Stockham v Chief Executive, Department of Natural Resources
[2000] QLC 62
•12 October 2000
|
BRISBANE
12 October 2000
Re: Appeal against Annual Valuation
Valuation of Land Act 1944
Valuation Roll No: 7669/93500
Local Government: Burdekin.
(AV99-1209).
William Kevin Stockham
v.
Chief Executive, Department of Natural Resources
(Hearing at Townsville)
D E C I S I O N
Background:
This relates to land at Keith Venables Road, Ayr, described as Lots 41 to 43 on CP903751, Parish of Barratta. The subject land is located about 42kms south-west of the township of Ayr, in an established cane growing area. The land is used for sugar cane production, and is farmed as a single parcel. The subject land has fair access to Keith Venables Road which is a formed gravel roadway. The key issues are the impacts of flooding and the value of cane production areas (CPA).
The subject land comprises a total of 326.8 hectares and is zoned "Rural B" under the Burdekin Shire Council's Town Planning Scheme effective at the date of valuation of 1 October 1997. The subject land has a near rectangular shape with frontage to Keith Venables Road on both its eastern and southern boundaries. The land is predominantly cleared coastal forest country, which was originally timbered with poplar gum, Moreton Bay ash, and ti-tree. The arable irrigable land comprises mainly clays and some sodic affected clays, and is prone to inundation and drainage problems. The subject land is serviced with electricity, and there is a nominal water allocation of 8 megalitres per hectare to the arable irrigable lands.
On 10 March 1999 the Chief Executive issued a valuation of the subject land at $1,850,000. Following an objection the Chief Executive amended that valuation on 28 July 1999 to $1,800,000. The appellant has now appealed that figure claiming the unimproved value should more properly be $1,440,000.
Mr B Baxter, solicitor of Ruddy Tomlins and Baxter, appeared for the appellant, calling evidence from George Kenneth Stockham, a very experienced cane grower and former chairman of the Invicta Mill Suppliers Committee; and Geoffrey William Eales, an experienced registered valuer. Mr J O'Rourke, Principal Legal Officer, appeared for the respondent, calling evidence from John Robert Hoult, the Departmental registered valuer now accepting responsibility for determining the valuation. Mr Hoult has extensive experience in valuing cane lands.
The History of the Valuation -
The appellant acquired the subject land in April 1998, subsequent to the adopted date of valuation of 1 October 1997. The subject land was purchased at a public auction which attracted considerable interest and alternative bidders. At the time of purchase Mr Stockham argues that it was believed that a cane assignment, now CPA, should be obtainable.
Since that date there have been no further cane production areas allocated, pending an agreement with the Invicta Mill management (CSR) in respect of the expansion of cane harvesting. The agreement came into existence as a result of expansion of the mill areas and a subsequent reluctance by the mill to grant new cane production areas since the deregulation of the sugar industry. While the matter of cane production areas overall has been one of less an issue, since 1992/93 in certain areas such as the Invicta Mill, the lack of crushing capacity has led to the need for the special agreement between the mill and farmers in the area.
Prior to sale at auction the subject land had been developed by the respondent for expansion of cane harvesting. It had been the intention of the respondent to sell each new parcel with a current cane production area in place. At the date of valuation (1 October 1997) there was no CPA for the subject land, although an application for a CPA had been lodged by the appellant.
However, because of the provisions of the Trade Practices Act, and enquiries by the Australian Competition and Consumers Commission (ACCC), any agreement on crushing areas is currently delayed indefinitely. Mr Stockham further advises that there is no mechanism under the Sugar Industries Act 1999 whereby a miller can be required to expand. That knowledge is widely understood among cane farmers in the Invicta Mill area.
The Impact of Flooding -
It is agreed by the parties that the subject land has been impacted by flooding from a balancing storage (ponding) area adjacent to the north and north-west of the subject land. That balancing area was developed by the respondent Department as part of the water management arrangements for Oakey Creek. The water storage is located at its nearest point some 200 metres to the north-west, with the designed overflow discharge a further 200 metres away. There is a levee bank along the northern boundary of the subject land which is designed to contain the flood waters in the retention storage area.
