Windsor v Minister for Lands

[1995] QLC 17

[1995] QLC 17

 

  LAND COURT

BRISBANE

31 March 1995
           Re:     Application for conversion of tenure of
  Special Lease No. 05/200217 -
  Nebo Shire
  Lessee:  Colean W. Windsor

(Hearing at Mackay)

DECISION

Mrs Windsor, as the applicant for conversion of the above lease to freeholding tenure being of land described as Lot 7 on Crown Plan 858374 Parish of Epsom, does not accept the Minister's determination of the unimproved value.  That determination as at 8 December, 1993 was in the amount of $40,000.  The land is situated about 16 kilometres northerly of the township of Nebo, and has frontage to the Peak Downs Highway.  It contains an area of 30.05 hectares and is zoned Special Purposes.
           Mrs Windsor attended the hearing and submitted that the unimproved value of the land lay in the range of "$400 to $600 per hectare" or about $15,000 in total.  In support of such an assessment, reference was made to the Department of Lands valuation of an aggregation of 142.7 hectares, of which the subject land forms part, in the amount of $55,000 as at 31st March, 1992.  That valuation equates to about $385 per hectare.  Attention was also drawn to a rental statement for the period 1st July, 1994 to 30th June, 1995 in which the unimproved value of the subject land was shown as being $30,000.  Mrs Windsor had also established that the Department of Lands valuations of three neighbouring large holdings ranged from $18 to $30 per hectare but those valuations were of large holdings with areas of 4,813 hectares, 5,568 hectares and 10,275 hectares.  In her submission details of five sales were provided.  Two of these were of what she described as good quality arable parcels with areas of 283.1 hectares and 170.6 hectares the sale prices being, on her analyses, $459 per hectare and $357 per hectare respectively for the land.  These sales took place during 1993.  There was then the sale of a site of 56.03 hectares for $80,000 in 1990, including a dwelling and large shed which sale she believed would have shown less than $1,000 per hectare for the land.  Another site much closer to Nebo than the subject land, containing 62.32 hectares, being arable land, sold in a highly improved condition for $170,000 in 1992.  In her opinion this sale would have shown a land content of $45,000.  The fifth sale in 1992 was of a site of 45.75 hectares in a highway corner location closer to Nebo, purchased for $70,000 but, she had established, for the intended purpose of a service station development.
           Mrs Windsor estimated that half of the subject land was hilly and while the balance was mainly creek flat, about half of that area had been worsened by past stone-crushing activities.  The remaining half, or one-quarter of the total area of the property was, in her opinion, good soil suitable for cultivation.  She had in the past grown some strawberries and pumpkins on this land.  The property is bounded by a creek in the east.  There is no permanent surface water, although supplies are obtained by excavation of the creek bed.  A permit has been obtained to use the water obtained in this manner.  According to Mrs Windsor the quantity of water is limited and the quality contaminated by toads.  This water is pumped to a tank at the house.  The main water supply is obtained from underground but is pumped at only about 100 gallons per hour and also reticulated to the house. 
           The Minister's determination resulted from a valuation carried out by Mr S.F. Penny, a senior valuer employed by the Department of Lands in Mackay.  He had inquired of an officer of Nebo Shire Council as to the history of the special purposes zoning.  He was informed that the zoning had resulted from the past Crown reserve status of the land, but was also informed that no difficulties should be expected in the land being rezoned to Rural A if such rezoning was desired.  Even so, rural residential-type uses were permitted under the existing special purposes zoning.  Mr Penny spoke of the incidence of a market for rural residential hobby-type sites in the locality.  In his opinion, that market is influenced by a site value rather than a value on a unit of area basis.  As he interpreted the market, differing criteria influenced the level of value paid for the two larger parcels of arable land included in Mrs Windsor's sales evidence.  The question of the added value of the improvements, in his opinion, affected the evidentiary worth of two of the remaining sales to which she had referred.

Mrs Windsor's fifth sale was in fact a resale of an earlier purchase which Mr Penny had adopted as part of his valuation basis.  He had not used the later sale showing a higher level of value due to the influence of the proposed service station proposal. 
           The details of that earlier sale were broadly as follows:

45.75 hectares, no natural water, zoned Rural A, electricity available, undulating forest country, sold in February 1992 for $40,000, analysed to show an unimproved value of $36,000.

Mr Penny adopted this value as reflecting the rural residential potential of the site which, being 9 kilometres south-west of the subject land, and that distance further from Mackay, was seen as having an inferior location to the subject land.
           Mrs Windsor did not agree that the sale property had inferior location as expressed by Mr Penny.  She did not accept that being 9 kilometres closer to Mackay which is still 77 kilometres away, influenced superior location for the subject land in comparison with the local amenities of Nebo.  She felt that proximity to that township was an advantage in the immediate locality.   Her appreciation of the influence of location relative to the township is considered to be logical.
           Mr Penny held the opinion that the availability of the permanent soak water under the bed of the creek on the subject property was an advantage of some significance.  While Mrs Windsor did not disagree that the soak water was an advantage she drew attention to the quality of the water supply and the regular excavation and maintenance which was required to obtain that supply.
           Mr Penny's valuation basis included the sale of a rural residential site some 26 kilometres from the subject land being that distance further from Mackay but also in this case further from Nebo than was the subject land. 
           Details of that sale are:

46.37 hectares, no natural water, no electricity available, zoned Rural A, open box and ironbark falling to flooded coolibah drainage area, sold in August 1991, for

$30,000 - analysed to show an unimproved site value of $29,000.

Mr Penny considered that this second sale site was far inferior for rural residential use than was the subject land.
           In Mr Penny's opinion the "slight area difference" between the larger sale properties and the subject land was of little consequence in the rural residential site market. 
           Reference was made during the hearing to the encumbrance of the subject land by an easement which centrally traversed the site and accommodated an electricity transmission line supported on steel towers, one of which is located on the subject property.  The existence of the easement was able to be established from plans attached to Mr Penny's valuation report.  While the area encumbered is not stated, that area is of some significance when the width appears to be about 80 metres, apparently designed to accommodate further works.
           Mr Penny's verbal evidence was that the presence of the easement and transmission line had been considered as having a deleterious effect which was reflected in the valuation.  He said that his primary basic sale adjoined an electricity substation, the effect of which would also have been reflected in that sale price. 
           In the end result, Mr Penny's method of valuation as a rural homesite is accepted as being correct in principle, as opposed to Mrs Windsor's attempt to establish a valuation based on a hectarage value.  Mr Penny was comfortable in his valuation opinion based not only on the sales quoted but his knowledge of the rural residential market in the broader locality.  Nevertheless, after hearing the evidence overall, the impression is gained that negative factors have not had the same level of consideration in Mr Penny's deliberations as did the factors he saw as positively affecting value.  The rural residential site market in the immediate locality is demonstrably weak when Mr Penny's basic sales and their dates relative to this matter are considered.  I have decided that a slightly more conservative approach than that adopted, is warranted. 
           The unimproved value of the land is consequently determined in the amount of $37,500 as at 8 December, 1993.
  (RE Wenck)          

Member of the Land Court