value or severance damage, but what does matter is that the premium was awarded on the same basis that the claimant submits the costs associated with the purchase of a replacement property ought to be allowed.
This head of claim is predicated on the claimant going into the marketplace and purchasing land to replace the land that has been resumed because additional land will, together with the retained land, provide the benefits of economies of scale in sugar cane production. That is one of the factors that gave rise to the premium being awarded by the Land Court (RJ [297]).
It would be quite another matter if the premium took into account only the adjacency of the resumed land to the claimant's retained land. It is clear that the Land Court considered that the premium should cover more than that aspect. (RJ [284])
No authority is needed for the proposition that compensation for the same element ought not to be allowed under more than one head. That has often been expressed as the principle against "double dipping".
In our view, were compensation to be allowed both in the form of the premium determined at first instance and in the form of stamp duty and professional fees yet to be incurred in the purchase of a replacement property, there would be a clear instance of double dipping.
We are not influenced by the fact that the respondent may have allowed the costs associated with the purchase of a replacement property to other dispossessed owners as part of settlement arrangements. In Merivale Pty Ltd v Brisbane Expo and Southbank Redevelopment Authority (1985) 10 QLCR 268, 286 the Land Appeal Court dealt with a similar issue in this way:
"We do not think that we have sufficient evidence before us as to the course of the negotiations to adopt with confidence an analysis of the Yellow Pages settlement. But if we felt we had sufficient information to make use of the settlement we would, on the evidence before us, apportion the settlement figure to make provision for legal fees and stamp duty on re-purchase and for interest as set out in Mr Deacon's valuation below. Where any agreement as to value, whether on sale or settlement, is made on the basis of a mistake which affects the value then, if the agreement is to be used at all, an appropriate adjustment must be made since the agreement did not reflect the true value of the land."
Ground 10
The learned President erred [para 349] in limiting the award for the disturbance claim for legal, valuation and other consultants' fees to fees incurred prior to the lodgement of the claim with the when he had found [paras 326, 327] that he was bound by Land Appeal Court authorities that the "cut off" point was the date of filing the claim with the Court.
Ground 11
In this regard, the learned President erred in finding [para 343]:
(a)that is it not open to a claimant to amend the claim served on the under s.19 of the Acquisition of Land Act 1967 before the claim is filed in the office of the Registrar of the Land Court under s.24(2A);
(b)that a statutory requirement for the claim lodged with the to be the same claim as is lodged with the court effectively limits claims for disturbance costs between the date of the lodgement of the claim with the and the date of the lodgement of the claim in the court to only costs directly connected with court lodgement; and
(c)that the only opportunity that a claimant has to amend the claim for compensation is after the claim is filed in the Land Court, with the leave of the court.
Disturbance compensation in the form of professional fees reasonably incurred in the preparation of a claim for compensation has been allowed by this Court at least since Howard v Commissioner for Railways (1967) 34 CLLR 140. On that occasion the Court relied on the English approach in London City Council v Tobin (1959) 1 All ER 649.
The question as to the period during which expenditure gives rise to a claim for compensation under this head was addressed in Merivale Motel Investments Pty Ltd v. Brisbane Exposition and Southbank Redevelopment Authority (1984-85) 10 QLCR 175 at 203-207. The learned Member concluded that the commencement date for the period would be the date of the Notice of Intention to Resume, whilst the end or cut-off date was the date of filing of the claim for compensation in the Court. The dispute between the parties in that case was concerned only with the commencement date. The decision on appeal in that case is reported in the same volume at 268 and at 287-288 the Land Appeal Court endorsed the conclusions of the Land Court on this point.
The date of filing a claim in the Court has been consistently adopted by the Land Appeal Court as the cut-off date for any claim for professional fees. See, for example, Lamont v Brisbane City Council (1980) 7 QLCR 120, 127 and Standfield v Brisbane City Council (1990) 13 QLCR 32, 68. There is no decision of this Court of which we are aware, however, where the cut-off date became a matter of debate between the parties. Earlier cut-off dates than the date of filing of the claim were adopted in Howard and in Szirtes v. Pine Rivers Shire Council (1969) 36 CLLR 9 and Wall v Commissioner of Irrigation and Water Supply (1970) 37 CLLR 65 also. However there was no issue in those cases that a later date, namely the date of filing of a claim, should have been adopted.