However twice in 1998, the flood waters have broken through the levee bank and inundated approximately half of the area of the subject land. The lands are also subject to flooding periodically from Oakey Creek by waters backing up along Keith Venables Road to the east of the subject land. Following legal representations, the flooding from the respondent's main irrigation channel has been rectified, and the levee bank along the northern boundary has been raised.
However Mr Stockham argues that the effectiveness of the repairs to the balancing storage basin remains to be demonstrated during times of a "significant rain event". Mr Stockham defines that as a fall of 150mm of rainfall in a period of 24 hours, as experienced twice since 1998. An attempt by the respondent's engineers to divert some of the balancing areas waters to a series of downstream waterholes, has been shelved due to objections from adjoining owners.
In his assessment of the value of the subject land, Mr Eales argues that the property has a certain perception of stigma attached to it because of the potential for flooding. Mr Eales believes that stigma was likely to remain in the marketplace until, over a period of time, the remedial works on the levee bank are seen to have worked. He is aware of that stigma through the instructions of other clients similarly impacted. However he only became aware of that stigma in recent years, and could not advise whether the stigma was known at the date of valuation in 1997.
In an attempt to quantify the effect of the flooding, Mr Eales has sought assistance from sales of regularly flooded cane lands in the Ingham area along Cattle Creek. He argues that he knows of no evidence of sales of flooded lands in the Burdekin area, and seeks guidance in the diminution of value in Ingham, where sales have disclosed diminution in value of 10% to 20% due to regular inundation every two or three years. In his comparisons Mr Eales has adopted 10% as the lower end of that range of depressed values.
However Mr Eales agrees that the range of flooding in the Ingham lands, related to the long depth of some of those parcels, where the lower half of the parcel actually flooded. Mr Eales concedes that in effect a 10% diminution in land value in those areas probably represented 20% for the flooding of half of the land every two to three years. Mr Eales believes that the subject land would be faced with a rainfall event of 150mm in 24 hours, nominally once in four to five years, and he speculates that the rainfalls have been unusual over the last few years. For those reasons he accepts 10% as a fair diminution in value because of flooding.
Mr Hoult agrees with the impact of flooding and inundation, and as a consequence of that information from the appellant during the objection conference, in respect of the flooding from the breakthrough of the levee bank, the unimproved value was reduced by $50,000 in July 1999. In his original valuation Mr Hoult had accepted that the unusual floods in 1998 had been seen as having a frequency of 1 in 40/50 years. As such he believes those floods would be similarly felt by all cane lands in the Burdekin Basin and he made no special allowance for the 1998 floods. He allowed the reduction of $50,000 in recognition of the retention basin overflow problems.
In his valuation Mr Hoult was guided by the State Water Project's release notes at the date of sale of the subject land, which showed 64.6 hectares at the northern end of the subject land as prone to inundation (20% of the total area). After now allowing for the additional $50,000 for overflow from the retention basin, Mr Hoult estimates that his concession for inundation is about 4% over the overall property, reflecting in his opinion about 30% of the actual area value. However, based upon those figures, a diminution of about 20% would seem appropriate over the 64.6 hectares of flooded land. Mr Hoult's total allowance for flooding was $50,000 plus $27,000 or $77,000.
Mr Hoult believes Mr Eales' allowance of 10% of diminution is excessive, based upon his experience of sales in the area. However Mr Hoult provides no sales to support his conclusion, referring only to some revenue flow analyses he undertook. However, he concedes that market evidence is the best indicator of value.
In terms of the likely risk of flooding on the subject land, compared to flooding on the sale properties analysed, Mr Hoult concedes that the ponding retention basin adjoining the subject land does increase the level of risk of flooding, hence his further discount of $50,000. However he does not see that risk as great in the catchment area, compared to other parcels. Mr Hoult argues that all soils in the Burdekin Basin are alluvial deposits, as the entire basin is a delta, and all properties become affected by floods. He believes such likely events would be considered by a prudent purchaser in the marketplace.
