T & E BOURBOUS v MAITLAND CITY COUNCIL [2005] NSWLEC 483

Land and Environment Court of New South Wales

CITATION : T & E BOURBOUS v MAITLAND CITY COUNCIL [2005] NSWLEC 483

APPLICANTS: T & E BOURBOUS

PARTIES : RESPONDENT: MAITLAND CITY COUNCIL

FILE NUMBER(S) : 30235 of 2004

CORAM: Bignold J

KEY ISSUES: Compensation - Compulsory Acquisition of Land :- Rear of existing shop premises - whether acquired land flood affected - whether acuired land had any development potential - Special Value

Land Acquisition (Just Terms Compensation) Act 1991 s66(1) LEGISLATION CITED: Water Management Act 2000 ss255, 256

CASES CITED: Pastoral Finance Association Ltd v The Minister (1914) AC 1083

DATES OF HEARING: 23 February 2005 Written submissions: 14 March 2005, 30 March 2005, 18 April 2005, 3 May 2005

DATE OF JUDGMENT: 09/05/2005

APPLICANT: Mr P. Barham, Barrister

Solicitors: Stoikovich Macri LEGAL REPRESENTATIVES:

RESPONDENT: Mr Williams, Solicitor

Solicitors: Thompson Norrie

JUDGMENT:

THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

BIGNOLD J

5 September 2005

30235 of 2004 T & E BOURBOUS v MAITLAND CITY COUNCIL JUDGMENT CORAM: HIS HONOUR A. INTRODUCTION 1 This is an objection pursuant to s66(1) of the Land Acquisition (Just Terms Compensation) Act 1991 (the Just Terms Act) against the amount of compensation offered by the Respondent in respect of the latter's compulsory acquisition by Notice published in Government Gazette No.174 of 31 October 2003 of the rear part of the Applicants' land situate at No.396 High Street Maitland. 2 The Notice of Compulsory Acquisition identified the public purpose for which the Applicants' land and other neighbouring lands fronting High Street Maitland (together being Lot 1 on Deposited Plan 1044531) were acquired as "for the purpose of open space and river front improvements." 3 The part of the Applicants' land that was compulsorily acquired comprised an area of 86.6m 2 leaving the Applicants a residue area of 112m2 (comprised in Lot 10 DP 1044531). 4 DP 1044531 which was prepared by surveyors on behalf of the Respondent is a plan showing land (being an aggregated area of 4018m DP 1044531 which was prepared by surveyors on behalf of the Respondent is a plan showing land (being an aggregated area of 4018m 2 ) proposed to be acquired by the Respondent for the aforesaid public purpose being generally the undeveloped rear sections of some 33 existing lots each having frontage to Hight Street Maitland and generally developed at the street frontage by existing shops. The street frontage of these existing shops comprises the Heritage Mall (a section of Hight Street) and the rear sections of the lots comprise undeveloped land comprising the levee bank and slopes to the Hunter River. This rear land (including the rear section of the Applicants' land) was the subject of "an easement or right to use the surface and subsoil or undersurface for the purpose of the preservation or mitigation of menace from floods" which was created by Notification published in Government Gazette No.83 of 18 August 1944 pursuant to Division 1 of Part V of the Public Works Act 1912 (the existing Hunter River flood mitigation easement). 5 The amount of compensation offered to the Applicants in the Compulsory Acquisition Notice was $5,000, as determined by the Valuer General, representing $4,000 "marked value" and $1,000 "disturbance" in terms of s55 of the Just Terms Act. 6 In their Points of Claim filed in the proceedings the Applicants claimed compensation in the sum of $43,000 being $35,000 for market value and $8,000 for disturbance (both amounts being exclusive of GST). 7 According to the Points of Claim the basis for the claimed amount of compensation was the "before and after" valuation method having regard to the (i) General Business 3(a) zoning of the Applicants' land under the Maitland Local Environmental Plan 1993 (the LEP) with a prescribed maximum floor space ratio of 2:1, (ii) the existing Hunter River flood mitigation easement, and (iii) the provisions of ss255 and s256 of the Water Management Act 2000 being provisions included in Chapter 5 Part 2 of that Act under the headings "Public Works – Hunter Valley flood mitigation works". 8 I shall refer to these details later in these reasons when I come to consider the competing valuation evidence. 9 Although the amounts of the competing valuations of market value are modest ($35,00 according to the Applicants' Valuer and $4,000 according to the Respondent's Valuer (who was the same person who had undertaken the Valuer General's determination of compensation)) the divergence in those amounts is considerable. As will appear the key to understanding this extreme divergence in valuation opinion (which was maintained despite extensive joint conferencing by the valuers) is to be found in their respective opinions concerning the development potential (if any) of the acquired land having regard to the planning and other restrictions imposed upon its use by virtue of it being indisputably wholly affected by the existing Hunter River flood mitigation easement and the provisions of ss255 and 256 of the Although the amounts of the competing valuations of market value are modest ($35,00 according to the Applicants' Valuer and $4,000 according to the Respondent's Valuer (who was the same person who had undertaken the Valuer General's determination of compensation)) the divergence in those amounts is considerable. As will appear the key to understanding this extreme divergence in valuation opinion (which was maintained despite extensive joint conferencing by the valuers) is to be found in their respective opinions concerning the development potential (if any) of the acquired land having regard to the planning and other restrictions imposed upon its use by virtue of it being indisputably wholly affected by the existing Hunter River flood mitigation easement and the provisions of ss255 and 256 of the Water Management Act and it being disputably within the floodway (the extent is disputable). The Respondent's Valuer attributes no development potential to the compulsorily acquired land whereas the Applicants' Valuer attributes some development potential for the acquired land by contemplating some minor extension of the existing shop development on the residue land by way of a timber deck with sail shade comprising a suitable lightweight construction on the existing levee bank. 10 Before examining the crucial matters in dispute between the Valuers I should briefly note some relevant facts concerning the compulsorily acquired land and the Applicants' residue land. B. RELEVANT FACTS CONCERNING THE COMPULSORILY ACQUIRED LAND AND THE APPLICANTS' RESIDUE LAND 11 The whole of the Applicants' land immediately prior to the date of compulsorily acquisition was included in the General Business 3(a) Zone under the LEP. That Zone comprises the "core retail areas" of a number of designated centres in Maitland including Central Maitland (the location of the Applicants' land): vide cl.21 of the LEP. 12 Within this Zone most types of development are permissible with development consent but the Council must not grant development consent if the proposed development does not satisfy the stated Zone Objectives: vide cl.21. 13 Clause 22(1) of the LEP specifies a maximum floor space ratio of 2:1 in respect of development within Zone 3(a) ("floor space ratio" being defined as the ratio of the gross floor area of a building to the area of the site on which the building is proposed to be erected). 14 Part 10 of the LEP is headed "Flooding" and contains the following provisions: 40. What restrictions apply to development of land affected by the Hunter Valley Flood Mitigation Act 1956? 1) The Council shall not consent to the carrying out of development for any purpose within 20 metres of: (a) any work to which the Hunter Valley Flood Mitigation Act 1956 extends; or (b) the bank of any part of the lower river within the meaning of that Act, except with the concurrence of the Director of Public Works. 2) In considering whether to grant concurrence as referred to in subclause (1), the Director of Public Works shall take into consideration the likely effect of the proposed development in relation to the flooding of land in the vicinity of the land on which the proposed development is to be carried out. 41. What restrictions apply to development of land within floodways? 1) Not withstanding the other provisions of this plan, the Council may only grant consent to development which, after having regard to any relevant comments of the Council's Flood Plain Management Committee, will not result in either: (a) detrimental changes to the flow of floodwater; or (b) possible harm to human life, animal welfare, or property. 2) Applications for consent for development in the floodway must be accompanied by a report setting out: (a) any likely dangers to human life; and (b) the likely impact the development may have on the character of floodwaters in the event of a major flood. 15 It is to be noted in passing in relation to cl.40 that the Hunter Valley Flood Mitigation Act 1956 was repealed by s401 of the Water Management Act . (Although the matter was not adverted to at the hearing it may be that the equivalent provisions of Chapter 5 Part 2 of the later Act apply in substitution for the relevant reference to the repealed Act: vide Schedule 9 of the later Act.) 16 Sections 255 and 256 of the Water Management Act are in the following terms: 255 Restriction on use of lands adjacent to levee banks (1) If a levee bank has been constructed adjacent to the Hunter River, the Minister may, by notice in writing to: