Land and Environment Court New South Wales Medium Neutral Citation: Mirvac Retail Sub SPV Pty Limited v Valuer General [2023] NSWLEC 1253 Hearing dates: Conciliation conference on 15 December 2022, 13 February 2023, 3 May 2023 and 8 May 2023. Date of orders: 24 May 2023 Decision date: 24 May 2023 Jurisdiction: Class 3 Before: Peatman AC Decision: The Court orders: (1) The appeal is upheld. (2) The land value of Lots 1, 2, 3, Pt 4, 5, 6, 7, 8, 9, 10, 12, 13, 14, 15 and 17 in Deposited Plan 776815, known as 2-10 Darling Drive, Sydney, for the Valuing Year 1 July, 2021 is determined as $230,000,000.00 in accordance with s 6A(1) of the Valuation of Land Act 1916 (NSW). Catchwords: VALUATION – location – planning – construction on a 'wet site'– conciliation conference – agreement between the parties – orders Legislation Cited: Land and Environment Court Act 1979, ss 19, 34 Valuation of Land Act 1916, Pt 3, ss 6A, 14A, 29, 34, 35C, 37, 38, 40 Category: Principal judgment Parties: Mirvac Retail Sub SPV Pty Limited (ACN 1228633521) (Applicant) Valuer General (Respondent) Representation: Counsel: L Johnston (Applicant) L Waterson (Respondent) Solicitors: King & Wood Mallesons (Applicant) Crown Solicitor of NSW (Respondent) File Number(s): 2022/245331 Publication restriction: Nil Judgment 1. COMMISSIONER: This appeal relates to a disallowance of objection to determination of land value pursuant to Pt 3 of the Valuation of Land Act 1916 (Valuation Act) by the Valuer General in relation to Lots 1, 2, 3, Pt 4, 5, 6, 7, 8, 9, 10, 12, 13, 14, 15 and 17 in Deposited Plan 776815, known as 2-10 Darling Drive Sydney (Land) for the valuation date of 1 July 2021. 2. The Applicant is the lessee of the Land, and pursuant to the terms of its lease is liable to pay rates and taxes to the relevant authorities in respect of the Land. 3. The Respondent issued a Notice of Valuation in accordance with ss 14A and 29(1)(b) of the Valuation Act, and the Applicant received the Land Tax Assessment Notice and supporting information dated 17 January 2022. 4. The issued land valuer for the valuing year 1 July 2021 of the Land was $245,000,000.00. 5. The Applicant lodged an objection to the issued land value with the Respondent pursuant to ss 29(3A) and 34 of the Valuation Act on 18 March 2022. 6. The Applicant further received a Notice of Determination (of the objection) dated 20 June 2022 from the Valuer General who recommended that the value remain. 7. On 18 August 2022 the Applicant filed this appeal pursuant to s 37(1) of the Valuation Act and in accordance with the time provisions in s 38(1) of the Valuation Act. 8. The proceedings fall within Class 3 of the Court's jurisdiction pursuant to s 19(b) of the Land and Environment Court Act 1979 (LEC Act). 9. The statutory power or function to be exercised in determining the proceedings is s 40(1)(b) of the Valuation Act and ss 34(3)(a) and (b) of the LEC Act. 10. The Court arranged a conciliation conference under s 34(1) of the LEC Act between the parties, which was held on conciliation conference on 15 December 2022, 27 January 2023, 13 February 2023, 3 May 2023 and 8 May 2023. Prior to the adjourned s 34 conciliation conference commencing on 11 May 2023 the parties filed an Agreement pursuant to s 34(3) of the LEC Act. I presided over the conciliation conference. 11. At the conciliation conference, the parties reached agreement as to the terms of a decision in the proceedings that would be acceptable to the parties. This decision involved the Court upholding the appeal, and determining the Land value pursuant to s 6A of the Valuation Act as at 1 July 2021. 12. Under s 34(3)(a) and (b) of the LEC Act, I must dispose of the proceedings in accordance with the parties' decision if the parties' decision is a decision that the Court could have made in the proper exercise of its functions. The parties' decision involves the Court exercising the function under s 40(1)(b) of the Valuation Act to determine the value of the Land as at 1 July 2021. There are jurisdictional prerequisites that must be satisfied before this function can be exercised. The parties identified the jurisdictional prerequisites of relevance in these proceedings, and explained how they have been satisfied as set out below: 1. The value of the Land is determined in accordance with s 6A of the Valuation Act. 2. The Applicant is the lessee of the Land. 3. Pursuant to s 35C of the Valuation Act, the Valuer General issued a Notice of Determination in respect of the Applicant's objection on 20 June 2022. 4. The Applicant is entitled to bring these proceedings pursuant to ss 29(1)(b), and 37(1) of the Valuation Act. 5. The Applicant filed its Class 3 Application in Court under s 37(1) of the Valuation Act on 18 August 2022, which is within the 60-day period imposed by s 38(1). 6. The Court has power to make a decision in place of the decision to which the appeal relates pursuant to s 40(1)(b) of the Valuation Act. 7. In relation to s 34 of the LEC Act: 1. Pursuant to the LEC Act, the parties attended the s 34(1) conciliation conference in good faith, and in particular: 1. The parties engaged valuation experts, who discussed, inter alia, the physical conditions of the land, the impacts of those conditions on value, having taken into account – - the location of the Land; - the applicable planning controls; and - the wet-site condition of the Land. 1. Subsequently, the parties' quantity surveyors engaged in discussions as to the adjustments necessary to account for the "extra-over" cost of construction on a wet-site. 1. Following further investigations and discussions between the experts, the parties arrived at an agreed figure for the value of the Land pursuant to s 6A of the Valuation Act that was acceptable to the parties, within the meaning of s 34(3) of the LEC Act. 1. For the reasons set out above, I am satisfied that the parties' decision is one that the Court could have made in the proper exercise of its functions, as required by s 34(3)(a) and (b) of the LEC Act, noting all jurisdictional pre-requisites to the proper exercise of the Court's powers have been met. 2. I shall uphold the appeal, and in accordance with s 40(1)(b) of the Valuation Act, determine that the land value of the Land in accordance with s 6A(1) of the Valuation Act is $230,000,000.00 as at 1 July 2021. 3. As the parties' decision is a decision that the Court could have made in the proper exercise of its functions, I am required under s 34(3) of the LEC Act to dispose of the proceedings in accordance with the parties' decision. 4. I note that the parties have agreed that each party is to bear its own costs of these proceedings. 5. The Court orders: 1. The appeal is upheld. 2. The land value of Lots 1, 2, 3, Pt 4, 5, 6, 7, 8, 9, 10, 12, 13, 14, 15 and 17 in Deposited Plan 776815, known as 2-10 Darling Drive, Sydney, for the Valuing Year 1 July, 2021 is determined as $230,000,000.00 in accordance with s 6A(1) of the Valuation of Land Act 1916 (NSW). M Peatman Acting Commissioner of the Court ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 24 May 2023