Woods v Department of Natural Resources and Mines
[2004] QLC 105
•6 December 2004
LAND COURT OF QUEENSLAND
CITATION: Woods v Department of Natural Resources and Mines [2004] QLC 0105 PARTIES: Francis James Woods
(applicant)v. Chief Executive, Department of Natural Resources and Mines
(respondent)FILE NO.: AV2003/0437 DIVISION: Land Court of Queensland PROCEEDING: Appeal against annual valuation under Valuation of Land Act 1944 DELIVERED ON: 6 December 2004 DELIVERED AT: Brisbane HEARD AT: Caboolture MEMBER Dr NG Divett ORDER: The unimproved value of $415,000 is set aside, and the unimproved value of SGP2/136, part of Lot 572 on FTY 1521, Lot 138 on C 31916, Lot 2 and 225 on SP 118010, and Lot 116 on MCH 1225 is determined in the sum of Four Hundred and Seventy-Five Thousand Dollars ($475,000). CATCHWORDS: Valuation – Statutory valuation – Valuation of Land Act 1944 – Use of land for farming – Types of farming use
Valuation – Statutory valuation – Valuation of Land Act 1944 – Issue of amended valuation – Correction of error in valuation under s.28(1)(h) – Proof of notice of amendment – Lack of document evidenceAPPEARANCES: Mr FJ Woods on his own behalf
Mr P Rabaa, Crown Law for the respondent
Background:
This matter relates to land at Maleny-Stanley River Road, Kilcoy and described as SGP 2/136, part of Lot 572 on FTY 1521, Lot 138 on C 31916, and Lot 2 on SP 118010, Parish of Durundur, and Lot 255 on SP 118010 and Lot 116 on MCH 1225, Parish of Conondale. The subject land has a total area of 165.9476 hectares, comprising 157.6476 hectares of freehold and 8.3 hectares of stock grazing permit. The land is located about 25 kilometres north of Woodford, and was the subject of a previous decision of this Court in FJ Woods v Chief Executive, Department of Natural Resources and Mines (AV2001/0468), 19 February 2004, unreported. The subject land is known as "Fort Lodge" and "Alan View". Access zoning and services in the current matter are all as outlined in that earlier decision, which established the unimproved value of the subject land at 1 October 2000. The current matter deals with a subsequent valuation at 1 October 2002. The key issues are again the highest and best use of the land, the method of valuation, the valuation appealed against, and comparison of sales.
On 24 February 2003 the Chief Executive issued a valuation of the subject land at $415,000. Following an objection the Chief Executive confirmed that figure on 15 July 2003. The appellant has now appealed on 30 July 2003 claiming the unimproved value should be $325,000.
Mr Francis Woods represented himself, also calling evidence from his son Francis James Wood, (junior). Mr P Rabaa, Counsel of Crown Law appeared for the respondent, calling evidence from Damien Peter Jones, the departmental registered valuer responsible for determining the valuation. The matter was heard on 17 June 2004.
History of the appeal -
Mr Jones submits that the original valuation of the subject land at $415,000, was subsequently found to be incorrect, and a new valuation was then issued under s.28(1)(h) of the Act on 4 May 2004. That error was discovered when Mr Jones commenced preparation of his submission to this Court after Mr Woods' appeal was lodged on 4 August 2003. Mr Jones explains that the error apparently occurred as a consequence of changes that had to be made to s.17 valuations in the Kilcoy area, following a decision of this Court to reduce unimproved value increases for the 1 October 2000 valuation. That direction was noted in the previous decision on the subject land in AV2001/0468, at paragraph [3].
In explaining how the error had occurred, Mr Jones advises that he had inadvertently applied only a 10% increase to the previous unimproved value of $375,000. A similar 10% increase had been applied to other parcels in that location, in order to allow for the earlier directions of this Court to reduce the former valuation increases in Kilcoy from 50% to 30%. But those reductions had not been implemented at the date of issue of the current valuations. All parcels, other than those being appealed against, were then subsequently increased by only 10% in order to reflect the 20% reduction in the 1 October 2000 valuations, resulting in an overall increase for the current year of between 27% to 28% above their 2000 unimproved values. That 10% increase had then inadvertently been applied to the unimproved value of the subject land, which had already been reduced following the Kilcoy court decision. Consequently the subject land was increased by 20% less than the surrounding parcels, and needed to be brought into line.