Cane Production Areas -
As noted earlier, the Invicta Mill has gone through a period of expansion at a time of relaxed industry constraints following deregulation of the sugar industry. Mr Stockham advises that because of the limited number of growers who applied for new cane production areas, CSR was reluctant to expand the mills operations. As a method of alleviating grower concerns, CSR commenced negotiations to establish an agreement with growers in accordance with national competition policy. An original agreement was signed in 1988. Negotiations for a new agreement commenced about 1996, and before the appellant acquired the subject land in 1998.
The Invicta Mill undertook a $300,000,000 expansion in 1992, but by the end of 1995, CSR would not renew that earlier agreement. CSR's objective was to renegotiate a new agreement based upon a longer working week, and longer season, rather than to increase crushing capacity. The change in the agreement was also impacted by the introduction of a new Act (Sugar Industry Act 1999), and the establishment of a Cane Production Board.
Proposals still being resolved include a 10 year lifespan for the agreement, starting date and supply arrangements, a cane price formula including recognition of "old" and "new" CPA, compensation for old CPA growers, and adoption of the agreement for the 2000 season. While the agreement was being finalised, the appellant applied for a CPA on the understanding that any agreement was likely to be in accordance with the new CPA arrangements. However at the date of valuation there was no CPA agreement in place for the subject land or for 12 or 13 other lots, out of in excess of 100 growers in the area.
In considering the impact of the recognition of "new" and "old" CPA, Mr Eales argues that the marketplace is now accepting that there is a differential between those two rates. He sees that differential as representing a penalty on new CPA allocations reflecting the infrastructure levy of $1 per tonne for 10 years, while the old CPA has no infrastructure liability. That infrastructure levee is for capital works on the tramline and extra capacity at the mill.
To that must also be added compensation payments for old CPA farmers at $1.07 per tonne in perpetuity, giving a differential between the new and old CPA of $2.07 per tonne. Mr Hoult notes the $1.07 per tonne and sees that as comprising an extended season and weekend allowance. It is presumably that differential in business opportunities between new and old CPAs which gives rise to the concerns about restriction on trade practices still exercising the mind of the ACCC.
In seeking market evidence of the recognition of that above differential, Mr Eales relies upon hearsay confidential information supplied to him from a solicitor, now deceased. Mr Eales compares his calculations of the present value of the infrastructure levee at 10% over 10 years, plus the $1.07 compensation in perpetuity, and concludes that the suggested market price now being confidentially accepted reflects only one-third of its theoretical value.
Mr Eales concludes that lower figure probably reflects some lack of realisation of the true value of transferable CPAs, but argues the market figure of $600 per hectare is a conservative estimate of that value of a right to produce and crush cane. Mr Eales advises that, depending upon what interest rate is used, the value of a CPA could be of the order of $1500 per hectare. Mr Eales confirms that there are no records of sales of CPA available from the respondent.
Mr Eales has no argument with Mr Hoult's sales comparisons, or the analysed rates adopted. However he argues that in accordance with good valuation practice, what must be compared are like properties. In his opinion, as the subject land had no CPA at the date of valuation, then its value must reflect that lesser value compared to sales where CPA was available. Mr Eales deducts $600 per hectare for that purpose.
Mr Hoult argues that at the date of valuation at 1 October 1997, the market evidence reveals that CPAs were virtually obtainable on demand at the nominal cost of an application fee of $200 through the cane growers association. Accordingly Mr Hoult makes no allowance for any additional value for a CPA. Mr Hoult concedes that market forces subsequently may have changed that market perception since 1997, but he argues that it is not a matter to be considered at 1 October 1997. He accepts that $600 per hectare may be some evidence of value now, but not in 1997.
Mr Hoult relies upon his comparison on an arable irrigable approach, ignoring CPAs which he sees had no value in the Invicta Mill area. Mr Hoult advises that approach was adopted for the revaluations in 1993 and 1995. However he concedes that the Act allows for consideration of assignment allowances, a practice Mr Baxter argues prevailed prior to the deregulation of the industry.
