Webster v Chief Executive, Department of Natural Resources
[2000] QLC 79
•14 December 2000
|
BRISBANE
14 December 2000
Re: Appeal against annual valuation
Valuation of Land Act 1944
Valuation Roll No: 1947
Local Government: Cooloola
(AV99-271).
Mervyn Webster
v.
Chief Executive, Department of Natural Resources
(Hearing at Gympie)
D E C I S I O N
Background:
This matter relates to land at 5 Stewart Terrace, Gympie, and described as Lot 1 on MPH 23917, Parish of Gympie. The subject land is located approximately 1.7km north-east of the Mary Street Post Office, and has an area of 895 square metres. All normal utility services are available, and Stewart Terrace is a dual width bitumen sealed carriageway with concrete kerbing and channelling and parking lanes on both sides. Access is directly on to the subject land, which is zoned "Housing" under the Cooloola Town Planning Scheme of 19 December 1997, effective at the date of valuation of 1 October 1998. The zoning allows low density, low rise residential development. The key issues are comparison of sales, relativity, access, and the impact of commercial development and the railway line.
The subject land is irregular shaped, with good frontage to Stewart Terrace, and falls from the front to the rear. There are good rural views to the east. The old railway line is about 30 metres to the east of the subject land, and was decommissioned about 8 years ago. The only use of the railway line is now for a tourist train (the Mary Valley Rattler) which uses the line spasmodically. The subject land is in close proximity to shops and other amenities.
On 1 March 1999, the Chief Executive issued a valuation of the subject land at $26,500. Following an objection the Chief Executive amended that figure to $25,000, making further allowance for the impact of noise and the adjoining commercial activities. The appellant has now appealed that figure, claiming the unimproved value should more properly be $19,000.
Mr J Webster appeared and gave evidence for the appellant. Mr D Gaedtke, Senior Area Valuer, appeared for the respondent, calling evidence from Patricia Ann Quinlan, the Departmental Registered Valuer responsible for determining the valuation.
The Nature of the Land -
There is general agreement between the parties in respect of the nature of the land, its location and views. However, there is a slight difference in respect of difficulties associated with safe access from the subject land, due to some impacts of traffic flows along Stewart Terrace from the north. It was agreed that a slight bend in Stewart Terrace, the butcher's shop located on the front alignment of the adjoining parcel to the north (Lot 2 on MPH 23896) and parked cars and trucks on that parcel, all contribute to a less than acceptable level of vision of on-coming traffic when exiting the subject land. Ms Quinlan has allowed for some restrictions on access, but concedes the clear view of traffic is not good.
Proximity to the railway line was also noted, although the subject land has not been afforded any special reduction in value for that purpose. Ms Quinlan notes that where parcels are actually contiguous with a railway line, such as the adjoining two parcels to the south of the subject land (1 and 3 Stewart Terrace), then a reduction of 10% has been allowed in the unimproved values of those lands.
Views from the subject land to the north are obstructed by the commercial activities and buildings on the adjoining Lot 2. Views across Stewart Terrace to the west are obstructed by an old block of timber flats.
(2) Comparison of Sales -
The appellant provides no sales, relying only upon relativity with one parcel at 1 Stewart Terrace. Ms Quinlan supplies the following sales:· Sale 1 - (Old Maryborough Road - Lot 5 on RP817389)
This is a 649 square metre vacant parcel, zoned for housing, located about 1km north of the subject land. The sale is below street level with an easy fall to the rear, and has limited rural and mountain views to the south-west. Maryborough Road provides access to rural sites to the north-east, and is fairly busy, although less busy than Stewart Terrace. The sale is superior in shape and is less impacted by commercial activities, but is inferior in respect of views and proximity to shopping facilities. Overall the sale is seen as superior to the subject land.
The sale sold in May 1998 for $31,500, which after allowing for improvements was analysed at $30,500, and applied at $28,000.
· Sale 2 - (Tucker Street - Lot 80 on MCH 1979)
This is a 2,653 square metre parcel zoned for "Housing", located across Stewart Terrace from the subject land. The sale has a long narrow width with easy to moderate fall to the centre of the parcel from Tucker Street to the west, but a very steep narrow and restricted second access to Stewart Terrace to the east. The sale overlooks a petrol depot near its south-eastern boundary, and the back of the railway station to the south. The sale also overlooks a hardware store which operates seven days a week.