To support his advice Mr Jones supplied a copy of a computer notice (Exhibit 2). He argues that to the best of his knowledge a formal letter of advice would have been sent to the appellant confirming that notice of increase in the unimproved value of the subject land. Mr Jones concedes that the respondent was not in a position to demonstrate that a letter had been sent, as it is now departmental policy not to maintain copies of such letters, which are currently despatched by a mass postal process executed by contractors. While it does provide some problems for valuers having to prove that such a letter was in fact sent to the owner, he advises that where confirmation is seen as necessary, that can be arranged by seeking confirmation from the Councils involved. A copy of that letter of advice is also forwarded to the Council to amend their rate base records.
Mr Woods advises that he was unaware of the further increase in the unimproved value. He also notes that he had not yet received any rate notice advice from the Council for the current year, as those notices are only despatched once per year in July. For that reason he was unaware whether the Council was informed of any further increase in the unimproved value of the subject land. Mr Jones had not pursued the matter with the Council, and could not provide any confirmation from that source. Mr Rabaa was given leave to seek subsequent confirmation to assist the Court following the hearing.
Subsequent to the hearing Mr Jones provided the further following statement by Robert Phipps, Land Officer of Land Services, Caboolture office of the Department of Natural Resources and Mines, in respect of the subject lands:
"A search of the valuation roll reveals the following:
The valuation of the above lands was recently amended in terms of section 28(1)(h) of the Valuation of Land Act 1944. A fresh notice of valuation was issued to the owner on 4 May 2004 in the amount of $475,000, with a date of effect of 30 June 2003."
Attached to that letter were two computer printouts showing the changes affected by Mr Phipps: a copy of the computer history of the parcel, and a further copy of the details of the notice to the owner, at PO 28, Mountain View Road, Maleny Queensland 4552. However there was no copy of the actual notice shown, or reasons given for the amended valuation.
In his analysis of the subject land Mr Jones has provided the following valuation details:
110 hectares good rainforest at $3,900 per hectare = $341,000
24.5 hectares fair rainforest at $2,150 per hectare = $40,800
7.15 hectares steep rocky rainforest at $625 per hectare = $3,574
16 hectares unavailable rainforest = Nil
8.3 hectares mixed rainforest/forest permit = $4,773
Total= $490,915
Less severance for the bitumen roads between
Lot 138, Lot 2 and Lot 116 at 2.5% = $12,273
Final Unimproved Value = $478,642
Allow $475,000
The nature of the land –
Details of the nature of the subject land was as agreed in the previous decision in paragraphs [5] and [6]. However Mr Woods advises that the steeper country is subject to slippage areas, where continuous maintenance has been required to preserve the pastures since 1974. Mr Woods estimates that those maintenance costs have represented about 3,000 hours of equipment hire to build the dams and upgrade slipways, in order to get the land into its current state of development. However Mr Woods concedes that he has not maintained any records of those costs. He argues that those costs of improvements have not been allowed for by Mr Jones. Mr Woods also notes that a large part of the south-eastern area of the subject land is very steep gorge country, which has no value as farming land. Mr Jones agrees with that statement, noting that he has allowed for 16 hectares of that steep land as having no value in his valuation (Exhibit 4 – p.6). Mr Woods queries whether the area is not greater than 16 hectares, but provides no details of how he comes to that conclusion.
