O'Connor v Valuer-General[2016] QLC 44

LAND COURT OF QUEENSLAND

Background

1. [1]
   This decision relates to an appeal by the appellants Daniel James & Despina Maria O'Connor against a valuation by the respondent, the Valuer-General, pursuant to the Land Valuation Act 2010 (the LVA), which valued the appellants’ property situated at 24 Rowallan Close at Westlake, a western suburb of Brisbane with many river and lakeside properties.
2. [2]
   The subject land is a wedge-shaped block of low-density residential land with an area of 860m². 
3. [3]
   The subject lot has a 10.7m frontage, the rear southern (boundary) measures 29.59m and shares a side (eastern) boundary of 29.6m which adjoins a public path.^[1]
4. [4]
   The land is generally level at approximately 18m AHD at the front of the site and at the rear.  It is located about 170m from the Brisbane River and did not flood in the 2011 flood event being 2 to 4m above the flood-water height.^[2] 
5. [5]
   Rowallan Close is a short bitumen-sealed no-through-road with concrete kerb and channelling.  It is accessed via Wendouree Crescent, a local through road.
6. [6]
   On the subject land is a large two-storey brick and tile house which was apparently built in the late 1990s.  All the adjoining and nearby houses in the whole of Rowallan Close are of a similar standard and are very well-maintained. 
7. [7]
   The land is not far from the Pullen Reach of the Brisbane River but itself did not flood during the 2011 flooding event which devastated much of this area.
8. [8]
   All of the standard suburban services are available to the site.
9. [9]
   The valuation appeal made on 1 October 2014 effective from 30 June 2015 was for a sum of $520,000.  The appellants contend that the valuation should be $450,000.
10. [10]
    An objection was lodged by Mr and Mrs O'Connor but the valuation remained unaltered.  The decision-maker determining that “when compared to sale prices of similar properties, the delegate decided the figure supported the applied value and no change in the valuation should be made.”^[3]

The legislative framework

11. [11]
    This appeal is brought pursuant to the provisions of s 155 of the Land Valuation Act 2010 (LVA).
12. [12]
    The LVA made a number of significant changes to the valuation process which had previously been carried out pursuant to the provisions of the Valuation of Land Act 1944 (VLA). 
13. [13]
    The LVA retains the obligation upon the Valuer-General pursuant to s 5 of the LVA to carry out a valuation of all properties throughout Queensland for the purpose of rating, land tax and other associated purposes. 
14. [14]
    The Valuer-General is required to comply, in its conduct in the valuation exercise, with the requirements of the Land Valuation Act when undertaking the various valuations required.
15. [15]
    The LVA brought about a change to the valuation approach insofar as under the previous Act the VLA all valuations were of unimproved value but now, under the LVA, valuations are broken into two categories namely non-rural land which embraces residential, commercial and industrial land on the one hand and rural land on the other.
16. [16]
    Pursuant to the provisions of the LVA the value of land to be valued by the respondent is, in the case of non-rural land (as in the present case), its site value which term is defined in the Act and for rural land its unimproved value.
17. [17]
    Within the Schedule to the LVA “site value” is defined:

“site value, for land, means its site value under chapter 2, part 2, division 3.”

18. [18]
    Section 19 of the LVA provides as follows:

“19 What is the site value of improved land

 (1) If land is improved, its site value is its expected realisation under a bona fide sale assuming all non-site improvements for the land had not been made.

 (2) However, the land’s site value is affected by any other relevant provisions of this chapter.”

19. [19]
    The term “expected realisation” is defined in s 17 of the LVA which provides as follows:

“17 What is the land’s expected realisation

 (1) The expected realisation of land under a bona fide sale is the capital sum that its unencumbered estate in fee simple might be expected to realise if that estate were negotiated for sale as a bona fide sale.

 (2) In this section—

unencumbered means unencumbered by any lease, agreement for lease, mortgage or other charge.”

20. [20]
    Section 18 emphasises the utility of a “bona fide sale” and that term is defined in s 18 which provides as follows:

 “(1) A bona fide sale, for land, is its sale on reasonable terms and conditions that a bona fide seller and buyer would require assuming the following (the bona fide sale tests)—

  (a) a willing, but not anxious, buyer and seller;

    (b) a reasonable period within which to negotiate the sale;

    (c)  that the property was reasonably exposed to the market.

 (2) For subsection (1), in considering whether terms and conditions are reasonable, regard must be had to—

  (a) the land’s location and nature; and

  (b) the state of the market for land of the same type.

 (3) To remove any doubt, it is declared that if—

  (a) there is a sale of the land in question; and

  (b) the bona fide sale tests are complied with;

    the sale is a bona fide sale.

 (4) In this section—

  land in question means land whose value is being decided.”

21. [21]
    In a decision in a matter of Lawson v Valuer-General^[4] His Honour Mr Smith provided a useful overview of the current valuation process. 
22. [22]
    In the course of that decision His Honour referred to a decision of His Honour Mr Isdale in Steers v Valuer-General.^[5]  In that decision His Honour Mr Isdale was obliged to consider the valuation of land pursuant to the LVA and in particular His Honour referred to those cases which establish the well-established importance of sales in determining what ought be the appropriate value of land. 
23. [23]
    In the Steers decision His Honour observed as follow:

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

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

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

24. [24]
    In the Lawson decision, to reinforce the point made by His Honour Mr Isdale above, His Honour Mr Smith said:^[6]

“[14] I consider it remains a relevant feature under the LVA, to consider market value. As then President Trickett said in Fairfax v. Department of Natural Resources and Mines.

 ‘[11] The principles for determination of the ‘market value’ of land were established by the High Court in Spencer v The Commonwealth (1907) 5 CLR 418. In that case, the High Court found that the value of land is determined by the price that a willing but not over-anxious buyer would pay to a willing but not over-anxious seller, both of whom are aware of all the circumstances which might affect the value of the land, either advantageously or prejudicially, including its situation, character, quality, proximity to conveniences or inconveniences, its surrounding facilities, the then present demand for land and the likelihood of a rise or fall in the value of a property. (See Griffith CJ at 432 and Isaacs J at 441).

