Body Corporate for Ocean Plaza Apartments CTS 5879 v Valuer-General; Body Corporate for Points North CTS 4774 v Valuer-General

Boland v Yates Property Corporation Pty Ltd (1999) 74 ALJR 209, cited

BWP Management Ltd v Valuer-General [2019] QLAC 4; (2019) 40 QLCR 232, considered

Challenger Property Management Pty Ltd v Stonnington City Council [2011] VSC 184; (2011) 34 VR 445, cited

Chief Executive, Department of Natural Resources and Mines v Kent Street Pty Ltd [2009] QCA 399; (2009) 171 LGERA 365, cited Dowling & Anor v Valuer-General [2023] QLC 1, considered Eumundi Group Hotels Pty Ltd v Valuer General [2021] QLAC 2, cited

Fox v Percy [2003] HCA 22; (2003) 214 CLR 118, cited

Interchase Corporation Ltd (in Liq) v Grosvenor Hill (Qld) Pty Ltd (No 3) [2003] 1 Qd R 26, cited

ISPT Pty Ltd v Melbourne City Council [2008] 20 VR 447, considered

Jensen v Valuer-General [2024] QLAC 3, cited

Kelliher v Commissioner for Main Roads [No. 2] [2015] WASC 478, cited

Lancini Properties Pty Ltd v Savills (Qld) Pty Ltd [2009] QSC 323, cited

Macarthur Central Shopping Centre Pty Ltd v Valuer- General (No. 2) [2016] QLC 80, considered

Multiplex 240 Queens Street Landowner Pty Ltd v Department of Natural Resources, Mines and Water [2007] QLC 10, cited

Maurici v Chief Commissioner of State Revenue (2003) 212 CLR 111, cited

Perpetual Trustee Company Ltd v Department of Natural Resources, Mines and Water (2006) 27 QLCR 64, cited Tetzner v Colonial Refining Sugar Company Ltd [1957] 3 WLR 338, considered

Valuer-General v Body Corporate for 'Tennyson Reach' Community Titles Scheme 39925 [2018] QLAC 7; (2018) 39 QLCR 302, cited YFG Shopping Centres Pty Ltd v Valuer-General [2020] QLC 10, considered

R Traves KC and T Ritchie (instructed by Mahoneys) for the appellants

D O'Brien KC and D Quayle (instructed by Clayton Utz) for the respondents

• [1] On 19 July 2023, the Valuer General1 valued two parcels of land at Coolangatta at

$47,500,0002 and $54,500,0003.

• [2] The recipients of those valuations - the two Bodies Corporate - considered those values too high.
• [3] They objected and then appealed4.
• [4] They say that the true values are $35,000,000 and $39,000,000.
• [5] The two appeals were heard together. Each side called a valuer. The valuers adopt different methodologies, but as a base, rely on sales evidence.
• [6] There are few useful comparable sales.
• [7] An absence of precise comparisons is one of the reasons why valuation is a matter of estimation, not a precise mathematical calculation.
• [8] Evaluative judgment is required.

• [9] The central issue in each appeal is the value of the subject parcels. There are contests about:

(a) the highest and best use of the subject parcels;

(b) the competing valuation methodologies;

(c) whether a key sale identified by both valuers can be utilised; and

(d) the usefulness of the other sales identified by the valuers.

1. Without first obtaining resolutions authorising those appeals, as required by section 312 of the Body Corporate and Community Management Act 1997. See [2014] QLC 22. The parties agreed this issue was resolved prior to the matter being heard.

• [10] The appeals are under the Land Valuation Act 2010 ("LVA"). Sections 169-170 state the nature of the appeal and the orders that can be made.
• [11] Chapter 2, Division 3 of the Act sets out the way to determine site value.
• [12] In Macarthur Central Shopping Centre Pty Ltd v Valuer-General (No. 2), Kingham P said:5
  • [4] The Land Valuation Act 2010 governs the valuation process, an artificial exercise for rating and taxation purposes. The site value of improved land is the capital sum it might be expected to realise for its unencumbered estate under a bona fide sale assuming all non-site improvements for the land had not been made. A bona fide sale is one on reasonable terms and conditions assuming willing, but not anxious, buyer and seller; a reasonable period within which to negotiate the sale; and reasonable exposure of the property to the market. In considering reasonable terms and conditions, regard must be had to the location and nature of the land and the state of the market for land of the same type.
    • [5] Those provisions give statutory expression to the test propounded by the High Court in Spencer v The Commonwealth: that the value of land is what a hypothetical prudent purchaser would entertain in purchasing it for the most advantageous purpose for which it was adapted. That is synonymous with the market value of the land.

• [13] The Land Appeal Court has articulated the principles involved with considering comparable sales.6

• [14] The Land Appeal Court has reasoned7 that appeals of this kind involve a two step process:

in which the first step is to determine whether the appellant has met its onus of proving its grounds against the valuation in the objection decision. If, and only if, the appellant discharges that onus, then the court moves to the second step of deciding whether to reduce, confirm or increase the valuation to the amount the court considers necessary to correctly make the valuation.8

5 [2016] QLC 80.

1. BWP Management Ltd v Valuer-General [2019] QLAC 4; (2019) 40 QLCR 232 at [19]- [25] per Kingham P, with whom Mullins J and Stilgoe M (as her Honour then was) agreed.
2. Valuer-General v Body Corporate for 'Tennyson Reach' Community Titles Scheme 39925 [2018] QLAC 7; (2018) 39 QLCR 302, 331 at [50]; Jensen v Valuer-General [2024] QLAC 3 at [20].

8 Jensen v Valuer-General [2024] QLAC 3 at [20].

• [15] It falls to consider the first step, which is to ask whether there is an error in the issued valuations.
• [16] The valuation figures argued for by the VG in these appeals are different to the valuation figures that initiated these appeals. Superficially, that ought to indicate error in the issued valuations. The VG says that it does not.
• [17] The difference is:

(a) for Ocean Plaza, the issued valuation is $54,500,000, but Ms Wadley (the VG's expert valuer) says $55,500,000;

(b) for Points North, the issued valuation is $47,500,000, but Ms Wadley says

$49,500,000.