However Mr Hoult further advises that there has been no subsequent revaluation of the subject area since October 1997. The decision not to revalue an area may be a logical decision from the perspective of the Chief Executive, for whatever reason. However it is noted that the intention of the Valuation of Land Act (the Act) is directed to ensuring that the value of land is better provided for rating and taxing purposes. Part of that intention is to allow either for a general valuation (s.18), or a change in the value of a single parcel where the Chief Executive is of the opinion that a change should be made (s.28(1)(g)).
In the circumstances of the current matter it would appear that market forces may have changed to the extent that there is now a measurable differential between lands which have a CPA, and those that do not. However Mr Hoult does not accept that his sales were all fully assigned as he believes Mr Eales has assumed. To support that view Mr Hoult notes areas of his sales which had significant drainage problem areas, discussed later.
Both Mr Eales and Mr Hoult agree that since 1991 under amendments introduced under the Sugar Industry Act, assignments could be sold and transferred independent of land. It is also agreed that assignments can be leased, and Mr Hoult advises that in 1999 people were paying about $2.00 per tonne, on a yield of about 110 tonnes per hectare, or $220 per hectare, in order to be able to harvest their cane. He argues that while that might reflect 1999 values, that was not the case in 1997, where there was an abundance of assignments throughout the district. However Mr Hoult concedes that they are not handing out CPAs at the present time, or since the date of valuation of 1 October 1997. Mr Hoult agrees that there has developed a market for CPAs since October 1997. He also agrees that there may be some issues about CPAs which were likely to have been known by the appellant, when he acquired the subject land in 1998, as negotiations on an agreement commenced in March 1998.
Method of Valuation -
There is general agreement between Mr Eales and Mr Hoult about the sales adopted and their analysis. In their respective assessments of the classification of the types of land, and the appropriate rates per hectare for the subject land, the valuers are also in general agreement in respect of the classification of the land and the general level of values as follows:
Mr Eales -
Type of Land Area Rate per ha Value
Class 2 183.4ha $6,710 $1,230,614
Class 3 89.7ha $5,735 $ 514,429
Class 4 53.7ha $3,380 $ 181,506
TOTAL $1,926,549
Mr Hoult -
Type of Land Area Rate per ha Value
Fairly arable/irrigable 183.4 $6,006 $1,101,500Fairly arable/irrigable
(sodic affected) 89.7ha $6,006 $ 538,738
Poor non-allocated arable 53.7ha $3,177 $ 170,605
TOTAL $1,810,843
The major difference then between the valuers lies in whether some further deduction should be allowed for the flooding or CPAs. Mr Eales has also allowed an allowance of 5% for the non-commanded water supply on the subject land. Mr Eales understands that the sales adopted by Mr Hoult reflect the general command nature of water supply in the Burdekin. Where water is not available on command, then additional infrastructure such as pumping is required to operate the farm.
Mr Eales advises that the normal practice in the Burdekin Basin for such additional infrastructure cost is to allow an allowance of 5% of the overall value of the property. Mr Eales therefore deducts a further $96,327 for non-command supply giving him a total value before flooding or CPA allowances of $1,830,222. Both valuers agree that an unimproved value of $1,800,000 would be appropriate without any extra flooding or CPA allowances.
Mr Hoult does not quibble with the allowance for non-command land, but notes that his records from State Water Projects reveal that only Lot 41 (119.5ha), plus a further 3 hectares on Lot 42 has uncommanded water on the subject land, or 37% of the total area.
Decision:
As a starting point I accept that the unimproved value of the subject land as assigned cane land in the Burdekin area would be $1,800,000. What I must then decide is whether there should be any further allowance for the extra risk of flooding, and whether the lack of a CPA would detract from that value.
The Impact of Flooding -
I note first that Mr Holt has compared the subject land with sales on a direct comparison basis, and he advises that his Sales 1 and 2 both suffer from some inundation. Both of those sales have a significant drainage line nearby. Sale 2 was inundated along its northern boundary in 1998, and similarly Sale 1 was inundated along its eastern boundary. By making a direct comparison with those sales Mr Hoult argues that he has allowed for some further inundation, providing a benefit of $27,000 initially for the subject land.