 [12] It has been well established that the unimproved value of land is ascertained by reference to prices that have been paid for similar parcels of land in Waterhouse v The Valuer-General (1927) 8 LGR (NSW) 137 at 139, Pike J said that:

‘Land in my opinion differs in no way from any other commodity. It certainly is more difficult to ascertain the market value of it but-as with other commodities-the best way to ascertain the market value is by finding what lands comparable to the subject land were bringing in the market on the relevant date-and that is evidenced by sales.’

[15] Despite the legislative change, it is refreshing that the views expressed by the High Court in Spencer, now well over a century ago, remain just as current and relevant today as they did when they were first uttered. It is certainly my view, at least at this stage until other authorities may prove me wrong, to continue to apply the Spencer test under the LVA.”

25. [25]
    In addition to the changes with respect to the valuation process, the regime established by the LVA also brought about a change in the evidentiary onus. 
26. [26]
    Previously, under s 3 of the VLA, the valuation made by the Valuer-General was deemed to be correct unless proved otherwise either upon objection or appeal.  That is to say there was the presumption of correctness in favour of the valuation contended for by the Valuer-General.
27. [27]
    The LVA does not retain that evidentiary presumption but rather provides, at s 169, that:

1. “(1)
   The hearing must be limited to the grounds stated in the valuation appeal notice.

3. (2)
   The appeal must be by way of a rehearing.

3. (3)
   The appellant has the onus of proof for each of the grounds of appeal.”

28. [28]
    Accordingly Mr O'Connor is limited to those matters which are recited in the notice of appeal and carries the onus of proving those grounds. 
29. [29]
    Numerous cases decided by this Court have reflected upon the importance of sales evidence of comparable land to assist in the obligations opposed upon this Court to consider the contentions of an appellant against the valuation of his or her land. 
30. [30]
    For example His Honour Mr Smith in Meiers v Valuer-General^[7] had to consider the issue of comparable sales.  In that case His Honour noted with approval the observations of His Honour Mr Isdale in Steers v Valuer-General^[8] where His Honour said:

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

The witnesses

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

The town planning context

31. [31]
    The joint report prepared by the valuers Ms Manners and Mr O'Connor identifies the following agreed aspects of the town planning context of the subject land.^[9] 

“The land is designated "Low Density Residential" under the Brisbane City Plan 2014, (gazetted 30th June 2014).

The land is located within the "Centenary Suburbs Neighbourhood Plan".

The valuers agreed that the Highest and Best use of the site is considered to be for "single dwelling house" purposes as defined at section 47 of the Land Valuation Act 2010 and there has been no change in the residential development of the subject site under the Neighbourhood Plan.

They agreed that the land is suitable for single unit residential dwelling purposes and has all necessary planning, consents, permits, licences, authorities and approvals for the current use.”

The Issues

32. [32]
    In the notice of appeal the following grounds of appeal are stated:

“1. The site value (SV) is excessive for the subject property and all other residential land in Westlake.  Increases of 15% to the subject and 40% to riverfront lands in Westlake have been applied and can not be substantiated. 

2. Recognition of the reflected factors (from 2013 to 2014) of properly analysed vacant land sales in Westlake has not occurred.  Local sales reflect no change in SV from the previously assessed $450,000.

3. There is no evidence to support the wide variance in % increases applied to residential lands across the Centenary suburbs i.e., 15% to 40% increase in Westlake and 5% to 10% increases in other adjoining suburbs.

4. Attachments ‘A’, ‘B’ and ‘C’ substantiate and support the above three grounds.”

33. [33]
    Attachment A was Mr O'Connor’s online objection lodgement printed out by the State Valuation Service in which he referred to four sales which he said were relevant to his appeal.
34. [34]
    Those sales were land located at 61 Callabonna Street Westlake, 18 La Belle Court Westlake, 44 Tennent Street Westlake and 17 Kosciusko Street Middle Park. 
35. [35]
    Attachment B was a Smart Map Plan identifying the subject land and the location of three of the four sales to which he referred in his objection.
36. [36]
    Attachment C was a document entitled “Further sales submissions and relativity”.
37. [37]
    That document contained reference to an additional six other sales that were not referred to in evidence.
38. [38]
    By way of conclusion Attachment C observed:

“Further support for the argument of unfair treatment of Westlake values is contained in the general increases applied to all adjacent suburbs – only a 5% to 10% increase to Riverhills, Middle Park, Mount Ommaney, Jamboree Heights and Sumner – with the exception of Mount Ommaney, all suburbs have been valued at traditionally lower levels of value than Westlake.  Westlake SV increases range from 15% to 40%? 

While a full review of all sales in the Centenary suburbs has not been undertaken, I believe that sales and grounds submitted add support to my valid contentions that the SV of my land (and other surrounding lands) should have remained at their existing SVs – mine at $450,000.”

Documentary evidence

39. [39]
    The evidence before the Court consisted entirely of valuation reports namely:

1. Joint Expert Report prepared by Mr O'Connor and Ms Manners (Exhibit 1);
2. An Expert Witness Report / Statement prepared by Mr O'Connor (Exhibit 2);
3. A Response to Expert Witness Report / Statement prepared by Mr O'Connor (Exhibit 3);
4. A Statement of Evidence prepared by Ms Manners (Exhibit 4);
5. A Response to Appellant Expert Witness Statement prepared by Ms Manners (Exhibit 5).