• [18] The VG says that the differences are within a range of tolerance (less than 5%) which means Ms Wadley's opinions are relevantly not different from the issued valuations.
• [19] The VG cites cases said to support the notion of a range of tolerance9. Those cases refer to a range of tolerance in different contexts. Dowling used a range when considering whether an issued valuation was in error. YFG does not endorse the use of a range of tolerance for that purpose and says that whether or not a valuation is obviously excessive depends on the circumstances of each case.
• [20] There is a risk in supporting the notion of a range of tolerance when considering whether there is an error in the issued valuation. The risk is that it creates a higher hurdle to appealing a valuation issued by the VG. Error becomes more and more difficult to establish. Support for the range of tolerance not leading to error is difficult to find in the terms of the legislation. I prefer the view that whether there is an error or not depends on the circumstances of each case - there ought to be no automatic range of tolerance that prevents a small error from being identified as an error.
• [21] Under the previous legislation, this Court concluded that a difference between issued valuation and expert evidence valuation could indicate an error in the issued valuation: Perpetual Trustee Company Ltd v Department of Natural Resources, Mines and Water10 and Multiplex 240 Queens Street Landowner Pty Ltd v Department of

1. YFG Shopping Centres Pty Ltd v Valuer-General [2020] QLC 10; Dowling & Anor v Valuer- General [2023] QLC 1; Lancini Properties Pty Ltd v Savills (Qld) Pty Ltd [2009] QSC 323; Interchase Corporation Ltd (in Liq) v Grosvenor Hill (Qld) Pty Ltd (No 3) [2003] 1 Qd R 26 at [21].

10 (2006) 27 QLCR 64 at [24].

Natural Resources, Mines and Water11. Those cases were decided under the previous Act and before Tennyson Reach.

• [22] Whether the issued valuations are in error involves an assessment of the whole of the evidence. The assessment depends on the circumstances of each case.
• [23] Here, as a matter of fact on the evidence, the issued valuations are in error because:

(a) the issued valuations rely on a sale it is determined below ought not to have been relied on;

(b) Ms Wadley's valuation of each parcel is different from the issued valuations.

• [24] 66 Marine Parade is an amalgam of two lots and various easements12. It has a total area of 9,970 square metres. It is almost square, with 101.2 metres of frontage to Marine Parade, 82 metres of frontage to Dutton Street and an 89 metre frontage to Griffith Street.
• [25] 80 Marine Parade is also an amalgam of lots and easements13. It has a total area of 11,120 square metres. It is almost square, with 106 metres of frontage to Marine Parade, 96.5 metres of frontage to Warner Street and 110 metres frontage to Griffith Street.
• [26] Across Marine Parade is a beachfront park which contains the Coolangatta Surf Life Saving Club. At the rear of the subjects, Griffith Street is a four lane (two each way) street with shops and professional offices.
• [27] The subjects are collectively improved by 'The Strand' shopping centre, which is a four level podium of retail and commercial uses. There are two basement levels of car parking.
• [28] Above the shopping centre:

(a) on 66 Marine Parade, is a 22 storey residential tower called 'Points North';

(b) on 80 Marine Parade, is a 21 storey residential tower called 'Oceans Plaza'.

11 [2007] QLC 10 at [217].

1. Lot 1 on SP238281 and Lot 2-141 on BUP10777: Exhibit 1A, Court Book, Volume 1, Tab 13, Valuation Join Expert Report ("JER"), p 287 at [106]-[108].

13 Lot 116-117 on BUP12734, Lot 2-5, 8-111 on BUP9442, Lot 114-114 on BUP9530, and Lot 113 on

• [29] Both subject parcels have the same designations in the Gold Coast City Plan. Each is in the Centre Zone (designated as Major Centre). That offers a wide possibility of uses including business, retail, professional, administrative, community, entertainment, cultural and residential14. The Centre Zone code specifically describes the Coolangatta major centre in terms that create an expectation of high intensity development (with the reservation that protection of residential amenity is important).
• [30] The Building Height Overlay map shows the maximum for both subject parcels to be 84 metres15.
• [31] The views from the subject parcels - from the upper two thirds of towers built on the land - are extensive16. The subject parcels are deep sites, each on a corner. Views will be available along the road corridors. There will also be views across Griffith Street at the rear because the land on the other side of Griffith Street has a height limit of 24 metres. The land to the north, on the opposite side of Dutton Street, is limited to 29 metres.

(a) each parcel is to be valued separately;

(b) each parcel is to be valued as though it is unimproved;

(c) the neighbouring sites do not have to be imagined to be unimproved;

(d) the existing shopping centre is spread over both parcels, without reference to lot boundaries (i.e., the supermarket is partly in 66 Marine Parade and partly in 80 Marine Parade); and

(e) the valuation exercise involves valuing each parcel unimproved, but as though half a shopping centre looms over it from next door.

• [33] Mr Crawford accounts for this by applying a 5% risk reduction to his end values. His concerns are wide ranging but include delays and cost blowouts, additional

1. The Strategic Framework in the City Plan permits an applicant to seek an "uplift" of that maximum building height subject to stated criteria. That would require an impact assessable development application.

16 Exhibit 10, Real Estate photos from 80 Marine Parade, Coolangatta.

construction costs to make safe persons on the adjoining site and the risks of litigation from adjoining owners and tenants for the loss17.

• [34] Ms Wadley disagrees in principle that a reduction is required, but says that if the Court determines that it is required, a 5% reduction is a satisfactory figure.
• [35] The VG colourfully submits that Mr Crawford applying the risk reduction amount is a point of material distraction and inaccuracy in his thinking. It says that Mr Crawford's approach is not authorised by Tetzner v Colonial Refining Sugar Company Ltd18 and that imagining blank walls or open faces on neighbouring buildings is no part of the exercise. It says that there is no evidence of any structural issue preventing either parcel of land from being developed in and of itself. It says that if it is a problem, it is a problem for the adjoining site, not the parcel being valued.
• [36] The Bodies Corporate submit that the focus ought to be on section 19 of the LVA which requires imagining that improvements have not been made.
• [37] Neither side refers to any cases where this situation has been resolved.
• [38] Mr Crawford's approach does, perhaps, import too much negative sentiment. The risks of cost blowouts and litigation etc are possible on any site in a built up, beachfront area. It can be expected that a prospective purchaser would seek to maximise the development potential of either of the subject parcels. That is a situation commonly confronted. It is not such a negative as to warrant a risk reduction as Mr Crawford suggests.
• [39] While conscious of the obligation in section 19, it is correct to say that this is a problem for the neighbours, not a problem for the parcel of land being valued. A 5% risk reduction is not required.