At first instance the Land Court considered that it was bound by the Land Appeal Court authorities which had expressly adopted the cut-off date as being the date of filing of the claim, namely Merivale, Lamont and Standfield. Nevertheless, the Court also concluded that there was a statutory prohibition on amendment of a claim between the date of lodgement with the Constructing Authority and that of filing with the Court. Accordingly, the Land Court concluded that expenditure on professional fees incurred subsequent to the date of lodgement with the Constructing Authority were not compensable. It is this question of the right to amend a claim for compensation that is the basis of the claimant's appeal Ground 11 which we now turn to discuss.
The claimant served his claim for compensation on the respondent on 15 February 2000. That claim was prepared in reliance on valuation advice provided by Mr Eales and on legal advice from Ruddy, Tomlins & Baxter, Solicitors and a barrister.
On 15 May 2001 the claimant contacted Mr Barry Taylor of Suthers Taylor, Solicitors, with a view to him acting in connection with the claim for compensation.
The disputed claim for professional fees related to costs incurred by or at the request of Suthers Taylor for the period 15 May 2001 to 14 November 2001.
On 16 November 2001 the claim for compensation, which was materially the same as that served on the Constructing Authority, was filed in the Land Court Registry.
The effect of a resumption on the interest of a dispossessed owner is provided for in s.12(5) of the Acquisition of Land Act 1967:
"(5) On and from the date of the publication of the gazette resumption notice the land thereby taken shall be vested or become unallocated State land as provided by the foregoing provisions of this section absolutely freed and discharged from all trusts, obligations, mortgages charges, rates, contracts, claims, estates, or interest of what kind soever, or if an easement only is taken, such easement shall be vested in the Constructing Authority or, where the gazette resumption notice prescribes, in the corporation requiring the easement, and the estate and interest of every person entitled to the whole or any part of the land shall thereby be converted into a right to claim compensation under this Act and every person whose estate and interest in the land is injuriously affected by the easement shall have a right to claim compensation under this Act."
Section 19 of the Act provides for the form and content of a claim for compensation. That need not be set out in detail here, however we notice that there is no requirement, indeed no provision for a claim to make reference to a claim for interest on unpaid compensation moneys. Section 28 provides that the Court may award interest except with respect to money advanced under s.23 and s.28(1B) provides relevantly:
"Interest so ordered to be paid shall be payable as if it were part of the compensation in question and shall be added to the amount thereof and be payable by the Constructing Authority accordingly."
This provision, together with s.19, imply that interest is not part of compensation for the purpose of a claim for compensation. It follows that for such purposes compensation is that provided for in s.20 of the Act.
A claim for compensation "shall be served upon the Constructing Authority" (s.19(1)). If that has not occurred, a Constructing Authority "may refer to the Land Court for hearing and determination the matter of the amount of compensation" (s.24(1)) and may also apply to the Court for an order that the "claimant", who may best be described as the dispossessed owner at this point, enter an appearance by "filing in the office of the registrar of the Land Court … a claim for compensation in accordance with the requirements of Section 19".
Section 24(2) provides for a claimant to refer the matter of the determination of compensation to the Land Court:
"If the amount of the compensation has not been sooner agreed upon, the claimant may so refer that matter at any time after the date upon which the claimant delivered to the Constructing Authority a claim for compensation in accordance with the requirements of section 19."
The Land Court Rules 2000 provide for the way in which a proceedings is to be initiated and in so doing afford the first opportunity for a claimant to formally seek interest on unpaid compensation moneys. Rule 7(1) provides:
"A proceeding is started by filing an originating application with the registrar of the court."
and Rule 8(2)(d)(i) says:
"(2) Also, an applicant must, in an originating application -
…
(d) state -(i) the orders or other relief sought in the proceeding;"
If the amount of compensation has been agreed upon, no jurisdiction arises in the Land Court to determine compensation under the Act (Garside v The Crown (1984) 10 QLCR 121), however a simple admission by the Constructing Authority of the amount claimed would often not amount to an agreement. This is, first, because the claimant may wish to pursue interest on compensation. Whilst interest may be awarded by the Court, there is no bar to the parties settling on an amount of interest where circumstances permit. Second, there is s.12(5A) which provides:
"The amount of such compensation may be agreed upon between the Constructing Authority and the claimant subject, however, to the consent of any mortgagee of the land taken."