Mr Woods concedes that the subject land generally is seen as having a good average annual rainfall, and is also seen as equal to the best dairying land in that locality. He agrees that the land provides good feed for his dairy cattle, which generally exceeds the quality of feed needed to sustain beef cattle production. However Mr Woods (junior) argues that the existing kikuyu grasses on the subject land are not the best grasses for beef cattle, where a high fibre level is needed to sustain beef production. Mr Woods (junior) agrees that beef cattle can be supplemented by hand feeding, but he argues that is very costly at $8 to $9 for a bale of hay. He agrees that his dairying cattle are also hand fed grain while milking, but argues that the very lush grasses on the subject land, would need considerably higher dry content to supplant beef cattle production. He also notes that his current dairying herd needs the softer pastures on the subject land. Mr Woods (junior) argues that the preferred buffel grasses for beef cattle purposes, will not grow on the subject land. He sees the highest and best use of the subject land as for dairying.
Another matter of concern to the appellants is the relative small size of the subject land at 165 hectares for beef cattle production as a "farming" enterprise. While they agree that the land is large enough for dairying purposes, where 80 to 100 milking cows are sufficient to sustain barely profitable economic returns, that would not be achieved for beef cattle purposes. The overall carrying capacity is 166 cattle. Mr Woods (junior) distinguishes the type of beef cattle properties being compared with the subject land, as he argues that they represent more the "hobby farmer" element of farming. He argues that such comparisons are not fair comparisons with farming enterprises such as the subject land. He notes that while the price of milk has fallen since deregulation of the industry, yet an economic living can just be made on such a relatively small area. However he continues to argue that because of that fall off in profitability, then the unimproved value of the land should also decline.
Mr Woods (junior) agrees that they have remained in dairying since the deregulation of the industry in 2000, principally because of the major facilities that have now been upgraded on the subject land, explained previously in the previous decision at paragraphs [7] to [9]. However he argues that if they turn to beef cattle production, the small size of their herd would limit the number of cattle they could turn off the property on a regular basis, in order to maintain a regular cash flow. Such a cash flow would not only be needed to sustain the appellant's lifestyle, but also to sustain regular inputs into the herd. Mr Woods (junior) notes that those levels can operate for "hobby farmers", which would only need minor financial support to be a rural home lifestyle.
Mr Woods (junior) concedes that beef cattle production had previously been undertaken on "Alan View" which is now part of the subject land. However he argues those beef cattle were also "propped up" by the returns from the then three dairy farms surrounding those beef cattle. He believes that an average turnoff period for beef cattle of about 2 years would make it very difficult to operate as a financial operation on only 165 hectares.
Mr Jones agrees that the gross returns from beef cattle would be less than those currently sustained from dairying on the subject land. However he believes that a good low cost beef operation could be sustained. Mr Jones notes that because there would be less daily operational costs involved in beef cattle, then, in his opinion, a small marginal profit could be sustained. Mr Jones agrees that in better economic times dairying was always shown to be a higher return, but those circumstances changed in 2000. Mr Jones notes that several of his sales reflect properties which were formerly used for dairying, but have since changed to beef cattle production. He also rejects Mr Woods' (junior) assertion that buffel grass is needed for beef on the subject land, as he notes that there are no buffel grasses on any of his comparable sales. He also notes that slippages have also occurred on other second class country types throughout the locality, including some of his sales, and involving 8 hectares on Sale 5 (Everest), which he argues are steeper and more slipped than the subject land.
Comparison of sales –
The appellant provides no sales evidence to support his estimate of the unimproved value. Mr Jones provides the following comparable rural sales:
· Sale 1 – (Frizzo to Fullerton Farms – Lot 329 on CG 4525 – "Frizzo"). This is a 164.3 hectare parcel located about 13 kilometres south-west of the subject land, and 9.7 kilometres north-east of Woodford. Access is via 2 kilometres of bitumen, 6.5 kilometres of formed gravel and 1.2 kilometres of rough forestry track. The sale comprises 24% good red/brown horticultural forest slopes, 21% marginal grey/yellow horticultural forest slopes, and 55% creek flats forest grazing lands. The sale is used for Macadamia and pine plantation with the balance suitable for grazing. There is one dam and seasonal water in Blackrock Creek. The subject land has superior access, is slightly inferior on the country type due to the horticultural value on the sale, but has better soils than the wet balance land of the sale, and has better rainfall. Overall the sale land is slightly superior due to the established horticulture on the sale. The sale sold in April 2002 for $850,000 ($2,094 per acre), was analysed at $554,045 ($3,372 per hectare), showing a factor of 1.4. The sale was applied at $515,000 ($3,134) per hectare, showing a 30% increase.