(a) how to articulate or define a highest and best use; and, separately

(b) the highest and best use of the subject parcels.

1. [1957] 3 WLR 338. To the extent that there was a contest about the application of Tetzner (e.g., in Exhibit 18, Respondent's Closing Submissions filed 1 April 2025 ("Exhibit 18"), at [23]-[26]), that

contest does not require resolution: Transcript 5-94, line 44 to 5-95, line 13.

• [41] The difference is important because it reflects the way in which each side approaches the development potential of the land.
• [42] In ISPT Pty Ltd v Melbourne City Council19, the Victorian Court of Appeal considered the level of precision required in identifying the highest and best use. The answer is that it depends on the evidence20.
• [43] Ms Wadley identifies the highest and best use to be "mixed use sites consisting of multi-unit residential over a retail/commercial podium in accordance with the planning scheme"21.
• [44] Mr Crawford disagrees sharply. He thinks it "insufficient to merely state" what Ms Wadley has stated. He says that "[t]here must be analysis to form an opinion on the specific highest and best use". That is slightly ironic for reasons I will return to.
• [45] Mr Crawford's view of the highest and best use is:

(a) for 66 Marine Parade -

(i) four basement levels of car parking providing a total of 940 car parks being 404 for the retail component and 536 for the residential towers;

(ii) ground floor and first floor similar to the current site improvements;

(iii) two residential towers with a total unit area of 41,875 square metres in 335 units.

(b) for 80 Marine Parade -

(i) four basement levels of car parking, providing 1,016 car parks being 522 parks for the retail and 494 for the residential;

(ii) ground floor and first floor similar to the current site improvements;

(iii) two residential towers with a total lot area of 48,250 square metres in 386 units.

• [46] Except for the retail/commercial podium, that is effectively a doubling of the current site improvements for each parcel. Mr Crawford considers a third tower on each of the subject parcels to involve "excessive development risk"22.

• [47] Mr Crawford's highest and best use imagines the current retail on the ground floor and first floor being replicated. He thinks that the two levels that currently sit above that (office and cinema) do not constitute the highest and best use23.
• [48] Ms Wadley thinks that the third and fourth levels of the current podium would be part of the highest and best use - on the basis that a prudent purchaser would maximise the potential of the site for retail/commercial.
• [49] Each side forcefully submitted that the approach of the other expert was wrong.
• [50] The Bodies Corporate say Ms Wadley erred by adopting a highest and best use which prevented her from forming even a tentative view of the likely development on the subject properties24.
• [51] The VG says that Mr Crawford erred by adopting a highest and best use that was so specific that it could only have been justified if it had been founded on detailed expert evidence from a town planner, an architect, a civil engineer, and an urban economic demand specialist - none of which is in evidence25. It says that Mr Crawford fills the gaps in the evidence himself without the relevant expertise to do so. It says the specificity created, on Mr Crawford's evidence, an artificial constraint on the development potential on the subject properties.
• [52] Mr Crawford was cross-examined about the tests or workings that underpin his view. The details are not in the JER, as they should be.
• [53] Taking the upper two levels of the existing podium as an example, paragraph 206 of the JER records Mr Crawford's position as:

The upper two levels of the Oceans Plaza are commercial offices and the cinemas and that is consistent with the Centre zone. I have tested this but concluded that development does not constitute the highest and best use.

• [54] When asked about the data associated with that test or where to find the explanation of the result of that test, Mr Crawford told the Court, "... the result of the test is that it doesn't exist. I would agree that I did not detail the test that I did26."

• [55] Elsewhere, a matter that Mr Crawford described as involving a "somewhat crude analysis"27, in fact involved no articulated analysis in the JER at all28.
• [56] Calculations that do appear in the JER29 include unexplained inputs. Mr Crawford's approach of adopting a demand rate of 1.6 car parks per unit and using that as a multiplier to work out how many units could be achieved was opaque. It is not possible to be confident on the evidence that the figure ought to be 1.6, rather than 1.4 or some other figure.
• [57] There is no evidence from other relevant experts30. In the absence of town planning evidence or evidence about acceptable car parking rates per developed unit, Mr Crawford gives his own opinion of that. He is an experienced witness and may be capable of that. He speaks, though, of financial feasibility studies, expected numbers of residential units or expected gross lettable area of retail. It ranges broadly and without serious explanation of what underpins it. It makes his evidence of far lesser assistance in this regard.
• [58] Mr Crawford's view is unambitious for the subject land, in two key ways:

(a) it is improbable that each parcel would be limited to two towers apiece. These are large pieces of land. Mr Crawford dismissed the idea of a third tower on the basis that it would not have ocean views (being stuck behind the two towers and so, blocked). That too readily gives up on the idea that a third tower at the rear of each site might have appealing views to the south. It also too readily gives up on the possibility of a design for the front two towers that are not monolithic rectangular blocks, but rather some other shape that might permit ocean views to be obtained through or around them.

(b) the opinion that the development potential is limited by it being uneconomical to have more than four levels of basement car parking is difficult to accept. It is elusively said to be based on experience, rather than a tangible estimate or calculations. Mr Crawford offers no cost/benefit analysis of having more (or fewer) basement levels. In a general sense, it is

28 Transcript 3-64, line 33. Also Transcript 3-64, line 45 through to 3-65, line 13.

1. Except a report and supplementary report of two Quantity Surveyors who were not called to give evidence: Exhibit 1B, Court Book, Tabs 15-16, pp 661-865. The quantity surveying experts agreed in large part and their evidence is not determinative here.

understandable to say that digging more basement levels in this location would be expensive. There is no evidence, however, of what that expense would be. Or whether that expense might be offset by, for example, having three rather than two residential towers above. To limit the subject land to four storeys of basement only is to understate the potential of the subject parcels.