The provision which was critical to the reasoning of the Land Court is s.24(2A):
"The claimant shall make the reference by filing in the office of the registrar of the Land Court copies of the claim delivered by the claimant to the Constructing Authority and of the notice of intention to resume and a gazette copy of the gazette resumption notice taking the land." (our emphasis)
There is provision in s.24(3) for a claimant to amend a filed claim for compensation:
"The claimant shall not amend the claim filed by the claimant in the office of the registrar of the Land Court except upon leave granted by that court (which leave the court may grant upon such terms as it deems just, including terms with respect to the payment of costs)."
Section 26(1) provides that:
"The Land Court has jurisdiction to hear and determine all matters relating to compensation under this Act."
It is clear then that the jurisdiction of the Court is enlivened by a reference to the Court under s.24 and, in particular for present purposes, by s.24(2) and (2A). In such circumstances where the Court is seized of a claim for compensation that conforms with s.19, it is appropriate to speak of "amending" such a claim rather than for the provision of a new claim. It is a matter for the Court as to the form any approved amendment takes, however the claim for compensation that is amended will remain as the document that triggers jurisdiction. It would be a usual term of the granting of such leave that, apart from natural justice requirements, the Constructing Authority be made aware of any amendment.
No provision similar to s.24(3) is to be found which conditions any amendment of a claim for compensation not yet filed in the Court. The inference to be drawn is that there is, therefore, no inhibition to amending such a claim.
Section 24(2A) requires that the claimant file "copies of the claim delivered by the claimant to the constructing authority …". The purpose in the Court having before it a copy of the claim last served on the Constructing Authority is quite apparent. The referral of the claim to the Court represents the fact, if not the complaint, that the Constructing Authority has failed to admit the claim. It would be inappropriate, therefore, that the Constructing Authority have a claim for an amount of compensation which is different from that included in a claim filed in the Court.
We can discern no good reason why prior to the reference to the Court a claimant must be limited to the preparation and serving on the Constructing Authority of a single claim for compensation. We accept that, as s.19 is expressed, a claimant may not be able to amend a claim already served but not yet filed by, for example, the simple expedient of a letter. However, it seems both allowable and of practical benefit that a dispossessed owner have the opportunity to replace a claim for compensation by a later document which also satisfies s.19 in circumstances, for example, where the claimant receives improved advice. The central proposition in the respondent's submissions is that a claimant wishing to seek a figure different from that originally claimed is prohibited from formally doing so until there is a reference to the Court when the amendment is then subject to leave. That proposition has no compelling appeal to us being neither supported by the statute nor serving any apparent policy purpose.
The conclusion which we have drawn does not, however, lead us to the view that the cut-off date must be the date of filing of a claim in the Court. Indeed, we hold that the date on which the claim is last served on the Constructing Authority is the cut-off date for this head of compensation. Once that claim is served, the claim, for the purpose of the head of compensation under discussion, has been finalised.
There can therefore be no warrant for any compensation for professional fees incurred later than that date. Should the claim for compensation be referred to the Land Court, such professional fees fall to be considered as costs of the action - as we discuss at [156] below. If no reference to the Court is made and the matter is settled, the fate of such fees is fully a matter for the parties.
The cut-off date for professional fees incurred in the preparation of the claim for compensation in the present case is 15 February 2000. That was the date of the serving on the Constructing Authority of the only claim for compensation. Accordingly, the claim for professional fees incurred by or at the request of Suthers Taylor, Solicitors, after that date are disallowed. It may have been quite reasonable for Suthers Taylor to undertake the work they did in checking the claim for compensation in order that they could provide considered advice to the claimant. However, it is not appropriate that the respondent be called upon to pay for the provision of that advice and for the preparation of the claim for compensation.
It follows that there is no need for us to separately address Ground 10.
Ground 12
Further, having ruled that costs directly connected with the lodgement in the Land Court of the claim were claimable as disturbance [para 343], the learned President erred in not awarding all such costs.