The sale is larger in area and more regular in general shape, has similar services and zoning, but is inferior in topography, location and views. Overall the sale is seen as inferior to the subject land.
The sale sold in July 1998 for $23,000, which after allowing for improvements was analysed at $21,000, and applied at $19,200.
Ms Quinlan explains that as a general principle in Gympie, parcels on the high lands with views have unimproved values between $25,000 and $30,000; while parcels in the lower lands without views have unimproved values between $22,000 and $26,000. Her Sale 2 is seen as an inferior parcel. Ms Quinlan confirms that some of the higher lots also have adjoining influences from commercial activities.
(3) Relativity -
Mr Webster seeks relativity with a parcel one removed to the south of the subject land at 1 Stewart Terrace (Lot 2 on MPH 23999). That parcel has an area of 906 square metres, is more regularly shaped over the building area, but adjoins the railway line. Mr Webster sees 1 Stewart Terrace as having comparable area, and views to the east; but superior shape, access and neighbouring development with residential properties adjoining on both sides.
Mr Webster notes that 1 Stewart Terrace has an unimproved value of $24,000, from which he concludes, in his opinion, an unimproved value for the subject land at $19,000. Mr Webster also notes that 1 Stewart Terrace is also further removed from the intersection of Stewart Terrace and Horseshoe Bend Road, which is a major traffic hazard. Mr Webster provides photographs of parked vehicle hazards, and restricted views along Stewart Terrace to support his claim.
Ms Quinlan agrees that views to the east from 1 Stewart Terrace would be comparable, subject to the removal of existing trees. However in respect of the impact of traffic along Stewart Terrace, Ms Quinlan notes that a parcel in Horseshoe Bay Road, one lot removed from the corner (Lot 7 on MPH 23967), also has restrictions upon entry to Stewart Road by a "left turning only" sign. Ms Quinlan notes that Lot 7 has an area of 766 square metres, an unimproved value of $26,500, and falls from Horseshoe Bay Road to the rear.
Ms Quinlan also notes that the intervening property at 3 Stewart Road has an area of 1,406 square metres, an unimproved value of $30,500, and also adjoins the railway line. She also draws relativity with the flats across Stewart Terrace at Lot 1 on MPH 6539, which has an area of 794 square metres, is below Stewart Terrace and falls to the rear, and has an unimproved value of $30,500. Ms Quinlan notes Lot 1 has similar zoning as the subject land, but a higher land use for flats. Ms Quinlan also notes that relativity has remained unchanged since the valuation at 1 January 1995. Subsequent valuations have remained the same since 1995, and at each succeeding valuation the values have merely been re-written by the Chief Executive.
Decision:
I note first that responsibility to prove his case rests with the appellant under section 45(4) of the Act, which states when referring to a notice of appeal:
"45.(4) Such notice shall state the grounds of appeal and the appeal shall be limited to the grounds so stated and the burden of proving any and every such ground shall be upon the owner."
I note further that Mr Webster has limited his appeal to the matters of the impact of commercial activities upon the subject land, relativity with one parcel, and difficulties of access. In response Ms Quinlan has provided comparisons with sales of vacant lands, other relativities with surrounding parcels, and has made provision for the impacts of the commercial activities. Where then does the difference lie between the parties?
Firstly Ms Quinlan has adopted the method of comparisons preferred by courts at all levels. That was explained by the Land Appeal Court in WM and TJ Fischer v. Valuer-General (1982-83) 9 QLCR 44, where it said at p.46:"It is indeed a fundamental principle of valuation that the best basis for assessment of unimproved value is the use of sales of vacant or lightly improved parcels. Whilst maintenance of correct relativity is also of considerable importance for rating or revenue type valuations, we cannot prefer in the circumstances of this case, the use of the principle of relativity to the exclusion of the sales evidence."
That principle was also perhaps most clearly established in PH Clough v. Valuer-General (1981-82) 8 QLCR 70, where the Land Appeal Court said at page 76:
"It has been judicially laid down many times and in many jurisdictions that in ascertaining unimproved value, sales of unimproved land of comparable quality, situation, etc to the subject parcel, if they are available, are to be preferred as the best guide for arriving at unimproved value. The reason is obvious. In applying such sales there is no room for error in analyzing the value of improvements.
Because there is less room for difference of opinion as to value of the various items of improvement and comparison is thus simpler, it has been held that highly improved sales should be avoided in preference to sales comprising a lesser degree of improvement."