• [59] Ms Wadley's highest and best use is very general. The Bodies Corporate submit that it was so general as to be obtuse. Ms Wadley suggests that for each subject parcel the highest and best use could be between one and four towers31.
• [60] The end conclusion is that Mr Crawford understates the development potential of the land. It can very likely do better than two towers per subject parcel. I agree with Ms Wadley's opinion that the figure could be as high as four towers per subject parcel. It may involve a three or four storey podium. To be as conservative as Mr Crawford has, is to understate a circumstance that would affect the land value advantageously - that is, that the subject parcels are prime development sites with significant town planning possibility.
• [61] It is not obvious that the vigorous debate about the highest and best use is essential to resolving the central issue. The debate matters in a general sense of viewing the comparable sales in their proper context. It matters when considering the valuation methodologies and approaches of the valuers. That said, preferring Ms Wadley's approach to the highest and best use does not lead to a conclusion about what must be the correct value of the subject parcels.

• [62] The valuers utilise different valuation methodologies. There is no one correct method to use in valuing land32.
• [63] Mr Crawford uses three methods:

(a) a direct comparison by component method, with the components being:

(i) dollar rate per square metre33 of residential area, where the rates reached are by way of comparison with sales;

32 Boland v Yates Property Corporation Pty Ltd (1999) 74 ALJR 209 at [281]-[283].

(ii) $rate/m2 of gross floor area/net lettable area34 for the non-residential component, where the rates reached are by way of comparison with comparable sales;

(b) a direct comparison by component with the components being:

(i) value per unit, where the rates reached are by way of comparison with comparable sales;

(ii) $rate/m2 of GFA/NLA for the non-residential component, where the rates reached are by way of comparison with comparable sales;

(c) a direct comparison method having regard to sales evidence analysed to

$rate/m2 of site area. This method was reached independently of the direct comparison by component methods and did not rely on Mr Crawford's specific highest and best use.

(a) a direct comparison with comparable sales on a $rate/m2;

(b) a check method comparing gross sale prices.

• [65] The Bodies Corporate suggest that Ms Wadley ought to use more than one method. They say that Ms Wadley's "check method" is no proper method at all. They say that method does not recognise all the differences between the properties and is far too general.
• [66] There is no criticism of Ms Wadley's use of the direct comparison method.
• [67] The VG suggests that Mr Crawford's direct comparison by component method is flawed because it introduces a range of judgments and assumptions outside of legitimate valuation judgment, which cannot be proved and which introduce uncertainty and false precision.
• [68] There is debate about the International Valuation Standards and whether each valuer approached their task consistent with those Standards. It would have been helpful if Ms Wadley found a more robust check method, or second method, to corroborate her main approach. It is not surprising, though, that she does not - given the limited information that is available. Consistency (or otherwise) with the International

Valuation Standards is not a determinative factor in the assessment of either valuer's evidence.

• [69] Identifying the appropriate valuation method will depend on the available evidence35.
• [70] The direct comparison by component method risks giving the unwarranted appearance of mathematical precision to the exercise. Mr Crawford sets out his use of those methods carefully at paragraphs 691 and 692 of the JER. In this case, the inputs into those methods are too opaque to allow confidence in them.
• [71] The Bodies Corporate are correct that Ms Wadley's check method is so general as to be of limited assistance.
• [72] On the evidence, the direct comparison with comparable sales method using dollar per square metre, is the most helpful. There are sales to use - albeit with some limitations outlined below.

• [73] Each side submits that the Court should prefer the evidence of their valuer because of some error in approach of the other valuer. Those submissions refer to the demeanour of the witnesses or the way in which each responded to cross-examination.
• [74] Both Mr Crawford and Ms Wadley genuinely attempted to assist the Court. Each demonstrated independence. It is unnecessary to resort to assessments of demeanour. Here, the appeals can be resolved by the intrinsic merit (or otherwise) of the evidence36.
• [75] The Bodies Corporate submit that Mr Crawford's valuation methodology does not collapse entirely if he is wrong about the highest and best use. I agree. His dollars per square metre rate method does not rely on his view about the highest and best use. That dollars per square metre rate method is a helpful input into the valuation exercise.
• [76] This is not a case where one of the valuers has made an error or taken an approach which makes their evidence inutile. Each of them make helpful contributions when analysing the comparable sales. Each of them produce figures which can be brought together to analyse the value of the subject parcels.

35 Kelliher v Commissioner for Main Roads [No. 2] [2015] WASC 478 at [87]; Challenger Property

Management Pty Ltd v Stonnington City Council [2011] VSC 184; (2011) 34 VR 445 at [24].

1. Paraphrasing the observation in Societe d'Avances Commerciales v Merchants' Marine Insurance Co (1924) 18 Ll L Rep 162 that appears in Fox v Percy [2003] HCA 22; (2003) 214 CLR 118 at [30].

• [77] A significant part of the hearing was dedicated to whether Sale 1 ought to be disregarded. The Bodies Corporate say that it is a related party transaction and cannot be relied on. The VG relies on it as a primary sale.

• [78] Sale 1 is 3 Hill Street, Coolangatta. On 14 January 2022 it sold for $42,300,000. It is 7,071 square metres.
• [79] It is quite nearby to the subject parcels. It is on an elevated headland. A road and a park separates it from the ocean. There is no beach at the elevated level of the land. The parties disagree about the views it has and the advantages it offers.
• [80] It is different to the subject parcels because while it is also "oceanfront", that occurs in a quite different context - outside of the commercial hub of Coolangatta and, instead, in a residential context. The parties disagree about whether that makes it inferior or superior to the subject parcels. There is a subjective element to that debate - e.g., whether having a cinema and supermarket nearby is a positive or a negative.
• [81] The subject parcels offer double the building height and double the development density to what is available on the Sale 1 land - and the capacity for retail and commercial uses.