· Sale 2 – (Smith to Rimbond Pty Ltd – Lot 174 on CG 85 – "Smithfield"). This is a 105.5 hectare property located about 10 kilometres south-west of the subject land, and about 11.3 kilometres west of Woodford. Access is by 8.3 kilometres bitumen sealed D'Aguilar Highway, then 1.5 kilometres bitumen Eaton Lane and 1.5 kilometres dirt road. The sale comprises 23% heavy wet forest creek flats, 44% gentle forest slopes, and 33% light grey easy to moderate forest slopes. The sale is used for cattle breeding. There are 10 medium to small dams and seasonal water in Stoney Creek. The subject land has superior access, more fertile country and higher rainfall, and superior water. Overall the sale is much inferior to the subject land. The sale sold in January 2002 for $650,000 ($2,493 per acre) was analysed at $157,842 ($1,496 per hectare) showing a factor of 1.4, and applied at $144,000 ($1,365 per hectare), showing a 27% increase.
· Sale 3 – (Willaton to McInnes – Lot 153 on C 31856 – "Black Rock Ridge"). This is a 60.6 hectare parcel located about 11 kilometres south of the subject land, and 6.1 kilometres north of Woodford. Access is by 2 kilometres of bitumen sealed D'Aguilar Highway, 1.9 kilometres Kilcoy-Beerwah Road, 1.2 kilometres bitumen Strip Cove Road, and then bitumen McCabe Road. The access can be cut off by flooding in Stanley River. The sale comprises 46% creek flats and swampy forests, and 54% level to easy wattle and gum forests. The sale is used for cattle breeding and fattening, and has one dam, one bore and seasonal water in Blackrock Creek. The sale has similar access, of poorer rainfall and inferior forest country. Overall the sale is inferior to the subject land. The sale sold in May 2001 for $450,000 ($3,005 per acre) was analysed at $140,629 ($2,320 per hectare), showing a factor of 1.48, and has been applied at $120,000 ($1,980 per hectare). The sale shows a 26% increase.
[19]
· Sale 4 – (Deakin to Aitken – Lot 192 on LX 276 and Lot 7 on SP 100198 – "Lyndhurst"). This is a 75.593 hectare parcel located about 4 kilometres south-west of the subject land, and 18.6 kilometres north-west of Woodford. Access is by 2 kilometres bitumen D'Aguilar Highway, 6.1 kilometres bitumen Kilcoy-Beerwah Road and 10.5 kilometres winding bitumen Bellthorpe Range Road. The sale comprises 49% easy to moderate arable and good grazing red stoney rain forest, and 51% good easy to moderate brown heavy forest country, with gravelly forest in the north-west. The sale is an ex-dairy farm now used for cattle fattening with horticulture potential. There is one large dam, and seasonal water in Camp Creek. The subject has superior access following the upgrading of the Maleny-Stanley River Road, and is only 14 kilometres to Maleny to the north. The subject also has more good fertile rainforest soils, with easier slopes. The rainfall is similar. Overall the sale is inferior to the subject land. The sale sold in April 2002 for $700,000 ($3,747 per acre), was analysed at $329,359 ($4,357 per hectare), showing a factor of 1.29, and applied at $280,000 ($3,704 per hectare), showing an increase of 10%, as the previous valuation was left unchanged following the previous 50% increase. (See paragraph [5]).
