The case of The Trust Company Limited v Valuer-General  QLC 25 concerned an appeal by a landowner against the Valuer-General's valuation of the landowner's land at 1233 Wynnum Road, Cannon Hill.
The landowner contended that the valuation was excessive. The Court was required to consider the following:
- whether the Valuer-General's valuation of $1,600,000 was excessive when compared to the sales of comparable properties;
- whether the Valuer-General's valuation methodology was faulty as the value did not reflect the characteristics of the land and the constraints on its use;
- whether the valuation by the landowner's valuer of $1,000,000 was more accurate.
The Court preferred the Valuer-General's valuation and dismissed the appeal.
The Court confirmed that the appropriate method for determining the value of land is to use comparable sales on the open market around the date of the valuation and to assume the land is held in Fee Simple, and sold by agreement between fully informed and willing parties.
Particulars of the land
The land was 60m2 in area and contained 10 double-sided fuel bowsers with 20 fuelling bays. The land was in the Emerging Community Zone within the River Gateway Neighbourhood Plan under the Brisbane City Plan 2014. A small portion of the land was subject to flooding and overland flow.
The method used by both valuers to value the land was the direct comparison method using a rate per square metre based on comparable sales. To that end, both valuers determined that the highest and best use of the land was as a service station, being its present use.
The Court preferred the evidence of the Valuer-General's valuer, rather than the landowner's valuer which was based on unqualified opinion
Whilst the valuers agreed that the highest and best use of the land was a service station, the landowner's valuer argued that the valuation should be based on the optimum use of the land as a service station being an eight bay fuelling station. The Court found that the contention that the land would be better suited for an eight bay fuelling station was not based on any evidence and was the valuer's opinion only and, as such, should not be adopted by the Court. The Valuer-General's valuer determined the land value by using comparable sales of land for commercial purposes in the area. The Court preferred the evidence of the Valuer-General's valuer, being based on comparable sales of commercial land, rather than that of the landowner's valuer which relied upon unqualified opinion about the use of the land.
The comparable sales relied upon by the landowner's valuer had limited utility
The Court found that the comparable sales relied upon by the landowner's valuer were of limited utility. One sale did not take into account any expert assessment of the improvement to the land as a service station. A second sale was based on the land being lightly improved and the Court held that it could not rely on this sale as the value of the business was enmeshed in the total sale price. The third sale was considered to be sound. However, the Court ultimately found in favour of the Valuer-General as the comparable sales relied upon by the landowner were not true comparable sales and could not be relied upon.
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