The question of whether Sale 1 should be excluded

• [82] Sitting above questions of how comparable it is, is the bigger question of whether it ought to be disregarded.
• [83] Mr Crawford says that no reliance should be placed on it. Ms Wadley rejects the idea that it is tainted and continues to rely on it as a primary sale.
• [84] The base legal principle is that for a sale to be useful, it ought to be at arm's length, unaffected by special circumstances37. The disagreement here is whether the 14 January 2022 transaction was at arm's length.

37 Maurici v Chief Commissioner of State Revenue (2003) 212 CLR 111 at [16].

• [85] Prior to the hearing, the evidence on the topic developed from passing reference in the first JER, to an affidavit from the VG's solicitor exhibiting freshly obtained documents38 to then a second Valuation JER39 that deals exclusively with the issue.
• [86] The vendor was Sunland Greenmount Pty Ltd, a subsidiary of Sunland Ltd. The purchaser was Arium Group Pty Ltd - a company owned by a group of people, some of whom were directors of Sunland Ltd40. Sunland went to great lengths to examine whether the sale was fair or reasonable (or represented market value). It commissioned an independent expert report from an accounting/audit firm (Grant Thornton) to determine whether the sale was fair or reasonable (or represented market value)41. Grant Thornton commissioned an independent valuation by Herron Todd White ("HTW"). Those independent reports were commissioned to satisfy ASIC Regulatory guidelines42.
• [87] Of the HTW valuation, only the abstract is available - not the whole document. The abstract shows the "market value" assessed as $40,000,00043.
• [88] The Grant Thornton report gives details of the sale process. Arium initially bid

$41,500,000. It later increased that bid to $42,300,000. Of particular interest is the detail given about the other bids. There were recorded to be four shortlisted bidders, at various amounts (ranging from $37 million to $42 million) and subject to various conditions. Arium's offer was higher than the other offers.

• [89] Grant Thornton sets out details of Sunland's evaluation of the other bids. Amidst a number of observations about that is the statement: "... [a] number of bidders were unknown to both Sunland and the Agent and were assessed to carry significant execution and settlement risks"44.
• [90] The valuers have no additional detail of the competing bids. They rely on what is in the Grant Thornton report.
• [91] A real estate marketing video was tendered45 to show images of the sale site and from the sale site. It offers no assistance. It is more hyperbole than hard evidence.

38 Exhibit 1B, Tab 17, Affidavit of Kaia Maree Duce sworn 13 February 2025 ("Duce Affidavit").

39 Supplementary Joint Expert Report filed 19 August 2024 ("SJER"), pp 643-660.

40 Exhibit 14, Diagram: "Sale 1 - Structure of Transaction Parties as at 27 May 2021".

42 Duce Affidavit, pp 913-914. See also, Exhibit 18 at [30(h)].

45 Exhibit 9, "USB Stick containing real estate promotional video for Sale 1".

• [92] Grant Thornton concluded that the sale was fair and reasonable.
• [93] The argument here is not whether the purchasers obtained the land cheaply. It is whether it was truly a competitive process.
• [94] The Bodies Corporate submit that while the independent report process may have ensured that the sale transacted at a price which was at least market value, it did not ensure that the sale transacted at market value. They say that:
  1. Grant Thornton and HTW had far more information about the sale than is before the Court, including the Put and Call Option Agreement and (likely) the underbids, and they did not consider $42.3M to be market value. Grant Thornton determined that the market value of the sale property was $40m, not the sale price of $42.3m. This was based on an "Abstract of Valuation Report" by HTW. A complete valuation report is not available. Neither valuer places weight on a HTW report as evidence of value. HTW itself said that its valuation should be regarded with a higher degree of caution than would normally be the case, given the absence of market evidence.
  2. HTW, although having regard to the Put and Call Option, did not adopt the contract price as market value.
  3. Mr Crawford considered the fact that the underbids were from arm's length parties, and were lower than $42.3M and highly conditioned, was evidence that $42.3M was not market value.

1. Critical information is not before the Court including the Put and Call Option Agreement and the underbids, which might allow the Court and valuers to test the sale.46

• [95] The VG submits that the independent report process demonstrates that the sale was, effectively, at arm's length. It says:

(a) there was an extensive marketing campaign which yielded seven bids - four of which were shortlisted - ranging from $29 million to $50 million (those bids being subject to various conditions);

(b) Sunland established an Independent Board Committee and obtained the Grant Thornton report;

(c) the Independent Board Committee and Grant Thornton both concluded the transaction was fair and recommended to shareholders that they vote in favour of it;

46 Exhibit 17, Appellants' Closing Submissions filed 1 April 2025 ("Exhibit 17") at [63].

(d) Grant Thornton relied on the idea that Arium had offered a 5.7% premium over the market value as assessed by HTW;

(e) the Grant Thornton report was brought about because of ASIC Regulatory Guide 111 which provides that a transaction is fair when the value of the financial benefit being offered by the company to the related party is equal to or less than the value of the assets being acquired.

• [96] The VG cites texts and cases as examples of instances where sales have been challenged but brought to account in the Court's analysis47. Those cases turn on their own facts. The context is essential.
• [97] Here, the context is not fully known. The Sunland process looks rigorous and was, no doubt, conducted in good faith and with proper purpose. The gap is between what Sunland, Grant Thornton and Herron Todd White knew and what the Court knows. It involves subjective judgments and unknowns that do not demonstrate that the sale was a truly competitive process.
• [98] I agree with the Bodies Corporate that the extensive process of obtaining independent reports did not remove the advantage enjoyed by the related party purchaser48. It is, therefore, not a sale that should be relied on to derive the value of the subject parcels.

• [99] The sale 1 situation is complex and finely balanced. Each of the competing arguments is clearly arguable. In my view, the evidence supports the conclusion that the sale was not at arm's length.
• [100] The Bodies Corporate submit that Ms Wadley misunderstands the situation with sale 1 and by relying on it, undermines the reliability of her valuation more generally. I disagree. Ms Wadley did not make a glaring or obvious error that reflects negatively on her overall approach.