· Sale 5 – (Murray to Patterson – Lots 3 to 5, 19, 20 and 22 on RP 30010, Lot 2 on SL 708 and Lot 3 on RP 852159 – "Everest"). This is a 189.098 hectare parcel located about 30 kilometres south of the subject land, and 19 kilometres south of D'Aguilar, 24 kilometres south of Woodford, and 39 kilometres west of Caboolture. Access to the sale is by 20 kilometres of bitumen D'Aguilar Highway, 19 kilometres Brisbane-Woodford Road to the gravel Murray Road turnoff. The sale comprises 5% easy red rainforest scrub soils, 72% steeper vine and bastard scrub, and 23% steeper heavy forest. The sale is an ex-dairy farm now used for cattle fattening and breeding. There are two small house dams and permanent water in Flagstone and Byron Creeks. The sale has a similar distance to Woodford, but a steeper access up the mountain range. The sale has steeper country, slight inferior rainforest, although the general country types are similar. Overall the sale is seen as inferior. The sale sold in November 2002 as a mortgagee in possession sale for $1,450,000 ($3,113 per acre), was analysed at $643,428 ($3,403 per hectare), showing a factor of 1.69, and was applied at $485,000 ($2,565 per hectare), showing an increase of 28%.
Mr Jones further claims that his Sale 5 (Everest) demonstrates the general trend in that area, where people are moving out of dairying and into beef. Mr Jones advises that following that mortgagee sale, the new owners removed and sold all of the dairying machinery from the dairy shed for about $50,000. He also advises that his Sale 4 (Lyndhurst) was also an old dairy property that had ceased dairy operations about 3 years ago. Mr Jones advises that Sale 4 (Lyndhurst) had grain silos at sale date. Mr Jones also rejects that his sales reflect only hobby farmers, as he notes that there are a number of larger operations in Kilcoy area that operate on kikuyu grasses as pastures.
In respect of his Sale 4 (Lyndhurst) Mr Jones agrees that the large dam on that sale holds about 80 to 100 mega litres of water, and also had in place some irrigation lines that had previously been used for horticultural purposes. He agrees that the land immediately to the east of Sale 4 is currently planted to avocados, but he argues that Sale 4 does not have much north facing slopes for horticultural development. While he agrees that the old irrigation lines on Sale 4, subject to new pressure systems being installed, could be used for future irrigation, for improving the pastures, Mr Jones has provided little extra added value for that purpose, as the new owner has used the lands for grazing since he acquired Sale 4.
In explaining his analysis of his sales, Mr Jones advises that he has full detailed analyses sheets, which he could have provided to the Court to explain his reason. However as the sales analyses were not seriously challenged, he had not seen that as needed in the circumstances. Mr Rabaa notes that a full analyses of the sales were provided to the Court in another matter of JP and WG Krause v Department of Natural Resources and Mines (AV2003/0211) – Exhibit 6 in that matter. In respect of his statement that some of his small comparison sales are not merely hobby farms, but provide a working farming enterprise, Mr Jones concedes that those smaller properties comprising similar kikuyu pastures, also have areas of irrigation pasture along Kilcoy Creek.
Decision:
In the previous decision on this matter, I outlined the legislation intention of s.17 of the Valuation of Land Act 1944, and its application to the determination of unimproved value for "farming" purposes, and I will not repeat those facts. However the appellant raises an interesting perspective about the purpose of s.17 of the Act. Mr Woods argues that it is not appropriate to compare the subject lands with other "farming" activities, where the purpose of those other lands may be seen as "hobby farming". He argues that the market for such "hobby" farms, draws generally from a wider sector of society than lands used for a fully commercial basis for genuine "farming" purposes. As such he argues that those two land uses represent different market perspective. However Mr Woods does not support his conclusion with evidence of any sales of those other "farming" lands.
Mr Jones by comparison rejects Mr Woods' assertions, arguing that his selected sales are not "hobby farms", and reflect genuine "farming" activities, even where those sales are smaller in area than the subject land. Mr Jones notes that his Sale 4 is only 75.6 hectares, yet is used for cattle feeding and horticulture, both farming activities Mr Jones believes could be adapted on the subject land. However Mr Jones agrees that such grazing lands do benefit from irrigated pastures along Kilcoy Creek, which is not available on the subject land.