The Hearing

40. [40]
    The appellants are self-represented and Mr O'Connor conducted the case on behalf of himself and his wife.
41. [41]
    Mr O'Connor has no legal qualifications and that, of course, does not preclude anyone in this Court from running their own case. 
42. [42]
    A complicating factor however is that Mr O'Connor is also a registered valuer, in the employ of the respondent and he prepared his own “expert” valuation report. 
43. [43]
    This is not the first occasion on which a similar set of circumstances has come before this Court. 
44. [44]
    His Honour Member Smith was confronted by an eerily similar set of circumstances in Meiers v Valuer-General.^[10]
45. [45]
    In that case Mr Meiers was a Senior Valuer in the employ of the respondent and acted both as advocate and expert valuer. 
46. [46]
    Ultimately upon having the rules of conduct of the Australian Property Institute (API) brought to his attention, where, within those rules there is a provision:^[11]

"a Member must not… act as an advocate and as an expert in the same matter." 

47. [47]
    Mr Meiers desisted from attempting to give evidence as an expert.
48. [48]
    Earlier Member Smith had referred to the observations of His Honour Member Jones in Cupo v Department of Natural Resources and Water.^[12] 
49. [49]
    I can do no better than repeat the observations of His Honour Member Smith and the extracts from the Cupo decision, which he chose to quote in the course of his decision in the Meiers matter, to inform the view which talk of the conduct which I take of Mr O'Connor’s attempt to, notionally represent himself and his wife, but to also seek to have himself regarded as an “expert” as that term is clarified by the Rules of the Land Court.^[13]  (See especially Land Court Rules Part 5 Div 3 ss 24C and 24F).  The following appears:^[14]

“[14] Mrs Johnson made reference to the important Court decision of P and R Cupo v Department of Natural Resources and Water. This was a decision in the Land Court by his Honour, Member Jones of 26 February 2009. In that case the valuer for the appellant also conducted the role of advocate on behalf of the appellant. In considering the consequences of this, his Honour, Member Jones, had this to say.

“[41] The second matter is that Mr Hyne not only appeared as advocate for the applicants but also as their expert witness. This is, in my view, a situation that ought be avoided in all but exceptional circumstances. Generally speaking, subject to his/her duties to the Court, opponent, client and professional governing body, an advocate's role is to persuade the Court to adopt his clients' case and reject the case for the opposition. On the other hand the role of an expert witness is to assist the Court by giving honest and objective evidence. The failure of any expert to act otherwise would place him/her in breach of the expert witness' overriding duty to the Court. The real potential for tension arising when a person attempts to act as an advocate and expert witness is obvious.

[42] In this case no objection was taken to Mr Hyne acting in both roles. In circumstances where such an objection was taken the then President of this Court identified the difficulties confronting both the Court and the individual involved. In Pratt v The Department of Natural Resources and Water the then President said:

“[12] However, although as agent and advocate Mr Whip had identified with his clients’ case, he felt that he could give his valuation evidence in an objective and impartial manner. I have no doubt that he tried. However, that placed a great deal of stress upon him throughout these hearings. In an attempt to separate the two roles, when acting as advocate he went so far as to refer to himself as the valuer in the third person. Although he consciously attempted to separate the conflicting duties when acting as a valuer, he was unable to completely divorce himself from his partisan interest in the outcome of the case. That may well have been subconscious rather than deliberate.

[13] There is a continuing debate about the independence of any expert witness retained by a party. The argument goes that a paid expert will usually adopt his client's case and skew evidence to present it in the most favourable light in order to secure a favourable outcome for the person who pays him. Such bias may not be designed to deliberately mislead, it may be more a matter of emphasis.

[14] In the present case, there is no doubt that Mr Whip was more sympathetic to his clients’ case, even though he tried to remain impartial in giving his valuation evidence. Therefore, I have no alternative than to find that his evidence is tainted to that extent. However, there is some authority for the proposition that an interest or a perceived interest in the outcome of litigation does not constitute a justification for the exclusion of expert evidence. It is simply a matter which goes to the weight of that evidence. Therefore, even though Mr Whip's evidence was tainted, it was admitted. However, any argumentative or adversarial statements were excluded from consideration. Furthermore, where there was a conflict between Mr Whip's evidence and that of the Department's valuer, little or no weight was attributed to Mr Whip's evidence unless it was corroborated from another source, or unless the Department's valuer was demonstrably wrong.

[15] Before leaving this topic, it must be pointed out that throughout these proceedings it cannot said that Departmental valuers were entirely independent and unbiased. They are employed by the Department and clearly have an interest in the outcome of the litigation. However, their evidence was afforded a higher degree of weight than that of Mr Whip, because generally there was not a blurring of the duties they owed to the Court. However, from time to time a bias was apparent, in failing to make concessions where appropriate and in advancing or endeavouring to support propositions which were clearly wrong." (Emphasis added).

50. [50]
    The observations of His Honour Member Jones quoted above are entirely apposite.
51. [51]
    I accept that Mr O'Connor, in the present case, attempted to give his evidence honestly but it was inevitably tainted because at all times he maintained an advocatory role. 
52. [52]
    In all of the circumstances I am unable to accord Mr O'Connor’s evidence the same weight as I give to that of Ms Manners. 
53. [53]
    In the course of the opening Mr O'Connor informed the Court:^[15]

“The case is about trying to restore consistency and integrity for site values dated October ’14 and applied to residential properties in Westlake and, in particular, my property at 24 Rowallan Close, Westlake.”

54. [54]
    After the inspection had been completed, at the resumption Mr O'Connor informed the Court as follows:^[16]

“The case is about trying to restore consistency and integrity of the site values dated October ’14, in particular, my parcel at 24 Rowallan Close. If the Valuer-General’s original valuer had observed correct procedures by properly investigating all three vacant sales and correctly applied no increase to the 2013 dated site values, we would not need to be here today. It seems what has occurred is the valuer overlooked sales 1 and 2 originally and then proceeded to adopt sale 3 as the only basis available for Westlake non-riverfront land.