• [101] Ms Wadley has analysed rates for sales 2 to 9 as follows (along with her characterisation of the sale):

(b) Sale 3 - $3,427/m2 (not comparable);

(c) Sale 4 - $16,625/m2 (primary);

(d) Sale 5 - $7,294/m2 (primary);

(e) Sale 6 - $7,764/m2 (secondary);

(f) Sale 7 - does not recognise it as being comparable;

(g) Sale 8 - $9,807/m2 (secondary);

(h) Sale 9 - $13,122/m2 (secondary)

• [102] Mr Crawford's version of those figures49 is:

(a) Sale 2 - $2,334/m2 (primary);

(b) Sale 3 - $3,331/m2 (primary);

(c) Sale 4 - $15,749/m2 (primary);

(d) Sale 5 - $7,031/m2 (primary);

(e) Sale 6 - $6,396/m2 (primary);

(f) Sale 7 - $391/m2 (primary);

(g) Sale 8 - $9,571/m250;

(h) Sale 9 - $13,122/m251.

• [103] The differences are not significant, given that those analysed rates still need to be scrutinised to work out how comparable each of those sites is to the each of the subject parcels. The only sales where it has been necessary to make a finding as to the dollar rate per square metre have been Sale 2 ($2,548/m2) and Sale 6 ($7,000/m2). These are discussed further below.
• [104] Ms Wadley uses her figures, having regard to the attributes, location and situation of the subject parcels to adopt a rate of $5,000 for the subject properties52. For 66 Marine Parade, Ms Wadley adopts $49,500,00053. For 80 Marine Parade, it is $55,600,000.

49 Amended page 128A of the JER titled 'Sales Evidence Analysis Summary AJC'.

53 That takes 9,653m2 as being unencumbered and 317m2 at a 20% diminution because of easements.

• [105] Mr Crawford utilises his three methods54 - but focussing on his value per square metre method, he adopts a rate of $4,000 per square metre for the subject parcels. For Points North that results in $39,880,00055. For Oceans Plaza it is $44,480,00056.

• [106] Once Sale 1 is excluded, eight sales remain for consideration. Each valuer has views about those sales - that is, whether they are primary, secondary or of limited use. The valuers analyse the sales to adjust for improvements or unusual circumstances. There is some disagreement about that analysis, but not much.
• [107] The valuers agree that no single sale is directly comparable57.
• [108] The modest adjustments made in the analysis of each sale gives the appearance of scientific or mathematic rigour to a process that instead involves matters of judgement and opinion. The adjustments, for easements or access or something else, play very little (if any) determinative role in reaching a concluded value for the subject parcels.
• [109] At best, the adjustments feed into the comparable sales at a point before those sales are then, effectively, adjusted again when working out how comparable they are to the subjects. It is all necessarily imprecise.
• [110] The eight remaining sales show a wide variation in dollar per square metre values.

• [111] Sale 2 is 103 Ferny Avenue, Surfers Paradise. On 12 March 2021 it sold for

• [112] It is one block back from the beach and west of the Surfers Paradise esplanade. It is several blocks north of the Surfers Paradise central business district. There is a light rail stop nearby.
• [113] It is burdened by an easement footprint of 2,607 square metres.
• [114] It is in the High Density Residential zone. It has no building height restrictions.
• [115] On 15 March 2022, there was a development approval for three towers with 38, 40, and 42 storeys of residential units and 15 ground level individual tenancies.

55 Mr Crawford then reduces it by 5% for risk/contingency.

56 Mr Crawford then reduces it by 5% for risk/contingency.

• [116] There are two disagreements about the analysis of the sale - (1) whether the sale should be adjusted to account for an alleged payment of rates and land tax by the purchaser and (2) what to make of the easement.
• [117] As to the first issue, Ms Wadley adjusts the sale price by $1,500,000 to account for an alleged payment of outstanding rates and land tax owing on the property. Mr Crawford makes no adjustment. The evidence about the payment comes from a column in the Gold Coast Bulletin that says that "apparently" the payment was made. It appears to be something like a real estate related gossip column58. The Bodies Corporate say that there is no reliable evidence that the payment was made.
• [118] Valuers rely on conversations with agents, conversations with purchasers and an array of informal information to analyse a sale. There have been many contests before the Court about whether particular information should have been relied on. Here, the Bodies Corporate are right - the information supporting the adjustment for outstanding rates and land tax is too flimsy to support an adjustment of $1,500,000.
• [119] As to the second issue, Ms Wadley adjusts the sale by diminishing the size of the land to account for an easement. Mr Crawford makes no adjustment for the easement because he thinks it can be used as a setback or for access. He says if valuing the land on a rate per square metre basis, he would apply a 30-40% discount on the easement area.
• [120] There was evidence of what the purchaser thought of the easement (whether it was a positive or a negative). That evidence was insubstantial. The better point is that the easement could be used for something - whether as a setback or as an access. Mr Crawford's approach of applying a 30-40% discount to the easement area is preferred.
• [121] Sale 2 is most similar in land size, but much lower in per square metre value.
• [122] The valuers think the sale is in a superior location to the subject parcels, but an inferior situation being one block back from the beach. That inferior situation overwhelms any advantage of the sale land being in a superior suburb. The context of the Sale 2 land is substantially less attractive than the subject site - being located between two substantial north-south roads and a significant distance from the beach. There are some views from the sale land59, but it is - across roads - surrounded by development.

The subject parcels have the advantage of openness across Marine Parade, where there is no high rise development but simply a park.

• [123] Sale 2 is also not right in the heart of Surfers Paradise, but slightly removed to the north.
• [124] The Bodies Corporate say that Sale 2 is particularly comparable because it is a similar size, the restricted views are offset by an unlimited building height potential and it is in a superior location. It is difficult to balance the restricted views with the building height opportunity, but the Sale 2 land seems substantially inferior all around compared to the subject parcels.
• [125] It is difficult to reconcile why the Sale 2 land sold at a low dollar per square metre rate. That may be, in part, because it is a large piece of land. More influential than that, though, is its disadvantages. While Sale 2 supports the view of $4,000 per square metre for the subject parcels, it is not so comparable as to be a powerful indicator of that view.
• [126] From the options helpfully set out in the Appellants' closing submissions filed 1 April 202560 at paragraph 85, the sale should be analysed at $2,548 per square metre.