Now while there may be some argument that genuine grazing lands tend to be larger than the areas of the subject land, unless those local grazing lands have the benefit of either special irrigation or agistment from other parcels, I believe the different perspectives tend to be weighted by the personal experience of each farmer. Some farmers tend to seek the more regular financial cash flows of dairying, with all of its daily commitments to stock. Other farmers adapt easily to the longer periods between economic returns, but the lesser daily need for stock maintenance in terms of beef cattle. In the end it is the use of the land which best suits the individual needs of the farmer. In the current matter the appellants both see the economic return of dairying on the subject land, with all of its current problems, as a more reliable cash flow situation.
Now while Mr Woods argues that Mr Jones sales reflect a different market sector, he has not demonstrated that point. Unless that can be shown to be reflected in the marketplace, then the use of lands for "farming" purposes under s.17 of the Act, is as noted in the earlier decision in paragraph [32] of that matter. The land must be taken to be used for its highest and best use.
Now to assist the appellant in understanding the purpose of s.17 of the Act, it may be helpful to outline some of the history that led to the introduction of the expanded nature of the current s.17. Prior to expanding s.17(2)(c) of the Act which defines the "substantial commercial purpose or character" of land used for farming, the courts had been critical of the intended definition of "farming" under the Act. At that time many genuine farmers were found not to satisfy the Act as such as the average income or level of activities were not seen to be "substantial" in nature. The intentions of the legislation prior to the amendments to clarify s.17(2)(c) were previously discussed by the President of this Court in GT and BG Taylor v Chief Executive, Department of Lands (1992-93) 14 QLCR 477, at 488 onwards. As a consequence of that uncertainty, many farmers were then faced with higher unimproved values as the lands were seen as not complying with s.17 and its concessions allowed in the valuations. Various decisions to that effect are found in the Land Court Decisions 15 QLCR at pages 190, 237, 246, 286, 311 and 374.
To clarify that uncertainty the Parliament expanded s.17(2)(c) to its current meaning, which now provides measurable criteria upon which to base a s.17 determination. Most farmers are now eligible for such concessions in their rating indebtedness. However with an average gross annual return over 3 years of at least $5,000, others may also be benefiting from a concession. But that is not for this Court to determine, unless there is marketplace evidence to demonstrate the two market sectors. It may well be that small property owners who have geared their operations appropriately, are prepared to pay more for "farming" lands, than others who need to earn greater returns for their physical efforts. But the current market does not demonstrate those levels as Mr Jones' sales disclose.
Now Mr Jones' Sale 4 (Lyndhurst) and Sale 5 (Everest) were formerly dairy farms which are now adapted to grazing lands. Were it not profitable to do so, it is unlikely that the new purchasers would have taken that path. While Mr Woods might argue that dairying remains his best option, and is the highest and best use of the subject land, the owners of Sales 4 and 5 clearly see grazing or horticulture as their highest and best use for those properties. The conclusion can be reached that either "farming" type is a current option. On that basis I agree again with Mr Jones, that comparisons of sales of lands used for "farming", whether for grazing or dairying, in the general locality, would be reasonable comparisons.
While I accept that the relative size of the subject lands could provide a limit on the number of cattle that could be used for grazing purposes, I note that lands of a similar size have been used, particularly where agistments on other parcels, can be used in conjunction as part of that "farming" use. The use of nearby lands used in common farming purposes was addressed in JW and K Higbie v Chief Executive, Department of Lands (1992-93) 14 QLCR 518, at 523.
The matter of two separate parcels used in conjunction as a single farming enterprise was also upheld by the Land Appeal Court in RM and AJ Beanland v The Valuer-General (1990-91) 13 QLCR 113. That is provided for under s.34(1)(b) of the Act which says:
"34.(1) Unless the chief executive otherwise directs, there shall be included in 1 valuation –
(b)several parcels of land in the same area which do not adjoin but are worked as 1 holding and used exclusively for the purposes of farming, and are owned by the same person and which, if let, are all let to 1 person.”
However while the appellants continue to maintain their current dairying operations, entitlements to a s.17 concession are not a problem.