What may have been considered as a conservative increase of 15 per cent was applied not realising sale site 3 value was low and out of line with other surrounding values. If the sales 3 corrected site value as advised by both valuers’ reports in the court today was considered then a correct conclusion would have been that the site value should remain unchanged at their existing 2013 levels. After the March 2015 issue of this 15 per cent increase to non-riverfront lands some [indistinct] up to 40 per cent increase on the riverfront lands, objections such as mine would have pointed to the obvious fact that sales 1 and 2 were also supporting the existing 2013 levels of value.”

55. [55]
    In the course of the earlier opening I had enquired the following of Mr O'Connor and the following dialogue then ensued:^[17]

“HIS HONOUR: Do I understand, having read the report and the joint report, Mr O'Connor, that your thesis is that the whole of the Westlake area is wrongly valued.

APPLICANT D.J. O'CONNOR: Yes, your Honour.

HIS HONOUR: Well, do I have any power about that?

APPLICANT D.J. O'CONNOR: Your Honour, I’m referring, mainly, to the precedents in relation to uniformity of values and relativity.

HIS HONOUR: Which precedents are they? Take me to that. Tell me about them.

APPLICANT D.J. O'CONNOR: They’d be the Grahn - - -

HIS HONOUR: The which?

APPLICANT D.J. O'CONNOR: Grahn.

HIS HONOUR: Is that a case, is it?

APPLICANT D.J. O'CONNOR: Yes. Yes. Grahn v The Valuer-General. I’ll just get the references, your Honour. I’ve referred to them in my brief but – yes, there’s - - -

HIS HONOUR: You refer to them in your report, as I recall.

APPLICANT D.J. O'CONNOR: Yes. That’s correct, your Honour. I’m just trying to - - -

HIS HONOUR: Have you got copies for me at all?

APPLICANT D.J. O'CONNOR: Not to hand up, your Honour, I’m sorry.

HIS HONOUR: Righto. So what’s the principle that you say comes from Grahn?

APPLICANT D.J. O'CONNOR: Well, it’s a combination of Grahn and Barnwell and Fischer as reported in Grahn. I’ve got the full Grahn Land Appeal Court decision here in front of me, and at page 328 of the decision in the Queensland Land Court reports I refer to, in particular:

…desirable that valuations made for the purposes of the Valuation of Land Act

–

 as the Act was back then –

...comparable lands should bear proper relativity, one to the other, so long as the valuations are soundly based.”

56. [56]
    At one point it appeared that Mr O'Connor was proceeding on a gross misapprehension of the power of this Court.  He was concerned about relativity not just between his lot and other lots of land but by what he described as “direct comparison with each parcel of land”.^[18]
57. [57]
    There then followed this passage of dialogue between Mr O'Connor and myself:^[19]

“HIS HONOUR: Because this is where I have some difficulty with your thesis. If we’re looking at one out of 50 lots all in the Westlake area, then, you get some comparability between this lot, the lot next door to one down the street and the one 45 over the back fence. But as I understood, some of what you’ve put in your report, you’re saying the Westlake area in its totality is out of alignment with other areas across Brisbane.

APPLICANT D.J. O'CONNOR: Following the Valuer-General’s valuation.

HIS HONOUR: Well, how could I adjust the whole of the valuations for Westlake?

APPLICANT D.J. O'CONNOR: In considering my valuation, your Honour, and in order to maintain uniformity or relativity with other valuations in Westlake, if it would be possible for the court to instruct the Valuer-General to review the values.  I’m not sure - - -

HIS HONOUR: I don’t have that power. You will have to take me – this is a court of statutory jurisdiction. The only things that I can do, within limits, are exercise the powers that a statute gives me. Now, unless you can take me to a statutory power that says I can say, ‘Mr Valuer-General, get on your bike and go and revalue the whole of Westlake,’ I don’t understand how you think I can do it. Assuming that they are completely wrong, that there’s a monkey in the system, how can I do it?”

58. [58]
    In trying to get a clear understanding of what Mr O'Connor’s case was I asked him as follows:^[20]

“You see, what I’m – what I’m suggesting to you is that your whole case is premised upon a notion that all of the valuations in your area – all of them – have been conducted on an inappropriate or ill-informed basis, and they ought all be made lower. That’s right, isn’t it?

APPLICANT D.J. O'CONNOR: That’s correct, your Honour.

HIS HONOUR: And if they are all made lower, the necessary consequence is that yours would be made lower.

APPLICANT D.J. O'CONNOR: I think, in the first instance, if I were to prove that my valuation should be made lower, I would have thought that that would also indicate, to maintain that relativity and using only the vacant land sales available, that all other valuations should also be rewritten at their existing levels.”

59. [59]
    In his oral opening, his reports prepared for the purposes of this appeal, his oral evidence and his cross-examination of Ms Manners, Mr O'Connor made it clear that a significant part of his case relied upon his concerns about relativity – not just as between his lot of land but in the broader sense evidenced by the passages which have been quoted above. 
60. [60]
    It is trite to say that the Court is not concerned with how an earlier valuer may have approached his or her valuation obligations. 
61. [61]
    Section 169 of the LVA which has been quoted above, makes it clear that the appeals against valuations are by rehearing and that an appellant bears the onus of proof for each of the grounds of appeal.
62. [62]
    The grounds of appeal set out in [33] above focus on valuations which have been carried out across the whole of the Westlake area. 
63. [63]
    The nomination of a matter as a ground of appeal does not automatically make it a valid or useful ground of appeal. 
64. [64]
    The focus of the Court in this particular case is on the value only of the subject site which, as pointed out elsewhere in this decision, is generally assessed by reference to sales at a relevant time of comparable land or of land which gives guidance as to the value of the subject land. 
65. [65]
    Counsel for the respondent in her written submissions drew the Court’s attention to the decision of His Honour Mr Isdale in Farr v Valuer-General.^[21]
66. [66]
    In the Farr decision His Honour observed as follows:

‘[28] The spreadsheet analysis shows how the valuations of the subject land compare, over time, with the values placed on nearby properties. The present question before the Court however, is not how the value of the subject land compares to valuations placed on surrounding blocks, but rather what is the correct valuation of the subject land itself. Land Court Member Mr Scott considered this in Thomson v Department of Natural Resources and Mines.  The learned Member said that:

“ [7] This issue has come up on more than one occasion in the past, one example being found in Gibson v Chief Executive, Department of Lands (V92-64 unreported Land Appeal Court 9 June 1995) at 6:

‘We reiterate what has been said often before – and what is Mr Tighe's chief concern – the importance of correct relativity in the equitable distribution of the rating burden cannot be overstated. However the question before this Court is the correct valuation of the subject land, not the correct valuation of an area. It would not advance the appellant's case to satisfy us that her neighbour's land was undervalued: … The appellant must show that the valuation of her land was incorrect.’

