Steers v Valuer-General

[2012] QLC 12

LAND COURT OF QUEENSLAND

CITATION:  Steers v Valuer-General [2012] QLC 0012

PARTIES:Norman Francis Steers

(Appellant)
  v.
  Valuer-General
  (Respondent)

FILE NO:LVA820-11

DIVISION:General Division

PROCEEDING:  Appeal against valuation under the Land Valuation Act 2010

DELIVERED ON:                  22 March 2012

DELIVERED AT:                   Brisbane

HEARD AT:Brisbane

HEARD ON:  29 February 2012

MEMBER:Mr WA Isdale

ORDER/S:1.      The appeal is dismissed.

2.The Valuer-General’s valuation of Five Hundred and Fifteen Thousand Dollars ($515,000) is confirmed.

CATCHWORDS:         Land Valuation Act 2010, ss 4(1), 7, 45, 169

Cattanach v Water Conservation and Irrigation Commission (1962) 9 LGRA 352

Crompton v Commissioner of Highways (1973) 32 LGRA 8

ISPT Pty Ltd v Melbourne City Council & Anor [2008] VR 447

JL and I Qualischefski v Valuer-General (1979) 6 QLCR 167
NR and PG Tow v Valuer-General (1978) 5 QLCR 378

APPEARANCES:                  Mr NF Steers, the appellant, appeared on his own behalf

Mrs T Johnson, Principal Lawyer, Legal Services, Department of Environment and Resource Management, for the respondent

The Appeal

1. Mr Steers owns 1.904 ha of land at 17 Brentwick Street, Chermside. As required by the Land Valuation Act 2010 (the Act) the respondent valued it as at 1 October 2010. That valuation of $515,000 unimproved value is the subject of the present appeal.

The Appellant’s case

1. The appellant gave evidence and tendered documentation which included copies of plans and photographs as well as statements from a number of persons. The sole witness for the appellant was Mr Steers who was also his own advocate. Mr Steers explained that he had built his own home on the land in the mid 1970s and had built up the land with “approximately 2 million cubic metres”[1] of fill. He expressed the view that the valuation should now be 10 times what he purchased the land for in 1970 and hence should be $50,000. He commented twice in the course of the proceedings that he had refused an offer of $10,000,000 for the land for development with home units. Mr Steers did not refer the Court to any body of evidence of sales of land in support of his contention for a valuation of $50,000. He emphasised the need to consider the land in its unimproved state and directed attention to its susceptibility to flooding and the presence of an easement for drainage purposes and an ecological corridor on the land.

   [1]     Exhibit 1, first page and second page. This figure was repeated in Mr Steers’ oral evidence.

2. Mr Steers informed the Court that he is a carpenter and also described an extensive background in the civil construction industry that saw him performing leading practical roles in building infrastructure of national significance. He is not qualified as a valuer of land.

3. On behalf of the respondent, evidence was given by Mr Sunil Philip Kunnath, a Registered Valuer, Associate Member of the Australian Property Institute and accredited Certified Practising Valuer. Mr Kunnath holds the degree of Master of Property Studies from the University of Queensland and has had three years experience valuing residential property in Brisbane. He is responsible for valuations in the Kedron division of Brisbane.

4. Mr Kunnath was present in Court with the leave of the Court during the appellant’s evidence and presented his report, gave evidence and was then cross-examined for about two hours.[2] His evidence was that he adhered to the opinion provided in his written report even after hearing the evidence presented by the appellant.

[2]     For 45 minutes prior to and 1 hour and 18 minutes after the luncheon adjournment.

1. Mr Kunnath made clear that he had arrived at the unimproved value of the land on the basis of its rural zoning and on the basis that it was used only for a single dwelling.[3] I note that, this being so, it is not relevant that, for instance, someone may be willing, as Mr Steers stated, to offer $10,000,000 for the land in view of its potential for more intensive development. The appellant has the benefit of the land being valued on the basis that its greater potential and therefore higher value is, for present purposes, not taken into account.[4]

   [3]     Land Valuation Act 2010, s.45.

   [4]     Exhibit 3 p.9.

2. Mr Kunnath has prepared his valuation using the method of direct comparison[5] of the land the subject of this appeal (the subject) with sales of other land. Importantly, Mr Kunnath made clear at page 9 of his report, which is exhibit 3, that the valuation reflects the flood free area within the subject. Comparisons have been made with other flood affected land suitable for residential use.

   [5]     Exhibit 3 p.9.