• [127] Sale 3 is 31-35 McLean Street, Coolangatta. On 5 May 2021 it sold for $7,900,000. It is 2,355 square metres.
• [128] Of all the sales, it is the nearest in location to the subject parcels. It is a small, unusual shape. It is constrained by a heritage building. It is in a Centre zone.
• [129] There is no meaningful difference between the valuers' analysis of the sale.
• [130] Paradoxically, this land is subject to a 39 metre "limit" in the Building Height - but has a development approval for a tower of 18 storeys (58.75 metres). An application to increase that to 21 storeys (67.7 metres) is on appeal before the Planning and Environment Court.
• [131] The 18 storey development approval was obtained after the relevant date of valuation here. The parties say to disregard the approval. That is right. It ought not have any role in the valuation analysis. That said, it is quite odd that the Court is to assume that the subject parcels would be developed no more intensively than the Building Height

Overlay map figure, when there is evidence that applicants nearby are achieving greater heights than the map specifies. Nevertheless, the approval is no part of the analysis occurring here.

• [132] There is no meaningful difference between the valuers' views of the dollars per square metre rate.
• [133] Sale 3 is difficult to apply. Mr Crawford says that it is a primary sale. It is likely to be built out on all sides61. That, and the combination of its smaller size, non- beachfront location and heritage constraint mean that its comparability to the subject parcels is negligible. Ms Wadley considered Sale 3 to be of no assistance. That is right.

• [134] Sale 4 is 3343 Gold Coast Highway, Surfers Paradise. On 12 August 2021 it sold for

• [135] It has unimpeded ocean views (there is a two lane road, but no park, between the land and the beach). It has two lengthy street frontages on the east and the west.
• [136] It is in the High Density Residential zone. It has no building height restrictions.
• [137] It is being developed very intensively. That development will involve nine basement car parking levels.
• [138] Both valuers consider it a primary sale. It is one of only two properties that they agree is primary.
• [139] Sale 4 involves the valuers reaching similar analysed figures on a dollars per square metre basis, but differing substantially about the weight to be afforded the sale.
• [140] While it is difficult to work out why Sale 2 sold at a low dollar per square metre rate, it is similarly difficult to account for why Sale 4 sold at such a high rate. It must be because it has an excellent location and an excellent aspect.
• [141] Mr Crawford thinks Sale 4 to be superior to the subject parcels on the basis of there being no park between the land and the ocean, it being in Surfers Paradise (superior location) and it being close to a light rail station. Ms Wadley thinks it is slightly superior.

• [142] It is only zoned for residential but has no building height limit.
• [143] It is of interest that Sale 4 transacted at approximately double the dollar rate per square metre of Sale 5. As the Bodies Corporate accept, that demonstrates a significant premium was paid for esplanade land62.
• [144] It is markedly superior to the subject parcels. But it reflects the premium paid for oceanfront land. It supports the $5,000 per square metre view of the subject parcels, not the $4,000 per square metre view.

• [145] Sale 5 is 1 Albert & Victoria Avenue, Broadbeach. On 9 July 2021 it sold for

• [146] It is 250 metres from the ocean, with restricted ocean views. It is in the Centre zone63. It is in an area of unrestricted building height.
• [147] It is being developed for a mix of residential towers and retail/commercial uses. The development will involve six basement car parking levels.
• [148] The valuation experts both consider it is a primary sale. It is the second and only other sale they agree is primary.
• [149] There is no meaningful difference between the valuers' views of the dollars per square metre rate.
• [150] Sale 5 is in what the valuers say is a slightly more desirable location (Broadbeach versus Coolangatta), but a materially inferior location to the subject parcels. It is comparable in terms of retail potential and other amenity. It has an awkward shape and internal position. All of that said, it has an unlimited building height. It is difficult to weigh those factors for and against. Ms Wadley suggests that Sale 5 is inferior to the subject parcels principally because of the oceanfront location and ocean views enjoyed at the latter. That is right.

1. Albeit that it occupies a different position in the Centre Zone code hierarchy - Broadbeach is a 'principal centre' whereas Coolangatta is a 'major centre'; City of Gold Coast's Centre Zone code. See Exhibit 8B, pp 2-3.

• [151] Mr Crawford says there is a distinct similarity between Broadbeach and the subject properties in that they are both zoned Centre and both incorporate multi-level retail and commercial below residential towers64.
• [152] Sale 5 is interesting, though, because at about $7,000 per square metre for inferior land, it supports a higher value for the subject parcels. Even noting that Sale 5 could be expected to be at a higher dollar figure per square metre because of its smaller size, it is not that small. The sale is helpful in determining the value of the subject parcels.

• [153] Sale 6 is 1293 Gold Coast Highway, Palm Beach. On 11 August 2020 it sold for

• [154] It is beachfront. It is in a Medium Density Residential zone and has a mapped building height of 29 metres.
• [155] The valuers differ about whether adjustment should be made for a seawall setback. Ms Wadley adjusts the developable area to 2,707 square metres to account for the setback. She says the seawall setback area has no value because it cannot be developed. Mr Crawford disagrees and says it could be landscaped and beautified to add value.
• [156] Really, the position is somewhere between the two. The easement area is not valueless, but nor is it making a very valuable contribution by being a place for landscaping. The difference between the valuers' analysis of this sale is not significant even with their differences about the easement.
• [157] The conclusion is that this sale ought to be treated as being approximately $7,000 per square metre.
• [158] Sale 6 is only one third the size of the subject parcels. The Bodies Corporate say that its location is far superior to the subject parcels.
• [159] The VG says that Sale 6 is difficult to use to derive the value of the subject parcels because Sale 6 has absolute beachfront location, significantly inferior residential potential and an absence of any retail or commercial potential.

• [160] The parties agree that it contributes little to the exercise. The VG says it has no utility at all. Despite that, the Court is equipped with evidence about it. The sale gives a broad indication of the premium price commanded by oceanfront land.
• [161] It is more "oceanfront" than the subject parcels. But it has lesser development opportunity (residential only; height limited). The $7,000 per square metre figure for Sale 6 supports the $5,000 per square metre view of the subject parcels, not the $4,000 per square metre view.