[8] A similar opinion is expressed by the Land Appeal Court in Bignell v Chief Executive, Department of Lands (AV92-65 unreported Land Appeal Court 4 March 1996) at 11:

‘What has to be decided in this case is the proper value of the subject land by reference to sales evidence about comparable unimproved properties. … If a proper valuation of the subject land makes it inconsistent with the relative values of neighbouring blocks then so be it. The question before this Court is 'the correct valuation of the subject land, not the correct valuation of the area'.’

[29] The values of the properties considered in the spreadsheet were not tested by market evidence in the present proceeding and where, as here, the value of the subject property is said to be wrong a conclusion of its value based on relativities to other valuations cannot safely be made unless it is shown that those valuations are correct on the basis of supporting market evidence, not just that those valuations exist. On the face of it they may be no more reliable than the valuation being impugned.

The Court’s jurisdiction and the importance of sales evidence

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

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

In appeals of the nature of the subject, the onus which the appellant must assume is not an easy one to discharge without the assistance of a registered valuer who can lead evidence as to sales analyses and/or comparison with valuations made by the Valuer-General in respect of comparable properties.”

67. [67]
    The observations of His Honour Mr Scott in the decision of Ladewig v Department of Natural Resources, Mines and Water are entirely apposite.^[22]
68. [68]
    In the Ladewig case the appellants, appearing in person, contended that the subject land was not at correct relativity to other statutory valuations applied by the Chief Executive to land in the relevant area. 
69. [69]
    In that decision the following appears:^[23]

“[7] Mr Ladewig referred to other relativity properties in the Blacks Beach area which he said demonstrated that the Chief Executive's statutory valuations were inconsistent. The task of the Court in a matter such as this is to determine the value of the land the subject of the appeal. That is achieved by applying valuation evidence to the property in question. If all of the other statutory valuations in Blacks Beach are wrong or inconsistent with each other that cannot logically assist in determining the value of the subject property. Neither is the Court charged with the responsibility of inquiring generally into valuations in the area and correcting them if they are found to be in error. The Court's duty is to hear each appeal individually. Correspondingly, if there is no appeal with respect to any individual property the Court should not purport to conclude a view as to the value of each such property.”

70. [70]
    In his opening to the Court Mr O'Connor did not refer to the decision in Ladewig but did refer to three other cases.^[24]
71. [71]
    Those three cases were referred to by His Honour Mr Scott in the Ladewig decision where the following appears:^[25]

‘[13] In Grahn v Valuer General the Court recorded these propositions with approval:

‘(a) It is desirable that valuations made for the purposes of the Valuation of Land Act 1944 of comparable lands should bear proper relativity, one to the other, so long as 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. (R and MM Barnwell v The Valuer-General (1989) 13 QLCR 13, at p. 16 and cases cited in it.’

‘(e) Whilst maintenance of correct relativity is of considerable importance for rating valuations, the use of the principle of relativity should not be preferred to the exclusion of relevant (even if not ideal) sales evidence (WM and TJ Fischer v the Valuer-General (1983) 9 QLCR 44, at p.46.’

 The importance of sales evidence in valuation cases as against the relativity between statutory valuations was stressed by Land Appeal Court in Clough v Valuer-General.

  “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.” ’

72. [72]
    In my view Mr O'Connor has, for reasons which I will develop later, misunderstood the import of those quotes and the decisions in those cases.  He, in my respectful opinion, is driven by concerns to:

“[Try] to restore consistency and integrity for site values dated October ’14 and applied to residential properties in Westlake and, in particular, my property at 24 Rowallan Close, Westlake.”^[26]

73. [73]
    Mr O'Connor seems to have disregarded the importance which numerous cases in both this Court and the Land Appeal Court and other Courts around Australia have placed upon the role of comparable sales in considering appeals against valuations imposed by valuing authorities.^[27] 

“Ms Manners has correctly pointed out in her statement that vacant land sales in Westlake are, indeed, very rare and scarce. With this in mind I again pose the question, why has the Valuer-General completely ignored the fact that the three only local sales support maintaining site values that exist in 2013 levels. Why and how are they deduced that site values in 2014 should increase by 15 per cent and 40 per cent is the question I haven’t had answered.

I question the integrity of the process where sales site values are reduced to be made look basic well after the valuations have been issued without altering the rest of the suburb or sub-market area to similarly reduced levels. I hope that by highlighting and revealing this questionable practice in this court of equity and good conscience today that Westlake residential site values may be restored to their correct 2013 levels. Whether that be through the Valuer-General taking action and the court deciding on my property, remains to be seen.

I hope this case finds in my favour and serves as a precedent to discourage these questionable practices occurring again.  Correct analysis of the sales in the first instance would have revealed that there should be no change to the 2013 Westlake level of values. I have submitted and verified these issues through my report and response statement and will be tested to find further to their veracity today.”