Once he was made aware of the extent of the damage by the breaching of the levee bank, Mr Hoult has now increased that to $77,000 or about 4% of the total area (reflecting 20% for the actual flooded lands).
If I compare that to Mr Eales' allowance of 10% for the comparable flooding at Ingham, I find that Mr Eales' estimate is based upon 10% for the total area of those long parcels of which 50% was flooded. That suggests an allowance of 20% for the actual flooded areas would seem appropriate. However that compares to the lands at Ingham which have a 2 to 3 year frequency of a 150mm in 24 hour rainfall, compared to four to five years at the subject land. On balance I believe the subject land overall could be subject to flooding at the rate of 4% based upon a normal flooding sequence.
However in addition to that normal potential for flooding of part of the subject land, there is also the risk of a further breach of the adjoining levee bank surrounding the balancing storage area. While that levee was repaired, I accept Mr Eales' opinion that there remains some stigma on the land, at least until subsequent significant rainfalls demonstrate to the contrary. On the basis of Mr Hoult's assessment of $50,000 to allow for that risk of further damage, I will also allow a further $50,000, beyond the current approximate 4% allowed for periodic flooding. That suggests an overall allowance of $77,000 plus $50,000, or $127,000 for flood risks. The unimproved value as cane land with a CPA in place would be $1,750,000.
The Impact of a CPA -
Perhaps the most contentious issue is whether the lack of a cane assignment (CPA) should impact the value of the land. Summarising Mr Hoult's evidence I understand him to accept that CPAs have now engendered a special value in the marketplace. Certainly the evidence of the agreement still being negotiated would support that opinion. However it is Mr Hoult's opinion that any movement in the marketplace for CPAs is all subsequent to the date of the valuation (1 October 1997), and is therefore not a matter for consideration in the current matter.
I note for instance when discussing changes in the CPAs, Mr Hoult said:"Yes. I believe the situation there has just been an evolving process whereby it has been put to us that the assignment is obtaining value and leading up to the sort of date of effect that the agreement will come into place. And really I see that movement in assignment value there just really akin to any movement in value of land after the date of valuation, there's not a great deal we can do about that until there's a new date of valuation." (Transcript 38.)
In respect of the Chief Executive's responsibility to determine valuations, I note that he has the discretion to set a date for a general valuation under s.18 which states:
"18(1). The chief executive may at periodic intervals fix, by gazette notice, a date for a general valuation.
(2)In making the valuation all lands in the area shall be valued as at the date so fixed. "
Accordingly when the subject land was sold in April 1998, it was lawful for the Chief Executive to determine the value of that new parcel as at the date of the current valuation for Queensland at 1 October 1997. While I have no evidence of the date of issue of the general valuations for that period, it would be consistent with historical records for that to have occurred about March 1998, about the time that negotiation of the new agreement for CPA was commenced with CSR.
At the time of the purchase of the subject land in April 1998, the appellant was likely therefore, as a prudent purchaser, to have been aware of the changing nature of the market for CPAs. In fact the lack of increased crushing capacity had been an issue at the Invicta Mill since 1992/93. The extent of concern that such awareness of potential problems in gaining a CPA has subsequently been demonstrated by the creation of a differential even between those growers with an old CPA, and those with a new one ($2.7 per tonne or $220 per hectare). What impact would a lack of any CPA have upon the value of the land?
The only evidence that I have in respect of the likely market value of a CPA is hearsay from a deceased solicitor, who was party to a confidential dealing between unspecified purchasers and sellers of cane lands. I also note that such confidential information occurred apparently subsequent to the sale of the subject land, and certainly subsequent to 1 October 1997. I am also aware that as a valuer with long experience in the cane industry, Mr Eales believes that reported figure of $600 per hectare reflects a very conservative capitalisation of the now differential of $2.07 per tonne.
While the rate of allowance is a matter of speculation, in the absence of other sales evidence, what can be contemplated is whether any allowance for CPA should in fact be applied retrospectively to a value as at 1 October 1997.