• [162] Sale 7 is 1 Marina Quays Boulevard, Hope Island. On 28 March 2017 it sold for

• [163] It is in the Centre zone. Ms Wadley says it has a 33 metre height designation65.
• [164] It is thoroughly incomparable. It is a great distance from the subject parcels. It is nowhere near the beach. It sold years ago.
• [165] Mr Crawford includes it in the list of sales as his primary evidence for assessing the site value of the two retail levels of the subject parcels66. Ms Wadley does not rely on it at all because she considers that it is not comparable.
• [166] The sale was analysed in a judgment of the Land Appeal Court.67 Mr Crawford includes it here partly because it was analysed by that Court. That is a helpful but futile endeavour, though, because the sale is too distant, too long ago and too unlike the subject parcels to be of any assistance here.

• [167] The valuers identified sales at 154-156 Marine Parade, Coolangatta68 and 146 Marine Parade, Coolangatta.69 The sales were included to complete the picture of market activity in Coolangatta. Neither side pressed Sales 8 or 9 as having a serious role to play in determining the value of the subject parcels.
• [168] There is no meaningful difference between the valuers' views of the dollars per square metre rate, for either sale.

67 Eumundi Group Hotels Pty Ltd v Valuer General [2021] QLAC 2.

68 Sold on 30 August 2021 for $11,886,364. It is 1,194 square metres.

69 Sold on 18 January 2021 for $11,500,000. It is 862 square metres.

• [169] Sales 8 and 9 are small. There is no dispute that a smaller property will transact at a higher dollar rate per square metre than a larger property, all other things being equal70.
• [170] Sale 9, while not very comparable, provides an interesting exercise in relativity. The VG points out that it is one twelfth the size of the subject parcels but nonetheless sold for $11.74 million - despite the subject parcels having double the height and density potential. That does support the advantage of esplanade front land in the mind of a prospective purchaser.
• [171] Otherwise, neither of these sales contributes meaningfully to the valuation task.

• [172] Put informally, the question is whether the figures at paragraphs [101] and [102] above properly lead to a value of $4,000 per square metre of land, or $5,000 per square metre.
• [173] Numerous approaches can be used to find the figure. In YFG Shopping Centres Pty Ltd v Valuer-General71 the Court suggested (about approaching the valuers evidence):

The correct approach to valuation is to assign the subject land, by comparison, to its proper place in the scale of values disclosed by sales proved. Using the market continuum method of valuation, the analysed sale rate for the subject site must be somewhere between the worst of the superior sites and the best of the inferior sites.

• [174] By analogy here, the factors that support $5,000 per square metre and the factors that support $4,000 per square metre is an exercise in locating the correct value within the spectrum of the sales.
• [175] The highest and best use of the subject parcels is a relevant part of comparing those parcels to the comparable sales. A more intensive highest and best use would, obviously enough, be a circumstance that would affect the land value advantageously.
• [176] The valuers work out the comparability of the sales by scaling them up or down depending on the view of comparability. Percentage figures are used to say, for example, that Mr Crawford's $4,000 per square metre figure is 70% in excess of his applied rate for Sale 2. The Bodies Corporate say that shows Mr Crawford must be

right - he has reckoned with the disadvantages of Sale 2 in comparison to the subjects and reached an appropriately adjusted figure.

• [177] Mr Crawford's $4,000 per square metre figure was derived not just from a one on one comparison with Sale 2 but with an overall, judgment and opinion based exercise with reference to all of the sales. Mr Crawford acted conventionally and appropriately in the way he considered it. So did Ms Wadley. It does not mean that either of their views must be accepted wholesale.
• [178] That said, the sales support Ms Wadley's figure of $5,000 per square metre, with an adjustment to deal with the Sale 1 issue.

• [179] Even though Sale 1 is not to be relied on, it is necessary to identify a dollar per square metre rate for it, to explain how deducting it from the analysis affects the conclusion. Mr Crawford has an analysed figure for it of $6,383/m2. Ms Wadley has $6,575/m2. The parties fiercely contest the comparability of the sale land.
• [180] Ms Wadley says the Sale 1 land is overall inferior because it is in a less desirable location with substantially inferior views, no material commercial or retail potential, only half the height potential and only half the available density.
• [181] Mr Crawford says it is in a superior location. He says it is in a prestigious residential locality attracting a superior quality development than would be appropriate for the subject properties which he considers would be more down market by comparison.
• [182] They are both partially correct. Ms Wadley's list of matters making it inferior is right, although the views are not as dire as she makes out. Mr Crawford is right when he says that its elevated headland position gives it a slightly intangible prestige or premium quality.
• [183] Removing it from the analysis puts downward pressure on the top of the range - ie. the $5,000 per square metre. Quantifying the extent of that downward pressure is difficult, but ought only be slight. I think a deduction of $250 per square metre is appropriate.
• [184] The synthesis of Sales 2, 4, 5 and 6, plus the removal of Sale 1 from consideration leads to $4,750 per square metre.

• [185] The issued valuations are in error. Ms Wadley ought not have relied on Sale 1. That required the remaining sales to be synthesised to reach the values.
• [186] There are serious indicators that oceanfront land commands a value premium over non-oceanfront land. Sale 2 is the anomaly, but it is markedly inferior. Sale 3 is sufficiently lacking in comparability to make it difficult to apply. Sales 4, 5 and 6 support the $5,000 per square metre view over the $4,000 per square metre view. The overarching impression of the evidence is that the land ought to be valued at the higher amount. In this case, just under $5,000 per square metre. Some of the sales are at very high rates per square metre.
• [187] The Bodies Corporate have done everything that they can to challenge the issued valuations. Their legal representatives have comprehensively and tenaciously put forward every argument in their favour. The difficulty for the Bodies Corporate is that the highest and best use of the land and the sales evidence does not support the lower values that they contend for.
• [188] I adopt $4,750 per square metre. That yields values for the subject parcels at:

(a) For 80 Marine Parade (Oceans Plaza) $52,820,000; and

(b) For 66 Marine Parade (Points North) $47,040,50072.

72 Valuing the easement area of 317 square metres at $3,750 per square metre.