74. [74]
    Apart from having some difficulty fully comprehending what Mr O'Connor was referring to in the second of the two quoted paragraphs from the transcript, I am bound to observe that there was no evidence before me that any of the methodologies adopted by the Valuer-General’s officers were questionable or in any way improper. 
75. [75]
    This Court has on a number of occasions commented on the appropriateness of computer based mass valuation methodology.  Mr RE Wenck, Member of this Court observed in Kennedy^[28] as follows:

‘In terms of the general annual valuation methodology employed by the chief executive, it is observed that in Wilson v. Chief Executive, Department of Lands (1994-95) 15 QLCR 63, the Land Appeal Court said at 70, 71:

"The scheme of annual valuations enables values to follow the market on an annual basis. The scheme would not work without the aid of computers. Nor would it work, if as Mr Wilson would appear to submit, that each allotment should be individually inspected annually and a valuation produced in a form detailing every aspect of the relevant lot, the value placed on it and the basis for the valuation."

Then later at 71 the Court found:

"The process in our opinion does not offend the statute."’

76. [76]
    Apart from the powers to adjust valuations vested in the Valuer-General, this Court is concerned only with the valuation of a lot of land the subject of an appeal by the landowner to this Court.  The Court does not, unilaterally, presume to amend the value of lots of land whose owners have not seen fit to bring an appeal against the valuation before this Court. 
77. [77]
    Similarly this Court has no charter to review the methodologies adopted by the officers of the Valuer-General in discharging their statutory obligations pursuant to the LVA.  The Court is only concerned, as His Honour Mr Scott succinctly explained in the Ladewig decision, with determining whether the value of a lot of land is appropriate or not in circumstances where the appellant landowner carries the onus pursuant to s 169(3) of the LVA. 
78. [78]
    The valuers in their joint meeting agreed as to the relevant “bonafide” sales evidence of vacant land in the suburb of Westlake.  They agreed on three sales which are all of vacant land but which vary in size and attributes. 
79. [79]
    As recorded in the joint report all of the comparable sales have prepared building pads and the valuers have agreed that the added value of any built improvements to be deducted in the analyses of the sale properties is minimal.^[29] 
80. [80]
    The sales considered by the valuers are set out in their joint report in a sales evidence summary table as follows:^[30]

81. [81]
    Consistent with his intention or aspiration that this appeal should result in some revaluation of all of the properties in the Westlake area Mr O'Connor sets out his approach in the joint report in the following terms:^[31]

 “ For the purposes of supporting a site value of $450,000 on the subject property, this valuation has been undertaken by the direct comparison of vacant and/or lightly improved land sales in as near to comparable locations as possible with adjustments made for points of difference. The fact that the sales evidence supports no change to existing Site Values and only minor relativity changes [Sale 3] are required would support application of a rewrite of existing Site Values or a factor of 1.0 should be applied to the properties.”

82. [82]
    With respect to the sale 3, i.e. land located at 44 Tennent Street Westlake, both Mr O'Connor and Ms Manners agree that the sale at $480,000 on 19 February 2014 was a sale at above value and that the valuation should be somewhat less than $480,000.  Mr O'Connor contends for $430,000 in line with his approach while Ms Manners considers it should be valued at $450,000.^[32]
83. [83]
    Consistent with his approach to the valuation exercise for the purpose of this appeal Mr O'Connor explained the relevance of what he saw as the inappropriate 2013 valuation exercise upon which any adjustment in 2014 was necessarily based. 
84. [84]
    In response to questions from me in which I was trying to understand the methodology which he had followed, the following appears in the transcript.  Referring to a map which appeared at page 13 of his report^[33]  Mr O'Connor said:^[34]

“But certainly, yes, the appellants’ sale relativity and sales 1 to 3 on page 13. I point to sale 3 as lot 52 and with – at the top – handwriting I suggest that October ’13, October ’14 values for lot 52 should be $430,000. Lot 53 is the parcel of land beside the sale adjoining the river path. I suggest it should be $550,000 on both occasions, and the other parcel that I decided needed reviewing was lot 55 to the south of the sale 3. It should be reviewed to $440,000. Sale 1, as reviewed by The Valuer-General, so originally issued at $610,000 and then reviewed it to $560,000. I agree that that should be $560,000 both October ’13 and October ’14.

So what’s the meaning of the thing called sale factor 1.12 on sale 3?---The factor of – that would indicate that – with my relativity of $430,000, the analysed sale price at $480,000 – that analysis of that sale would realise a factor of 12 per cent increase over the previously existing value adjusted to my figures.

What I’m – see, Mr O'Connor, what I’m struggling with is how we get from 450,000 to 480,000 or vice versa?---Yes. Well, the precedent - - -

You say – sorry, let me continue the question just so that you know what I’m talking about. You say, “I suggest that there should be the sale – the price”?---Not the price; the value.

The value?---The site value.

Well, what I don’t see in the report is how you get to that figure. That’s what I’m asking you. What calculations – what factors do you take into account to get to that figure?---This is my experience over the years as a valuer in looking at the relative values, and what my task is as a registered valuer when doing mass appraisal valuations – I’ve got this further outline in my submissions – is initially look at the sales as they occur, analyse them to site value, investigate them as to their bona fides and interview parties as possible, and then what I do is I look at the relative site values to gauge how they are impacted by the analysis of their sale. And I discovered, on looking at this – this parcel at $360,000, when I looked - - -

What sale are we looking at?---Sale 3.

Yes?---When I look at this existing value of $360,000 I look at other - - -

So the value as at October 2014 or ’13?---October ’13.

Yes?---I realised that that parcel of land is not valued in line with other parcels of land, and I refer to the smaller parcels along - - -

Sorry, just let me understand. So you’ve gone back to the 2013 valuations and the starting point for this analysis which appears in your output of the analysis that appears in your report is premised upon correcting the 2013 valuation and then moving from there?---That’s what I’ve stated in my statement.

Well, that’s what I’m asking you. That’s – that’s in terms of the logic just so that I understand what I’m being asked to accept. You say you’ve gone back and you’ve looked at the previous valuation, not the one that’s under appeal. You’ve looked at the previous 2013 valuation?--- That’s correct, your Honour.