The method of valuation –
I consider then Mr Woods' concerns that the very extensive improvements on the subject land have not been allowed for by Mr Jones. Now Mr Jones rejects the approach commonly referred to as the top/down method of valuation, where one starts from the overall capital value of the highly improved property, and deducts from that figure the added value of the improvements which have been made. Mr Jones prefers to seek comparisons on the basis of unimproved values, arrived at from sales of comparable lands, after fully analysing those sales down to unimproved values. It must also be noted that it is the added value that any improvements bring to the land, which are important, and not their actual costs of development.
In the current matter there was no evidence provided of the overall capital worth of the subject property as an operational farming business. The details of possible costs incurred by the appellant were also not documented, and are vague at best. On that basis the Court is only left with the approach adopted by Mr Jones, which does follow precedents long held by courts at all levels when determining unimproved values. I believe a clear understanding of that approach was expressed by the Land Appeal Court in PH Clough v Valuer-General (1981-82) 8 QLCR 70, where it said at 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."
I accept Mr Jones' approach as quite appropriate.
Comparison of sales -
If I consider then the comparisons provided I find:
SaleArea Applied Rate Comparison
1 (Frizzo)164.3 ha $3,134 per ha Slightly superior
2 (Smithfield) 105.5 ha $1,365 per ha Much inferior
3 (Blackrock 60.6 ha $1,980 per ha Inferior
Ridge)
4 (Lyndhurst) 75.593 ha $3,704 per ha Inferior
5 (Everest)189.1 ha $2,565 per ha Inferior
Subject land 165.95 ha $2,875 per ha -
On those comparisons there is nothing to suggest that Mr Jones has made an error. I note that his Sale 4 (Lyndhurst) has a higher applied rate due to its smaller size, and also because of its higher horticultural potential, which was apportioned at $5,000 per hectare. While Sale 5 (Everest) has similar improved pasture potential, and general country types, the fact that it was a mortgagee sale possibly impacts its conservative application.
Summary –
In summarising this matter I note that had the Chief Executive not issued a fresh amended valuation notice on 4 May 2004 under s.28(1)(h), then the unimproved value appealed against by Mr Woods would have remained at $415,000, as shown on the notice of appeal (Exhibit 1). Now 28(1)(h) is specifically designed to provide the Chief Executive powers to amend the valuation where an error or omission is seen to require correction, and it is not as a result of an error of law or a mistake of fact, which would be dealt with under s.28(A). When a valuation has been demonstrated to conform to s.28(1)(h), then the Chief Executive may alter the valuation under s.29. Such altered valuations under s.29 are then subject to the provisions covering objections and appeals specified in part 6 and 6A of the Act, which is generally seen as separate to the provisions covering annual valuations under part 4 of the Act.
It is noted that under s.50(2) an amended notice of valuation may be issued at any time after the valuation is made, and a dissatisfied owner may then object to the Chief Executive under s.52. Late objections up to within one year may be accepted by the Chief Executive under s.52(A)(b). The Chief Executive then considers any objections under s.53, and issues a notice of his decision under s.54.
Subject to those conditions, an owner may then appeal to this Court under s.55 which states:
"55.(1) An owner who has duly objected to the chief executive against a valuation made by the chief executive may, if dissatisfied with the decision of the chief executive upon the objection, appeal to the Land Court.
(2) Except as hereinafter in this section provided, such appeal shall not lie unless it is instituted within 42 days after the date of issue to the owner concerned by the chief executive of notice of the chief executive's decision upon the objection (which date of issue shall be stated in such notice)."
In the current matter, if there was document evidence that the appellant had in fact been issued with the amended valuation notice on 4 May 2004, then it would have been bound upon him to firstly object to that fresh notice, and if that fresh objection was rejected, then Mr Woods could have lodged a fresh appeal to this Court against the new valuation of $475,000. But there is no conclusive proof that the notice was in fact sent by post to Mr Woods on that date. Had the respondent maintained copies of that correspondence, or of details of the actual postal service, then the amended valuation to $475,000 would have been deemed to have issued. The consequences of such a scenario are that Mr Woods would then currently be found not to have formally objected to that valuation notice, and this Court would have no jurisdiction to hear an appeal against the unimproved value. (See Department of Natural Resources and Mines v NE Christie (NSW) Pty Ltd [2004] 28 October 2004 QLAC 0091, paragraph [15]).