The use of evidence of sales

1. The use of sales to provide comparisons of value is well established. In NR and PG Tow v Valuer-General (1978) 5 QLCR 378, the Land Appeal Court constituted by Stable SPJ, Mr Smith and Mr Carter said at page 381:

   “Courts of the highest authority have laid down that the best test of value is to be found in the sales of comparable properties, preferably unimproved, on the open market round about the relevant date of valuation and between prudent and willing, but not over-anxious parties.”

2. This Court is required to follow the decisions of the Land Appeal Court and accordingly must prefer the evidence of comparable sales to the method contended for by the appellant, simply increasing a previous value by a factor of 10. Mr Steers did not explain why this particular multiplier and not some other one should be applied.

The onus of proof

1. The Act, by s.169 provides that the hearing of the appeal must be limited to the grounds stated in the notice of appeal[6] and that the appellant has the onus of proof for each of the grounds of appeal.[7] In practice, it is not likely to be a simple matter to establish that the subject ought to be valued at $50,000 without the assistance of a registered valuer who might be able to point to sales of comparable land supporting such a value.

[6]     Land Valuation Act 2010, s.169(1).

[7]     Land Valuation Act 2010, s.169(3).

The sales evidence

1. The sale properties relied on by the respondent’s valuer were criticised by the appellant who pointed out that, for instance, a sale at Kenmore was not near to the subject land. The same could rightly be said of the sale at Pinjarra Hills and the sale at Tingalpa. The valuer’s evidence however was not contradicted by any witness qualified in that field of expertise. He stated that there were no sales of suitably sized comparable blocks close by and that the sales used were comparable. Mr Kunnath did not merely assert the existence of comparability but provided reasons for it, such as comparable radial distance from the centre of the city, comparable exposure to flooding and constraints such as wetland corridors. He has inspected all of the sale properties.

The witnesses

1. The appellant as his own advocate was enthusiastic in support of his case. The internal consistency of the evidence introduced in support of it was somewhat lacking however. His claim that approximately 2 million cubic metres of fill had been placed on low-lying parts of the land was examined by Mr Kunnath who pointed out that mathematics demonstrates that even if evenly spread over the property this would have raised the land very significantly. Contour maps dating from before and after when the fill was said to have been added do not show any change reflective of such an amount of fill, or much change at all. The contours in 1946 are shown in exhibit 5 and those in 2009 are on page 8 of exhibit 3. The valuer also pointed out that placing fill material where described in the flood corridor on the subject land was on an area that could not be built on and therefore added no value. Accordingly, notionally removing it for the purpose of finding unimproved value would make no difference to that value. Having observed the demeanour of Mr Kunnath when in the witness box and his attentiveness to the appellant’s evidence, I accept that he was endeavouring to assist the Court in accordance with his duty as an expert witness. In view of the inaccuracy in the appellant’s evidence in relation to the amount of fill on the land, I am unable to accept his evidence in relation to that. Even if I were to accept Mr Steers’ evidence on this point, the valuer has approached his valuation in a manner such that the amount of fill added to the flood-prone area would not affect the valuation. It would make no difference if 2 million cubic metres, 2 million cubic feet or some other amount of fill was added.

2. I am not satisfied on the evidence that the appellant has demonstrated that the valuer could not compare the subject to the sale properties. The Valuer has provided detailed comparisons in his report[8] and there is no expert evidence to the effect that these sales are not capable of being used by a professional valuer for comparison with the subject. The appellant was not able to point to any matters which the valuer would accept or the Court could accept as rendering any of the sales not comparable or the valuation invalidated by error.

   [8]     Exhibit 3.

The sales evidence

1. Sale 1 relied on by the respondent was of 4,140 m² of uncleared land at 138A Kenmore Road, Kenmore which sold for $458,500 on 2 October 2009. It is irregular in shape, moderately to steeply sloping and about 800 m² is affected by a waterway corridor and approximately 1,000 m² by a wildlife corridor, thus limiting the usable area to 2,300 m². It is landlocked and unsewered. It is about 10 km south-west from the Brisbane Central Business District. The subject is located about 10 km to the north of the CBD.

2. Sale 2, at 2938 Moggill Road, Pinjarra Hills was of 1.012 ha of rural land which sold for $403,000 on 5 December 2010. It has a flood-free area of about 2,000 m². It is subject to an easement and is in a waterway corridor. It is unsewered and located 17 km from the Brisbane CBD.

3. Sale 3 is at 573 Hemmant Road, Tingalpa with an area of 5.886 ha. Around 95% is zoned as park land and 2,943 m² is zoned rural with a flood free area of approximately 1,010 m². It sold for $900,000 on 29 April 2009. It is 10 km east of the Brisbane CBD. It has easements for overland water flow and adjoins a cemetery.