The costs involved are:
Drafting and settling Land Court Originating Application.
Letter to Department of Environment and Heritage (DOE) enclosing by way of service the Originating Application to the Land Court.
Letter to Department of Natural Resources, Mines and Energy enclosing by way of service the Originating Application to Land Court.
Letter to Land Court of Queensland enclosing the Originating Application for filing.
Letter to DOE enclosing by way of service the Originating Application.
Telephone attendance on EPA relating to receiving a copy of the Originating Application.
These costs were incurred after the date of the serving on the Constructing Authority of the claim for compensation. Accordingly, the claim for such costs must fail.
Apart from that, these costs may not, in our view, be properly characterised as costs incurred in preparation of the claim for compensation. They are costs incurred in the process of initiating the trial and fall to be considered as costs of the action. That distinction was made in Heavey Lex No. 64 Pty Ltd & Anor v Chief Executive, Department of Transport (1999) 20 QLCR 296 at 433 to 440 and was not disturbed on appeal.
Review of Land Court Determination
In Warren v Coombs [1978-79] 142 CLR 531, after, as described by Aickin J at 561, as an examination of cases "dealing with the function of an appellate court in hearing an appeal on questions (including inferences) of fact", the majority, Gibbs ACJ, Jacobs and Murphy JJ, said at 552:
"Again with the greatest respect, we can see no justification for holding that an appellate court, which, after having carefully considered the judgment of the trial judge, has decided that he was wrong in drawing inferences from established facts, should nevertheless uphold his erroneous decision. To perpetuate error which has been demonstrated would seem to us a complete denial of the purpose of the appellate process. The duty of the appellate court is to decide the case - the facts as well as the law - for itself. In so doing it must recognise the advantages enjoyed by the judge who conducted the trial. But if the judges of appeal consider that in the circumstances the trial judge was in no better position to decide the particular question than they are themselves, or if, after giving full weight to his decision, they consider that it was wrong, they must discharge their duty and give effect to their own judgment."
We are mindful of the advantages enjoyed by the learned President in having conducted the hearing over a long sitting period. We are also aware of the difficulties encountered through the nature of the evidence, the approach of the various experts and the complexity of the many issues involved. We have been assisted by the clarity with which the evidence was considered and decided in the reasons for judgment. Many of the issues have been revisited in the submissions in support of the grounds of both appeals.
It is with regard to relatively few of those issues where the potential for error was shown. We see the Land Court to have been in no better position than this Court to consider and decide those issues. Where we have decided that error in the determination of compensation has occurred and where we are in a position to review the determination, we will conduct that review.
Our finding with regard to the error in application of the Pointe Gourde principle to the town planning restrictions associated with the zoning of the land, by itself, has no significant effect on the determination of compensation. Our consideration of the evidence and the submissions, and particularly the valuation evidence, suggests to us that the risks associated with the highest and best potential use of the land, had there been no interference caused to the clearing strategy of the claimant by the making of the ICO's, would not have warranted review of the levels of value applied by the Land Court to any land classification. It is the culmination of risks to the levels of value applied to the potential arable lands which becomes the real issue, in our view.
The more identifiable effect of the risk issues flows from:
·The risk that a review of the areas of Class 1 and Class 3 land would bring with it the need for consideration of the effect, if any, of the 3 metre contour. In our view that risk, for valuation purposes, would have applied to the areas of increase over those shown on the DPI mapping, regardless of the scale of that mapping. Had the measured areas of 100 ha of Class 1 land and 512 ha of Class 3 land been adopted by the Land Court for valuation purposes, on the evidence available at the date of resumption, then no risk to the levels of value reasonably applicable to those classes of land would have been seen to exist. Although the risk attaches to the inclusion of a further 20 ha of Class 1 land and 38 ha of Class 3 land, a diminished effect then spreads over the whole of the reviewed area. That is the manner in which the merit in the State's appeal on this issue will be considered.
·In terms of the issue in the claimant's appeal that some of the Class 3 land should have been considered by the Land Court as being Class 2 land, we see the merit in that argument as being best resolved as an offset of some of the risk attaching to the 3 metre contour through the increase of the Class 3 land on review.