Mr Hoult concedes that changes have occurred in the value of a CPA, and it may have been impacting the market at the date of sale in April 1998, and certainly at the date of issue of the new valuation at 10 March 1999. However Mr Hoult argues that what he must do is to hypothetically interpret the value of the subject land at 1 October 1997, 6 months prior to the subject land coming into existence for valuation purposes. This is a task confronted by the respondent regularly when new parcels are created. As Mr Hoult argues it is the normal practice of the respondent to retrospectively value the new parcel at the relevant date, and any changes in the market are then identified in succeeding valuations.
However precedents dictate that in assessing unimproved value, market considerations impacting a property up to the date of issue may be considered. In that respect I note directions in KP and RD Weisenberger v. Valuer-General (1978) 5 QLCR 125; and also in RG McMurray v. Valuer-General (1983) 9 QLCR 35, at 36. In those matters this Court and the Land Appeal Court considered the use of lands for primary production activities, and concluded that they were unable to have regard to any use after the date of issue of the valuation. By adopting that direction the Court was able to have regard to matters occurring between the date of the valuation and the date of issue.
I note also that the use of subsequent events can be considered, as noted in Daandine Pastoral Company v. Commissioner of Land Tax (1943) 7 The Valuer 299, where Williams J in the High Court of Australia said at p.304:"Values must be calculated in the light of circumstances which existed on the material date, in this case 30 June 1939, but subsequent events can be taken into account in order to determine the proper weight to attach to such circumstances. Subsequent sales are just as admissible in evidence as prior sales provided that in all the circumstances they are comparable. If between the material date and the date of the subsequent sale, supervening events occur which alter the conditions previously existing, the subsequent sales would not be comparable and would be useless."
Support for the use of subsequent sales is also to be found in McCathie v. Federal Commissioner of Taxation (1944) 69 CLR 1, at p.16 and also in Federal Commissioner of Taxation v. Harris (1980) 30 ALR 10, at 18. However in Harris, Fisher J noted at p.25 that the subsequent events cannot create an expectation which was not in existence at the relevant date.
Any change in circumstances must also be viewed in line with guidance to be found in Hurdis v. The Minister (1957) 2 LGRA 132, where Hardie J found at p.138:"Another matter which would be important to a prospective purchaser was the marked upward trend in values of land in the area during the period preceding the relevant date. ---- That increase, particularly in the latter portion of the period, would be a significant matter for a prospective purchaser to bear in mind when considering what would be a reasonable price for him to pay for the subject land. It has another significance also, in that it demonstrates that a sale otherwise comparable and useful for the purpose of establishing values in the area at the relevant date, would lose much of its comparability and usefulness if it took place at a point of time far or substantially removed from that date. "
However in concluding any impact of a changing market for CPA in the current matter, it is important to heed directions of the Land Appeal Court in Beedell Farms and Grazing Pty Ltd v. Valuer-General (1979) 6 QLCR 322, where the Land Appeal Court said at p.329:
"At the same time we stress that the object of the exercise that we have to carry out is to arrive at an unimproved value as at a relevant date. Trends, factors and conditions affecting the market as at that date must be taken into account but only to the extent that they were present or were reasonably foreseeable as at that time. Viewing matters as we are over three years after the relevant date, care must be taken to ensure that hindsight does not unduly colour or unduly influence our opinion of market conditions and their reasonable foreseeability as at the relevant date. "
The principle of considering wider economic factors was also noted in GE Cominos and Co Pty Ltd v. Chief Executive, Department of Lands (1996-97) 16 QLCR 311, at 316, where the Land Appeal Court considered the impact of a national airline strike upon the tourist oriented economy of Cairns in North Queensland. In that matter the Land Appeal Court noted that the locality of the subject land, in what is referred to as the "golden block", had experienced a boom during 1987 and in early 1998. Subsequently in 1989, due mainly to the external forces of the airline strike, the property market had severely declined, and continued to be depressed at the date of valuation. The analogy of the Cominos decision to the current matter is obvious.