4. Sale 4 at 332 Muller Road, Taigum, was of 2.331 ha zoned as an emerging community. It sold for $700,000 on 11 June 2009 lightly improved with a dwelling and shed. The analysed sale price was $657,700 allowing for the value of the improvements. A hatchet-shaped allotment with a flood free area of approximately 2,530 m² it is located 14 km north of the Brisbane CBD. It has a smaller flood-free area than the flood-free area on the subject.

5. Compared to those sales of land, Mr Kunnath valued the subject in its unimproved state at $515,000. He did this in view of the assumptions required by the Act and to which I have already referred.

6. The Court is not an investigating tribunal and must rely on the evidence put before it by the parties. In JL and I Qualischefski & Ors v Valuer-General (1979) 6 QLCR 167, the Land Appeal Court in its judgment said, at page 172:

   “Neither this Court nor the Land Court in the subject jurisdiction may assume the role of an investigating tribunal requiring the Valuer-General to substantiate his case. This is in contradistinction to jurisdiction conferred under the Land Act.”

7. It is not necessary that sales considered by a valuer be within a particular distance from the subject property in order to the considered to be comparable. Land some distance away may still be comparable.[9]

   [9]     Crompton v Commissioner of Highways (1973) 32 LGRA 8 at 23-24: “… the valuer should, in the first instance, look at the sales of land over a wide geographical and temporal range, and from these select those that appear potentially useful as a basis for comparison.”

   The Law Affecting Valuation of Land in Australia, 4^th ed. Alan A Hyam. The Federation Press, 2009 p.199:  “Special consideration should not be given to sales within a specified area over and above sales outside of that area, provided that the lands are truly comparable: Cattanach v Water Conservation and Irrigation Commission (1962) 9 LGRA 352 at 361.”

8. Although a specialised judicial tribunal[10] not bound by the rules of evidence[11] this Court is required to consider the evidence before it and is not able to substitute its opinion for that of an expert or to comminute the expert evidence and construct its own opinion from fragments of the expert’s views.[12]

   [10]    Land Court Act 2000, s.4(1).

   [11]    Land Court Act 2000, s.7.

   [12]    ISPT Pty Ltd v Melbourne City Council & Anor [2008] VR 447 at 474 [124].

9. Mr Kunnath maintained his view under cross-examination and his demeanour was that of a patient professional respectfully answering the questions put to him in a manner which assisted the Court. Where he did not agree with propositions put to him his explanations were uniformly clear and relevant.

10. In addition to the four sales which he used to value the subject, Mr Kunnath referred to supporting evidence in the form of a sale of land at 124 Maundrell Terrace, Chermside West on 13 January 2012, after the date of valuation, for $565,000. With an area of 1.226 ha it was uncleared low density residential land with a slightly larger useable flood-free area than the subject. It has 3,800 m² of useable area and was found to support the value arrived at by the four sales which had been applied.

11. The sale of 992 Gympie Road, Chermside on 13 March 2006 for $879,000 was also seen as supportive of the value arrived at. It is a neighbouring parcel to the subject and sold well before the valuation date. It was not used to arrive at the value of the subject. It has no flood-free area and is improved with a dwelling. Allowing for that, the sale is said to support the value of the subject.

12. The unimproved sales of two small residential parcels within 50 metres of the subject were also analysed to provide some perspective upon the subject land but not to value it.

Conclusion

1. On the evidence put before the Court, the appellant has not established a basis upon which the Court could be satisfied that the unimproved value of the subject land on 1 October 2010 was $50,000 or that it should be arrived at by the method contended for by the appellant.

2. The method of valuation used by the expert called on behalf of the respondent is the method which the courts have found to be the best test of value and there has not been any competing expert evidence supportive of a different conclusion on value to that drawn by the respondent’s expert witness.

3. In the circumstances, the appellant has not been successful in establishing the correctness of a different level of value to that contended for by the respondent and I accept the evidence of Mr Kunnath and his opinion of the value of the subject land.

4. In exhibit 1, Mr Steers wrote “I would, however, be happy to pay the current land valuation if the easement was removed and the creek placed back to its original course.” This Court does not have jurisdiction which would allow it to order either of those things.

Orders

1.The appeal is dismissed.

2.The Valuer-General’s valuation of Five Hundred and Fifteen Thousand Dollars ($515,000) is confirmed.

HIS HONOUR WA ISDALE

MEMBER OF THE LAND COURT