If I turn then to the matter of relativity, while consistent valuations are indeed an important objective of the Valuation of Land Act, I note that in R and MM Barnwell v. Valuer-General (1990-91) 13 QLCR 13, the Land Appeal Court said at p.17:
"It has been well recognised over the years that previously established relativity in unimproved values can and does change from valuation to valuation. If there was no justification for a change in relativity, the valuer's task would be very simple in that all that would be required to establish value would be accomplished by the use of an adjusting formula. This, of course, is undesirable. "
I also note that the appellants should be able to rely upon existing unimproved values in seeking relativity. In fact section 33 of the Act directs:
"Any and every valuation, or alteration of the valuation, of any land made, or purporting to be made, under this Act by the chief executive shall be deemed to be correct until proved otherwise upon objection or appeal or until altered or further altered."
That principle was followed in TF and SA Shepherdson v. Valuer-General (1992-93) 14 QLCR 83, where the learned Member said at page 87:
"Applying to this case the principles of law summarised above, it is desirable that valuations of comparable lands should bear proper relativity. The appellants are entitled to rely on the valuations of properties in the vicinity of the subject land as being correct. ---- Although the comparable sales support a valuation in the order of that assigned to the subject land, it is appropriate that attention be given to obtaining some relativity to blocks in the same category of land."
However it is also noted that it is not an appropriate course of action to rely entirely upon a single parcel for relativity, where the evidence discloses that an error may have occurred in that parcel. That was followed in Hans and Else Grahn v. Valuer-General (1992-93) 14 QLCR 327, where the Land Appeal Court followed the findings in Barnwell (supra) which said at page 16:
"We are conscious that it is desirable that valuations made for the purposes of the Valuation of Land Act of comparable lands should bear proper relativity, one to the other, if the valuations are soundly based. It is, however, untenable to adopt a value for one parcel on relativity with another which has no sound basis."
If I then consider the current unimproved value of 1 Stewart Terrace, I note that it has apparently had an allowance of 10% applied to reflect its adjacency to the railway line. If that railway line is now decommissioned, then perhaps a reconsideration of the unimproved value might conclude a value of $26,400 for that parcel. However, at this time, and certainly at 1 October 1998, such a concept is mere speculation, as the recommissioning of the railway line could not be eliminated in the mind of any prudent potential purchaser.
What the impact of the railway line demonstrates is that the subject land does not suffer from such a direct disability. In fact, if the subject land was adjoining the railway line, then its unimproved value was likely to be only $22,500.
On the evidence there is nothing to discredit Ms Quinlan's comparisons with her Sales 1 and 2. The value of the subject land is less than $28,000 and greater than $19,200. If I ignore the impact of the adjoining commercial development, and the more restricted access visibility of traffic at the subject land, I could accept that the unimproved value of the subject land would be about $26,500.
The question then is whether Ms Quinlan has allowed sufficiently for the two impacts when she determined a value of $25,000 for that purpose. Bearing in mind the photographic evidence of the parked cars and trucks, and the vertical and horizontal alignments of Stewart Terrace at its intersection with Horseshoe Bay Road, I feel there is some doubt which could be exercised in the appellant's favour.
Where discretion in such matters is to be exercised, I seek guidance in the findings of the High Court in Commissioner of Succession Duties (SA) v. Executor Trustee and Agency Company of South Australia Limited and Others (1946-47) 74 CLR 358, where Dixon J said at page 373:"I have had the advantage of reading the judgment prepared by Williams J and agree in it. I should like, however, to add for myself that there is some difference of purpose in valuing property for revenue cases than in compensation cases. In the second the purpose is to ensure that the person to be compensated is given a full money equivalent of his loss, while in the first it is to ascertain what money value is plainly contained in the asset so as to afford a proper measure of liability to tax. While this difference cannot change the test of value, it is not without effect upon a court's attitude in the application of the test. In a case of compensation doubts are resolved in favour of a more liberal estimate, in a revenue case, of a more conservative estimate."
On balance then I will reduce the unimproved value of the subject land to $24,000 to resolve all doubts in the appellant's favour.
Conclusion:
Having considered the whole of the evidence I am persuaded that the appellant has partly proved his case. The unimproved value as determined by the Chief Executive is set aside, and the unimproved value of Lot 1 on MPH 23917 is determined at Twenty-four thousand dollars ($24,000).
Member of the Land Court
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