The problem with the current procedures of the respondent, by not maintaining detailed records of their issuing of notices to owners, is that owners may not become aware of changes in the value of their lands, and may lose any inherent rights to object or appeal, unless they are correctly informed by the Chief Executive. Mr Woods' evidence that he has no memory of receiving that amended valuation notice about May 2004 demonstrates the confusion that can occur.
It may well be that there is an efficiency saving for the Chief Executive to introduce the current commercial arrangements for notifying owners, but any new approach must also be able to demonstrate that owners' rights are protected. The current practice would also seem to place an additional burden upon the professional valuer providing evidence to this Court. Unless the Court can be confident that full processes have in fact been executed, then any benefit of doubt in that respect must be given to the appellant.
In the current matter I am not convinced that the owner (Mr Woods) was informed of the fresh valuation, and I will accept the valuation appealed against at $415,000 as noted on the notice of appeal (Exhibit 1). However I also accept Mr Jones' assessment of the unimproved value of the subject land at $475,000, as noted in paragraph [9]. It is noted that in respect of the unimproved value of a parcel, a registered valuer is entitled to lead evidence to a higher figure.
That was noted in a decision of this Court in Schokman v Chief Executive, Department of Natural Resources (1998) 19 QLCR 386. In that matter the learned Member said at 389:
"In my opinion, section 45 does not prevent an appellant from leading evidence of valuation to an amount lower than that stated in the notice of appeal. Nor does it prevent the Court from determining that the unimproved value of the land was an amount lower than the amount stated there. The authorities support that conclusion.
Important also is section 66 of the Act which empowers the Court to reduce or increase the amount of the valuation in dispute to the extent necessary, in the Court's opinion, to determine the amount correctly under, subject to and in accordance with the Act. The case will be decided on that basis."
In the Schokman matter the Member noted the findings of the learned Member Mr Smith (later President), who, in the matter of Brooker v Valuer-General (1966) 33 CLLR 159, at 165, followed the findings of the Full Court of the Supreme Court in The Australian pastoral Company Limited v. The King 8 C.L.L.R. 311, where Lukin J said at 326:
"We think that the document of valuation when made and furnished by the Minister, is not subject to amendment, particularly when, as in the present case such valuation correctly recorded the Commissioner's opinion at the time. The inability to make such amendment does not prevent the Commissioner, any more than it would the tenant in regard to the tenant's valuation, from offering evidence at variance with the valuation so made. The Court, in our opinion, is not limited to its powers by the amounts set out in such valuations, but may reassess, at an amount in excess of the Commissioner's valuation or less than the tenant's valuation, in accordance with what they think reasonable and proper."
In the Brooker matter Mr Smith said at 165:
"This proposition it seems to me is the basis of what has become the accepted practice of allowing parties to call evidence of valuation at a figure at variance with that contained in any document filed in the Court prior to the hearing."
I also note that s.66j of the Valuation of Land Act directs:
"66. Order of Court
Upon an appeal under section 55 the Land Court or, upon the rehearing of any such appeal, the Land Appeal Court may –
(a) affirm the valuation appealed against; or
(b) reduce or increase the amount of that valuation to the extent necessary in its opinion to determine the same correctly under, subject to, and in accordance with this Act.
and, subject to section 70, make such order as it sees fit with respect to the payment of costs."
On the evidence I believe that Mr Jones has correctly valued the subject land at $475,000.
Conclusion:
Having considered the whole of the evidence I am not persuaded that the appellant has proved his case. The unimproved value of $415,000 is set aside, and the unimproved value of SGP2/136, part of Lot 572 on FTY 1521, Lot 138 on C 31916, Lot 2 and 225 on SP 118010, and Lot 116 on MCH 1225 is determined in the sum of Four Hundred and Seventy-Five Thousand Dollars ($475,000).
NG DIVETT
MEMBER OF LAND COURT
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