·In considering the levels of value which were reasonably applicable to the arable land classifications, we would not interfere with the Land Court's analysis of the market evidence or its findings as to the level of value applicable to the land classifications, cleared to improved pastures. However for the reasons given we see error in those levels of value being adopted for land cleared to improved pasture to a grazing standard, with added value of $750/ha, when the highest and best use of the relevant sale lands was for arable purposes. It is our opinion, that while the evidence as to the added value of clearing to improved pasture standard was inconclusive, the standard of clearing and the cost to convert the improved pasture land to cultivation standard should have been a significant consideration. For that reason, it is our view that the evidence of Mr Cross with regard to the added value of clearing to improved pasture and his methodology in analysing sales to a timbered basis, should not have been disregarded.
In a valuation made at a date earlier than the date of resumption, Mr Cross had valued 100 ha of Class 1 timbered land at $6,000/ha and 550 ha of Class 3 timbered land at $3,500/ha (RJ [255], [257]). For reasons associated with the 3 metre contour and a perception of a declining market, the Class 1 land had been deleted from the valuation made by him at the date of resumption and an area of 512 ha of Class 3 land was then valued at $2,500/ha. For reasons with which we agree, the basis for the later valuation was rejected by the Land Court. An opinion was expressed (RJ [263]) that the earlier valuation provided better evidence of value. The determination of compensation was however, based on effective rates, as "timbered" land, of $7,250/ha for the Class 1 land, which was also seen to have potential for banana production, and $3,750/ha for the Class 3 land, with the comment that if Class 2 land had to be valued, an appropriate rate would be $6,000/ha. ($5,250/ha "timbered")
After our consideration of the favourable findings to the State in terms of the risk issues and Mr Cross' evidence in relation to the added value of the timber treatment on the sale lands, we have concluded that a "timbered" valuation of $6,250/ha is reasonable for the area of Class 1 land as increased to 120 ha. If we maintained generally the same relativity as found by the Land Court, the Class 3 land would then be valued at a rounded $3,250/ha. However, giving the benefit of doubt to the claimant with regard to some of the Class 3 land having potential to be upgraded to Class 2 we have decided to adopt the valuation originally applied to the Class 3 land by Mr Cross, at $3,500/ha on a timbered basis.
Our finding on these issues has effect only with regard to the lands with arable potential and we would not interfere with either the area found by the Land Court to have highest and best potential use for grazing purposes or the effective value applied, on a timbered basis.
The following determination results for the land component:
Land in its "timbered" condition -
120 ha Class 1 land @ $6,250/ha $750,000
550 ha Class 3 land @ $3,500/ha $1,925,000
180 ha grazing @ $1,250/ha $225,000
398 ha mangroves and swampy tidal areas @ $250/ha $99,500
$2,999,500
In practical figures - adopt $3,000,000
Our finding on the "special value" issue, requires the calculation of the quantum of the premium to be reviewed, to $225,000 being 7.5% of the value of resumed land as now determined.
As no other headings of the Land Court's determination will be disturbed as a result of our findings, the determination of this Court is as follows:
Value of Land taken $3,000,000
Special Value $225,000
Value of Commercial Timber $168,689
Disturbance - legal, valuation and other consultants' fees
to the date of serving of the Claim for Compensation $26,000
Total$3,419,689
Orders:
1.To the extent that the State has been successful in having the quantum of the Land Court's determination reduced, and the claimant has been unsuccessful in having it increased, the appeal by the State is allowed and the appeal by the claimant disallowed.
2.Compensation is determined in the amount of $3,419,689 (Three Million Four Hundred and Nineteen Thousand, Six Hundred and Eighty-nine Dollars).
3.The respondent pay interest at the rate of 6 per cent per annum on the amount of $3,393,689 from the date of resumption, 19 November 1999, until 13 April 2000, when an advance of $1,830,000 was paid; and on the amount of $1,563,689 from 14 April 2000, until 25 August 2000 (which the parties agreed is the appropriate date that the legal and valuation fees were paid) and then on the amount of $1,589,689 from 26 August 2000 up to the day immediately preceding the date upon which final payment of compensation is made.
JONES J
JUSTICE OF THE SUPREME COURT
RE WENCK
MEMBER OF THE LAND COURT
RP SCOTT
MEMBER OF THE LAND COURT
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