In the current matter it is argued by Mr Baxter that at the date of sale of the subject land in April 1998, and certainly at the date of issue of the valuation in March 1999, there was a widening recognition in the marketplace that CPAs were developing a separate market identity. I believe that trend would have been well entrenched in market expectations by the date of issue of the valuation in March 1999, and is therefore a matter that should have been noted in the valuation.
It is not the role of this Court to direct the Chief Executive in the exercise of his discretion afforded him under the Act. That was found in AH Raynbird v. Valuer-General (1980-81) 7 QLCR 99, at 103; RT and J Tobin v. Valuer-General (1986-87) 11 QLCR 29, at 33; and also in Moyses and Others v. Townsville City Council (1979) 6 QLCR 271, where the Land Appeal Court said at page 274:"Moreover the effect of modern authority is that '--- where an unfettered discretion is given by a statute or a rule no court can by its decision impose conditions upon the free exercise of that discretion by another Court ---': Middleton v. Freier and Others (1958) Qd.R.351 at 357, per Philp J, speaking for the Full Court."
While the Full Court was referring to the actions of a superior court in relation to the discretion exercised by a lower court, in my opinion, a similar caveat must also extend to any discretion exercise under a statute. In that respect I note that Philp J went on to say at p.357:
"---- the discretion must be exercised in the light of the circumstances of the particular case."
I also note that discretion must be exercised with judicial constraint as directed by the High Court in House v. The King (1936) 55 CLR 499, where Starke J said at p.503:
"But the sentence imposed upon an accused person for an offence is a matter peculiarly within the province of the judge who hears the charge: he has a discretion to exercise which is very wide, but it must be exercised judicially, according to rules of reason and justice, and not arbitrarily or capriciously or according to private opinion."
The matter of judicial discretion was further clarified by the High Court when it said at p.504:
"The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing do so. It may not appear how the primary judge has reached the result embodied in his order but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred."
In the current matter there is no evidence of any actions by the respondent which could be considered to breach the requirements of sound judicial discretion. On that basis there is no power for this Court to overturn the decision by the respondent to not implement the provisions of s.28(1)(g), which states that an alteration to a valuation should not be made -
"28(1)(g). Unless, in the opinion of the chief executive, circumstances affecting the valuation of the land are such as to render an alteration necessary or desirable for preserving or attaining uniformity in values between that valuation and subsisting valuations of other comparable parcels of lands; "
However, the evidence would support the view that circumstances had appeared by March 1999 which may have affected the valuation of the subject land so as to disturb relativities with adjoining lands, where those adjoining lands had existing CPAs. I believe, as the market for CPAs had developed, there was clearly a differential in value for lands with a CPA allocated and those without a CPA.
While it was correct for the respondent to establish the unimproved values as he did retrospectively to 1 October 1997, it would have also been appropriate for him to take on notice the changing nature of the relativities of the 12 or 13 parcels which continued to lack the added benefit of an allocated CPA. Had that been fully considered, in my opinion, the Chief Executive was likely to have come to the conclusion to exercise s.28(1)(g) in order to rectify the developing disparities. There was no compelling reason to assume that the disparity must wait until the next annual valuation, which has not occurred to this time. On the evidence before me that disparity between lands with an allocated CPA and those without a CPA would appear to reflect about $600 per hectare.
Summary:
In summarising this matter I note that s.33 dictates that the valuation is deemed to be correct unless proved to the contrary; and that the onus to prove his case rests upon the appellant under s.45(4). On the evidence, I accept that the appellant has satisfied the requirements of s.45(4) and I determine the unimproved value as follows:
Unimproved value as allocated cane land = $1,800,000
Less
Impact of balancing storage area = $ 50,000
Disability of no CPA allocation = $ 196,080Unimproved value = $1,553,920
Say, $1,554,000
Conclusion:
Having considered the whole of the evidence, I am persuaded that the appellant has partly proved his case. The valuation determined by the Chief Executive is set aside, and the unimproved value of Lots 41 to 43 on CP 903751 is determined at One million, five hundred and fifty-four thousand dollars ($1,554,000).
(NG Divett)
Member of the Land Court
0
2
0