And your experience tells you that that valuation was wrong?---Yes.

And so we take – recognising then that that valuation was wrong, we take the figure that you say it should have been - - -?---That’s correct.

- - - and then come forward from there to the 2014 valuation?---And from that I conclude that there should be no change to the 2013 valuation.

But no change to the valuation that you determined should have been the 2013 valuation?---That’s correct.

But the 2013 valuations have gone and done and dusted?---This is the - - -

Nobody is ever going to change it, are they?---The mass appraisal process is one in which we investigate the sales and their relationship with their previously existing values. That’s what I’m going back to. In all my submissions, that’s what I’ve – that’s what I’ve stated.

Yes. But I’m just – I know you’ve said that in your statement. What I’m trying to get a grip on is your methodology for your current evidence about the valuation conducted as at the 1st October 2014 to be effective from the 30th of June 2015. You say a starting point is that you’ve gone back to the valuations in 2013 - - -?---That’s correct.

- - - and ascertained that because of the mass valuation approach they were all incorrect?---No. No, your Honour. We’ve, in - - -

Well, one of them. The one you’re focussing on?---They’re – certainly, sale 3 and the two other parcels around it. We’re certainly correct.

Was wrong – was wrong in 2013?---In 2013, yes. I’ve made that in my submissions, so it’s in writing, yes.

85. [85]
    With respect to his sale 1, i.e. the land located at 61 Callabonna Street Westlake sold in July 2013 for $575,000, Mr O'Connor identifies that land which has been benched and retained and filled with a moderate fall from Callabonna Street to the building site as being very superior to the subject site having superior size, outlook, elevation and ambience.
86. [86]
    With respect to sale 1 Ms Manners disagrees^[35] with Mr O'Connor that that sale constituted land which was “very superior” in comparison with the subject.^[36] 
87. [87]
    Ms Manners acknowledges that the property is larger, more elevated and enjoys filtered views of the Brisbane River through the adjoining timbered reserve land.  However she points to the heavier traffic than Rowallan Close and the lack of appeal of a quiet cul-de-sac.  The land is also identified in the BCC Flood Wise Report despite the lands elevation above January 2011 flood heights.  She also points to it being surrounded by homes of a less impressive standard than those surrounding the subject site. 
88. [88]
    Ms Manners also points out that historically dating from the first release of land in this area the original purchase prices for the subject and sale 1 demonstrated a 4% higher price paid for sale 1 than was paid for the subject land and appears to suggest that the current valuations of the two lots remain broader consistent with the October 2014 site value of sale 1 at $560,000 being nearly 8% more than the subject land.
89. [89]
    With respect to sale 2, which Mr O'Connor identifies as having been benched and levelled and partly retained with a river view parcel but no river frontage, and as being vastly superior to the subject with what he describes, somewhat confusingly,^[37]  as “panoramic Brisbane River vista like views” and a significantly larger area.^[38]
90. [90]
    He acknowledges that that land was flooded to about 0.5 m in the 2011 floods. 
91. [91]
    He points out in his report that the originally issued site value of $810,000 illustrated a 133% application of the sale when it was issued but he acknowledges that the site value was reviewed and adjusted to $600,000 in June 2015 which constituted a 3.4% increase over the previous site value of $580,000.
92. [92]
    Of that sale Ms Manners disputes that it is “vastly superior” in comparison with the subject.^[39]
93. [93]
    In her report she emphasises that the land was entirely covered by water (in the January 2011 flood event) which reached a height of 13.5 m with a consequence that the land is wholly located within the BCC River Flood Planning Overlays.
94. [94]
    In terms of locality Ms Manners expresses the view that the site in La Belle Court is less appealing and in a less appealing street than Rowallan Close. 
95. [95]
    She does acknowledge however that the sale property should be assessed as being superior overall to the subject site because of size, views and the shared boundary with the parkland.
96. [96]
    She also points out that the sale price of sale 2 is only 5% more than the purchase price of 61 Callabonna Street (i.e. sale 1) in July 2013 which was a smaller site with obscured views of the river. 
97. [97]
    By way of summary Ms Manners concludes:^[40]

“It is my opinion that this sale’s good river views are diminished by the flood prone nature of the land.  The subject’s attractive, quiet, flood free, river precinct location makes it a desirable property despite the lack of river views.”

98. [98]
    She also goes on to point out that the purchase price in July 2014 at $608,888 was 17% more than the subject site’s value and the current October 2014 site value of $600,000 for the sale 2 land is approximately 15% more than the subject. 
99. [99]
    That seems to me to evidence a strong degree of relativity having been maintained in the valuations as between sale 2 and the subject.
100. [100]
     As to sale 3 Mr O'Connor continued his focus on the 2013 site valuation and the rate of increase since that date, he says as follows:^[41]

“This land had an existing October 2013 dated Site Value of $360,000 and was increased 15% [F1.15] to realise an October 2014 dated Site Value of $415,000. The conservative 86% application of this sale to support a F1.15 increase in Rowallan Close Westlake is flawed logic, in my opinion. As per the previous submissions and the map and table (below), I seek leave of the court from the suggested Site Value of $450,000 in my original Grounds of Appeal to suggest an October 2014 dated Site Value of $430,000 should be applied to this sale.”

101. [101]
     He concludes his observations with respect to Site 3 by contending that:^[42]

“I believe, with some relativity exceptions nominated above and illustrated below, this part of Westlake should have been rewritten at existing levels of value.”

102. [102]
     That is to say, by my understanding of this evidence, he used the evidence of Sale 3 to relate back to valuations which were done in 2013 and 2014 without applying any aspect of Sale 3 to the appropriate value of the subject site.
103. [103]
     When I pressed Mr O'Connor about his analysis of Sale 3 he said as follows:^[43]

“The sale price is $480,000. That’s the analysed sale price; the analysed site value, $480,000. And the existing 2013 site value was $360,000. The Valuer-General increased it to $415,000, and what I have said is, in relation to my submissions, that there is no change in the market. I believe this site in relativity to other sites should be assessed at $430,000. Ms Manners, in fact, considers it should be valued at $450,000.”

104. [104]
     Notwithstanding Mr O'Connor’s analysis and assertions with respect to Sale 3 the fact remains that it was sold as vacant land at a price of $480,000 on 19 February 2014.
105. [105]
     It may well be that that selling price is out of line with what Mr O'Connor says should have been the selling price having regard to his relativity analysis, however, it is a sale which has occurred within a relevant period in which, in my opinion, is able to be taken into account in assessing what should be the proper value of the subject land. 
106. [106]
     The 1 October 2014 site valuation of Sale 3 is $415,000 which, as Ms Manners points out:^[44]

“The 1 October 2014 site valuation of the sale property is $415,000, approximately 25% less than the subject.  Mr O'Connor contends this site value is too low.”

107. [107]
     Ms Manners agrees with Mr O'Connor that the current site value of that Sale 3 property does seem low and expresses the opinion that a conservative valuation relative to the purchase price paid in February 2014 would be $450,000 which she says:^[45]

“would narrow the relative difference in values between the two sites to 15% less on the sale land than the subject.”

108. [108]
     She acknowledges, as Mr O'Connor does, that the site value of the Sale 3 property was reviewed during the course of undertaking the new valuations which were issued in March 2016 for a date of valuation of 1 October 2015 so that the new site valuation for the Sale 3 land is now $450,000.^[46]
109. [109]
     I do not place much weight upon the movement in valuations from October 2014 to October 2015 as conditions can sometimes change dramatically within a 12 month period.
110. [110]
     As to sale 3 Mr Manners identifies that property, located at 44 Tennent Street, as being more elevated than the subject with glimpses of the river to the north-west through the timbered parkland.  It is a smaller lot than the subject with a near regular shape but a 22 m wide frontage to Tennant Street which itself is a busy through road. 
111. [111]
     As with her comment about sale 2 Ms Manners points to the Tennant Street site as lacking the appeal of a quiet cul-de-sac and being surrounded by houses which are on smaller lots and of a less impressive standard than those located surrounding the subject site. 
112. [112]
     As with Mr O'Connor, Ms Manners looks back to the prices when the lots in this neighbourhood were first released and says:^[47]

“When allotments in this riverside neighbourhood were first released by developers in 1998 / 1999, the original purchase prices for the subject and this sale property demonstrated a 10% cheaper price paid for this sale land.”

113. [113]
     It is always a difficult matter to reconcile or to come to a view as to why one report ought be preferred or the competing opinions of valuers based on evidence honestly given. 
114. [114]
     On occasions it has been pointed out that the giving of valuation evidence and coming to a view about an appropriate valuation is more of an art than a science.  In BWP Management Limited v Valuer-General^[48] His Honour Mr Isdale had reason to discuss legal considerations about valuation methods. 
115. [115]
     He referred to a number of well-known decisions when he said as follows:^[49]

‘[34] In Chief Executive, Department of Natural Resources v Radlett Enterprises Pty Ltd the Land Appeal Court said:

“As Mason J. said in Federal Commissioner of Taxation v. St. Helen’s Farm (ACT) Pty Ltd (1980-81) 146 CLR 336 at page 381:

‘Valuation is a matter of estimation, not a precise mathematical calculation.’

Valuation is intended to be an interpretation of a market, which in itself is imprecise, even when it is created by vendors and purchasers who satisfy the often quoted qualifications necessary to meet the test explained in Spencer v. The Commonwealth of Australia (1907) 5 CLR 418.”26

 The Court went on to say:

“As was observed in Secretary of State for Foreign Affairs v Charlesworth, Pilling & Co. (1901) AC 373, at 391:

‘It is quite true that in all valuations, judicial or other, there must be room for inferences and inclinations of opinion which being more or less conjectural, are difficult to reduce to exact reasoning or to explain to others. Everyone who has gone through the process is aware of this lack of demonstrative proof in his own mind, and knows that every expert witness called before him has had his own set of conjectures, of more or less weight according to his experience and personal sagacity.’”

 Recognising the inherent difficulty in the valuer’s task, the Courts have attempted to reduce, as far as possible, the scope for uncertainty. In Valuer-General v Marano the Land Appeal Court said:

“It is well established that the best way to ascertain the unimproved value of land is by applying to it sales of unimproved, comparable, lands which took place reasonably close to the date at which the valuation is to be made. But in many districts it is impossible to obtain sufficient unimproved sales to form a sound foundation, and it therefore becomes necessary to analyse sales of improved lands for the purpose of ascertaining, as far as is possible, what part of the purchase price of the sale property relates to improvements and what part is attributable to the land itself.

This latter approach is now, of necessity, more frequently adopted before this Court and the Land Court.”

116. [116]
     In the concluding part of her written report^[50] Ms Manners says:

“I have not had regard to earlier sales evidence on any lots other than the subject and those sales as tabled in the sales basis.  The earlier sales do not form the basis of the valuation of the subject site as at the date of valuation 1 October 2014.

I have valued the subject site only for the purposes of this appeal to the Land Court; I have not valued all of the residential sites in the suburb of Westlake.

I have not approached the valuation of the site on the basis of a change to the existing 1 October 2013 valuation amount.”

117. [117]
     I am satisfied that the evidence and conclusions of Ms Manners are to be preferred to those of Mr O'Connor for the reasons earlier set out in this decision.
118. [118]
     In an appeal such as this the Court is concerned only with what ought be the appropriate valuation attaching to a site the subject of the appeal and not produce a result which calls into question the totality of all the valuations in which the subject land of sites in the area within which the subject land is located. 
119. [119]
     Accordingly, the appeal is dismissed.

ORDER:

1. The appeal is dismissed.

WL COCHRANE

A/PRESIDENT